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FORM 8-K
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): November 12, 1999
CHARTER COMMUNICATIONS, INC.
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(Exact name of registrant as specified in its charter)
Delaware
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(State or Other Jurisdiction of Incorporation or Organization)
333-83887 43-1857213
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Commission File Number (Federal Employer
Identification Number)
12444 Powerscourt Drive - Suite 400
St. Louis, Missouri 63131
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(Address of Principal Executive Offices) (Zip Code)
(Registrant's telephone number, including area code) (314) 965-0555
<PAGE> 2
ITEM 2 ACQUISITION OF ASSETS.
On November 12, 1999, Charter Communications Holding Company, LLC (Charter
Holdco), managed by and 40.6% owned by Charter Communications, Inc. (the
"Company") and Charter Communications VI, LLC (Charter Communications VI), a
wholly owned subsidiary of Charter Holdco, completed the acquisition of
partnership interests of Fanch Cablevision of Indiana, L.P. and ARH Ltd.,
specified assets of Cooney Cable Associates of Ohio, Limited Partnership,
Fanch-JV2 Master Limited Partnership, Mark Twain Cablevision Limited
Partnership, Fanch-Narragansett CSI Limited Partnership, North Texas
Cablevision, Ltd., Post Cablevision of Texas, Limited Partnership and Spring
Green Communications, L.P. and the stock of Tioga Cable Company, Inc., Cable
Systems, Inc. and, indirectly, Hornell Television Service, Inc. (collectively
referred to as "Fanch" herein) for an aggregate purchase price of approximately
$2.4 billion, subject to adjustment.
In connection with the Fanch acquisition, CC VI Operating, LLC (CC VI
Operating), a wholly owned subsidiary of Charter Communications VI, entered into
new credit facilities to finance a portion of the Fanch purchase price. Upon the
closing of the Fanch acquisition, CC VI Operating borrowed $850 million under
the new Fanch credit facilities. A portion of the proceeds from Charter
Communications, Inc.'s initial public offering of Class A common stock were used
to fund the Fanch acquisition.
The Fanch cable systems are located in Colorado, Indiana, Kansas, Kentucky,
Michigan, Mississippi, New Mexico, Oklahoma, Texas and Wisconsin and serve
approximately 537,000 customers. For the nine months ended September 30, 1999,
the Fanch cable systems had revenues of approximately $157.7 million. For the
year ended December 31, 1998, the Fanch cable systems had revenues of
approximately $141.1 million.
On November 15, 1999, the Company and Charter Holdco completed the
acquisition of all of the equity interests of Avalon Cable LLC from Avalon
Cable Holdings LLC and Avalon Investors, L.L.C. for an aggregate purchase price
of approximately $832 million (subject to adjustment), including approximately
$273.3 million in assumed debt. Immediately after the Avalon acquisition, the
Company contributed its indirect interest in Avalon Cable LLC to Charter
Holdco. A portion of the proceeds from the Company's initial public offering
of Class A common stock were used to fund the Avalon acquisition.
The assumed debt was comprised of $150.0 million principal outstanding of
publicly held 9 3/8% subordinated notes and $123.3 million accreted value of
publicly held 11 7/8% senior discount public notes. This acquisition of Avalon
constituted a change in control under the indentures to the publicly held 9 3/8%
Subordinated Notes and publicly held 11 7/8% Senior Discount Notes. These
indentures provide that upon the occurrence of a change of control, each holder
of the notes has the right to require Avalon to purchase all or any part (equal
to $1,000 or an integral multiple thereof) of such holder's notes at a cash
offer price equal to 101% of the aggregate principal amount thereon or 101% of
the accreted value for the senior discount public notes plus accrued and unpaid
interest and liquidated damages, if any.
In connection with the Avalon acquisition, Avalon Cable of Michigan LLC,
now known as CC Michigan, LLC and Avalon Cable of New England LLC, now known as
CC New England, LLC, both wholly owned subsidiaries of Avalon Cable LLC, jointly
and severally entered into new credit facilities to finance a portion of the
Avalon purchase price. Upon the closing of the Avalon acquisition, $165 million
was borrowed under the new Avalon credit facilities.
Avalon operates cable systems in Michigan and New England serving
approximately 257,000 customers. For the nine months ended September 30, 1999,
the Avalon cable systems had revenues of approximately $80.2 million. For the
year ended December 31, 1999, the Avalon cable systems had revenues of
approximately $18.2 million.
A copy of the Company's press releases announcing the consummation of the
Fanch and Avalon acquisitions are being filed as Exhibit 99.1 and Exhibit 99.2,
respectively, with this report.
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ITEM 7 FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(a) Financial statements of business acquired.
Not required.
(b) Pro forma financial information.
Not required.
(c) Exhibits.
2.8(a) Securities Purchase Agreement, dated May 13, 1999, by and
between Avalon Cable Holdings LLC, Avalon Investors, L.L.C.,
Avalon Cable of Michigan Holdings, Inc. and Avalon Cable LLC
and Charter Communications Holdings, LLC and Charter
Communications, Inc. (now known as Charter Investment, Inc.)
(incorporated by reference to Amendment No. 1 to the
registration statement on Form S-4 of Avalon Cable of
Michigan LLC, Avalon Cable of Michigan Inc., Avalon Cable of
New England LLC and Avalon Cable Finance Inc. filed on May
28, 1999, File No. 333-75453).
2.8(b) Assignment and Contribution Agreement, entered into as of
October 11, 1999 by and between Charter Communications
Holding Company, LLC and Charter Communications, Inc.
(incorporated by reference to Amendment No. 3 to the
registration statement on Form S-1 of Charter
Communications, Inc. filed on October 18, 1999, File No.
333-83887).
2.8(c) Assignment Agreement effective as of June 16, 1999, by and
among Charter Communications, Inc., Charter Communications
Holdings, LLC, Charter Communications Holding Company, LLC,
Avalon Cable Holdings LLC, Avalon Investors, L.L.C., Avalon
Cable of Michigan Holdings, Inc. and Avalon Cable LLC
(incorporated by reference to Amendment No. 3 to the
registration statement on Form S-1 of Charter
Communications, Inc. filed on October 18, 1999, File No.
333-83887).
2.10(a) Purchase Agreement, dated as of May 21, 1999, among
Blackstone TWF Capital Partners, L.P., Blackstone TWF
Capital Partners A L.P., Blackstone TWF Capital Partners B
L.P., Blackstone TWF Family Investment Partnership, L.P.,
RCF Carry, LLC, Fanch Management Partners, Inc., PBW Carried
Interest, Inc., RCF Indiana Management Corp., The Robert C.
Fanch Revocable Trust, A. Dean Windry, Thomas Binning, Jack
Pottle, SDG/Michigan Communications Joint Venture, Fanch-JV2
Master Limited Partnership, Cooney Cable Associates of Ohio,
Limited Partnership, North Texas Cablevisions, LTD., Post
Cablevision of Texas, Limited Partnership, Spring Green
Communications, L.P., Fanch-Narragansett CSI Limited
Partnership, and Fanch Cablevision of Kansas General
Partnership and Charter Communications, Inc. (now known as
Charter Investment, Inc.) (incorporated by reference to
Amendment No. 3 to the registration statement on Form S-1 of
Charter Communications, Inc. filed on October 18, 1999, File
No. 333-83887).
2.10(b) Assignment of Purchase Agreement by and between Charter
Investment, Inc. and Charter Communications Holding Company,
LLC, effective as of September 21, 1999 (incorporated by
reference to Amendment No. 3 to the registration statement
on Form S-1 of Charter Communications, Inc. filed on October
18, 1999, File No. 333-83887).
10.41 Credit Agreement, dated as of November 12, 1999, among CC
VI Holdings, LLC, CC VI Operating Company, LLC, several
banks and other financial institutions or entities named
therein, Citibank, N.A. and ABN Ambro Bank N.V., as
documentation agents, Chase Securities Inc. and Banc of
America Securities LLC, as syndication agents and Toronto
Dominion (Texas), Inc., as administrative agents.*
<PAGE> 4
10.42 Credit Agreement, dated as of November 15, 1999, among
Avalon Cable LLC, CC Michigan, LLC, CC New England, LLC,
several banks and other financial institutions or entities
named therein, First Union National Bank and PNC Bank,
National Association, as syndication agents, Bank of
Montreal, Chicago Branch and Mercantile Bank National
Association, as co-documentation agents, and Bank of
Montreal, as administrative agent.*
99.1 Press release dated November 15, 1999.*
99.2 Press release dated November 15, 1999.*
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* filed herewith
<PAGE> 5
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
Charter Communications, Inc. has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
CHARTER COMMUNICATIONS, INC.,
registrant
Dated November 29, 1999 By: /s/ KENT D. KALKWARF
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Name: Kent D. Kalkwarf
Title: Senior Vice President and
Chief Financial Officer
(Principal Financial
Officer and Principal
Accounting Officer)
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EXHIBIT 10.41
CREDIT AGREEMENT, dated as of November 12, 1999, among CC VI HOLDINGS, LLC,
a Delaware limited liability company ("Holdings"), CC VI OPERATING COMPANY, LLC,
a Delaware limited liability company (the "Borrower"), the several banks and
other financial institutions or entities from time to time parties to this
Agreement (the "Lenders"), CITIBANK, N.A. and ABN AMRO BANK N.V., as
documentation agents (in such capacity, the "Documentation Agents"), CHASE
SECURITIES INC. and BANC OF AMERICA SECURITIES LLC, as syndication agents (in
such capacity, the "Syndication Agents"), and TORONTO DOMINION (TEXAS), INC., as
administrative agent (in such capacity, the "Administrative Agent").
The parties hereto hereby agree as follows:
SECTION . DEFINITIONS
. Defined Terms. As used in this Agreement, the terms listed in this
Section 1.1 shall have the respective meanings set forth in this Section 1.1.
"ABR": for any day, a rate per annum (rounded upwards, if necessary, to the
next 1/100th of 1%) equal to the greater of (a) the Prime Rate in effect on such
day and (b) the Federal Funds Effective Rate in effect on such day plus 1/2 of
1%. Any change in the ABR due to a change in the Prime Rate or the Federal Funds
Effective Rate shall be effective as of the opening of business on the effective
day of such change in the Prime Rate or the Federal Funds Effective Rate,
respectively.
"ABR Loans": Loans the rate of interest applicable to which is based upon
the ABR.
"Acquisition": as defined in Section 5.1(b).
"Accumulated Benefit Obligations": the actuarial present value of the
accumulated benefit obligations under any Plan, calculated in a manner
consistent with Statement No. 87 of the Financial Accounting Standards Board.
"Addendum": an instrument, substantially in the form of Exhibit D-1, by
which a Lender becomes a party to this Agreement as of the Closing Date.
"Adjustment Date": as defined in the Pricing Grid.
"Administrative Agent": as defined in the preamble hereto.
"Affiliate": as to any Person, any other Person that, directly or
indirectly, is in control of, is controlled by, or is under common control with,
such Person. For purposes of this definition, "control" of a Person means the
power, directly or indirectly, either to (a) vote 10% or more of the securities
having ordinary voting power for the election of directors (or persons
performing similar functions) of such Person or (b) direct or cause the
direction of the management and policies of such Person, whether by contract or
otherwise.
"Agents": the collective reference to the Syndication Agents, the
Documentation Agents and the Administrative Agent.
"Aggregate Exposure": with respect to any Lender at any time, an amount
equal to the sum of (a) the aggregate then unpaid principal amount of such
Lender's Term Loans, (b) the amount of such Lender's unutilized Tranche A Term
Commitment then in effect and (c) the amount of such Lender's Revolving
Commitment then in effect or, if the Revolving Commitments have been terminated,
the amount of such Lender's Revolving Extensions of Credit then outstanding.
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"Aggregate Exposure Percentage": with respect to any Lender at any time,
the ratio (expressed as a percentage) of such Lender's Aggregate Exposure at
such time to the Aggregate Exposure of all Lenders at such time.
"Agreement": this Credit Agreement, as amended, supplemented or otherwise
modified from time to time.
"Annualized Asset Cash Flow Amount": with respect to any Disposition of
assets, an amount equal to the portion of Consolidated Operating Cash Flow for
the most recent Asset Disposition Test Period ending prior to the date of such
Disposition which was contributed by such assets multiplied by four.
"Annualized Operating Cash Flow": for any fiscal quarter, an amount equal
to Consolidated Operating Cash Flow for such period multiplied by four.
"Annualized Pro Forma Operating Cash Flow": an amount, determined on any
Disposition Date in connection with any proposed Disposition pursuant to Section
7.5(e), equal to Consolidated Operating Cash Flow for the most recent Asset
Disposition Test Period multiplied by four, calculated in the manner
contemplated by Section 1.2(e) but excluding the effect of such Disposition.
"Applicable Margin": (a) with respect to Tranche A Term Loans, Tranche B
Term Loans, Revolving Loans and Swingline Loans, the per annum rates determined
in accordance with the Pricing Grid and (b) with respect to Incremental Term
Loans, such per annum rates as shall be agreed to by the Borrower and the
applicable Incremental Term Lenders as shown in the applicable Increased
Facility Activation Notice.
"Application": an application, in such form as the relevant Issuing Lender
may specify from time to time, requesting such Issuing Lender to open a Letter
of Credit.
"Approved Fund": with respect to any Lender that is a fund that invests in
commercial loans, any other fund that invests in commercial loans and is managed
or advised by the same investment advisor as such Lender or by an Affiliate of
such investment advisor.
"Asset Disposition Test Period": as of any date of determination, the most
recent fiscal quarter as to which financial statements have been delivered
pursuant to Section 6.1.
"Asset Sale": any Disposition of property or series of related Dispositions
of property (excluding (a) Exchanges pursuant to which no cash consideration is
received by the Borrower or any of its Subsidiaries and (b) any such Disposition
permitted by clause (a), (b), (c) or (d) of Section 7.5) that yields gross cash
proceeds to the Borrower or any of its Subsidiaries in excess of $1,000,000.
"Assignee": as defined in Section 10.6(c).
"Assignment and Acceptance": an Assignment and Acceptance, substantially in
the form of Exhibit E.
"Assignor": as defined in Section 10.6(c).
"Attributable Debt": in respect of a sale and leaseback transaction entered
into by Holdings, the Borrower or any of its Subsidiaries, at the time of
determination, the present value of the obligation of the lessee for net rental
payments during the remaining term of the lease included in such sale and
leaseback transaction including any period for which such lease has been
extended or may, at the sole option of the lessor, be extended. Such present
value shall be calculated using a discount rate equal to the rate of interest
implicit in such transaction, determined in accordance with GAAP.
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"Authorizations": all filings, recordings and registrations with, and all
validations or exemptions, approvals, orders, authorizations, consents,
Licenses, certificates and permits from, the FCC, applicable public utilities
and other Governmental Authorities, including, without limitation, CATV
Franchises, FCC Licenses and Pole Agreements.
"Available Revolving Commitment": as to any Revolving Lender at any time,
an amount equal to the excess, if any, of (a) such Lender's Revolving Commitment
then in effect over (b) such Lender's Revolving Extensions of Credit then
outstanding; provided, that in calculating any Lender's Revolving Extensions of
Credit for the purpose of determining such Lender's Available Revolving
Commitment pursuant to Section 2.6(a), the aggregate principal amount of
Swingline Loans then outstanding shall be deemed to be zero.
"Benefitted Lender": as defined in Section 10.7(a).
"Board": the Board of Governors of the Federal Reserve System of the United
States (or any successor).
"Borrower": as defined in the preamble hereto.
"Borrowing Date": any Business Day specified by the Borrower as a date on
which the Borrower requests the relevant Lenders to make Loans hereunder.
"Budget": as defined in Section 6.2(c).
"Business": as defined in Section 4.17(b).
"Business Day": a day other than a Saturday, Sunday or other day on which
commercial banks in New York City or Houston, Texas are authorized or required
by law to close, provided, that with respect to notices and determinations in
connection with, and payments of principal and interest on, Eurodollar Loans,
such day is also a day for trading by and between banks in Dollar deposits in
the London, England interbank eurodollar market.
"Capital Lease Obligations": as to any Person, the obligations of such
Person to pay rent or other amounts under any lease of (or other arrangement
conveying the right to use) real or personal property, or a combination thereof,
which obligations are required to be classified and accounted for as capital
leases on a balance sheet of such Person under GAAP and, for the purposes of
this Agreement, the amount of such obligations at any time shall be the
capitalized amount thereof at such time determined in accordance with GAAP.
"Cash Equivalents": (a) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States government or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one year from the date of acquisition; (b)
certificates of deposit, time deposits, eurodollar time deposits or overnight
bank deposits having maturities of six months or less from the date of
acquisition issued by any Lender or by any commercial bank organized under the
laws of the United States or any state thereof having combined capital and
surplus of not less than $500,000,000; (c) commercial paper of an issuer rated
at the time of acquisition at least A-1 by Standard & Poor's Ratings Services
("S&P") or P-1 by Moody's Investors Service, Inc. ("Moody's"), or carrying an
equivalent rating by a nationally recognized rating agency, if both of the two
named rating agencies cease publishing ratings of commercial paper issuers
generally, and maturing within six months from the date of acquisition; (d)
repurchase obligations of any Lender or
<PAGE> 4
of any commercial bank satisfying the requirements of clause (b) of this
definition, having a term of not more than 30 days, with respect to securities
issued or fully guaranteed or insured by the United States government; (e)
securities with maturities of one year or less from the date of acquisition
issued or fully guaranteed by any state, commonwealth or territory of the United
States, by any political subdivision or taxing authority of any such state,
commonwealth or territory or by any foreign government, the securities of which
state, commonwealth, territory, political subdivision, taxing authority or
foreign government (as the case may be) are rated at the time of acquisition at
least A by S&P or A by Moody's; (f) securities with maturities of six months or
less from the date of acquisition backed by standby letters of credit issued by
any Lender or any commercial bank satisfying the requirements of clause (b) of
this definition; or (g) shares of money market mutual or similar funds which
invest exclusively in assets satisfying the requirements of clauses (a) through
(f) of this definition.
"CATV Franchise": collectively, with respect to the Borrower and its
Subsidiaries, (a) any franchise, license, permit, wire agreement or easement
granted by any political jurisdiction or unit or other local, state or federal
franchising authority (other than licenses, permits and easements not material
to the operations of a CATV System) pursuant to which such Person has the right
or license to operate a CATV System and (b) any law, regulation, ordinance,
agreement or other instrument or document setting forth all or any part of the
terms of any franchise, license, permit, wire agreement or easement described in
clause (a) of this definition.
"CATV System": any cable distribution system owned or acquired by the
Borrower or any of its Subsidiaries which receives audio, video, digital, other
broadcast signals or information or telecommunications by cable, optical,
antennae, microwave or satellite transmission and which amplifies and transmits
such signals to customers of the Borrower or any of its Subsidiaries.
"Closing Date": the date on which the conditions precedent set forth in
Section 5.1 shall have been satisfied, which date is November 12, 1999.
"Code": the Internal Revenue Code of 1986, as amended from time to time.
"Collateral": all property of the Loan Parties, now owned or hereafter
acquired, upon which a Lien is purported to be created by the Guarantee and
Collateral Agreement.
"Commitment": as to any Lender, the sum of the Tranche A Term Commitment,
the Tranche B Term Commitment and the Revolving Commitment of such Lender.
"Commitment Fee Rate": the per annum rate determined in accordance with the
Pricing Grid.
"Conduit Participant": any trust, partnership, limited liability company or
other entity that (a) is organized under the laws of the United States or any
state thereof, (b) is engaged in making, purchasing or otherwise investing in
commercial loans in the ordinary course of its business and (c) is organized,
managed or sponsored by any Lender.
"Commonly Controlled Entity": an entity, whether or not incorporated, that
is under common control with the Borrower within the meaning of Section 4001 of
ERISA or is part of a group that includes the Borrower and that is treated as a
single employer under Section 414 of the Code.
"Compliance Certificate": a certificate duly executed by a Responsible
Officer substantially in the form of Exhibit B.
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"Conduit Lender": any special purpose corporation organized and
administered by any Lender for the purpose of making Loans hereunder otherwise
required to be made by such Lender and designated by such Lender in a written
instrument, subject to the consent of the Administrative Agent and the Borrower;
provided, that the designation by any Lender of a Conduit Lender shall not
relieve the designating Lender of any of its obligations to fund a Loan under
this Agreement if, for any reason, its Conduit Lender fails to fund any such
Loan, and the designating Lender (and not the Conduit Lender) shall have the
sole right and responsibility to deliver all consents and waivers required or
requested under this Agreement with respect to its Conduit Lender, and provided,
further, that no Conduit Lender shall (a) be entitled to receive any greater
amount pursuant to Section 2.16, 2.17, 2.18 or 10.5 than the designating Lender
would have been entitled to receive in respect of the extensions of credit made
by such Conduit Lender or (b) be deemed to have any Commitment hereunder.
"Confidential Information Memorandum": the collective reference to (a) the
Confidential Information Memorandum dated September 1999 and furnished to
certain of the Lenders in connection with the syndication of certain of the
Facilities prior to the Closing Date and (b) any other information memorandum
authorized by the Borrower to be distributed to one or more Lenders or
prospective Lenders in connection with any other syndication of any of the
Facilities (including in connection with any increase in the amount thereof).
"Consideration": with respect to any Investment or Disposition, (a) any
cash or other property (valued at fair market value in the case of such other
property) paid or transferred in connection therewith, (b) the principal amount
of any Indebtedness assumed in connection therewith and (c) any letters of
credit, surety arrangements or security deposits posted in connection therewith.
"Consolidated Debt Service Coverage Ratio": as of the last day of any
period, the ratio of (a) Annualized Operating Cash Flow determined in respect of
the fiscal quarter ending on such day to (b) the sum of (i) Consolidated
Interest Expense for the period of four consecutive fiscal quarters ending on
such day and (ii) scheduled principal payments on Indebtedness of the Borrower
or any of its Subsidiaries for the period of four consecutive fiscal quarters
commencing immediately after such day (or, in the case of the Revolving
Facility, the excess, if any, of the Total Revolving Extensions of Credit
outstanding on such day over the amount of the Total Revolving Commitments
scheduled to be in effect at the end of such period of four consecutive fiscal
quarters).
"Consolidated Interest Coverage Ratio": as of the last day of any period,
the ratio of (a) Consolidated Operating Cash Flow for the period of four
consecutive fiscal quarters ending on such day to (b) Consolidated Interest
Expense for the period of four consecutive fiscal quarters ending on such day.
"Consolidated Interest Expense": for any period, the sum of (a) total cash
interest expense (including that attributable to Capital Lease Obligations) of
the Borrower and its Subsidiaries for such period with respect to all
outstanding Indebtedness of the Borrower and its Subsidiaries (including all
commissions, discounts and other fees and charges owed with respect to letters
of credit and bankers' acceptance financing and net costs under Hedge Agreements
in respect of interest rates to the extent such net costs are allocable to such
period in accordance with GAAP) and (b) all Restricted Payments made by the
Borrower during such period in order to enable any of its Affiliates to pay cash
interest expense in respect of Indebtedness of such Affiliate.
"Consolidated Leverage Ratio": as of the last day of any period, the ratio
of (a) Consolidated Total Debt on such day to (b) Annualized Operating Cash Flow
determined in respect of the fiscal quarter ending on such day.
"Consolidated Net Income": for any period, the consolidated net income (or
loss) of the Borrower and its Subsidiaries, determined on a consolidated basis
in accordance with GAAP; provided that, GAAP to the contrary notwithstanding,
there shall be excluded (a) the income (or deficit) of any Person accrued prior
to the date it becomes a Subsidiary of the Borrower or is merged into or
consolidated
<PAGE> 6
with the Borrower or any of its Subsidiaries, (b) the income (or deficit) of any
Person (other than a Subsidiary of the Borrower) in which the Borrower or any of
its Subsidiaries has an ownership interest, except to the extent that any such
income is actually received by the Borrower or such Subsidiary in the form of
dividends or similar distributions, (c) the undistributed earnings of any
Subsidiary of the Borrower (including any Excluded Acquired Subsidiary) to the
extent that the declaration or payment of dividends or similar distributions by
such Subsidiary is not at the time permitted by the terms of any Contractual
Obligation (other than under any Loan Document) or Requirement of Law applicable
to such Subsidiary and (d) whether or not distributed, the income of any
Non-Recourse Subsidiary.
"Consolidated Operating Cash Flow": for any period with respect to the
Borrower and its Subsidiaries, Consolidated Net Income for such period plus,
without duplication and to the extent reflected as a charge in the statement of
Consolidated Net Income for such period, the sum of (i) total income tax
expense, (ii) interest expense, amortization or writeoff of debt discount and
debt issuance costs and commissions, discounts and other fees and charges
associated with Indebtedness, (iii) depreciation and amortization expense, (iv)
management fees expensed during such period, (v) any extraordinary or
non-recurring non-cash expenses or non-cash losses, provided that in the event
that the Borrower or any Subsidiary makes any cash payment in respect of any
such extraordinary or non-recurring non-cash expense, such cash payment shall be
deducted from Consolidated Operating Cash Flow in the period in which such cash
payment is made, (vi) losses on Dispositions of assets outside of the ordinary
course of business, and (vii) other noncash items reducing such Consolidated Net
Income and minus, without duplication and to the extent included in the
statement of Consolidated Net Income for such period, the sum of (i) any
extraordinary or non-recurring non-cash income or non-cash gains, (ii) gains on
Dispositions of assets outside of the ordinary course of business and (iii)
other noncash items increasing such Consolidated Net Income, all as determined
on a consolidated basis in accordance with GAAP.
"Consolidated Total Debt": at any date, the aggregate principal amount of
all Indebtedness (other than, in the case of contingent obligations of the type
described in clause (f) of the definition of "Indebtedness", any such
obligations not constituting L/C Obligations) of the Borrower and its
Subsidiaries at such date, determined on a consolidated basis in accordance with
GAAP.
"Contractual Obligation": as to any Person, any provision of any debt or
equity security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Default": any of the events specified in Section 8, whether or not any
requirement for the giving of notice, the lapse of time, or both, has been
satisfied.
"Disposition": with respect to any property, any sale, lease (other than
leases in the ordinary course of business, including leases of excess office
space and fiber leases), sale and leaseback, assignment, conveyance, transfer or
other disposition thereof, including pursuant to an exchange for other property.
The terms "Dispose" and "Disposed of" shall have correlative meanings.
"Disposition Date": as defined in Section 7.5(e).
"Documentation Agents": as defined in the preamble hereto.
"Dollars" and "$": dollars in lawful currency of the United States.
"Domestic Subsidiary": any Subsidiary of the Borrower organized under the
laws of any jurisdiction within the United States.
"Environmental Laws": any and all foreign, federal, state, local or
municipal laws, rules, orders, regulations, statutes, ordinances, codes,
decrees, requirements of any Governmental Authority or other Requirements of Law
(including common law) regulating, relating to or imposing liability or
<PAGE> 7
standards of conduct concerning protection of human health or the environment,
as now or may at any time hereafter be in effect.
"Equity Interests": any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, any and all
classes of membership interests in a limited liability company, any and all
classes of partnership interests in a partnership and any and all other
equivalent ownership interests in a Person, and any and all warrants, rights or
options to purchase any of the foregoing.
"ERISA": the Employee Retirement Income Security Act of 1974, as amended
from time to time.
"Eurocurrency Reserve Requirements": for any day as applied to a Eurodollar
Loan, the aggregate (without duplication) of the maximum rates (expressed as a
decimal fraction) of reserve requirements in effect on such day (including
basic, supplemental, marginal and emergency reserves under any regulations of
the Board or other Governmental Authority having jurisdiction with respect
thereto) dealing with reserve requirements prescribed for eurocurrency funding
(currently referred to as "Eurocurrency Liabilities" in Regulation D of the
Board) maintained by a member bank of the Federal Reserve System.
"Eurodollar Base Rate": with respect to each day during each Interest
Period pertaining to a Eurodollar Loan, the rate per annum determined on the
basis of the rate for deposits in Dollars for a period equal to such Interest
Period commencing on the first day of such Interest Period appearing on Page
3750 of the Dow Jones Markets screen as of 11:00 A.M., London time, two Business
Days prior to the beginning of such Interest Period. In the event that such rate
does not appear on Page 3750 of the Dow Jones Markets screen (or otherwise on
such screen), the "Eurodollar Base Rate" shall be determined by reference to
such other comparable publicly available service for displaying eurodollar rates
as may be selected by the Administrative Agent or, in the absence of such
availability, by reference to the rate at which the Administrative Agent is
offered Dollar deposits at or about 10:00 A.M., Houston time, two Business Days
prior to the beginning of such Interest Period in the interbank eurodollar
market where its eurodollar and foreign currency and exchange operations are
then being conducted for delivery on the first day of such Interest Period for
the number of days comprised therein.
"Eurodollar Loans": Loans for which the applicable rate of interest is
based upon the Eurodollar Rate.
"Eurodollar Rate": with respect to each day during each Interest Period
pertaining to a Eurodollar Loan, a rate per annum determined for such day in
accordance with the following formula (rounded upward to the nearest 1/100th of
1%):
Eurodollar Base Rate
----------------------------------------
1.00 - Eurocurrency Reserve Requirements
"Eurodollar Tranche": the collective reference to Eurodollar Loans under a
particular Facility the then current Interest Periods with respect to all of
which begin on the same date and end on the same later date (whether or not such
Loans shall originally have been made on the same day).
"Event of Default": any of the events specified in Section 8, provided that
any requirement for the giving of notice, the lapse of time, or both, has been
satisfied.
"Exchange": any exchange of operating assets for other operating assets in
a Permitted Line of Business and, subject to the last sentence of this
definition, of comparable value and use to those assets being exchanged,
including exchanges involving the transfer or acquisition (or both transfer and
acquisition) of Equity Interests of a Person so long as 100% of the Equity
Interests of such Person are transferred or acquired, as the case may be. It is
understood that exchanges of the kind described above
<PAGE> 8
as to which a portion of the consideration paid or received is in the form of
cash shall nevertheless constitute "Exchanges" for the purposes of this
Agreement so long as the aggregate consideration received by the Borrower and
its Subsidiaries in connection with such exchange represents fair market value
for the assets and cash being transferred by the Borrower and its Subsidiaries.
"Exchange Excess Amount": as defined in Section 7.5(f).
"Excluded Acquired Subsidiary": any Subsidiary described in Section 7.2(g)
to the extent that the documentation governing the Indebtedness referred to in
said paragraph prohibits such Subsidiary from becoming a Subsidiary Guarantor,
but only so long as such Indebtedness remains outstanding.
"Facility": each of (a) the Tranche A Term Commitments and the Tranche A
Term Loans made thereunder (the "Tranche A Term Facility"), (b) the Tranche B
Term Commitments and the Tranche B Term Loans made thereunder (the "Tranche B
Term Facility"), (c) the Incremental Term Loans (the "Incremental Term
Facility") and (d) the Revolving Commitments and the extensions of credit made
thereunder (the "Revolving Facility").
"Fanch Systems": the meaning assigned to the term "Systems" in the Purchase
Agreement, dated as of May 21, 1999, among Blackstone TWF Capital Partners,
L.P., the other Sellers (as defined therein) and Charter Communications, Inc. or
its assignees, as buyer.
"FCC": the Federal Communications Commission and any successor thereto.
"FCC License": any community antenna relay service, broadcast auxiliary
license, earth station registration, business radio, microwave or special safety
radio service license issued by the FCC pursuant to the Communications Act of
1934, as amended.
"Federal Funds Effective Rate": for any day, the weighted average of the
rates on overnight federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day that is a Business Day, the average of the
quotations for the day of such transactions received by the Administrative Agent
from three federal funds brokers of recognized standing selected by it.
"Flow-Through Entity": any Person that is not treated as a separate tax
paying entity for United States federal income tax purposes.
"Foreign Subsidiary": any Subsidiary of the Borrower that is not a Domestic
Subsidiary.
"Funding Office": the office of the Administrative Agent specified in
Section 10.2 or such other office as may be specified from time to time by the
Administrative Agent as its funding office by written notice to the Borrower and
the Lenders.
"GAAP": generally accepted accounting principles in the United States as in
effect from time to time, except that for purposes of Section 7.1, GAAP shall be
determined on the basis of such principles in effect on the date hereof and
consistent with those used in the preparation of the most recent audited
financial statements delivered pursuant to Section 4.1(b). In the event that any
"Accounting Change" (as defined below) shall occur and such change results in a
change in the method of calculation of financial covenants, standards or terms
in this Agreement, then the Borrower and the Administrative Agent agree to enter
into negotiations in order to amend such provisions of this Agreement so as to
equitably reflect such Accounting Changes with the desired result that the
criteria for evaluating the Borrower's financial condition shall be the same
after such Accounting Changes as if such Accounting Changes had not been made.
Until such time as such an amendment shall have been executed and
<PAGE> 9
delivered by the Borrower, the Administrative Agent and the Required Lenders,
all financial covenants, standards and terms in this Agreement shall continue to
be calculated or construed as if such Accounting Changes had not occurred.
"Accounting Changes" refers to changes in accounting principles required by the
promulgation of any rule, regulation, pronouncement or opinion by the Financial
Accounting Standards Board of the American Institute of Certified Public
Accountants or, if applicable, the SEC.
"Governmental Authority": any nation or government, any state or other
political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, central bank or other entity exercising executive,
legislative, judicial, taxing, regulatory or administrative functions of or
pertaining to government, any securities exchange and any self-regulatory
organization (including the National Association of Insurance Commissioners).
"Guarantee and Collateral Agreement": the Guarantee and Collateral
Agreement to be executed and delivered by Holdings, the Borrower and each
Subsidiary Guarantor, substantially in the form of Exhibit A, as the same may be
amended, supplemented or otherwise modified from time to time.
"Guarantee Obligation": as to any Person (the "guaranteeing person"), any
obligation of (a) the guaranteeing person or (b) another Person (including any
bank under any letter of credit) to induce the creation of which the
guaranteeing person has issued a reimbursement, counterindemnity or similar
obligation, in either case guaranteeing or in effect guaranteeing any
Indebtedness, leases, dividends or other obligations (the "primary obligations")
of any other third Person (the "primary obligor") in any manner, whether
directly or indirectly, including any obligation of the guaranteeing person,
whether or not contingent, (i) to purchase any such primary obligation or any
property constituting direct or indirect security therefor, (ii) to advance or
supply funds (1) for the purchase or payment of any such primary obligation or
(2) to maintain working capital or equity capital of the primary obligor or
otherwise to maintain the net worth or solvency of the primary obligor, (iii) to
purchase property, securities or services primarily for the purpose of assuring
the owner of any such primary obligation of the ability of the primary obligor
to make payment of such primary obligation or (iv) otherwise to assure or hold
harmless the owner of any such primary obligation against loss in respect
thereof; provided, however, that the term "Guarantee Obligation" shall not
include endorsements of instruments for deposit or collection in the ordinary
course of business. The amount of any Guarantee Obligation of any guaranteeing
person shall be deemed to be the lower of (a) an amount equal to the stated or
determinable amount of the primary obligation in respect of which such Guarantee
Obligation is made and (b) the maximum amount for which such guaranteeing person
may be liable pursuant to the terms of the instrument embodying such Guarantee
Obligation, unless such primary obligation and the maximum amount for which such
guaranteeing person may be liable are not stated or determinable, in which case
the amount of such Guarantee Obligation shall be such guaranteeing person's
maximum reasonably anticipated liability in respect thereof as determined by the
Borrower in good faith.
"Guarantors": the collective reference to Holdings and the Subsidiary
Guarantors.
"Hedge Agreements": all interest rate swaps, caps or collar agreements or
similar arrangements dealing with interest rates or currency exchange rates or
the exchange of nominal interest obligations, either generally or under specific
contingencies.
"Holdings": as defined in the preamble hereto, together with any successor
thereto pursuant to Section 7.4(e). Effective upon the consummation of any
transaction described in Section 7.4(e)(ii), (a) each reference to "Holdings" in
this Agreement or any other Loan Document shall be deemed to be a reference to
the Subsidiary referred to in said Section and (b) the predecessor Holdings
shall automatically be released from all of its obligations under the Loan
Documents to which it is a party.
"Holdings Debt": any Indebtedness of Holdings.
<PAGE> 10
"Increased Facility Activation Date": any Business Day on which any Lender
shall execute and deliver to the Administrative Agent an Increased Facility
Activation Notice pursuant to Section 2.1(c).
"Increased Facility Activation Notice": a notice substantially in the form
of Exhibit D-3.
"Increased Facility Closing Date": any Business Day designated as such in
an Increased Facility Activation Notice.
"Incremental Term Facility": as defined in the definition of "Facility".
"Incremental Term Lenders": (a) on any Increased Facility Activation Date
relating to Incremental Term Loans, the Lenders signatory to the relevant
Increased Facility Activation Notice and (b) thereafter, each Lender that is a
holder of an Incremental Term Loan.
"Incremental Term Loans": as defined in Section 2.1(a).
"Incremental Term Maturity Date": with respect to the Incremental Term
Loans to be made pursuant to any Increased Facility Activation Notice, the
maturity date specified in such Increased Facility Activation Notice, which date
shall be a date at least six months after the final maturity of the Tranche B
Term Loans.
"Indebtedness": of any Person at any date, without duplication, (a) all
indebtedness of such Person for borrowed money, (b) all obligations of such
Person for the deferred purchase price of property or services (other than
current trade payables incurred in the ordinary course of such Person's
business), (c) all obligations of such Person evidenced by notes, bonds,
debentures or other similar instruments, (d) all indebtedness created or arising
under any conditional sale or other title retention agreement with respect to
property acquired by such Person (even though the rights and remedies of the
seller or lender under such agreement in the event of default are limited to
repossession or sale of such property), (e) all Capital Lease Obligations of
such Person, (f) all obligations of such Person, contingent or otherwise, as an
account party under acceptances, letters of credit, surety bonds or similar
arrangements, (g) the liquidation value of all redeemable preferred Equity
Interests of such Person, (h) all Guarantee Obligations of such Person in
respect of obligations of the kind referred to in clauses (a) through (g) above,
(i) all obligations of the kind referred to in clauses (a) through (h) above
secured by (or for which the holder of such obligation has an existing right,
contingent or otherwise, to be secured by) any Lien on property (including
accounts and contract rights) owned by such Person, whether or not such Person
has assumed or become liable for the payment of such obligation, and (j) for the
purposes of Section 8(e) only, all obligations of such Person in respect of
Hedge Agreements. The Indebtedness of any Person shall include the Indebtedness
of any other entity (including any partnership in which such Person is a general
partner) to the extent such Person is liable therefor as a result of such
Person's ownership interest in or other relationship with such entity, except to
the extent the terms of such Indebtedness expressly provide that such Person is
not liable therefor.
"Initial Public Offering": an underwritten public offering of Equity
Interests of Charter Communications, Inc. pursuant to a registration statement
filed with the Securities and Exchange Commission in accordance with the
Securities Act of 1933, as amended, that yields Net Cash Proceeds of at least
$500,000,000.
"Insolvency": with respect to any Multiemployer Plan, the condition that
such Plan is insolvent within the meaning of Section 4245 of ERISA.
"Insolvent": pertaining to a condition of Insolvency.
<PAGE> 11
"Intellectual Property": the collective reference to all rights, priorities
and privileges relating to intellectual property, whether arising under United
States, multinational or foreign laws or otherwise, including copyrights,
copyright licenses, patents, patent licenses, trademarks, trademark licenses,
technology, know-how and processes, and all rights to sue at law or in equity
for any infringement or other impairment thereof, including the right to receive
all proceeds and damages therefrom.
"Interest Payment Date": (a) as to any ABR Loan, the last day of each
March, June, September and December to occur while such Loan is outstanding and
the final maturity date of such Loan, (b) as to any Eurodollar Loan having an
Interest Period of three months or less, the last day of such Interest Period,
(c) as to any Eurodollar Loan having an Interest Period longer than three
months, each day that is three months, or a whole multiple thereof, after the
first day of such Interest Period and the last day of such Interest Period and
(d) as to any Loan (other than any Revolving Loan that is an ABR Loan and any
Swingline Loan), the date of any repayment or prepayment made in respect
thereof.
"Interest Period": as to any Eurodollar Loan, (a) initially, the period
commencing on the borrowing or conversion date, as the case may be, with respect
to such Eurodollar Loan and ending one, two, three, six or, if consented to by
(which consent shall not be unreasonably withheld) each Lender under the
relevant Facility, nine or twelve months thereafter, as selected by the Borrower
in its notice of borrowing or notice of conversion, as the case may be, given
with respect thereto; and (b) thereafter, each period commencing on the last day
of the next preceding Interest Period applicable to such Eurodollar Loan and
ending one, two, three, six or, if consented to by (which consent shall not be
unreasonably withheld) each Lender under the relevant Facility, nine or twelve
months thereafter, as selected by the Borrower by irrevocable notice to the
Administrative Agent not less than three Business Days prior to the last day of
the then current Interest Period with respect thereto; provided that, all of the
foregoing provisions relating to Interest Periods are subject to the following:
() if any Interest Period would otherwise end on a day that is not a
Business Day, such Interest Period shall be extended to the next succeeding
Business Day unless the result of such extension would be to carry such Interest
Period into another calendar month in which event such Interest Period shall end
on the immediately preceding Business Day;
() the Borrower may not select an Interest Period under a particular
Facility that would extend beyond the Revolving Termination Date or beyond the
date final payment is due on the Tranche A Term Loans, the Tranche B Term Loans
or the relevant Incremental Term Loans, as the case may be;
() any Interest Period that begins on the last Business Day of a calendar
month (or on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the last
Business Day of a calendar month; and
() the Borrower shall select Interest Periods so as not to require a
payment or prepayment of any Eurodollar Loan during an Interest Period for such
Loan.
"Investments": as defined in Section 7.7.
"Issuing Lender": each of the Administrative Agent and any other Revolving
Lender that has agreed in its sole discretion to act as an "Issuing Lender"
hereunder and that has been approved in writing by the Administrative Agent as
an "Issuing Lender" hereunder, in each case in its capacity as issuer of any
Letter of Credit.
"L/C Commitment": $25,000,000.
<PAGE> 12
"L/C Fee Payment Date": the last day of each March, June, September and
December and the last day of the Revolving Commitment Period.
"L/C Obligations": at any time, an amount equal to the sum of (a) the
aggregate then undrawn and unexpired amount of the then outstanding Letters of
Credit and (b) the aggregate amount of drawings under Letters of Credit that
have not then been reimbursed pursuant to Section 3.5.
"L/C Participants": with respect to any Letter of Credit, the collective
reference to all Revolving Lenders other than the Issuing Lender that issued
such Letter of Credit.
"Lenders": as defined in the preamble hereto; provided, that unless the
context otherwise requires, each reference herein to the Lenders shall be deemed
to include any Conduit Lender.
"Letters of Credit": as defined in Section 3.1(a).
"License": as to any Person, any license, permit, certificate of need,
authorization, certification, accreditation, franchise, approval, or grant of
rights by any Governmental Authority or other Person necessary or appropriate
for such Person to own, maintain, or operate its business or property, including
FCC Licenses.
"Lien": any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge or other security
interest or any preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever (including any conditional sale or
other title retention agreement and any capital lease having substantially the
same economic effect as any of the foregoing).
"Loan": any loan made or held by any Lender pursuant to this Agreement.
"Loan Documents": this Agreement, any Notes and the Guarantee and
Collateral Agreement.
"Loan Parties": Holdings, the Borrower and each Subsidiary of the Borrower
that is a party to a Loan Document.
"Majority Facility Lenders": with respect to any Facility, the holders of
more than 50% of the aggregate unpaid principal amount of the Term Loans or the
Total Revolving Extensions of Credit, as the case may be, outstanding under such
Facility (or, in the case of the Revolving Facility, prior to any termination of
the Revolving Commitments, the holders of more than 50% of the Total Revolving
Commitments).
"Management Fee Agreement": the Management Agreement dated as of November
12, 1999 between the Borrower and Charter Communications, Inc.
"Material Adverse Effect": a material adverse effect on (a) the business,
property, operations or condition (financial or otherwise) of the Borrower and
its Subsidiaries taken as a whole or (b) the validity or enforceability of any
material provision of this Agreement or any of the other Loan Documents or the
rights or remedies of the Administrative Agent or the Lenders hereunder or
thereunder.
"Materials of Environmental Concern": any gasoline or petroleum (including
crude oil or any fraction thereof) or petroleum products or any hazardous or
toxic substances, materials or wastes, defined or regulated as such in or under
any Environmental Law, including asbestos, polychlorinated biphenyls and
urea-formaldehyde insulation.
"Multiemployer Plan": a Plan that is a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.
<PAGE> 13
"Net Cash Proceeds": (a) in connection with any Asset Sale or any Recovery
Event, the proceeds thereof in the form of cash and Cash Equivalents (including
any such proceeds received by way of deferred payment of principal pursuant to a
note or installment receivable or purchase price adjustment receivable or
otherwise, but only as and when received) of such Asset Sale or Recovery Event,
net of attorneys' fees, accountants' fees, investment banking fees, amounts
required to be applied to the repayment of Indebtedness secured by a Lien
expressly permitted hereunder on any asset that is the subject of such Asset
Sale or Recovery Event (other than any Lien pursuant to the Guarantee and
Collateral Agreement) and other customary fees and expenses actually incurred in
connection therewith and net of taxes paid or reasonably estimated to be payable
as a result thereof (after taking into account any available tax credits or
deductions and any tax sharing arrangements) and (b) in connection with any
issuance or sale of Equity Interests or any incurrence of Indebtedness, the cash
proceeds received from such issuance or incurrence, net of attorneys' fees,
investment banking fees, accountants' fees, underwriting discounts and
commissions and other customary fees and expenses actually incurred in
connection therewith.
"New Lender": as defined in Section 2.1(d).
"New Lender Supplement": as defined in Section 2.1(d).
"Non-Excluded Taxes": as defined in Section 2.17(a).
"Non-Recourse Subsidiary": (a) any Subsidiary of the Borrower created,
acquired or activated by the Borrower or any of its Subsidiaries in connection
with any Investment made pursuant to Section 7.7(g) and designated as such by
the Borrower substantially concurrently with such creation, acquisition or
activation and (b) any Subsidiary of such designated Subsidiary, provided, that
(i) at no time shall any creditor of any such Subsidiary have any claim (whether
pursuant to a Guarantee Obligation, by operation of law or otherwise) against
the Borrower or any of its other Subsidiaries (other than another Non-Recourse
Subsidiary) in respect of any Indebtedness or other obligation of any such
Subsidiary (other than in respect of a non-recourse pledge of Equity Interests
in such Subsidiary); (ii) neither the Borrower nor any of its Subsidiaries
(other than another Non-Recourse Subsidiary) shall become a general partner of
any such Subsidiary; (iii) no default with respect to any Indebtedness of any
such Subsidiary (including any right which the holders thereof may have to take
enforcement action against any such Subsidiary) shall permit (upon notice, lapse
of time or both) any holder of any Indebtedness of the Borrower or its other
Subsidiaries (other than another Non-Recourse Subsidiary) to declare a default
on such other Indebtedness or cause the payment thereof to be accelerated or
payable prior to its final scheduled maturity; (iv) no such Subsidiary shall own
any Equity Interests of, or own or hold any Lien on any property of, the
Borrower or any other Subsidiary of the Borrower (other than another
Non-Recourse Subsidiary); (v) no Investments may be made in any such Subsidiary
by the Borrower or any of its Subsidiaries (other than another Non-Recourse
Subsidiary) except pursuant to Section 7.7(g); (vi) the Borrower shall not
directly own any Equity Interests in such Subsidiary; and (vii) at the time of
such designation, no Default or Event of Default shall have occurred and be
continuing or would result therefrom. It is understood that Non-Recourse
Subsidiaries shall be disregarded for the purposes of any calculation pursuant
to this Agreement relating to financial matters with respect to the Borrower.
"Non-U.S. Lender": as defined in Section 2.17(d).
"Notes": the collective reference to any promissory note evidencing Loans.
"Other Taxes": any and all present or future stamp or documentary taxes or
any other excise or property taxes, charges or similar levies arising from any
payment made hereunder or from the execution, delivery or enforcement of, or
otherwise with respect to, this Agreement or any other Loan Document.
<PAGE> 14
"Participant": as defined in Section 10.6(b).
"Paul Allen Contributions": any capital contribution made by Paul G. Allen,
directly or indirectly, to the Borrower or any of its Subsidiaries.
"Paul Allen Group": the collective reference to (a) Paul G. Allen, (b) his
estate, spouse, immediate family members and heirs and (c) any trust,
corporation, partnership or other entity, the beneficiaries, stockholders,
partners or other owners of which consist exclusively of Paul G. Allen or such
other Persons referred to in clause (b) above or a combination thereof.
"PBGC": the Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA (or any successor).
"Permitted Line of Business": as defined in Section 7.14(a).
"Person": an individual, partnership, corporation, limited liability
company, business trust, joint stock company, trust, unincorporated association,
joint venture, Governmental Authority or other entity of whatever nature.
"Plan": at a particular time, any employee benefit plan that is covered by
ERISA and in respect of which the Borrower or a Commonly Controlled Entity is
(or, if such plan were terminated at such time, would under Section 4069 of
ERISA be deemed to be) an "employer" as defined in Section 3(5) of ERISA.
"Pole Agreement": any pole attachment agreement or underground conduit use
agreement entered into in connection with the operation of any CATV System.
"Pricing Grid": the pricing grid attached hereto as Annex A.
"Prime Rate": the rate of interest per annum publicly announced from time
to time by the Administrative Agent or its relevant affiliate as its prime rate
in effect (the Prime Rate not being intended to be the lowest rate of interest
charged by the Administrative Agent or its relevant affiliate in connection with
extensions of credit to debtors).
"Properties": as defined in Section 4.17(a).
"Qualified Indebtedness": (a) with respect to a Qualified Parent Company,
any Indebtedness (i) which is issued in a Rule 144A private placement or
registered public offering, (ii) which is not held by any Affiliate of the
Borrower and (iii) as to which 100% of the Net Cash Proceeds thereof are used by
such Qualified Parent Company to make Investments in one or more of its
Subsidiaries engaged substantially in businesses of the type described in
Section 7.14(a) and/or to refinance other Qualified Indebtedness or Indebtedness
of the Borrower and (b) with respect to an Affiliate of the Borrower, any
Indebtedness as to which 100% of the Net Cash Proceeds thereof were contributed
to the Borrower.
"Qualified Parent Company": Charter Communications Holding Company, LLC or
any of its direct or indirect Subsidiaries, in each case provided that the
Borrower shall be a Subsidiary of such Person.
"Recovery Event": any settlement of or payment in respect of any property
or casualty insurance claim or any condemnation proceeding relating to any asset
of the Borrower or any of its Subsidiaries.
"Refunded Swingline Loans": as defined in Section 2.5(b).
<PAGE> 15
"Refunding Date": as defined in Section 2.5(c).
"Register": as defined in Section 10.6(d).
"Regulation U": Regulation U of the Board as in effect from time to time.
"Reimbursement Obligation": the obligation of the Borrower to reimburse the
relevant Issuing Lender pursuant to Section 3.5 for amounts drawn under Letters
of Credit.
"Reinvestment Deadline": as defined in the definition of "Reinvestment
Notice".
"Reinvestment Deferred Amount": with respect to any Reinvestment Event, the
aggregate Net Cash Proceeds received by the Borrower or any of its Subsidiaries
in connection therewith that are not applied to prepay the Term Loans pursuant
to Section 2.9(a) as a result of the delivery of a Reinvestment Notice.
"Reinvestment Event": any Asset Sale or Recovery Event in respect of which
the Borrower has delivered a Reinvestment Notice.
"Reinvestment Notice": a written notice executed by a Responsible Officer
and delivered to the Administrative Agent within twelve months after any Asset
Sale or Recovery Event, stating that (a) no Event of Default has occurred and is
continuing, (b) the Borrower (directly or indirectly through a Subsidiary)
intends and expects to use all or a specified portion of the Net Cash Proceeds
of such Asset Sale or Recovery Event to acquire assets useful in its business,
on or prior to the earlier of (i) the date that is eighteen months from the date
of receipt of such Net Cash Proceeds and (ii) the date on which such proceeds
would be required to be applied, or to be offered to be applied, to prepay,
redeem or defease any Indebtedness of the Borrower or any of its Affiliates
(other than Indebtedness under this Agreement) if not applied as described above
(such earlier date, the "Reinvestment Deadline"), and (c) such use will not
require redemptions or prepayments (or offers to make redemptions or
prepayments) of any other Indebtedness of the Borrower or any of its Affiliates.
"Reinvestment Prepayment Amount": with respect to any Reinvestment Event,
the Reinvestment Deferred Amount relating thereto less any amount expended prior
to the relevant Reinvestment Prepayment Date to acquire assets useful in the
Borrower's business.
"Reinvestment Prepayment Date": with respect to any Reinvestment Event, the
earlier of (a) the relevant Reinvestment Deadline and (b) the date on which the
Borrower shall have determined not to, or shall have otherwise ceased to,
acquire assets useful in the Borrower's business with all or any portion of the
relevant Reinvestment Deferred Amount.
"Reorganization": with respect to any Multiemployer Plan, the condition
that such plan is in reorganization within the meaning of Section 4241 of ERISA.
"Reportable Event": any of the events set forth in Section 4043(b) of
ERISA, other than those events as to which the thirty day notice period is
waived under subsections .27, .28, .29, .30, .31, .32, .34 or .35 of PBGC Reg.
Sec. 4043.
"Required Lenders": at any time, the holders of more than 50% of the sum of
(a) the aggregate unpaid principal amount of the Term Loans then outstanding,
(b) the aggregate unutilized Tranche A Term Commitments then in effect and (c)
the Total Revolving Commitments then in effect or, if the Revolving Commitments
have been terminated, the Total Revolving Extensions of Credit then outstanding.
<PAGE> 16
"Required Prepayment Lenders": the Majority Facility Lenders in respect of
each Facility (with the Tranche B Term Facility and the Incremental Term
Facility being treated for this purpose as a single Facility).
"Requirement of Law": as to any Person, the Certificate of Incorporation
and By-Laws or other organizational or governing documents of such Person, and
any law, treaty, rule or regulation or determination of an arbitrator or a court
or other Governmental Authority, in each case applicable to or binding upon such
Person or any of its property or to which such Person or any of its property is
subject.
"Responsible Officer": the chief executive officer, president or chief
financial officer of the Borrower, but in any event, with respect to financial
matters, any of the chief financial officer or any other financial officer of
the Borrower.
"Restricted Payments": as defined in Section 7.6.
"Revolving Aggregate Committed Amount": the sum of the Total Revolving
Commitments as in effect on the Closing Date and the amount of any increases
therein effected pursuant to Section 2.1(c).
"Revolving Commitment": as to any Lender, the obligation of such Lender, if
any, to make Revolving Loans and participate in Swingline Loans and Letters of
Credit in an aggregate principal and/or face amount not to exceed the amount set
forth under the heading "Revolving Commitment" opposite such Lender's name on
Schedule 1.1 or in the Assignment and Acceptance or New Lender Supplement
pursuant to which such Lender became a party hereto, as the same may be changed
from time to time pursuant to the terms hereof. The original amount of the Total
Revolving Commitments is $350,000,000.
"Revolving Commitment Period": the period from and including the Closing
Date to the Revolving Termination Date.
"Revolving Extensions of Credit": as to any Revolving Lender at any time,
an amount equal to the sum of (a) the aggregate principal amount of all
Revolving Loans held by such Lender then outstanding, (b) such Lender's
Revolving Percentage of the L/C Obligations then outstanding and (c) such
Lender's Revolving Percentage of the aggregate principal amount of Swingline
Loans then outstanding.
"Revolving Facility": as defined in the definition of "Facility".
"Revolving Lender": each Lender that has a Revolving Commitment or that
holds Revolving Extensions of Credit.
"Revolving Loans": as defined in Section 2.1(b).
"Revolving Percentage": as to any Revolving Lender at any time, the
percentage which such Lender's Revolving Commitment then constitutes of the
Total Revolving Commitments (or, at any time after the Revolving Commitments
shall have expired or terminated, the percentage which the aggregate principal
amount of such Lender's Revolving Loans then outstanding constitutes of the
aggregate principal amount of the Revolving Loans then outstanding).
"Revolving Termination Date": May 12, 2008.
"SEC": the Securities and Exchange Commission, any successor thereto and
any analogous Governmental Authority.
<PAGE> 17
"Shell Subsidiary": any Subsidiary of the Borrower that is a "shell"
company having (a) assets (either directly or through any Subsidiary or other
Equity Interests) with an aggregate value not exceeding $10,000 and (b) no
operations.
"Single Employer Plan": any Plan that is covered by Title IV of ERISA, but
that is not a Multiemployer Plan.
"Solvent": when used with respect to any Person, means that, as of any date
of determination, (a) the amount of the "present fair saleable value" of the
assets of such Person will, as of such date, exceed the amount of all
"liabilities of such Person, contingent or otherwise", as of such date, as such
quoted terms are determined in accordance with applicable federal and state laws
governing determinations of the insolvency of debtors, (b) the present fair
saleable value of the assets of such Person will, as of such date, be greater
than the amount that will be required to pay the liability of such Person on its
debts as such debts become absolute and matured, (c) such Person will not have,
as of such date, an unreasonably small amount of capital with which to conduct
its business, and (d) such Person will be able to pay its debts as they mature.
For purposes of this definition, (i) "debt" means liability on a "claim", and
(ii) "claim" means any (x) right to payment, whether or not such a right is
reduced to judgment, liquidated, unliquidated, fixed, contingent, matured,
unmatured, disputed, undisputed, legal, equitable, secured or unsecured or (y)
right to an equitable remedy for breach of performance if such breach gives rise
to a right to payment, whether or not such right to an equitable remedy is
reduced to judgment, fixed, contingent, matured or unmatured, disputed,
undisputed, secured or unsecured.
"Specified Agents": the collective reference to the Administrative Agent
and the Syndication Agents.
"Specified Change of Control": a "Change of Control" or any defined term
having a comparable purpose contained in the documentation governing any
Holdings Debt or any Specified Long-Term Indebtedness.
"Specified Holdings Subsidiary": each Subsidiary of Holdings other than the
Borrower and its Subsidiaries.
"Specified Long-Term Indebtedness": any Indebtedness incurred pursuant to
Section 7.2(f).
"Specified Subordinated Debt": any Indebtedness of the Borrower issued
directly or indirectly to Paul G. Allen or any of his Affiliates, so long as
such Indebtedness (a) qualifies as Specified Long-Term Indebtedness and (b) has
terms and conditions substantially identical to those set forth in Exhibit H.
"Subsidiary": as to any Person, a corporation, partnership, limited
liability company or other entity of which shares of stock or other ownership
interests having ordinary voting power (other than stock or such other ownership
interests having such power only by reason of the happening of a contingency) to
elect a majority of the board of directors or other managers of such
corporation, partnership or other entity are at the time owned, or the
management of which is otherwise controlled, directly or indirectly, through one
or more intermediaries, or both, by such Person; provided, that Non-Recourse
Subsidiaries shall be deemed not to constitute "Subsidiaries" for the purposes
of this Agreement (other than the definition of "Non-Recourse Subsidiary").
Unless otherwise qualified, all references to a "Subsidiary" or to
"Subsidiaries" in this Agreement shall refer to a Subsidiary or Subsidiaries of
the Borrower.
"Subsidiary Guarantor": each Subsidiary of the Borrower other than any
Foreign Subsidiary and any Excluded Acquired Subsidiary.
<PAGE> 18
"Swingline Commitment": the obligation of the Swingline Lender to make
Swingline Loans pursuant to Section 2.4 in an aggregate principal amount at any
one time outstanding not to exceed $25,000,000.
"Swingline Lender": Toronto Dominion (Texas), Inc., in its capacity as the
lender of Swingline Loans.
"Swingline Loans": as defined in Section 2.4.
"Swingline Participation Amount": as defined in Section 2.5.
"Syndication Agents": as defined in the preamble hereto.
"Term Lenders": the collective reference to the Tranche A Term Lenders, the
Tranche B Term Lenders and the Incremental Term Lenders.
"Term Loans": the collective reference to the Tranche A Term Loans, Tranche
B Term Loans and Incremental Term Loans.
"Threshold Management Fee Date": any date on which, both before and after
giving pro forma effect to the payment of any previously deferred management
fees pursuant to Section 7.8(c) (including any Indebtedness incurred in
connection therewith), the Consolidated Interest Coverage Ratio, determined in
respect of the most recent period of four consecutive fiscal quarters for which
the relevant financial information is available, is greater than 2.25 to 1.0.
"Threshold Transaction Date": any date on which, both before and after
giving pro forma effect to a particular transaction (including any Indebtedness
incurred in connection therewith), the Consolidated Interest Coverage Ratio,
determined in respect of the most recent period of four consecutive fiscal
quarters for which the relevant financial information is available, is greater
than 1.75 to 1.0.
"Total Revolving Commitments": at any time, the aggregate amount of the
Revolving Commitments then in effect.
"Total Revolving Extensions of Credit": at any time, the aggregate amount
of the Revolving Extensions of Credit of the Revolving Lenders outstanding at
such time.
"Tranche A Aggregate Funded Amount": the sum of the aggregate principal
amount of Tranche A Term Loans made pursuant to Section 2.1(a) and the aggregate
principal amount of Tranche A Term Loans made pursuant to Section 2.1(c).
"Tranche A Term Commitment": as to any Tranche A Term Lender, the
obligation of such Lender to make a Tranche A Term Loan to the Borrower
hereunder in a principal amount not to exceed the amount set forth under the
heading "Tranche A Term Commitment" opposite such Lender's name on Schedule 1.1
or in the Assignment and Acceptance pursuant to which such Lender became a party
hereto, as the same may be changed from time to time pursuant to the terms
hereof. The original aggregate amount of the Tranche A Term Commitments is
$450,000,000.
"Tranche A Term Facility": as defined in the definition of "Facility".
"Tranche A Term Lender": each Lender that has a Tranche A Term Commitment
or is the holder of a Tranche A Term Loan.
"Tranche A Term Loan": as defined in Section 2.1(a).
<PAGE> 19
"Tranche A Term Percentage": as to any Tranche A Term Lender at any time,
the percentage which the aggregate principal amount of such Lender's Tranche A
Term Loans then outstanding constitutes of the aggregate principal amount of all
Tranche A Term Loans then outstanding.
"Tranche B Aggregate Funded Amount": the aggregate principal amount of
Tranche B Term Loans made on the Closing Date.
"Tranche B Term Commitment": as to any Tranche B Term Lender, the
obligation of such Lender to make a Tranche B Term Loan to the Borrower
hereunder in a principal amount not to exceed the amount set forth under the
heading "Tranche B Term Commitment" opposite such Lender's name on Schedule 1.1.
The original aggregate amount of the Tranche B Term Commitments is $400,000,000.
"Tranche B Term Facility": as defined in the definition of "Facility".
"Tranche B Term Lender": each Lender that has a Tranche B Term Commitment
or that holds a Tranche B Term Loan.
"Tranche B Term Loan": as defined in Section 2.1(a).
"Tranche B Term Percentage": as to any Tranche B Term Lender at any time,
the percentage which the aggregate principal amount of such Lender's Tranche B
Term Loans then outstanding constitutes of the aggregate principal amount of all
Tranche B Term Loans then outstanding.
"Transferee": any Assignee or Participant.
"Type": as to any Loan, its nature as an ABR Loan or a Eurodollar Loan.
"United States": the United States of America.
"Wholly Owned Subsidiary": as to any Person, any other Person all of the
Equity Interests of which (other than directors' qualifying shares required by
law) are owned by such Person directly or through other Wholly Owned
Subsidiaries or a combination thereof.
"Wholly Owned Subsidiary Guarantor": any Subsidiary Guarantor that is a
Wholly Owned Subsidiary of the Borrower.
. Other Definitional Provisions; Pro Forma Calculations. () Unless
otherwise specified therein, all terms defined in this Agreement shall have the
defined meanings when used in the other Loan Documents or any certificate or
other document made or delivered pursuant hereto or thereto.
() As used herein and in the other Loan Documents, and any certificate or
other document made or delivered pursuant hereto or thereto, (i) accounting
terms relating to Holdings, the Borrower and its Subsidiaries not defined in
Section 1.1 and accounting terms partly defined in Section 1.1, to the extent
not defined, shall have the respective meanings given to them under GAAP, (ii)
the words "include", "includes" and "including" shall be deemed to be followed
by the phrase "without limitation", (iii) the word "incur" shall be construed to
mean incur, create, issue, assume, become liable in respect of or suffer to
exist (and the words "incurred" and "incurrence" shall have correlative
meanings), and (iv) the words "asset" and "property" shall be construed to have
the same meaning and effect and to refer to any and all tangible and intangible
assets and properties, including cash, Equity Interests, securities, revenues,
accounts, leasehold interests, contract rights and any other "assets" as such
term is defined under GAAP.
<PAGE> 20
() The words "hereof", "herein" and "hereunder" and words of similar import
when used in this Agreement shall refer to this Agreement as a whole and not to
any particular provision of this Agreement, and Section, Schedule and Exhibit
references are to this Agreement unless otherwise specified.
() The meanings given to terms defined herein shall be equally applicable
to both the singular and plural forms of such terms.
() For the purposes of calculating Annualized Operating Cash Flow,
Annualized Pro Forma Operating Cash Flow, Consolidated Operating Cash Flow and
Consolidated Interest Expense for any period (a "Test Period"), (i) if at any
time from the period (a "Pro Forma Period") commencing on the second day of such
Test Period and ending on the last day of such Test Period (or, in the case of
any pro forma calculation made pursuant hereto in respect of a particular
transaction, ending on the date such transaction is consummated and, unless
otherwise expressly provided herein, after giving effect thereto), the Borrower
or any Subsidiary shall have made any Material Disposition (as defined below),
the Consolidated Operating Cash Flow for such Test Period shall be reduced by an
amount equal to the Consolidated Operating Cash Flow (if positive) attributable
to the property which is the subject of such Material Disposition for such Test
Period or increased by an amount equal to the Consolidated Operating Cash Flow
(if negative) attributable thereto for such Test Period, and Consolidated
Interest Expense for such Test Period shall be reduced by an amount equal to the
Consolidated Interest Expense for such Test Period attributable to any
Indebtedness of the Borrower or any Subsidiary repaid, repurchased, defeased or
otherwise discharged with respect to the Borrower and its Subsidiaries in
connection with such Material Disposition (or, if the Equity Interests of any
Subsidiary are sold, the Consolidated Interest Expense for such Test Period
directly attributable to the Indebtedness of such Subsidiary to the extent the
Borrower and its continuing Subsidiaries are no longer liable for such
Indebtedness after such Disposition); (ii) if during such Pro Forma Period the
Borrower or any Subsidiary shall have made a Material Acquisition (as defined
below), Consolidated Operating Cash Flow and Consolidated Interest Expense for
such Test Period shall be calculated after giving pro forma effect thereto
(including the incurrence or assumption of any Indebtedness in connection
therewith) as if such Material Acquisition (and the incurrence or assumption of
any such Indebtedness) occurred on the first day of such Test Period; (iii) if
during such Pro Forma Period any Person that subsequently became a Subsidiary or
was merged with or into the Borrower or any Subsidiary since the beginning of
such Pro Forma Period shall have entered into any disposition or acquisition
transaction that would have required an adjustment pursuant to clause (i) or
(ii) above if made by the Borrower or a Subsidiary during such Pro Forma Period,
Consolidated Operating Cash Flow and Consolidated Interest Expense for such Test
Period shall be calculated after giving pro forma effect thereto as if such
transaction occurred on the first day of such Test Period; and (iv) in the case
of determinations in connection with transactions involving the incurrence of
Indebtedness, Consolidated Interest Expense shall be calculated after giving pro
forma effect thereto (and all other incurrences of Indebtedness during such Pro
Forma Period) as if such Indebtedness was incurred on the first day of such Test
Period. For the purposes of this paragraph, pro forma calculations regarding the
amount of income or earnings relating to any Material Disposition or Material
Acquisition and the amount of Consolidated Interest Expense associated with any
discharge or incurrence of Indebtedness shall in each case be determined in good
faith by a Responsible Officer of the Borrower. If any Indebtedness bears a
floating rate of interest and the incurrence or assumption thereof is being
given pro forma effect, the interest expense on such Indebtedness shall be
calculated as if the rate in effect on the last day of the relevant Pro Forma
Period had been the applicable rate for the entire relevant Test Period (taking
into account any interest rate protection agreement applicable to such
Indebtedness if such interest rate protection agreement has a remaining term in
excess of 12 months). As used in this Section 1.2(e), "Material Acquisition"
means any acquisition of property or series of related acquisitions of property
that (i) constitutes assets comprising all or substantially all of an operating
unit of a business or constitutes all or substantially all of the Equity
Interests of a Person and (ii) involves the payment of Consideration by the
Borrower and its Subsidiaries in excess of $1,000,000; and "Material
Disposition" means any Disposition of property or series of related Dispositions
of property that yields gross proceeds to the Borrower or any of its
Subsidiaries in excess of $1,000,000.
<PAGE> 21
SECTION . AMOUNT AND TERMS OF COMMITMENTS
. Commitments; Increases in the Tranche A Term Facility and the Revolving
Facility; Incremental Term Loans. (a) Subject to the terms and conditions
hereof, (i) each Tranche A Term Lender severally agrees to make one or more term
loans (each, a "Tranche A Term Loan") to the Borrower in an aggregate amount not
to exceed the amount of the Tranche A Term Commitment of such Lender, (ii) each
Tranche B Term Lender severally agrees to make a term loan (each, a "Tranche B
Term Loan") to the Borrower in an amount not to exceed the amount of the Tranche
B Term Commitment of such Lender and (iii) each Incremental Term Lender
severally agrees to make one or more term loans (each, an "Incremental Term
Loan") to the extent provided in Section 2.1(c). The Term Loans may from time to
time be Eurodollar Loans or ABR Loans, as determined by the Borrower and
notified to the Administrative Agent in accordance with Sections 2.2 and 2.10.
Except as otherwise provided in Section 2.1(c), Tranche A Term Loans may only be
made on the Closing Date and one other date selected by the Borrower during the
period from the Closing Date to the earlier of March 31, 2000 and the date that
is 90 days after the Closing Date (such earlier date, the "Tranche A Commitment
Termination Date"), with the aggregate amount of Tranche A Term Loans made on
such other date not exceeding $250,000,000. Any unutilized Tranche A Term
Commitments shall automatically terminate on the Tranche A Commitment
Termination Date. Except as otherwise provided in Section 2.1(c), Tranche B Term
Loans may only be made on the Closing Date.
(b) Subject to the terms and conditions hereof, each Revolving Lender
severally agrees to make revolving credit loans ("Revolving Loans") to the
Borrower from time to time during the Revolving Commitment Period in an
aggregate principal amount at any one time outstanding which, when added to such
Lender's Revolving Percentage of the sum of (i) the L/C Obligations then
outstanding and (ii) the aggregate principal amount of the Swingline Loans then
outstanding, does not exceed the amount of such Lender's Revolving Commitment.
During the Revolving Commitment Period the Borrower may use the Revolving
Commitments by borrowing, prepaying the Revolving Loans in whole or in part, and
reborrowing, all in accordance with the terms and conditions hereof. The
Revolving Loans may from time to time be Eurodollar Loans or ABR Loans, as
determined by the Borrower and notified to the Administrative Agent in
accordance with Sections 2.2 and 2.10.
(c) The Borrower and any one or more Lenders (including New Lenders) may
from time to time agree that such Lenders shall make, obtain or increase the
amount of their Tranche A Term Loans, Incremental Term Loans or Revolving
Commitments, as applicable, by executing and delivering to the Administrative
Agent an Increased Facility Activation Notice specifying (i) the amount of such
increase and the Facility or Facilities involved, (ii) the applicable Increased
Facility Closing Date and (iii) in the case of Incremental Term Loans, (x) the
applicable Incremental Term Maturity Date, (y) the amortization schedule for
such Incremental Term Loans, which shall comply with Section 2.3, and (z) the
Applicable Margin for such Incremental Term Loans. Notwithstanding the
foregoing, without the consent of the Required Lenders, (i) the aggregate amount
of borrowings of Incremental Term Loans shall not exceed an amount equal to (w)
$300,000,000 plus (x) the aggregate principal amount of optional prepayments of
Term Loans made pursuant to Section 2.8 or optional reductions of the Revolving
Commitments pursuant to Section 2.7 (provided that the amount described in this
clause (x) shall not exceed $150,000,000) minus (y) the aggregate amount of
incremental Tranche A Term Loans or incremental Revolving Commitments obtained
pursuant to this paragraph, (ii) the aggregate amount of incremental Tranche A
Term Loans and incremental Revolving Commitments obtained pursuant to this
paragraph shall not exceed $150,000,000, (iii) incremental Tranche A Term Loans
may not be made on or after March 31, 2003, (iv) incremental Revolving
Commitments may not be obtained on or after December 31, 2004, (v) each increase
effected pursuant to this paragraph shall be in a minimum amount of at least
$50,000,000 and (vi) no more than five Increased Facility Closing Dates may be
selected by the Borrower during the term of this Agreement. No Lender shall have
any obligation to participate in any increase described in this paragraph unless
it agrees to do so in its sole discretion.
<PAGE> 22
(d) Any additional bank, financial institution or other entity which, with
the consent of the Borrower and the Administrative Agent (which consent shall
not be unreasonably withheld), elects to become a "Lender" under this Agreement
in connection with any transaction described in Section 2.1(c) shall execute a
New Lender Supplement (each, a "New Lender Supplement"), substantially in the
form of Exhibit D-2, whereupon such bank, financial institution or other entity
(a "New Lender") shall become a Lender for all purposes and to the same extent
as if originally a party hereto and shall be bound by and entitled to the
benefits of this Agreement.
(e) Unless otherwise agreed by the Administrative Agent, on each Increased
Facility Closing Date (other than in respect of Incremental Term Loans), the
Borrower shall borrow Tranche A Term Loans under the increased Tranche A Term
Facility, or shall borrow Revolving Loans under the increased Revolving
Commitments, as the case may be, from each Lender participating in the relevant
increase in an amount determined by reference to the amount of each Type of Loan
(and, in the case of Eurodollar Loans, of each Eurodollar Tranche) which would
then have been outstanding from such Lender if (i) each such Type or Eurodollar
Tranche had been borrowed or effected on such Increased Facility Closing Date
and (ii) the aggregate amount of each such Type or Eurodollar Tranche requested
to be so borrowed or effected had been proportionately increased. The Eurodollar
Base Rate applicable to any Eurodollar Loan borrowed pursuant to the preceding
sentence shall equal the Eurodollar Base Rate then applicable to the Eurodollar
Loans of the other Lenders in the same Eurodollar Tranche (or, until the
expiration of the then-current Interest Period, such other rate as shall be
agreed upon between the Borrower and the relevant Lender).
. Procedure for Borrowing. In order to effect a borrowing hereunder, the
Borrower shall give the Administrative Agent irrevocable notice (which notice
must be received by the Administrative Agent prior to 12:00 Noon, Houston time,
(a) three Business Days prior to the requested Borrowing Date, in the case of
Eurodollar Loans, or (b) one Business Day prior to the requested Borrowing Date,
in the case of ABR Loans), specifying (i) the Facility under which such Loan is
to be borrowed, (ii) the amount and Type of Loans to be borrowed, (iii) the
requested Borrowing Date and (iv) in the case of Eurodollar Loans, the
respective amounts of each such Type of Loan and the respective lengths of the
initial Interest Period therefor. Any Loans made on the Closing Date shall
initially be ABR Loans. Each borrowing shall be in an aggregate amount equal to
(x) in the case of ABR Loans, $5,000,000 or a whole multiple of $1,000,000 in
excess thereof (or, if the then aggregate Available Revolving Commitments are
less than $5,000,000, such lesser amount) and (y) in the case of Eurodollar
Loans, $10,000,000 or a whole multiple of $1,000,000 in excess thereof;
provided, that the Swingline Lender may request, on behalf of the Borrower,
borrowings under the Revolving Commitments that are ABR Loans in other amounts
pursuant to Section 2.5. Upon receipt of any such notice from the Borrower, the
Administrative Agent shall promptly notify each relevant Lender thereof. Each
relevant Lender will make the amount of its pro rata share of each borrowing
available to the Administrative Agent for the account of the Borrower at the
Funding Office prior to 11:00 A.M., Houston time, on the Borrowing Date
requested by the Borrower in funds immediately available to the Administrative
Agent. Such borrowing will then be made available not later than 2:00 P.M.,
Houston time, to the Borrower by the Administrative Agent crediting the account
of the Borrower on the books of such office with the aggregate of the amounts
made available to the Administrative Agent by the relevant Lenders and in like
funds as received by the Administrative Agent.
. Repayment of Loans. (a) The Tranche A Term Loans of each Tranche A Term
Lender shall mature in 22 consecutive quarterly installments, commencing on
March 31, 2003, each of which shall be in an amount equal to such Lender's
Tranche A Term Percentage multiplied by the percentage of the Tranche A
Aggregate Funded Amount set forth below opposite such installment:
<TABLE>
<CAPTION>
Installment Percentage
----------- ----------
<S> <C>
March 31, 2003 2.5%
June 30, 2003 2.5%
September 30, 2003 2.5%
</TABLE>
<PAGE> 23
<TABLE>
<CAPTION>
Installment Percentage
----------- ----------
<S> <C>
December 31, 2003 2.5%
March 31, 2004 3.75%
June 30, 2004 3.75%
September 30, 2004 3.75%
December 31, 2004 3.75%
March 31, 2005 3.75%
June 30, 2005 3.75%
September 30, 2005 3.75%
December 31, 2005 3.75%
March 31, 2006 5.0%
June 30, 2006 5.0%
September 30, 2006 5.0%
December 31, 2006 5.0%
March 31, 2007 6.25%
June 30, 2007 6.25%
September 30, 2007 6.25%
December 31, 2007 6.25%
March 31, 2008 7.5%
May 12, 2008 7.5%
</TABLE>
(b) The Tranche B Term Loans of each Tranche B Term Lender shall mature in
24 consecutive quarterly installments (each due on the last day of each calendar
quarter, except for the last such installment), commencing on March 31, 2003,
each of which shall be in an amount equal to such Lender's Tranche B Term
Percentage multiplied by (i) in the case of the first 23 such installments,
0.25% of the Tranche B Aggregate Funded Amount and (ii) in the case of the last
such installment (which shall be due on November 12, 2008), 94.25% of the
Tranche B Aggregate Funded Amount.
(c) The Incremental Term Loans of each Incremental Term Lender shall mature
in consecutive installments (which shall be no more frequent than quarterly) as
specified in the Increased Facility Activation Notice pursuant to which such
Incremental Term Loans were made, provided that, prior to the date that is six
months after the final maturity of the Tranche B Term Loans, the aggregate
amount of such installments for any four consecutive fiscal quarters shall not
exceed 1% of the aggregate principal amount of such Incremental Term Loans on
the date such Loans were first made.
(d) The Total Revolving Commitments shall be permanently reduced on each of
the dates set forth below by an aggregate amount equal to the percentage of the
Revolving Aggregate Committed Amount set forth opposite such date:
<TABLE>
<CAPTION>
Date Percentage
---- ----------
<S> <C>
December 31, 2004 10.0%
December 31, 2005 15.0%
December 31, 2006 30.0%
December 31, 2007 30.0%
May 12, 2008 15.0%
</TABLE>
(e) Any reduction or termination of the Revolving Commitments pursuant to
this Section 2.3 shall be accompanied by prepayment of the Revolving Loans
and/or Swingline Loans to the extent that the Total Revolving Extensions of
Credit exceed the amount of the Total Revolving Commitments after giving effect
thereto, provided that if the aggregate principal amount of Revolving Loans and
Swingline Loans then outstanding is less than the amount of such excess (because
L/C Obligations constitute a portion thereof), the Borrower shall, to the extent
of the balance of such excess, replace outstanding Letters of Credit and/or
deposit an amount in cash in a cash collateral account established with the
Administrative Agent for the benefit of the Lenders on terms and conditions
satisfactory to the Administrative Agent. The application of any prepayment
pursuant to this paragraph shall be made, first,
<PAGE> 24
to ABR Loans and, second, to Eurodollar Loans. Each prepayment of the Loans
under this paragraph (other than ABR Loans and Swingline Loans) shall be
accompanied by accrued interest to the date of such prepayment on the amount
prepaid.
. Swingline Commitment. Subject to the terms and conditions hereof, the
Swingline Lender agrees to make a portion of the credit otherwise available to
the Borrower under the Revolving Commitments from time to time during the
Revolving Commitment Period by making swingline loans ("Swingline Loans") to the
Borrower; provided that (a) the aggregate principal amount of Swingline Loans
outstanding at any time shall not exceed the Swingline Commitment then in effect
(notwithstanding that the Swingline Loans outstanding at any time, when
aggregated with the Swingline Lender's other outstanding Revolving Loans
hereunder, may exceed the Swingline Commitment then in effect) and (b) the
Borrower shall not request, and the Swingline Lender shall not make, any
Swingline Loan if, after giving effect to the making of such Swingline Loan, the
aggregate amount of the Available Revolving Commitments would be less than zero.
During the Revolving Commitment Period, the Borrower may use the Swingline
Commitment by borrowing, repaying and reborrowing, all in accordance with the
terms and conditions hereof. Swingline Loans shall be ABR Loans only.
. Procedure for Swingline Borrowing; Refunding of Swingline Loans. ()
Whenever the Borrower desires that the Swingline Lender make Swingline Loans it
shall give the Swingline Lender irrevocable telephonic notice confirmed promptly
in writing (which telephonic notice must be received by the Swingline Lender not
later than 12:00 Noon, Houston time, on the proposed Borrowing Date), specifying
(i) the amount to be borrowed and (ii) the requested Borrowing Date (which shall
be a Business Day during the Revolving Commitment Period). Each borrowing under
the Swingline Commitment shall be in an amount equal to $1,000,000 or a whole
multiple of $500,000 in excess thereof. Not later than 2:00 P.M., Houston time,
on the Borrowing Date specified in a notice in respect of Swingline Loans, the
Swingline Lender shall make available to the Administrative Agent at the Funding
Office an amount in immediately available funds equal to the amount of the
Swingline Loan to be made by the Swingline Lender. The Administrative Agent
shall make the proceeds of such Swingline Loan available to the Borrower on such
Borrowing Date by depositing such proceeds in the account of the Borrower with
the Administrative Agent on such Borrowing Date in immediately available funds.
() The Swingline Lender, at any time and from time to time in its sole and
absolute discretion and in consultation with the Borrower (provided that the
failure to so consult shall not affect the ability of the Swingline Lender to
make the following request) may, on behalf of the Borrower (which hereby
irrevocably directs the Swingline Lender to act on its behalf), on one Business
Day's notice given by the Swingline Lender no later than 1:00 P.M., Houston
time, request each Revolving Lender to make, and each Revolving Lender hereby
agrees to make, a Revolving Loan, in an amount equal to such Revolving Lender's
Revolving Percentage of the aggregate amount of the Swingline Loans (the
"Refunded Swingline Loans") outstanding on the date of such notice, to repay the
Swingline Lender. Each Revolving Lender shall make the amount of such Revolving
Loan available to the Administrative Agent at the Funding Office in immediately
available funds, not later than 11:00 A.M., Houston time, one Business Day after
the date of such notice. The proceeds of such Revolving Loans shall be
immediately made available by the Administrative Agent to the Swingline Lender
for application by the Swingline Lender to the repayment of the Refunded
Swingline Loans. The Borrower irrevocably authorizes the Swingline Lender to
charge the Borrower's accounts with the Administrative Agent (up to the amount
available in each such account) in order to immediately pay the amount of such
Refunded Swingline Loans to the extent amounts received from the Revolving
Lenders are not sufficient to repay in full such Refunded Swingline Loans.
() If prior to the time a Revolving Loan would have otherwise been made
pursuant to Section 2.5(b), one of the events described in Section 8(f) shall
have occurred and be continuing with respect to the Borrower or if for any other
reason, as determined by the Swingline Lender in its sole discretion, Revolving
Loans may not be made as contemplated by Section 2.5(b), each Revolving Lender
shall, on the date such Revolving Loan was to have been made pursuant to the
notice referred to in
<PAGE> 25
Section 2.5(b) (the "Refunding Date"), purchase for cash an undivided
participating interest in the then outstanding Swingline Loans by paying to the
Swingline Lender an amount (the "Swingline Participation Amount") equal to (i)
such Revolving Lender's Revolving Percentage times (ii) the sum of the aggregate
principal amount of Swingline Loans then outstanding that were to have been
repaid with such Revolving Loans.
() Whenever, at any time after the Swingline Lender has received from any
Revolving Lender such Lender's Swingline Participation Amount, the Swingline
Lender receives any payment on account of the Swingline Loans, the Swingline
Lender will distribute to such Lender its Swingline Participation Amount
(appropriately adjusted, in the case of interest payments, to reflect the period
of time during which such Lender's participating interest was outstanding and
funded and, in the case of principal and interest payments, to reflect such
Lender's pro rata portion of such payment if such payment is not sufficient to
pay the principal of and interest on all Swingline Loans then due); provided,
however, that in the event that such payment received by the Swingline Lender is
required to be returned, such Revolving Lender will return to the Swingline
Lender any portion thereof previously distributed to it by the Swingline Lender.
() Each Revolving Lender's obligation to make the Loans referred to in
Section 2.5(b) and to purchase participating interests pursuant to Section
2.5(c) shall be absolute and unconditional and shall not be affected by any
circumstance, including (i) any setoff, counterclaim, recoupment, defense or
other right that such Revolving Lender or the Borrower may have against the
Swingline Lender, the Borrower or any other Person for any reason whatsoever;
(ii) the occurrence or continuance of a Default or an Event of Default or the
failure to satisfy any of the other conditions specified in Section 5; (iii) any
adverse change in the condition (financial or otherwise) of the Borrower; (iv)
any breach of this Agreement or any other Loan Document by the Borrower, any
other Loan Party or any other Revolving Lender; or (v) any other circumstance,
happening or event whatsoever, whether or not similar to any of the foregoing.
. Commitment Fees, etc. () The Borrower agrees to pay to the Administrative
Agent for the account of each Revolving Lender and each Tranche A Term Lender a
nonrefundable commitment fee for the period from and including the Closing Date
to the last day of the Revolving Commitment Period or the date on which the
Tranche A Term Commitments have been fully utilized or terminated, as the case
may be, computed at the Commitment Fee Rate on the average daily amount of the
Available Revolving Commitment or the unutilized Tranche A Term Commitment, as
the case may be, of such Lender during the period for which payment is made,
payable quarterly in arrears on the last day of each March, June, September and
December and on the Revolving Termination Date or the date on which the Tranche
A Term Commitments have been fully utilized or terminated, as the case may be,
commencing on the first of such dates to occur after the date hereof.
() The Borrower agrees to pay to the Administrative Agent the fees in the
amounts and on the dates previously agreed to in writing by the Borrower and the
Administrative Agent.
. Termination or Reduction of Revolving Commitments. The Borrower shall
have the right, upon not less than three Business Days' notice to the
Administrative Agent, to terminate the Revolving Commitments or, from time to
time, to reduce the amount of the Revolving Commitments; provided that no such
termination or reduction of Revolving Commitments shall be permitted if, after
giving effect thereto and to any prepayments of the Revolving Loans and
Swingline Loans made on the effective date thereof, the Total Revolving
Extensions of Credit would exceed the Total Revolving Commitments. Any such
reduction shall be in an amount equal to $10,000,000, or a whole multiple of
$1,000,000 in excess thereof, shall reduce permanently the Revolving Commitments
then in effect and shall be applied pro rata to the scheduled reductions
thereof.
. Optional Prepayments. The Borrower may at any time and from time to time
prepay the Loans, in whole or in part, without premium or penalty, upon
irrevocable notice delivered to the
<PAGE> 26
Administrative Agent at least three Business Days prior thereto in the case of
Eurodollar Loans and at least one Business Day prior thereto in the case of ABR
Loans, which notice shall specify the date and amount of prepayment and whether
the prepayment is of Eurodollar Loans or ABR Loans; provided, that if a
Eurodollar Loan is prepaid on any day other than the last day of the Interest
Period applicable thereto, the Borrower shall also pay any amounts owing
pursuant to Section 2.18. Upon receipt of any such notice the Administrative
Agent shall promptly notify each relevant Lender thereof. If any such notice is
given, the amount specified in such notice shall be due and payable on the date
specified therein, together with (except in the case of Revolving Loans that are
ABR Loans and Swingline Loans) accrued interest to such date on the amount
prepaid. Partial prepayments of Term Loans and Revolving Loans shall be in an
aggregate principal amount of $5,000,000 or a whole multiple of $1,000,000 in
excess thereof. Partial prepayments of Swingline Loans shall be in an aggregate
principal amount of $1,000,000 or a whole multiple of $500,000 in excess
thereof.
. Mandatory Prepayments. () Unless the Required Prepayment Lenders shall
otherwise agree, if on any date the Borrower or any of its Subsidiaries shall
receive Net Cash Proceeds from any Asset Sale or Recovery Event then, (i) unless
a Reinvestment Notice shall be delivered in respect thereof, such Net Cash
Proceeds shall be applied within two Business Days after the deadline by which
such Reinvestment Notice is otherwise required to be delivered in respect of
such Asset Sale or Recovery Event toward the prepayment of the Term Loans
(provided that the foregoing requirement shall not apply to the first
$10,000,000 of aggregate Net Cash Proceeds received after the Closing Date) and
(ii) on each Reinvestment Prepayment Date, an amount equal to the Reinvestment
Prepayment Amount with respect to the relevant Reinvestment Event shall be
applied toward the prepayment of the Term Loans.
() The application of any prepayment pursuant to this Section 2.9 shall be
made, first, to ABR Loans and, second, to Eurodollar Loans. Each prepayment of
the Loans under this Section 2.9 shall be accompanied by accrued interest to the
date of such prepayment on the amount prepaid.
. Conversion and Continuation Options. () The Borrower may elect from time
to time to convert Eurodollar Loans to ABR Loans by giving the Administrative
Agent at least three Business Days' prior irrevocable notice of such election,
provided that any such conversion of Eurodollar Loans may only be made on the
last day of an Interest Period with respect thereto. The Borrower may elect from
time to time to convert ABR Loans to Eurodollar Loans by giving the
Administrative Agent at least three Business Days' prior irrevocable notice of
such election (which notice shall specify the length of the initial Interest
Period therefor), provided that no ABR Loan may be converted into a Eurodollar
Loan when any Event of Default has occurred and is continuing. Upon receipt of
any such notice the Administrative Agent shall promptly notify each relevant
Lender thereof.
() Any Eurodollar Loan may be continued as such upon the expiration of the
then current Interest Period with respect thereto by the Borrower giving
irrevocable notice to the Administrative Agent, in accordance with the
applicable provisions of the term "Interest Period" set forth in Section 1.1, of
the length of the next Interest Period to be applicable to such Loans, provided
that (i) no Eurodollar Loan may be continued as such when any Event of Default
has occurred and is continuing and (ii) if the Borrower shall fail to give any
required notice as described above in this paragraph, the relevant Eurodollar
Loans shall be automatically converted to Eurodollar Loans having a one-month
Interest Period on the last day of the then expiring Interest Period. Upon
receipt of any such notice the Administrative Agent shall promptly notify each
relevant Lender thereof.
. Limitations on Eurodollar Tranches. Notwithstanding anything to the
contrary in this Agreement, all borrowings, conversions and continuations of
Eurodollar Loans hereunder and all selections of Interest Periods hereunder
shall be in such amounts and be made pursuant to such elections so that, (a)
after giving effect thereto, the aggregate principal amount of the Eurodollar
Loans comprising each Eurodollar Tranche shall be equal to $10,000,000 or a
whole multiple of $1,000,000 in excess thereof and (b) no more than fifteen
Eurodollar Tranches shall be outstanding at any one time.
<PAGE> 27
. Interest Rates and Payment Dates. () Each Eurodollar Loan shall bear
interest for each day during each Interest Period with respect thereto at a rate
per annum equal to the Eurodollar Rate determined for such day plus the
Applicable Margin.
() Each ABR Loan shall bear interest at a rate per annum equal to the ABR
plus the Applicable Margin.
() (i) If all or a portion of the principal amount of any Loan or
Reimbursement Obligation shall not be paid when due (whether at the stated
maturity, by acceleration or otherwise), all outstanding Loans and Reimbursement
Obligations (whether or not overdue) shall bear interest at a rate per annum
equal to (x) in the case of the Loans, the rate that would otherwise be
applicable thereto pursuant to the foregoing provisions of this Section plus 2%
or (y) in the case of Reimbursement Obligations, the rate applicable to ABR
Loans under the Revolving Facility plus 2%, and (ii) if all or a portion of any
interest payable on any Loan or Reimbursement Obligation or any commitment fee
or other amount payable hereunder shall not be paid when due (whether at the
stated maturity, by acceleration or otherwise), such overdue amount shall bear
interest at a rate per annum equal to the rate then applicable to ABR Loans
under the relevant Facility plus 2% (or, in the case of any such other amounts
that do not relate to a particular Facility, the rate then applicable to ABR
Loans under the Revolving Facility plus 2%), in each case, with respect to
clauses (i) and (ii) above, from the date of such non-payment until such amount
is paid in full (as well after as before judgment).
() Interest shall be payable in arrears on each Interest Payment Date,
provided that interest accruing pursuant to paragraph (c) of this Section shall
be payable from time to time on demand.
. Computation of Interest and Fees. () Interest and fees payable pursuant
hereto shall be calculated on the basis of a 360-day year for the actual days
elapsed, except that, with respect to ABR Loans the rate of interest on which is
calculated on the basis of the Prime Rate, the interest thereon shall be
calculated on the basis of a 365- (or 366-, as the case may be) day year for the
actual days elapsed. The Administrative Agent shall as soon as practicable
notify the Borrower and the relevant Lenders of each determination of a
Eurodollar Rate. Any change in the interest rate on a Loan resulting from a
change in the ABR or the Eurocurrency Reserve Requirements shall become
effective as of the opening of business on the day on which such change becomes
effective. The Administrative Agent shall as soon as practicable notify the
Borrower and the relevant Lenders of the effective date and the amount of each
such change in interest rate.
() Each determination of an interest rate by the Administrative Agent
pursuant to any provision of this Agreement shall be conclusive and binding on
the Borrower and the Lenders in the absence of manifest error. The
Administrative Agent shall, at the request of the Borrower, deliver to the
Borrower a statement showing the quotations used by the Administrative Agent in
determining any interest rate pursuant to Section 2.12(a).
. Inability to Determine Interest Rate. If prior to the first day of any
Interest Period:
() the Administrative Agent shall have determined (which determination
shall be conclusive and binding upon the Borrower) that, by reason of
circumstances affecting the relevant market, adequate and reasonable means
do not exist for ascertaining the Eurodollar Rate for such Interest Period,
or
() the Administrative Agent shall have received notice from the
Majority Facility Lenders in respect of the relevant Facility that the
Eurodollar Rate determined or to be determined for such Interest Period
will not adequately and fairly reflect the cost to such Lenders (as
conclusively certified by such Lenders) of making or maintaining their
affected Loans during such Interest Period,
<PAGE> 28
the Administrative Agent shall give telecopy or telephonic notice thereof to the
Borrower and the relevant Lenders as soon as practicable thereafter. If such
notice is given (x) any Eurodollar Loans under the relevant Facility requested
to be made on the first day of such Interest Period shall be made as ABR Loans,
(y) any Loans under the relevant Facility that were to have been converted on
the first day of such Interest Period to Eurodollar Loans shall be continued as
ABR Loans and (z) any outstanding Eurodollar Loans under the relevant Facility
shall be converted, on the last day of the then-current Interest Period, to ABR
Loans. Until such notice has been withdrawn by the Administrative Agent, no
further Eurodollar Loans under the relevant Facility shall be made or continued
as such, nor shall the Borrower have the right to convert Loans under the
relevant Facility to Eurodollar Loans.
. Pro Rata Treatment and Payments. () Except in the case of the Incremental
Term Facility, each borrowing by the Borrower from the Lenders hereunder, each
payment by the Borrower on account of any commitment fee and any reduction of
the Commitments of the Lenders shall be made pro rata according to the
respective Tranche A Term Commitments, Tranche B Term Commitments or Revolving
Commitments, as the case may be, of the relevant Lenders.
() Each payment (including each prepayment) by the Borrower on account of
principal of and interest on the Term Loans shall be made pro rata according to
the respective outstanding principal amounts of the Term Loans then held by the
Term Lenders (except as otherwise provided in Section 2.15(d)). The amount of
each principal prepayment of the Term Loans shall be applied to reduce the then
remaining installments of the Tranche A Term Loans, Tranche B Term Loans and
Incremental Term Loans, as the case may be, pro rata based upon the then
remaining principal amount thereof. Amounts prepaid on account of the Term Loans
may not be reborrowed.
() Each payment (including each prepayment) by the Borrower on account of
principal of and interest on the Revolving Loans shall be made pro rata
according to the respective outstanding principal amounts of the Revolving Loans
then held by the Revolving Lenders.
() Notwithstanding anything to the contrary in this Agreement, with respect
to the amount of any mandatory prepayment of the Term Loans pursuant to Section
2.9 and, if the Borrower so elects in its sole discretion, any optional
prepayment of the Term Loans pursuant to Section 2.8, that in any such case is
allocated to Tranche B Term Loans or Incremental Term Loans (such amounts, the
"Tranche B Prepayment Amount" and the "Incremental Prepayment Amount",
respectively), at any time when Tranche A Term Loans remain outstanding, the
Borrower will (or, in the case of optional prepayments, may), in lieu of
applying such amount to the prepayment of Tranche B Term Loans and Incremental
Term Loans, respectively, on the date specified in Section 2.9 or 2.8, as the
case may be, for such prepayment, give the Administrative Agent telephonic
notice (promptly confirmed in writing) requesting that the Administrative Agent
prepare and provide to each Tranche B Lender and Incremental Term Lender a
notice (each, a "Prepayment Option Notice") as described below. As promptly as
practicable after receiving such notice from the Borrower, the Administrative
Agent will send to each Tranche B Lender and Incremental Term Lender a
Prepayment Option Notice, which shall be in the form of Exhibit F, and shall
include an offer by the Borrower to prepay on the date (each a "Prepayment
Date") that is 10 Business Days after the date of the Prepayment Option Notice,
the relevant Term Loans of such Lender by an amount equal to the portion of the
Prepayment Amount indicated in such Lender's Prepayment Option Notice as being
applicable to such Lender's Tranche B Term Loans or Incremental Term Loans, as
the case may be. On the Prepayment Date, (i) the Borrower shall pay to the
relevant Tranche B Lenders and Incremental Term Lenders the aggregate amount
necessary to prepay that portion of the outstanding relevant Term Loans in
respect of which such Lenders have accepted prepayment as described in the
Prepayment Option Notice, (ii) the Borrower shall pay to the Tranche A Lenders
an amount equal to 50% (or, in the case of optional prepayments, such percentage
as shall be determined by the Borrower in its sole discretion) of the portion of
the Tranche B Prepayment Amount and the Incremental Prepayment Amount not
accepted by the relevant Lenders, and such amount shall be applied to the
prepayment of the Tranche A Term Loans, and (iii) the Borrower shall be entitled
to retain the
<PAGE> 29
remaining portion of the Tranche B Prepayment Amount and the Incremental
Prepayment Amount not accepted by the relevant Lenders.
() All payments (including prepayments) to be made by the Borrower
hereunder, whether on account of principal, interest, fees or otherwise, shall
be made without setoff or counterclaim and shall be made prior to 12:00 Noon,
Houston time, on the due date thereof to the Administrative Agent, for the
account of the Lenders, at the Funding Office, in Dollars and in immediately
available funds. The Administrative Agent shall distribute such payments to the
Lenders promptly upon receipt in like funds as received. If any payment
hereunder (other than payments on the Eurodollar Loans) becomes due and payable
on a day other than a Business Day, such payment shall be extended to the next
succeeding Business Day. If any payment on a Eurodollar Loan becomes due and
payable on a day other than a Business Day, the maturity thereof shall be
extended to the next succeeding Business Day unless the result of such extension
would be to extend such payment into another calendar month, in which event such
payment shall be made on the immediately preceding Business Day. In the case of
any extension of any payment of principal pursuant to the preceding two
sentences, interest thereon shall be payable at the then applicable rate during
such extension.
() Unless the Administrative Agent shall have been notified in writing by
any Lender prior to a borrowing that such Lender will not make the amount that
would constitute its share of such borrowing available to the Administrative
Agent, the Administrative Agent may assume that such Lender is making such
amount available to the Administrative Agent, and the Administrative Agent may,
in reliance upon such assumption, make available to the Borrower a corresponding
amount. If such amount is not made available to the Administrative Agent by the
required time on the Borrowing Date therefor, such Lender shall pay to the
Administrative Agent, on demand, such amount with interest thereon at a rate
equal to the daily average Federal Funds Effective Rate for the period until
such Lender makes such amount immediately available to the Administrative Agent.
A certificate of the Administrative Agent submitted to any Lender with respect
to any amounts owing under this paragraph shall be conclusive in the absence of
manifest error. If such Lender's share of such borrowing is not made available
to the Administrative Agent by such Lender within three Business Days of such
Borrowing Date, the Administrative Agent shall also be entitled to recover such
amount with interest thereon at the rate per annum applicable to ABR Loans under
the relevant Facility, on demand, from the Borrower.
() Unless the Administrative Agent shall have been notified in writing by
the Borrower prior to the date of any payment being made hereunder that the
Borrower will not make such payment to the Administrative Agent, the
Administrative Agent may assume that the Borrower is making such payment, and
the Administrative Agent may, but shall not be required to, in reliance upon
such assumption, make available to the Lenders their respective pro rata shares
of a corresponding amount. If such payment is not made to the Administrative
Agent by the Borrower within three Business Days of such required date, the
Administrative Agent shall be entitled to recover, on demand, from each Lender
to which any amount which was made available pursuant to the preceding sentence,
such amount with interest thereon at the rate per annum equal to the daily
average Federal Funds Effective Rate. Nothing herein shall be deemed to limit
the rights of the Administrative Agent or any Lender against the Borrower.
. Requirements of Law. () If the adoption of or any change in any
Requirement of Law or in the interpretation or application thereof or compliance
by any Lender with any request or directive (whether or not having the force of
law) from any central bank or other Governmental Authority made subsequent to
the date hereof:
() shall subject any Lender to any tax of any kind whatsoever with
respect to this Agreement, any Letter of Credit, any Application or any
Eurodollar Loan made by it, or change the basis of taxation of payments to
such Lender in respect thereof (except for Non-Excluded Taxes covered by
Section 2.17 and changes in the rate of tax on the overall net income of
such Lender);
<PAGE> 30
() shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held
by, deposits or other liabilities in or for the account of, advances,
loans or other extensions of credit by, or any other acquisition of
funds by, any office of such Lender that is not otherwise included in
the determination of the Eurodollar Rate hereunder; or
() shall impose on such Lender any other condition;
and the result of any of the foregoing is to increase the cost to such Lender,
by an amount that such Lender deems to be material, of making, converting into,
continuing or maintaining Eurodollar Loans or issuing or participating in
Letters of Credit, or to reduce any amount receivable hereunder in respect
thereof, then, in any such case, the Borrower shall promptly pay such Lender,
upon its demand, any additional amounts necessary to compensate such Lender for
such increased cost or reduced amount receivable. If any Lender becomes entitled
to claim any additional amounts pursuant to this paragraph, it shall promptly
notify the Borrower (with a copy to the Administrative Agent) of the event by
reason of which it has become so entitled.
() If any Lender shall have determined that the adoption of or any change
in any Requirement of Law regarding capital adequacy or in the interpretation or
application thereof or compliance by such Lender or any corporation controlling
such Lender with any request or directive regarding capital adequacy (whether or
not having the force of law) from any Governmental Authority made subsequent to
the date hereof shall have the effect of reducing the rate of return on such
Lender's or such corporation's capital as a consequence of its obligations
hereunder or under or in respect of any Letter of Credit to a level below that
which such Lender or such corporation could have achieved but for such adoption,
change or compliance (taking into consideration such Lender's or such
corporation's policies with respect to capital adequacy) by an amount deemed by
such Lender to be material, then from time to time, after submission by such
Lender to the Borrower (with a copy to the Administrative Agent) of a written
request therefor, the Borrower shall pay to such Lender such additional amount
or amounts as will compensate such Lender for such reduction; provided that the
Borrower shall not be required to compensate a Lender pursuant to this paragraph
for any amounts incurred more than six months prior to the date that such Lender
notifies the Borrower of such Lender's intention to claim compensation therefor;
and provided further that, if the circumstances giving rise to such claim have a
retroactive effect, then such six-month period shall be extended to include the
period of such retroactive effect.
() A certificate as to any additional amounts payable pursuant to this
Section submitted by any Lender to the Borrower (with a copy to the
Administrative Agent) shall be conclusive in the absence of manifest error. The
obligations of the Borrower pursuant to this Section shall survive the
termination of this Agreement and the payment of the Loans and all other amounts
payable hereunder.
. Taxes. () All payments made by the Borrower under this Agreement shall be
made free and clear of, and without deduction or withholding for or on account
of, any present or future income, stamp or other taxes, levies, imposts, duties,
charges, fees, deductions or withholdings, now or hereafter imposed, levied,
collected, withheld or assessed by any Governmental Authority, excluding net
income taxes and franchise taxes (imposed in lieu of net income taxes) imposed
on the Administrative Agent or any Lender as a result of a present or former
connection between the Administrative Agent or such Lender and the jurisdiction
of the Governmental Authority imposing such tax or any political subdivision or
taxing authority thereof or therein (other than any such connection arising
solely from the Administrative Agent or such Lender having executed, delivered
or performed its obligations or received a payment under, or enforced, this
Agreement or any other Loan Document). If any such non-excluded taxes,
<PAGE> 31
levies, imposts, duties, charges, fees, deductions or withholdings
("Non-Excluded Taxes") or Other Taxes are required to be withheld from any
amounts payable to the Administrative Agent or any Lender hereunder, the amounts
so payable to the Administrative Agent or such Lender shall be increased to the
extent necessary to yield to the Administrative Agent or such Lender (after
payment of all Non-Excluded Taxes and Other Taxes) interest or any such other
amounts payable hereunder at the rates or in the amounts specified in this
Agreement, provided, however, that the Borrower shall not be required to
increase any such amounts payable to any Lender with respect to any Non-Excluded
Taxes (i) that are attributable to such Lender's failure to comply with the
requirements of paragraph (d) or (e) of this Section or (ii) that are United
States withholding taxes imposed on amounts payable to such Lender at the time
the Lender becomes a party to this Agreement, except to the extent that such
Lender's assignor (if any) was entitled, at the time of assignment, to receive
additional amounts from the Borrower with respect to such Non-Excluded Taxes
pursuant to this paragraph.
() In addition, the Borrower shall pay any Other Taxes to the relevant
Governmental Authority in accordance with applicable law.
() Whenever any Non-Excluded Taxes or Other Taxes are payable by the
Borrower, as promptly as possible thereafter the Borrower shall send to the
Administrative Agent for its own account or for the account of the relevant
Lender, as the case may be, a certified copy of an original official receipt
received by the Borrower showing payment thereof. If the Borrower fails to pay
any Non-Excluded Taxes or Other Taxes when due to the appropriate taxing
authority or fails to remit to the Administrative Agent the required receipts or
other required documentary evidence, the Borrower shall indemnify the
Administrative Agent and the Lenders for any incremental taxes, interest or
penalties that may become payable by the Administrative Agent or any Lender as a
result of any such failure.
() Each Lender (or Transferee) that is not a citizen or resident of the
United States of America, a corporation, partnership or other entity created or
organized in or under the laws of the United States of America (or any
jurisdiction thereof), or any estate or trust that is subject to federal income
taxation regardless of the source of its income (a "Non-U.S. Lender") shall
deliver to the Borrower and the Administrative Agent (or, in the case of a
Participant, to the Lender from which the related participation shall have been
purchased) two copies of either U.S. Internal Revenue Service Form W-8BEN or
Form W-8ECI, or, in the case of a Non-U.S. Lender claiming exemption from U.S.
federal withholding tax under Section 871(h) or 881(c) of the Code with respect
to payments of "portfolio interest", a statement substantially in the form of
Exhibit G and a Form W-8BEN, or any subsequent versions thereof or successors
thereto, properly completed and duly executed by such Non-U.S. Lender claiming
complete exemption from U.S. federal withholding tax on all payments by the
Borrower under this Agreement and the other Loan Documents. Such forms shall be
delivered by each Non-U.S. Lender on or before the date it becomes a party to
this Agreement (or, in the case of any Participant, on or before the date such
Participant purchases the related participation). In addition, each Non-U.S.
Lender shall deliver such forms promptly upon the obsolescence or invalidity of
any form previously delivered by such Non-U.S. Lender. Each Non-U.S. Lender
shall promptly notify the Borrower at any time it determines that it is no
longer in a position to provide any previously delivered certificate to the
Borrower (or any other form of certification adopted by the U.S. taxing
authorities for such purpose). Notwithstanding any other provision of this
paragraph, a Non-U.S. Lender shall not be required to deliver any form pursuant
to this paragraph that such Non-U.S. Lender is not legally able to deliver.
() A Lender that is entitled to an exemption from non-U.S. withholding tax
under the law of the jurisdiction in which the Borrower is located, or any
treaty to which such jurisdiction is a party, with respect to payments under
this Agreement shall deliver to the Borrower (with a copy to the Administrative
Agent), at the time or times prescribed by applicable
<PAGE> 32
law or reasonably requested by the Borrower, such properly completed and
executed documentation prescribed by applicable law as will permit such payments
to be made without withholding, provided that such Lender is legally entitled to
complete, execute and deliver such documentation and in such Lender's judgment
such completion, execution or submission would not materially prejudice the
legal position of such Lender.
() The agreements in this Section shall survive the termination of this
Agreement and the payment of the Loans and all other amounts payable hereunder.
. Indemnity. The Borrower agrees to indemnify each Lender and to hold each
Lender harmless from any loss or expense that such Lender may sustain or incur
as a consequence of (a) default by the Borrower in making a borrowing of,
conversion into or continuation of Eurodollar Loans after the Borrower has given
a notice requesting the same in accordance with the provisions of this
Agreement, (b) default by the Borrower in making any prepayment of or conversion
from Eurodollar Loans after the Borrower has given a notice thereof in
accordance with the provisions of this Agreement or (c) the making of a
prepayment of Eurodollar Loans on a day that is not the last day of an Interest
Period with respect thereto. Such indemnification may include an amount equal to
the excess, if any, of (i) the amount of interest that would have accrued on the
amount so prepaid, or not so borrowed, converted or continued, for the period
from the date of such prepayment or of such failure to borrow, convert or
continue to the last day of such Interest Period (or, in the case of a failure
to borrow, convert or continue, the Interest Period that would have commenced on
the date of such failure) in each case at the applicable rate of interest for
such Loans provided for herein (excluding, however, the Applicable Margin
included therein, if any) over (ii) the amount of interest (as reasonably
determined by such Lender) that would have accrued to such Lender on such amount
by placing such amount on deposit for a comparable period with leading banks in
the interbank eurodollar market. A certificate as to any amounts payable
pursuant to this Section submitted to the Borrower by any Lender shall be
conclusive in the absence of manifest error. This covenant shall survive the
termination of this Agreement and the payment of the Loans and all other amounts
payable hereunder.
. Change of Lending Office. Each Lender agrees that, upon the occurrence of
any event giving rise to the operation of Section 2.16 or 2.17(a) with respect
to such Lender, it will, if requested by the Borrower, use reasonable efforts
(subject to overall policy considerations of such Lender) to designate another
lending office for any Loans affected by such event with the object of avoiding
the consequences of such event; provided, that such designation is made on terms
that, in the sole judgment of such Lender, cause such Lender and its lending
office(s) to suffer no economic, legal or regulatory disadvantage, and provided,
further, that nothing in this Section shall affect or postpone any of the
obligations of any Borrower or the rights of any Lender pursuant to Section 2.16
or 2.17(a).
. Replacement of Lenders. The Borrower shall be permitted to replace any
Lender that (a) requests reimbursement for amounts owing pursuant to Section
2.16 or 2.17(a) or (b) defaults in its obligation to make Loans hereunder, with
a replacement financial institution; provided that (i) such replacement does not
conflict with any Requirement of Law, (ii) no Event of Default shall have
occurred and be continuing at the time of such replacement, (iii) prior to any
such replacement, such Lender shall have taken no action under Section 2.19
which has eliminated the continued need for payment of amounts owing pursuant to
Section 2.16 or 2.17(a), (iv) the replacement financial institution shall
purchase, at par, all Loans and other amounts owing to such replaced Lender on
or prior to the date of replacement, (v) the Borrower shall be liable to such
replaced Lender under Section 2.18 if any Eurodollar Loan owing to such replaced
Lender shall be purchased other than on the last day of the Interest Period
relating thereto, (vi) the replacement financial institution, if not already a
Lender, shall be reasonably satisfactory to the Administrative Agent, (vii) the
replaced Lender shall be obligated to make such replacement in
<PAGE> 33
accordance with the provisions of Section 10.6 (provided that the Borrower shall
be obligated to pay the registration and processing fee referred to therein),
(viii) until such time as such replacement shall be consummated, the Borrower
shall pay all additional amounts (if any) required pursuant to Section 2.16 or
2.17(a), as the case may be, and (ix) any such replacement shall not be deemed
to be a waiver of any rights that the Borrower, the Agents or any other Lender
shall have against the replaced Lender.
SECTION . LETTERS OF CREDIT
. L/C Commitment. () Subject to the terms and conditions hereof, each
Issuing Lender, in reliance on the agreements of the other Revolving Lenders set
forth in Section 3.4(a), agrees to issue letters of credit ("Letters of Credit")
for the account of the Borrower on any Business Day during the Revolving
Commitment Period in such form as may be approved from time to time by such
Issuing Lender; provided that no Issuing Lender shall issue any Letter of Credit
if, after giving effect to such issuance, (i) the L/C Obligations would exceed
the L/C Commitment or (ii) the aggregate amount of the Available Revolving
Commitments would be less than zero. Each Letter of Credit shall (i) be
denominated in Dollars, (ii) unless otherwise agreed by the Administrative Agent
and the relevant Issuing Lender, have a face amount of at least $500,000 and
(iii) expire no later than the earlier of (x) the first anniversary of its date
of issuance and (y) the date that is five Business Days prior to the Revolving
Termination Date, provided that any Letter of Credit with a one-year term may
provide for the renewal thereof for additional one-year periods (which shall in
no event extend beyond the date referred to in clause (y) above).
() No Issuing Lender shall be obligated to issue any Letter of Credit
hereunder if such issuance would conflict with, or cause such Issuing Lender or
any L/C Participant to exceed any limits imposed by, any applicable Requirement
of Law.
. Procedure for Issuance of Letter of Credit. The Borrower may from time to
time request that any Issuing Lender issue a Letter of Credit by delivering to
such Issuing Lender an Application therefor, completed to the satisfaction of
such Issuing Lender, and such other certificates, documents and other papers and
information as such Issuing Lender may request. Upon receipt of any Application,
the relevant Issuing Lender will process such Application and the certificates,
documents and other papers and information delivered to it in connection
therewith in accordance with its customary procedures and shall promptly issue
the Letter of Credit requested thereby (but in no event shall such Issuing
Lender be required to issue any Letter of Credit earlier than three Business
Days after its receipt of the Application therefor and all such other
certificates, documents and other papers and information relating thereto) by
issuing the original of such Letter of Credit to the beneficiary thereof or as
otherwise may be agreed to by such Issuing Lender and the Borrower. The relevant
Issuing Lender shall furnish a copy of such Letter of Credit to the Borrower
promptly following the issuance thereof. The relevant Issuing Lender shall
promptly furnish to the Administrative Agent, which shall in turn promptly
furnish to the Lenders, notice of the issuance of each Letter of Credit
(including the amount thereof).
. Fees and Other Charges. () The Borrower will pay a fee on all outstanding
Letters of Credit at a per annum rate equal to the Applicable Margin then in
effect with respect to Eurodollar Loans under the Revolving Facility, shared
ratably among the Revolving Lenders and payable quarterly in arrears on each L/C
Fee Payment Date after the issuance date. In addition, the Borrower shall pay to
the relevant Issuing Lender for its own account a fronting fee of 0.25% per
annum on the undrawn and unexpired amount of each Letter of Credit issued by
such Issuing Lender, payable quarterly in arrears on each L/C Fee Payment Date
after the Issuance Date.
() In addition to the foregoing fees, the Borrower shall pay or reimburse
the relevant Issuing Lender for such normal and customary costs and expenses as
are incurred or
<PAGE> 34
charged by such Issuing Lender in issuing, negotiating, effecting payment under,
amending or otherwise administering any Letter of Credit.
. L/C Participations. () Each Issuing Lender irrevocably agrees to grant
and hereby grants to each L/C Participant, and, to induce the Issuing Lenders to
issue Letters of Credit hereunder, each L/C Participant irrevocably agrees to
accept and purchase and hereby accepts and purchases from each Issuing Lender,
on the terms and conditions hereinafter stated, for such L/C Participant's own
account and risk an undivided interest equal to such L/C Participant's Revolving
Percentage in each Issuing Lender's obligations and rights under each Letter of
Credit issued by it hereunder and the amount of each draft paid by such Issuing
Lender thereunder. Each L/C Participant unconditionally and irrevocably agrees
with each Issuing Lender that, if a draft is paid under any Letter of Credit
issued by such Issuing Lender for which such Issuing Lender is not reimbursed in
full by the Borrower in accordance with the terms of this Agreement, such L/C
Participant shall pay to such Issuing Lender upon demand an amount equal to such
L/C Participant's Revolving Percentage of the amount of such draft, or any part
thereof, that is not so reimbursed.
() If any amount required to be paid by any L/C Participant to any Issuing
Lender pursuant to Section 3.4(a) in respect of any unreimbursed portion of any
payment made by such Issuing Lender under any Letter of Credit is paid to such
Issuing Lender within three Business Days after the date such payment is due,
such L/C Participant shall pay to such Issuing Lender on demand an amount equal
to the product of () such amount, times () the daily average Federal Funds
Effective Rate during the period from and including the date such payment is
required to the date on which such payment is immediately available to such
Issuing Lender, times () a fraction the numerator of which is the number of days
that elapse during such period and the denominator of which is 360. If any such
amount required to be paid by any L/C Participant pursuant to Section 3.4(a) is
not made available to the relevant Issuing Lender by such L/C Participant within
three Business Days after the date such payment is due, such Issuing Lender
shall be entitled to recover from such L/C Participant, on demand, such amount
with interest thereon calculated from such due date at the rate per annum
applicable to ABR Loans under the Revolving Facility. A certificate of the
relevant Issuing Lender submitted to any L/C Participant with respect to any
amounts owing under this Section shall be conclusive in the absence of manifest
error.
() Whenever, at any time after the relevant Issuing Lender has made payment
under any Letter of Credit and has received from any L/C Participant its pro
rata share of such payment in accordance with Section 3.4(a), such Issuing
Lender receives any payment related to such Letter of Credit (whether directly
from the Borrower or otherwise, including proceeds of collateral applied thereto
by such Issuing Lender), or any payment of interest on account thereof, such
Issuing Lender will distribute to such L/C Participant its pro rata share
thereof; provided, however, that in the event that any such payment received by
such Issuing Lender shall be required to be returned by such Issuing Lender,
such L/C Participant shall return to such Issuing Lender the portion thereof
previously distributed by such Issuing Lender to it.
. Reimbursement Obligation of the Borrower. The Borrower agrees to
reimburse the relevant Issuing Lender on each date on which such Issuing Lender
notifies the Borrower of the date and amount of a draft presented under any
Letter of Credit and paid by such Issuing Lender for the amount of (a) such
draft so paid and (b) any taxes, fees, charges or other costs or expenses
incurred by such Issuing Lender in connection with such payment. Each such
payment shall be made to the relevant Issuing Lender in lawful money of the
United States and in immediately available funds. Interest shall be payable on
any and all amounts remaining unpaid by the Borrower under this Section from the
date such amounts become payable (whether at stated maturity, by acceleration or
otherwise) until payment in full at the rate set forth in (i) until
<PAGE> 35
the second Business Day following the date of the applicable drawing, Section
2.12(b) and (ii) thereafter, Section 2.12(c).
. Obligations Absolute. The Borrower's obligations under this Section 3
shall be absolute and unconditional under any and all circumstances and
irrespective of any setoff, counterclaim or defense to payment that the Borrower
may have or have had against any Issuing Lender, any other Lender, any
beneficiary of a Letter of Credit or any other Person. The Borrower also agrees
with each Issuing Lender that no Issuing Lender shall be responsible for, and
the Borrower's Reimbursement Obligations under Section 3.5 shall not be affected
by, among other things, the validity or genuineness of documents or of any
endorsements thereon, even though such documents shall in fact prove to be
invalid, fraudulent or forged, or any dispute between or among the Borrower and
any beneficiary of any Letter of Credit or any other party to which such Letter
of Credit may be transferred or any claims whatsoever of the Borrower against
any beneficiary of such Letter of Credit or any such transferee. No Issuing
Lender shall be liable for any error, omission, interruption or delay in
transmission, dispatch or delivery of any message or advice, however
transmitted, in connection with any Letter of Credit, except for errors or
omissions found by a final and nonappealable decision of a court of competent
jurisdiction to have resulted from the gross negligence or willful misconduct of
the relevant Issuing Lender. The Borrower agrees that any action taken or
omitted by any Issuing Lender under or in connection with any Letter of Credit
or the related drafts or documents, if done in the absence of gross negligence
or willful misconduct and in accordance with the standards of care specified in
the Uniform Commercial Code of the State of New York, shall be binding on the
Borrower and shall not result in any liability of any Issuing Lender to the
Borrower.
. Letter of Credit Payments. If any draft shall be presented for payment
under any Letter of Credit, the relevant Issuing Lender shall promptly notify
the Borrower of the date and amount thereof. The responsibility of each Issuing
Lender to the Borrower in connection with any draft presented for payment under
any Letter of Credit shall, in addition to any payment obligation expressly
provided for in such Letter of Credit, be limited to determining that the
documents (including each draft) delivered under such Letter of Credit in
connection with such presentment are substantially in conformity with such
Letter of Credit.
. Applications. To the extent that any provision of any Application related
to any Letter of Credit is inconsistent with the provisions of this Section 3,
the provisions of this Section 3 shall apply.
SECTION . REPRESENTATIONS AND WARRANTIES
To induce the Agents and the Lenders to enter into this Agreement and to
make the Loans and issue or participate in the Letters of Credit, Holdings and
the Borrower hereby jointly and severally represent and warrant to the Agents
and each Lender that:
. Financial Condition. () The unaudited statement of operations data and
balance sheet of the Fanch Systems included in Appendix A of the Confidential
Information Memorandum have been prepared based on the best information
available to the Borrower as of the date of delivery thereof, and present fairly
the financial condition of the Fanch Systems for the 1998 fiscal year, and as of
December 31, 1998, as the case may be.
() The financial statements of TWFanch-One Company, TWFanch-Two Company,
Spring Green Communications, L.P., North Texas Cablevision, Ltd., Cable Systems,
Inc. and Fanch Narragansett CSI Limited Partnership, each included in Appendix A
of the Confidential Information Memorandum, have been reported on and
accompanied by an unqualified report of the independent public accountant
identified therein. Such financial statements present fairly the consolidated or
combined (as the case may be) financial condition of
<PAGE> 36
such Person as at the dates indicated, and the consolidated or combined (as the
case may be) results of its operations and cash flows for the periods indicated.
All such financial statements, including the related schedules and notes
thereto, have been prepared in accordance with GAAP applied consistently
throughout the periods involved (except as approved by the aforementioned firm
of accountants and disclosed therein). Holdings, the Borrower and its
Subsidiaries do not have any material Guarantee Obligations, contingent
liabilities and liabilities for taxes, or any long-term leases or unusual
forward or long-term commitments, including any interest rate or foreign
currency swap or exchange transaction or other obligation in respect of
derivatives, that are not reflected in the most recent financial statements
referred to in this paragraph. During the period from December 31, 1998 to and
including the date hereof there has been no Disposition by Holdings, the
Borrower or any of its Subsidiaries of any material part of its business or
property.
. No Change. Since June 30, 1999 there has been no event, development or
circumstance that has had or could reasonably be expected to have a Material
Adverse Effect.
. Existence; Compliance with Law. Each of Holdings, the Borrower and its
Subsidiaries (a) is duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization, (b) has the power and
authority, and the legal right, to own and operate its property, to lease the
property it operates as lessee and to conduct the business in which it is
currently engaged, (c) is duly qualified as a foreign entity and in good
standing under the laws of each jurisdiction where its ownership, lease or
operation of property or the conduct of its business requires such qualification
and (d) is in compliance with all Requirements of Law, in each case with respect
to clauses (c) and (d), except as could not, in the aggregate, reasonably be
expected to have a Material Adverse Effect.
. Power; Authorization; Enforceable Obligations. Each Loan Party has the
power and authority, and the legal right, to make, deliver and perform the Loan
Documents to which it is a party and, in the case of the Borrower, to borrow
hereunder. Each Loan Party has taken all necessary action to authorize the
execution, delivery and performance of the Loan Documents to which it is a party
and, in the case of the Borrower, to authorize the borrowings on the terms and
conditions of this Agreement. No consent or authorization of, filing with,
notice to or other act by or in respect of, any Governmental Authority or any
other Person is required in connection with the borrowings hereunder or with the
execution, delivery, performance, validity or enforceability of this Agreement
or any of the Loan Documents, except the filings referred to in Section 4.20.
Each Loan Document has been duly executed and delivered on behalf of each Loan
Party party thereto. This Agreement constitutes, and each other Loan Document
upon execution will constitute, a legal, valid and binding obligation of each
Loan Party party thereto, enforceable against each such Loan Party in accordance
with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the
enforcement of creditors' rights generally and by general equitable principles
(whether enforcement is sought by proceedings in equity or at law).
. No Legal Bar. The execution, delivery and performance of this Agreement
and the other Loan Documents, the issuance of Letters of Credit, the borrowings
hereunder and the use of the proceeds thereof will not violate any Requirement
of Law or any material Contractual Obligation of Holdings, the Borrower or any
of its Subsidiaries and will not result in, or require, the creation or
imposition of any Lien on any of their respective properties or revenues
pursuant to any Requirement of Law or any such Contractual Obligation (other
than the Liens created by the Guarantee and Collateral Agreement).
. Litigation. No litigation, investigation or proceeding of or before any
arbitrator or Governmental Authority is pending or, to the knowledge of Holdings
or the Borrower, threatened by or against Holdings, the Borrower or any of its
Subsidiaries or against any of their respective properties or revenues (a) with
respect to any of the Loan Documents or any of the
<PAGE> 37
transactions contemplated hereby or thereby, or (b) that could reasonably be
expected to have a Material Adverse Effect.
. No Default. Neither Holdings, the Borrower nor any of its Subsidiaries is
in default under or with respect to any of its Contractual Obligations in any
respect that could reasonably be expected to have a Material Adverse Effect. No
Default or Event of Default has occurred and is continuing.
. Ownership of Property; Liens. Each of Holdings, the Borrower and its
Subsidiaries has title in fee simple to, or a valid leasehold interest in, all
its material real property, and good title to, or a valid leasehold interest in,
all its other material property, and none of such property is subject to any
Lien except as permitted by Section 7.3.
. Intellectual Property. Holdings, the Borrower and each of its
Subsidiaries owns, or is licensed to use, all material Intellectual Property
necessary for the conduct of its business as currently conducted. No material
claim has been asserted and is pending by any Person challenging or questioning
the use, validity or effectiveness of any material Intellectual Property owned
or licensed by Holdings, the Borrower or any of its Subsidiaries, nor does
Holdings or the Borrower know of any valid basis for any such claim. The use of
Intellectual Property by Holdings, the Borrower and its Subsidiaries does not
infringe on the rights of any Person in any material respect.
. Taxes. Each of Holdings, the Borrower and each of its Subsidiaries has
filed or caused to be filed all federal, state and other material tax returns
that are required to be filed and has paid all taxes shown to be due and payable
on said returns or on any assessments made against it or any of its property and
all other taxes, fees or other charges imposed on it or any of its property by
any Governmental Authority (other than any the amount or validity of that are
currently being contested in good faith by appropriate proceedings and with
respect to which reserves in conformity with GAAP have been provided on the
books of Holdings, the Borrower or its Subsidiaries, as the case may be); no tax
Lien has been filed, and, to the knowledge of Holdings and the Borrower, no
claim is being asserted, with respect to any such tax, fee or other charge.
. Federal Regulations. No part of the proceeds of any Loans will be used
for "buying" or "carrying" any "margin stock" within the respective meanings of
each of the quoted terms under Regulation U as now and from time to time
hereafter in effect or for any purpose that violates the provisions of the
Regulations of the Board. If requested by any Lender or the Administrative
Agent, the Borrower will furnish to the Administrative Agent and each Lender a
statement to the foregoing effect in conformity with the requirements of FR Form
G-3 or FR Form U-1, as applicable, referred to in Regulation U.
. Labor Matters. Except as, in the aggregate, could not reasonably be
expected to have a Material Adverse Effect: (a) there are no strikes or other
labor disputes against Holdings, the Borrower or any of its Subsidiaries pending
or, to the knowledge of Holdings or the Borrower, threatened; (b) hours worked
by and payment made to employees of Holdings, the Borrower and its Subsidiaries
have not been in violation of the Fair Labor Standards Act or any other
applicable Requirement of Law dealing with such matters; and (c) all payments
due from Holdings, the Borrower or any of its Subsidiaries on account of
employee health and welfare insurance have been paid or accrued as a liability
on the books of Holdings, the Borrower or the relevant Subsidiary.
. ERISA. Each Plan is in material compliance with the applicable provisions
of ERISA and the Code. No Plan is a Multiemployer Plan or a "defined benefit
plan" (as defined in ERISA). Each Commonly Controlled Entity has met all of the
funding standards applicable to all
<PAGE> 38
Plans, and no condition exists which would permit the institution of proceedings
to terminate any Plan under Section 4042 of ERISA.
. Investment Company Act; Other Regulations. No Loan Party is an
"investment company", or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940, as amended. No Loan
Party is subject to regulation under any Requirement of Law (other than
Regulation X of the Board) that limits its ability to incur Indebtedness.
. Subsidiaries. Except as disclosed to the Administrative Agent by the
Borrower in writing from time to time after the Closing Date, () Schedule 4.15
sets forth the name and jurisdiction of organization of Holdings and each of its
Subsidiaries and, as to each such Subsidiary, the percentage of each class of
Equity Interests owned by any Loan Party and () except as set forth on Schedule
4.15, there are no outstanding subscriptions, options, warrants, calls, rights
or other agreements or commitments of any nature relating to any Equity
Interests of the Borrower or any of its Subsidiaries, except as created by the
Loan Documents.
. Use of Proceeds. The proceeds of the Loans, and the Letters of Credit,
shall be used for general purposes, including to finance the Acquisition and
permitted Investments.
. Environmental Matters. Except as, in the aggregate, could not reasonably
be expected to have a Material Adverse Effect:
(a) the facilities and properties owned, leased or operated by Holdings,
the Borrower or any of its Subsidiaries (the "Properties") do not contain, and
have not previously contained, any Materials of Environmental Concern in amounts
or concentrations or under circumstances that constitute or constituted a
violation of, or could give rise to liability under, any Environmental Law;
(b) neither Holdings, the Borrower nor any of its Subsidiaries has received
or is aware of any notice of violation, alleged violation, non-compliance,
liability or potential liability regarding environmental matters or compliance
with Environmental Laws with regard to any of the Properties or the business
operated by Holdings, the Borrower or any of its Subsidiaries (the "Business"),
nor does Holdings or the Borrower have knowledge or reason to believe that any
such notice will be received or is being threatened;
(c) Materials of Environmental Concern have not been transported or
disposed of from the Properties in violation of, or in a manner or to a location
that could give rise to liability under, any Environmental Law, nor have any
Materials of Environmental Concern been generated, treated, stored or disposed
of at, on or under any of the Properties in violation of, or in a manner that
could give rise to liability under, any applicable Environmental Law;
(d) no judicial proceeding or governmental or administrative action is
pending or, to the knowledge of Holdings and the Borrower, threatened, under any
Environmental Law to which Holdings, the Borrower or any Subsidiary is or will
be named as a party with respect to the Properties or the Business, nor are
there any consent decrees or other decrees, consent orders, administrative
orders or other orders, or other administrative or judicial requirements
outstanding under any Environmental Law with respect to the Properties or the
Business;
(e) there has been no release or threat of release of Materials of
Environmental Concern at or from the Properties, or arising from or related to
the operations of Holdings, the Borrower or any Subsidiary in connection with
the Properties or otherwise in connection with the Business, in violation of or
in amounts or in a manner that could give rise to liability under Environmental
Laws;
<PAGE> 39
(f) the Properties and all operations at the Properties are in compliance,
and have in the last five years been in compliance, with all applicable
Environmental Laws, and there is no contamination at, under or about the
Properties or violation of any Environmental Law with respect to the Properties
or the Business; and
(g) neither Holdings, the Borrower nor any of its Subsidiaries has assumed
any liability of any other Person under Environmental Laws.
. Certain Cable Television Matters. Except as, in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect:
() (i) Holdings, the Borrower and its Subsidiaries possess all
Authorizations necessary to own, operate and construct the CATV Systems or
otherwise for the operations of their businesses and are not in violation
thereof and (ii) all such Authorizations are in full force and effect and no
event has occurred that permits, or after notice or lapse of time could permit,
the revocation, termination or material and adverse modification of any such
Authorization;
() neither Holdings, the Borrower nor any of its Subsidiaries is in
violation of any duty or obligation required by the Communications Act of 1934,
as amended, or any FCC rule or regulation applicable to the operation of any
portion of any of the CATV Systems;
() (i) there is not pending or, to the best knowledge of Holdings or the
Borrower, threatened, any action by the FCC to revoke, cancel, suspend or refuse
to renew any FCC License held by Holdings, the Borrower or any of its
Subsidiaries and (ii) there is not pending or, to the best knowledge of Holdings
or the Borrower, threatened, any action by the FCC to modify adversely, revoke,
cancel, suspend or refuse to renew any other Authorization; and
() there is not issued or outstanding or, to the best knowledge of Holdings
or the Borrower, threatened, any notice of any hearing, violation or complaint
against Holdings, the Borrower or any of its Subsidiaries with respect to the
operation of any portion of the CATV Systems and neither Holdings nor the
Borrower has any knowledge that any Person intends to contest renewal of any
Authorization.
. Accuracy of Information, etc. No statement or information contained in
this Agreement, any other Loan Document, the Confidential Information Memorandum
or any other document, certificate or statement furnished by or on behalf of any
Loan Party to the Agents or the Lenders, or any of them, for use in connection
with the transactions contemplated by this Agreement or the other Loan
Documents, as supplemented from time to time prior to the date this
representation and warranty is made or deemed made, contains any untrue
statement of a material fact or omits to state a material fact necessary to make
the statements contained herein or therein not misleading. The projections and
pro forma financial information contained in the materials referenced above are
based upon good faith estimates and assumptions believed by management of the
Borrower to be reasonable at the time made, it being recognized by the Lenders
that such financial information as it relates to future events is not to be
viewed as fact and that actual results during the period or periods covered by
such financial information may differ from the projected results set forth
therein by a material amount. There is no fact known to any Loan Party that
could reasonably be expected to have a Material Adverse Effect that has not been
expressly disclosed herein, in the other Loan Documents, in the Confidential
Information Memorandum or in any other documents, certificates and statements
furnished to the Agents and the Lenders for use in connection with the
transactions contemplated hereby and by the other Loan Documents.
. Security Interests. The Guarantee and Collateral Agreement is effective
to create in favor of the Administrative Agent, for the benefit of the Lenders,
a legal, valid and enforceable security interest in the Collateral described
therein and proceeds thereof. In the case
<PAGE> 40
of certificated Pledged Stock described in the Guarantee and Collateral
Agreement, when certificates representing such Pledged Stock are delivered to
the Administrative Agent, and in the case of the other Collateral described in
the Guarantee and Collateral Agreement, when financing statements specified on
Schedule 4.20 in appropriate form are filed in the offices specified on Schedule
4.20, the Guarantee and Collateral Agreement shall constitute a fully perfected
Lien on, and security interest in, all right, title and interest of the Loan
Parties in such Collateral and the proceeds thereof, as security for the
Obligations (as defined in the Guarantee and Collateral Agreement), in each case
prior and superior in right to any other Person.
. Solvency. Each Loan Party (other than any Shell Subsidiary) is, and after
giving effect to the financing transactions referred to herein will be and will
continue to be, Solvent.
. Certain Tax Matters. As of the Closing Date, each of Holdings, the
Borrower and each of its Subsidiaries (other than any such Subsidiary that is
organized as a corporation) is a Flow-Through Entity.
. Year 2000 Matters. Based on a review of the operations of Holdings, the
Borrower and its Subsidiaries as they relate to the processing, storage and
retrieval of data, Holdings, the Borrower and its Subsidiaries do not believe
that a Material Adverse Effect is reasonably likely to occur as a result of
computer software and hardware that will not (a) receive, transmit, process,
compare, sequence, store, retrieve and present calendar dates (and data or
functions involving or based on calendar dates) falling on or after January 1,
2000 in the same manner and with the same functionality, accuracy, data
integrity and performance as calendar dates (and data involving or based on
calendar dates) falling on or before December 31, 1999, (b) receive, transmit,
process, compare, sequence, store, retrieve and present calendar dates in a four
digit year format or (c) correctly process calendar dates for leap years.
SECTION . CONDITIONS PRECEDENT
. Conditions to Initial Extension of Credit. The agreement of each Lender
to make the initial extension of credit requested to be made by it is subject to
the satisfaction, prior to or concurrently with the making of such extension of
credit on the Closing Date, of the following conditions precedent (with
references to the Lenders in this Section 5.1 referring only to Lenders as of
the Closing Date):
() Credit Agreement; Guarantee and Collateral Agreement. The Administrative
Agent shall have received (i) this Agreement, executed and delivered by the
Agents, Holdings and the Borrower, (ii) an Addendum, executed and delivered by
each Lender listed on Schedule 1.1, (iii) the Guarantee and Collateral
Agreement, executed and delivered by Holdings, the Borrower and each Subsidiary
Guarantor and (iv) an Acknowledgment and Consent in the form attached to the
Guarantee and Collateral Agreement, executed and delivered by each Issuer (as
defined therein), if any, that is not a Loan Party.
In the event that an Addendum has not been duly executed and delivered by
each Person listed on Schedule 1.1 on the date scheduled to be the Closing Date,
the condition referred to in clause (i) above shall nevertheless be deemed
satisfied if on such date the Borrower and the Administrative Agent shall have
designated one or more Persons (the "Designated Lenders") to assume, in the
aggregate, all of the Commitments that would have been held by the Persons
listed on Schedule 1.1 (the "Non-Executing Persons") which have not so executed
and delivered an Addendum (subject to each such Designated Lender's consent and
its execution and delivery of an Addendum). Schedule 1.1 shall automatically be
deemed to be amended to reflect the
<PAGE> 41
respective Commitments of the Designated Lenders and the omission of the
Non-Executing Persons as Lenders hereunder.
() Acquisition. The Fanch Systems shall have been acquired (the
"Acquisition") directly or indirectly by a Wholly Owned Subsidiary of the
Borrower.
() Existing Indebtedness. All of the existing credit facilities and other
Indebtedness (other than Indebtedness in an aggregate principal amount not
exceeding $10,000,000) of the Fanch Systems shall have been paid in full, and
any commitments under such credit facilities shall have been terminated.
() Approvals. All material governmental and third party approvals necessary
in connection with the financing contemplated hereby shall have been obtained
and be in full force and effect.
() Lien Searches. The Administrative Agent shall have received the results
of a recent Lien search in each of the jurisdictions where assets of the Loan
Parties are located, and such search shall reveal no Liens on any of the assets
of Holdings, the Borrower or any of its Subsidiaries except for Liens permitted
by Section 7.3 or Liens which have been discharged, or for which releases have
been tendered, on or prior to the Closing Date pursuant to documentation
satisfactory to the Administrative Agent.
() Financial Statements. The Lenders shall have received the financial
statements referred to in Section 4.1.
() Fees. The Lenders and the Agents shall have received all fees required
to be paid, and all expenses for which invoices have been presented (including
the reasonable fees and expenses of legal counsel), on or before the Closing
Date. All such amounts will be paid with proceeds of Loans made on the Closing
Date and will be reflected in the funding instructions given by the Borrower to
the Administrative Agent on or before the Closing Date.
() Closing Certificate; No Material Restrictions; Pro Forma Compliance. The
Administrative Agent shall have received, with a counterpart for each Lender, a
certificate of each Loan Party, dated the Closing Date, substantially in the
form of Exhibit C, with appropriate insertions and attachments, which (i) in the
case of Holdings, shall also certify that Holdings and its Subsidiaries are not
subject to material contractual or other restrictions that would be violated by
the transactions contemplated hereby and (ii) in the case of the Borrower, shall
also certify, in reasonable detail, pro forma compliance with Section 7.1(a)
for, or as at the end of, as the case may be, the most recent three-month period
for which the relevant financial information is available.
() Legal Opinions. The Administrative Agent shall have received one or more
signed legal opinions covering such matters incident to the transactions
contemplated by this Agreement as the Administrative Agent may reasonably
require.
() Filings, Registrations, Recordings, etc. Each document (including any
Uniform Commercial Code financing statement) required by the Guarantee and
Collateral Agreement under law or reasonably requested by the Administrative
Agent to be filed, registered or recorded in order to create in favor of the
Administrative Agent, for the benefit of the Lenders, a perfected Lien on the
Collateral described therein, prior and superior in right to any other Person,
shall be in proper form for filing, registration or recordation. The
Administrative Agent shall have received (i) the certificates, if any,
representing the Equity Interests pledged pursuant to the Guarantee and
Collateral Agreement, together with an undated stock power for each such
certificate executed by the pledgor thereof, and (ii) each promissory note (if
any) pledged to the
<PAGE> 42
Administrative Agent pursuant to the Guarantee and Collateral Agreement endorsed
in blank by the pledgor thereof.
. Conditions to Each Extension of Credit. The agreement of each Lender to
make any extension of credit requested to be made by it on any date (including
its initial extension of credit) is subject to the satisfaction of the following
conditions precedent:
() Representations and Warranties. Each of the representations and
warranties made by any Loan Party in or pursuant to the Loan Documents shall be
true and correct in all material respects on and as of such date as if made on
and as of such date.
() No Default. No Default or Event of Default shall have occurred and be
continuing on such date or after giving effect to the extensions of credit
requested to be made on such date.
() Other Documents. In the case of any extension of credit made on an
Increased Facility Closing Date, the Administrative Agent shall have received
such documents and information as it may reasonably request.
Each borrowing by and issuance of a Letter of Credit on behalf of the Borrower
hereunder shall constitute a representation and warranty by the Borrower as of
the date of such extension of credit that the conditions contained in Sections
5.2(a) and (b) have been satisfied.
SECTION . AFFIRMATIVE COVENANTS
Holdings and the Borrower hereby agree that, so long as the Commitments
remain in effect, any Letter of Credit remains outstanding or any Loan or other
amount is owing to any Lender or any Agent hereunder, each of Holdings and the
Borrower shall, and shall cause each Subsidiary of the Borrower to:
. Financial Statements. Furnish to the Administrative Agent (with
sufficient copies for each Lender):
() as soon as available, but in any event within 90 days after the end of
each fiscal year of the Borrower, a copy of the audited consolidated balance
sheet of the Borrower and its consolidated Subsidiaries as at the end of such
year and the related audited consolidated statements of income and of cash flows
for such year, setting forth in each case in comparative form the figures for
the previous year, reported on without a "going concern" or like qualification
or exception, or qualification arising out of the scope of the audit, by Arthur
Andersen LLP or other independent certified public accountants of nationally
recognized standing; and
() as soon as available, but in any event not later than 45 days after the
end of each of the first three quarterly periods of each fiscal year of the
Borrower, the unaudited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries as at the end of such quarter and the related
unaudited consolidated statements of income and of cash flows for such quarter
and the portion of the fiscal year through the end of such quarter, setting
forth in each case in comparative form the figures for the previous year,
certified by a Responsible Officer as being fairly stated in all material
respects (subject to normal year-end audit adjustments).
All such financial statements shall be complete and correct in all material
respects and shall be prepared in reasonable detail and in accordance with GAAP
applied consistently throughout the periods reflected therein and with prior
periods (except as approved by such accountants or officer, as the case may be,
and disclosed therein).
<PAGE> 43
. Certificates; Other Information. Furnish to the Administrative Agent
(with sufficient copies for each Lender) (or (i) in the case of clause (e)
below, to the Administrative Agent and (ii) in the case of clause (f) below, to
the relevant Lender):
() concurrently with the delivery of the financial statements referred to
in Section 6.1(a), a certificate of the independent certified public accountants
reporting on such financial statements stating that in making the examination
necessary therefor no knowledge was obtained of any Default or Event of Default
under Section 7.1, except as specified in such certificate;
() concurrently with the delivery of any financial statements pursuant to
Section 6.1, (i) a certificate of a Responsible Officer stating that, to the
best of each such Responsible Officer's knowledge, each Loan Party during such
period has observed or performed all of its covenants and other agreements, and
satisfied every condition, contained in this Agreement and the other Loan
Documents to which it is a party to be observed, performed or satisfied by it,
and that such Responsible Officer has obtained no knowledge of any Default or
Event of Default except as specified in such certificate and (ii) a Compliance
Certificate containing all information and calculations necessary for
determining compliance by Holdings, the Borrower and its Subsidiaries with the
provisions of this Agreement referred to therein as of the last day of the
fiscal quarter or fiscal year of the Borrower, as the case may be;
() as soon as available, and in any event no later than 45 days after the
end of each fiscal year of the Borrower, a budget for the following fiscal year
(which shall include projected Consolidated Operating Cash Flow and budgeted
capital expenditures), and, as soon as available, material revisions, if any, of
such budget with respect to such fiscal year (collectively, the "Budget"), which
Budget shall in each case be accompanied by a certificate of a Responsible
Officer stating that such Budget is based on reasonable estimates, information
and assumptions and that such Responsible Officer has no reason to believe that
such Budget is incorrect or misleading in any material respect;
() upon request by the Administrative Agent and within five days after the
same are sent, copies of all financial statements and reports (including reports
on Form 10-K, 10-Q or 8-K) that Holdings or the Borrower sends to the holders of
any class of its debt securities or public equity securities and, within five
days after the same are filed, copies of all financial statements and reports
that Holdings or the Borrower may make to, or file with, the SEC;
() no later than three Business Days prior to consummating any transaction
described in Section 7.2(f), 7.2(g), 7.5(e), 7.5(f), 7.5(g), 7.6(b), 7.7(f),
7.7(g) or (with respect to payment of deferred management fees) 7.8(c), a
certificate of a Responsible Officer demonstrating in reasonable detail (i) that
both before and after giving effect to such transaction, no Default or Event of
Default shall be in effect (including, on a pro forma basis, pursuant to Section
7.1) and (ii) compliance with any other financial tests referred to in the
relevant Section, provided that, in the case of Investments, Dispositions or the
payment of deferred management fees, the requirement to deliver such certificate
shall not apply to any Investment or Disposition pursuant to which the
Consideration paid is less than $25,000,000 or to any such payment of deferred
management fees in an amount less than $5,000,000; and
() promptly, such additional financial and other information as any Lender
may from time to time reasonably request.
. Payment of Obligations. Pay, discharge or otherwise satisfy at or before
maturity or before they become delinquent, as the case may be, all its material
obligations of whatever nature, except where the amount or validity thereof is
currently being contested in good faith by appropriate proceedings and reserves
in conformity with GAAP with respect thereto have been provided on the books of
Holdings, the Borrower or its Subsidiaries, as the case may be.
<PAGE> 44
. Maintenance of Existence; Compliance. (a) (i) Preserve, renew and keep in
full force and effect its existence and (ii) take all reasonable action to
maintain all rights, privileges and franchises necessary or desirable in the
normal conduct of its business, except, in each case, as otherwise permitted by
Section 7.4 and except, in the case of clause (ii) above, to the extent that
failure to do so could not reasonably be expected to have a Material Adverse
Effect; and (b) comply with all Contractual Obligations and Requirements of Law
except to the extent that failure to comply therewith could not, in the
aggregate, reasonably be expected to have a Material Adverse Effect.
. Maintenance of Property; Insurance. () Keep all material property useful
and necessary in its business in good working order and condition, ordinary wear
and tear excepted and (b) maintain with financially sound and reputable
insurance companies insurance on all its material property in at least such
amounts and against at least such risks (but including in any event public
liability, product liability and business interruption) as are usually insured
against in the same general area by companies engaged in the same or a similar
business.
. Inspection of Property; Books and Records; Discussions. (a) Keep proper
books of records and account in which full, true and correct entries in
conformity with GAAP and all Requirements of Law shall be made of all dealings
and transactions in relation to its business and activities and (b) permit
representatives of any Lender, coordinated through the Administrative Agent, to
visit and inspect any of its properties and examine and make abstracts from any
of its books and records at any reasonable time and as often as may reasonably
be desired and to discuss the business, operations, properties and financial and
other condition of Holdings, the Borrower and its Subsidiaries with officers and
employees of Holdings, the Borrower and its Subsidiaries and with its
independent certified public accountants.
. Notices. Promptly give notice to the Administrative Agent and each Lender
of:
() the occurrence of any Default or Event of Default;
() any (i) default or event of default under any Contractual Obligation of
Holdings, the Borrower or any of its Subsidiaries or (ii) litigation,
investigation or proceeding that may exist at any time between Holdings, the
Borrower or any of its Subsidiaries and any Governmental Authority, that, in
either case, could reasonably be expected to have a Material Adverse Effect;
() any litigation or proceeding commenced against Holdings, the Borrower or
any of its Subsidiaries which could reasonably be expected to result in a
liability of $25,000,000 or more to the extent not covered by insurance or which
could reasonably be expected to have a Material Adverse Effect;
() the following events, as soon as possible and in any event within 30
days after the Borrower knows or has reason to know thereof: (i) the occurrence
of any Reportable Event with respect to any Plan, a failure to make any required
contribution to a Plan, the creation of any Lien in favor of the PBGC or a Plan
or any withdrawal from, or the termination, Reorganization or Insolvency of, any
Multiemployer Plan or (ii) the institution of proceedings or the taking of any
other action by the PBGC or the Borrower or any Commonly Controlled Entity or
any Multiemployer Plan with respect to the withdrawal from, or the termination,
Reorganization or Insolvency of, any Plan; and
() any other development or event that has had or could reasonably be
expected to have a Material Adverse Effect.
<PAGE> 45
Each notice pursuant to this Section 6.7 shall be accompanied by a statement of
a Responsible Officer setting forth details of the occurrence referred to
therein and stating what action Holdings, the Borrower or the relevant
Subsidiary proposes to take with respect thereto.
. Environmental Laws. () Except as, in the aggregate, could not reasonably
be expected to result in a Material Adverse Effect, comply with, and ensure
compliance by all tenants and subtenants, if any, with, all applicable
Environmental Laws, and obtain and comply with and maintain, and ensure that all
tenants and subtenants obtain and comply with and maintain, any and all
licenses, approvals, notifications, registrations or permits required by
applicable Environmental Laws.
() Except as, in the aggregate, could not reasonably be expected to result
in a Material Adverse Effect, conduct and complete all investigations, studies,
sampling and testing, and all remedial, removal and other actions required under
Environmental Laws and promptly comply with all lawful orders and directives of
all Governmental Authorities regarding Environmental Laws.
. Interest Rate Protection. Within 120 days following the Closing Date, and
at all times thereafter, cause at least 50% of the aggregate outstanding
principal amount of Holdings Debt, Specified Long-Term Indebtedness and Term
Loans to be subject to a fixed rate, whether directly or pursuant to Hedge
Agreements having terms and conditions reasonably satisfactory to the
Administrative Agent.
. Additional Collateral. With respect to any new Subsidiary (other than a
Shell Subsidiary so long as it qualifies as such) created or acquired after the
Closing Date by the Borrower or any of its Subsidiaries (which shall be deemed
to have occurred in the event that any Non-Recourse Subsidiary ceases to qualify
as such), promptly (a) execute and deliver to the Administrative Agent such
amendments to the Guarantee and Collateral Agreement as the Administrative Agent
deems necessary or advisable to grant to the Administrative Agent, for the
benefit of the Lenders, a perfected first priority security interest in the
Equity Interests and intercompany obligations of such new Subsidiary that are
held by the Borrower or any of its Subsidiaries (limited, in the case of Equity
Interests of any Foreign Subsidiary, to 66% of the total outstanding Equity
Interests of such Foreign Subsidiary), (b) deliver to the Administrative Agent
the certificates, if any, representing such Equity Interests, and any
intercompany notes evidencing such obligations, together with undated stock
powers and endorsements, in blank, executed and delivered by a duly authorized
officer of the Borrower or such Subsidiary, as the case may be, and (c) except
in the case of a Foreign Subsidiary or an Excluded Acquired Subsidiary (until it
ceases to qualify as such), cause such new Subsidiary (i) to become a party to
the Guarantee and Collateral Agreement and (ii) to take such actions necessary
or advisable to grant to the Administrative Agent for the benefit of the Lenders
a perfected first priority security interest in the Collateral described in the
Guarantee and Collateral Agreement with respect to such new Subsidiary,
including the filing of Uniform Commercial Code financing statements in such
jurisdictions as may be required by the Guarantee and Collateral Agreement or by
law or as may be requested by the Administrative Agent.
. Organizational Separateness. In the case of Holdings, each Specified
Holdings Subsidiary, each Non-Recourse Subsidiary and the Borrower and its
Subsidiaries, (a) satisfy customary formalities with respect to organizational
separateness, including, without limitation, (i) the maintenance of separate
books and records and (ii) the maintenance of separate bank or other deposit or
investment accounts in its own name; (b) act solely in its own name and through
its authorized officers and agents; (c) in the case of the Borrower or any of
its Subsidiaries, not make or agree to make any payment to a creditor of
Holdings, any Specified Holdings Subsidiary or any Non-Recourse Subsidiary; (d)
not commingle any money or other assets of Holdings, any Specified Holdings
Subsidiary or any Non-Recourse Subsidiary with any money or other assets
<PAGE> 46
of the Borrower or any of its Subsidiaries; and (e) not take any action, or
conduct its affairs in a manner, which could reasonably be expected to result in
the separate organizational existence of Holdings, each Specified Holdings
Subsidiary and each Non-Recourse Subsidiary from the Borrower and its
Subsidiaries being ignored under any circumstance. Holdings agrees to cause each
Specified Holdings Subsidiary, and the Borrower agrees to cause each
Non-Recourse Subsidiary, to comply with the applicable provisions of this
Section 6.11.
. ERISA Reports. Furnish to the Administrative Agent as soon as available
the following items with respect to any Plan:
(a) any request for a waiver of the funding standards or an extension of
the amortization period;
(b) any reportable event (as defined in Section 4043 of ERISA), unless the
notice requirement with respect thereto has been waived by regulation;
(c) any notice received by any Commonly Controlled Entity that the PBGC has
instituted or intends to institute proceedings to terminate any Plan, or that
any Multiemployer Plan is insolvent or in reorganization;
(d) notice of the possibility of the termination of any Plan by its
administrator pursuant to Section 4041 of ERISA; and
(e) notice of the intention of any Commonly Controlled Entity to withdraw,
in whole or in part, from any Multiemployer Plan.
. ERISA, etc. Comply in all material respects with the provisions of ERISA
and the Code applicable to each Plan. Each of Holdings, the Borrower and its
Subsidiaries will meet all minimum funding requirements applicable to them with
respect to any Plan pursuant to Section 302 of ERISA or Section 412 of the Code,
without giving effect to any waivers of such requirements or extensions of the
related amortization periods which may be granted. At no time shall the
Accumulated Benefit Obligations under any Plan that is not a Multiemployer Plan
exceed the fair market value of the assets of such Plan allocable to such
benefits by more than $10,000,000. After the Closing Date, Holdings, the
Borrower and its Subsidiaries will not withdraw, in whole or in part, from any
Multiemployer Plan so as to give rise to withdrawal liability exceeding
$10,000,000 in the aggregate. At no time shall the actuarial present value of
unfunded liabilities for post-employment health care benefits, whether or not
provided under a Plan, calculated in a manner consistent with Statement No. 106
of the Financial Accounting Standards Board, exceed $10,000,000.
SECTION . NEGATIVE COVENANTS
Holdings and the Borrower hereby agree that, so long as the Commitments
remain in effect, any Letter of Credit remains outstanding or any Loan or other
amount is owing to any Lender or any Agent hereunder, each of Holdings and the
Borrower shall not, and shall not permit any Subsidiary of the Borrower to,
directly or indirectly (provided that only Sections 7.2, 7.3, 7.4, 7.10, 7.12,
7.14(b) and 7.15 shall apply to Holdings):
. Financial Condition Covenants.
() Consolidated Leverage Ratio. Permit the Consolidated Leverage Ratio
determined as of the last day of any fiscal quarter of the Borrower ending
during any period set forth below to exceed the ratio set forth below opposite
such period:
<PAGE> 47
<TABLE>
<CAPTION>
Period Consolidated Leverage Ratio
------ ---------------------------
<S> <C>
01/01/00 - 06/30/01 6.95 to 1.0
07/01/01 - 06/30/02 6.75 to 1.0
07/01/02 - 06/30/03 6.25 to 1.0
07/01/03 - 06/30/04 5.50 to 1.0
07/01/04 - 06/30/05 4.50 to 1.0
07/01/05 and thereafter 4.00 to 1.0
</TABLE>
() Consolidated Interest Coverage Ratio. Permit the Consolidated Interest
Coverage Ratio determined as of the last day of any fiscal quarter ending during
any period set forth below to be less than the ratio set forth below opposite
such period:
<TABLE>
<CAPTION>
Period Consolidated Interest Coverage Ratio
------ ------------------------------------
<S> <C>
01/01/00 - 06/30/01 1.50 to 1.0
07/01/01 - 06/30/03 1.75 to 1.0
07/01/03 and thereafter 2.00 to 1.0
</TABLE>
() Consolidated Debt Service Coverage Ratio. Permit the Consolidated Debt
Service Coverage Ratio determined as of the last day of any fiscal quarter
ending after January 1, 2000 to be less than 1.25 to 1.0.
For the purposes of paragraphs (b) and (c) above, in calculating the relevant
ratios for any period that is not comprised of four fiscal quarters commencing
after the Closing Date, Consolidated Interest Expense for the relevant period
shall be deemed to equal Consolidated Interest Expense for the number of fiscal
quarters commencing after the Closing Date that fall within such period
multiplied by the appropriate factor necessary to annualize such amount.
. Indebtedness. Create, issue, incur, assume, become liable in respect of
or suffer to exist any Indebtedness, except:
() Indebtedness of any Loan Party pursuant to any Loan Document;
() Indebtedness of the Borrower to any Subsidiary and of any Wholly Owned
Subsidiary Guarantor to the Borrower or any other Subsidiary;
() Guarantee Obligations incurred in the ordinary course of business by the
Borrower or any of its Subsidiaries of obligations of any Wholly Owned
Subsidiary Guarantor;
() Indebtedness described on Schedule 7.2(d);
() Indebtedness (including, without limitation, Capital Lease Obligations)
secured by Liens permitted by Section 7.3(f) in an aggregate principal amount
not to exceed $10,000,000 at any one time outstanding;
() Indebtedness of the Borrower (but not any Subsidiary of the Borrower)
incurred on any Threshold Transaction Date so long as (i) no Default or Event of
Default shall have occurred and be continuing or would result therefrom, (ii)
such Indebtedness shall have no scheduled amortization prior to the date that is
one year after the final maturity of the Term Loans outstanding on the date such
Indebtedness is incurred and (iii) the covenants and default provisions
applicable to such Indebtedness shall be no more restrictive than those
contained in this Agreement, provided that the requirement that such
Indebtedness be incurred on a Threshold Transaction Date shall not apply in the
case of any refinancing of Indebtedness previously incurred pursuant to this
Section 7.2(f) so long as the interest rate and cash-pay characteristics
<PAGE> 48
applicable to such refinancing Indebtedness are no more onerous than those
applicable to such refinanced Indebtedness;
() Indebtedness of any Person that becomes a Subsidiary pursuant to an
Investment permitted by Section 7.7, so long as (i) no Default or Event of
Default shall have occurred and be continuing or would result therefrom, (ii)
such Indebtedness existed at the time of such Investment and was not created in
anticipation thereof, (iii) the Borrower shall use its best efforts to cause
such Indebtedness to be repaid no later than 120 days after the date of such
Investment, (iv) if such Indebtedness is not repaid within such period then,
until such Indebtedness is repaid, the operating cash flow of the relevant
Subsidiary shall be excluded for the purposes of calculating Consolidated
Operating Cash Flow (whether or not distributed to the Borrower or any of its
other Subsidiaries) and (v) the aggregate outstanding principal amount of
Indebtedness incurred pursuant to this paragraph shall not exceed $100,000,000;
() letters of credit for the account of the Borrower or any of its
Subsidiaries obtained other than pursuant to this Agreement, so long as the
aggregate undrawn face amount thereof, together with any unreimbursed
reimbursement obligations in respect thereof, does not exceed $5,000,000 at any
one time;
() Indebtedness of Holdings (but not the Borrower or any of its
Subsidiaries) so long as (i) such Indebtedness shall have no scheduled
amortization prior to the date that is one year after the final maturity of the
Term Loans outstanding on the date such Indebtedness is incurred and (ii) 100%
of the Net Cash Proceeds thereof (other than any such Net Cash Proceeds that are
applied to refinance other Indebtedness of Holdings) shall be used by Holdings
to make Investments in one or more of its Affiliates engaged substantially
exclusively in businesses of the type described in Section 7.14(a); and
() additional Indebtedness of the Borrower or any of its Subsidiaries in an
aggregate principal amount (for the Borrower and all Subsidiaries) not to exceed
$25,000,000 at any one time outstanding.
. Liens. Create, incur, assume or suffer to exist any Lien upon any of its
property, whether now owned or hereafter acquired, except:
() Liens for taxes, assessments and other governmental charges not yet due
or that are being contested in good faith by appropriate proceedings, provided
that adequate reserves with respect thereto are maintained on the books of
Holdings, the Borrower or its Subsidiaries, as the case may be, in conformity
with GAAP;
() carriers', warehousemen's, mechanics', materialmen's, repairmen's or
other like Liens arising in the ordinary course of business that are not overdue
for a period of more than 30 days or that are being contested in good faith by
appropriate proceedings;
() pledges or deposits in connection with workers' compensation,
unemployment insurance and other social security legislation;
() deposits made to secure the performance of bids, tenders, trade
contracts, leases, statutory or regulatory obligations, surety and appeal bonds,
bankers acceptances, government contracts, performance bonds and other
obligations of a like nature incurred in the ordinary course of business, in
each case excluding obligations for borrowed money;
() easements, rights-of-way, municipal and zoning ordinances, title
defects, restrictions and other similar encumbrances incurred in the ordinary
course of business that, in the aggregate, are not substantial in amount and
that do not in any case materially detract from the value of the
<PAGE> 49
property subject thereto or materially interfere with the ordinary conduct of
the business of Holdings, the Borrower or any of its Subsidiaries;
() Liens securing Indebtedness of Holdings, the Borrower or any of its
Subsidiaries incurred pursuant to Section 7.2(e) to finance the acquisition of
fixed or capital assets, provided that (i) such Liens shall be created
substantially simultaneously with the acquisition of such fixed or capital
assets, (ii) such Liens do not at any time encumber any property other than the
property financed by such Indebtedness and (iii) the amount of Indebtedness
secured thereby is not increased;
() Liens created pursuant to the Guarantee and Collateral Agreement
securing obligations of the Loan Parties under (i) the Loan Documents, (ii)
Hedge Agreements provided by any Lender or any Affiliate of any Lender and (iii)
letters of credit issued pursuant to Section 7.2(h) by any Lender or any
Affiliate of any Lender;
() any landlord's Lien or other interest or title of a lessor under any
lease or a licensor under a license entered into by Holdings, the Borrower or
any of its Subsidiaries in the ordinary course of its business and covering only
the assets so leased or licensed;
() Liens created under Pole Agreements on cables and other property affixed
to transmission poles or contained in underground conduits;
() Liens of or restrictions on the transfer of assets imposed by any
franchisors, utilities or other regulatory bodies or any federal, state or local
statute, regulation or ordinance, in each case arising in the ordinary course of
business in connection with franchise agreements or Pole Agreements;
() Liens arising from judgments or decrees not constituting an Event of
Default under Section 8(h); and
() Liens not otherwise permitted by this Section so long as neither (i) the
aggregate outstanding principal amount of the obligations secured thereby nor
(ii) the aggregate fair market value (determined as of the date such Lien is
incurred) of the assets subject thereto exceeds (as to Holdings, the Borrower
and all Subsidiaries), when added to the aggregate outstanding amount of
Attributable Debt, $10,000,000 at any one time.
. Fundamental Changes. Enter into any merger, consolidation or
amalgamation, or liquidate, wind up or dissolve itself (or suffer any
liquidation or dissolution), or Dispose of all or substantially all of its
property or business, except that:
() any Subsidiary of the Borrower may be merged or consolidated with or
into any Wholly Owned Subsidiary Guarantor (provided that the Wholly Owned
Subsidiary Guarantor shall be the continuing or surviving entity);
() any Subsidiary of the Borrower that is a holding company with no
operations may be merged or consolidated with or into the Borrower (provided
that the Borrower shall be the continuing or surviving entity);
() any Subsidiary of the Borrower may Dispose of any or all of its assets
(upon voluntary liquidation or otherwise) to any Wholly Owned Subsidiary
Guarantor;
() any Shell Subsidiary may be dissolved; and
<PAGE> 50
() so long as no Default or Event of Default has occurred or is continuing
or would result therefrom, (i) Holdings may be merged or consolidated with any
Affiliate of Paul G. Allen (provided that either (x) Holdings is the continuing
or surviving entity or (y) if Holdings is not the continuing or surviving
entity, such continuing or surviving entity assumes the obligations of Holdings
under the Loan Documents to which it is a party pursuant to an instrument in
form and substance reasonably satisfactory to the Administrative Agent and, in
connection therewith, the Administrative Agent shall receive such legal
opinions, certificates and other documents as it may reasonably request) and
(ii) Holdings may transfer all of the Equity Interests of the Borrower to a
Subsidiary of Holdings created for the purpose of holding such Equity Interests
(provided that such Subsidiary assumes the obligations of Holdings under the
Loan Documents to which it is a party pursuant to an instrument in form and
substance reasonably satisfactory to the Administrative Agent and, in connection
therewith, the Administrative Agent shall receive such legal opinions,
certificates and other documents as it may reasonably request).
. Disposition of Property. Dispose of any of its property, whether now
owned or hereafter acquired, or, in the case of any Subsidiary, issue or sell
any Equity Interests to any Person, except:
() the Disposition of obsolete or worn out property in the ordinary course
of business;
() the sale of inventory in the ordinary course of business;
() Dispositions expressly permitted by Section 7.4;
() the sale or issuance of any Subsidiary's Equity Interests to the
Borrower or any Wholly Owned Subsidiary Guarantor;
() the Disposition (directly or indirectly through the Disposition of 100%
of the Equity Interests of a Subsidiary) of operating assets by the Borrower or
any of its Subsidiaries (it being understood that Exchange Excess Amounts shall
be deemed to constitute usage of availability in respect of Dispositions
pursuant to this Section 7.5(e)), provided that (i) on the date of such
Disposition (the "Disposition Date"), no Default or Event of Default shall have
occurred and be continuing or would result therefrom; (ii) the Annualized Asset
Cash Flow Amount attributable to the assets being disposed of, when added to the
Annualized Asset Cash Flow Amount attributable to all other assets previously
disposed of pursuant to this Section 7.5(e) during the one-year period ending on
such Disposition Date (or, if shorter, the period from the Closing Date to such
Disposition Date), shall not exceed an amount equal to 30% of Annualized Pro
Forma Operating Cash Flow determined as of such Disposition Date; (iii) the
Annualized Asset Cash Flow Amount attributable to the assets being disposed of,
when added to the Annualized Asset Cash Flow Amount attributable to all other
assets previously disposed of pursuant to this Section 7.5(e) during the period
from the Closing Date to such Disposition Date), shall not exceed an amount
equal to 50% of Annualized Pro Forma Operating Cash Flow determined as of such
Disposition Date; (iv) at least 75% of the proceeds of such Disposition shall be
in the form of cash; and (v) the Net Cash Proceeds of such Disposition shall be
applied to prepay the Term Loans to the extent required by Section 2.9(a);
() any Exchange by the Borrower and its Subsidiaries, provided that (i) on
the date of such Exchange, no Default or Event of Default shall have occurred
and be continuing or would result therefrom; (ii) the assets received in
connection with such Exchange shall be received by a Wholly Owned Subsidiary of
the Borrower (or, in the case of any Equity Interests so received, by the
Borrower); (iii) in the event that (x) any cash consideration is paid to the
Borrower or any of its Subsidiaries in connection with such Exchange and (y) the
Annualized Asset Cash Flow Amount attributable to the assets being Exchanged
exceeds the annualized asset cash flow amount (determined in a manner comparable
to the manner in which Annualized Asset Cash
<PAGE> 51
Flow Amounts are determined hereunder) of the assets received in connection with
such Exchange (such excess amount, an "Exchange Excess Amount"), then, the
Disposition of such Exchange Excess Amount is permitted by clauses (ii) and
(iii) of Section 7.5(e); and (iv) the Net Cash Proceeds of such Exchange, if
any, shall be applied to prepay the Term Loans to the extent required by Section
2.9(a);
() Dispositions of property acquired after the Closing Date, (other than
property acquired in connection with Exchanges of property owned on the Closing
Date), so long as (i) no Default or Event of Default shall have occurred and be
continuing or would result therefrom, (ii) a definitive agreement to consummate
such Disposition is executed no later than twelve months after the date on which
relevant property is acquired and (iii) such Disposition is consummated within
eighteen months after the date on which the relevant property is acquired; and
() the Disposition of other property having a fair market value not to
exceed $5,000,000 in the aggregate for any fiscal year of the Borrower.
. Restricted Payments. Declare or pay any dividend (other than dividends
payable solely in common stock of the Person making such dividend) on, or make
any payment on account of, or set apart assets for a sinking or other analogous
fund for, the purchase, redemption, defeasance, retirement or other acquisition
of, any Equity Interests of Holdings, the Borrower or any Subsidiary, whether
now or hereafter outstanding, or make any other distribution in respect thereof,
either directly or indirectly, whether in cash or property or in obligations of
Holdings, the Borrower or any Subsidiary (collectively, "Restricted Payments"),
except that:
() any Subsidiary may make Restricted Payments to the Borrower or any
Wholly Owned Subsidiary Guarantor;
() the Borrower may make distributions (directly or indirectly) to any
Qualified Parent Company or any Affiliate of the Borrower for the purpose of
enabling such Person to make scheduled interest payments in respect of its
Qualified Indebtedness, provided that (i) no Default or Event of Default shall
have occurred and be continuing or would result therefrom, (ii) each such
distribution shall be made on a Threshold Transaction Date (except in the case
of any distribution made for the purpose of paying interest on (x) Qualified
Indebtedness as to which 100% of the Net Cash Proceeds thereof were contributed
to the Borrower as a capital contribution or (y) Qualified Indebtedness incurred
to refinance such Qualified Indebtedness) and (iii) each such distribution shall
be made no earlier than three Business Days prior to the date the relevant
interest payment is due;
() so long as no Default or Event of Default has occurred and is continuing
or would result therefrom, (i) the Borrower may make distributions to Holdings
or direct payments to be used to repurchase, redeem or otherwise acquire or
retire for value any Equity Interests of any Qualified Parent Company held by
any member of management of Holdings, the Borrower or any of its Subsidiaries
pursuant to any management equity subscription agreement or stock option
agreement in effect as of the Closing Date, provided that the aggregate amount
of such distributions shall not exceed $5,000,000 in any fiscal year of the
Borrower and (ii) the Borrower may make distributions to Holdings as described
in the last sentence of Section 7.9;
() so long as no Default or Event of Default has occurred and is continuing
or would result therefrom, the Borrower may make distributions to Holdings for
any purpose, provided that, after giving effect to any such distribution, the
Consolidated Leverage Ratio shall be less than 4.00 to 1.0;
() the Borrower may make distributions to Holdings to permit Holdings (or
any parent company thereof) to pay (i) attorneys' fees, investment banking fees,
accountants' fees,
<PAGE> 52
underwriting discounts and commissions and other customary fees and expenses
actually incurred in connection with any issuance, sale or incurrence by
Holdings (or any such parent company) of Equity Interests or Indebtedness (other
than any such amounts customarily paid out of the proceeds of transactions of
such type), provided, that such amounts shall be allocated in an appropriate
manner (determined after consultation with the Administrative Agent) among the
Borrower and the other Subsidiaries, if any, of the issuer or obligor in respect
of such Equity Interests or Indebtedness and (ii) other administrative expenses
(including legal, accounting, other professional fees and costs, printing and
other such fees and expenses) incurred in the ordinary course of business, in an
aggregate amount in the case of this clause (ii) not to exceed $2,000,000 in any
fiscal year; and
() in respect of any calendar year or portion thereof during which the
Borrower is a Flow-Through Entity, so long as no Default or Event of Default has
occurred and is continuing or would result therefrom, the Borrower may make
distributions (directly or indirectly) to the direct or indirect holders of the
Equity Interests of the Borrower that are not Flow-Through Entities, in
proportion to their ownership interests, sufficient to permit each such holder
to pay income taxes that are required to be paid by it with respect to its
Equity Interests in the Borrower for the prior calendar year, as estimated by
the Borrower in good faith.
. Investments. Make any advance, loan, extension of credit (by way of
guaranty or otherwise) or capital contribution to, or purchase any Equity
Interests, bonds, notes, debentures or other debt securities of, or any assets
constituting a significant part of a business unit of, or make any other
investment in, any Person (all of the foregoing, "Investments"), except:
() extensions of trade credit in the ordinary course of business;
() investments in Cash Equivalents;
() Guarantee Obligations permitted by Section 7.2;
() loans and advances to employees of the Borrower or any of its
Subsidiaries in the ordinary course of business (including for travel,
entertainment and relocation expenses) in an aggregate amount not to exceed
$2,000,000 at any one time outstanding;
() Investments by the Borrower or any of its Subsidiaries in the Borrower
or any Person that, prior to such investment, is a Wholly Owned Subsidiary
Guarantor;
() acquisitions by the Borrower or any Wholly Owned Subsidiary Guarantor of
operating assets (substantially all of which consist of cable systems), directly
through an asset acquisition or indirectly through the acquisition of 100% of
the Equity Interests of a Person substantially all of whose assets consist of
cable systems, provided, that (i) no Default or Event of Default shall have
occurred and be continuing or would result therefrom and (ii) the aggregate
Consideration (excluding Consideration paid with the proceeds of Paul Allen
Contributions and Consideration consisting of operating assets transferred in
connection with Exchanges) paid in connection with such acquisitions, other than
acquisitions consummated on a Threshold Transaction Date, shall not exceed
$150,000,000 during the term of this Agreement;
() the Borrower or any of its Subsidiaries may contribute cable systems to
any Non-Recourse Subsidiary so long as (i) such Disposition is permitted
pursuant to Section 7.5(e), (ii) no Default or Event of Default shall have
occurred and be continuing or would result therefrom, (iii) after giving effect
thereto, the Consolidated Leverage Ratio shall be equal to or lower than the
Consolidated Leverage Ratio in effect immediately prior thereto and (iv) the
Equity Interests received by the Borrower or any of its Subsidiaries in
connection therewith shall be pledged as
<PAGE> 53
Collateral (either directly or through a holding company parent of such
Non-Recourse Subsidiary so long as such parent is a Wholly Owned Subsidiary
Guarantor); and
() in addition to Investments otherwise expressly permitted by this
Section, Investments by the Borrower or any of its Subsidiaries in an aggregate
amount (valued at cost) not to exceed $50,000,000 during the term of this
Agreement.
. Certain Payments and Modifications Relating to Indebtedness and
Management Fees. () Make or offer to make any payment, prepayment, repurchase or
redemption in respect of, or otherwise optionally or voluntarily defease or
segregate funds with respect to (collectively, "prepayment"), any Specified
Long-Term Indebtedness, other than (i) the payment of scheduled interest
payments required to be made in cash, (ii) the prepayment of Specified
Subordinated Debt with the proceeds of other Specified Long-Term Indebtedness or
of Loans and (iii) the prepayment of any such Indebtedness with the proceeds of
other Specified Long-Term Indebtedness so long as such new Indebtedness has
terms no less favorable to the interests of the Borrower and the Lenders than
those applicable to the Indebtedness being refinanced.
() Amend, modify, waive or otherwise change, or consent or agree to any
amendment, modification, waiver or other change to, any of the terms of the any
Specified Long-Term Indebtedness, other than any such amendment, modification,
waiver or other change that (i) (x) would extend the maturity or reduce the
amount of any payment of principal thereof or reduce the rate or extend any date
for payment of interest thereon or (y) is immaterial to the interests of the
Lenders and (ii) does not involve the payment of a consent fee.
() Make, agree to make or expense any payment in respect of management
fees, directly or indirectly, except that the Borrower may pay management fees
pursuant to the Management Fee Agreement so long as (i) no Default or Event of
Default shall have occurred and be continuing or would result therefrom, (ii)
the aggregate amount of such payments expensed during any fiscal year of the
Borrower shall not exceed 3.50% of consolidated revenues of the Borrower and its
consolidated Subsidiaries for such fiscal year (provided that, in addition,
payments of management fees may be made in respect of amounts that have been
accrued, but were not paid, during any preceding fiscal year of the Borrower
ending on or after December 31, 2000, so long as the aggregate amount of
payments made pursuant to this parenthetical during any fiscal year of the
Borrower (other than any such payments made on a Threshold Management Fee Date),
when added to the aggregate amount of non-deferred management fees otherwise
paid pursuant to this clause (ii) during such fiscal year, shall not exceed 5.0%
of consolidated revenues of the Borrower and its consolidated Subsidiaries for
such fiscal year) and (iii) each such payment shall be made no earlier than
three Business Days prior to the date such payment is due.
() Amend, modify, waive or otherwise change, or consent or agree to any
amendment, modification, waiver or other change to, any of the terms of the
Management Fee Agreement, other than any such amendment, modification, waiver or
other change that (i) (x) would extend the due date or reduce the amount of any
payment thereunder or (y) does not adversely affect the interests of the Lenders
and (ii) does not involve the payment of a consent fee.
. Transactions with Affiliates. Enter into any transaction, including any
purchase, sale, lease or exchange of property, the rendering of any service or
the payment of any management, advisory or similar fees, with any Affiliate
(other than the Borrower or any Wholly Owned Subsidiary Guarantor) unless such
transaction is (a) not prohibited under this Agreement, (b) in the ordinary
course of business of the Borrower or such Subsidiary, as the case may be, and
(c) upon fair and reasonable terms no less favorable to the Borrower or such
Subsidiary, as the case may be, than it would obtain in a comparable arm's
length transaction with a Person that is not an Affiliate. The foregoing
restrictions shall not apply to transactions expressly permitted by Section 7.6
or Section 7.8(c). Notwithstanding anything to the contrary in this Section 7.9,
so
<PAGE> 54
long as no Default or Event of Default shall have occurred and be continuing,
the Borrower shall be permitted to pay (either directly or by way of a
distribution to Holdings) amounts not in excess of 1.0% of the aggregate
enterprise value of Investments permitted hereby to certain Affiliates of the
Borrower.
. Sales and Leasebacks. Enter into any arrangement with any Person (other
than Subsidiaries of the Borrower) providing for the leasing by Holdings, the
Borrower or any Subsidiary of real or personal property that has been or is to
be sold or transferred by Holdings, the Borrower or such Subsidiary to such
Person or to any other Person to whom funds have been or are to be advanced by
such Person on the security of such property or rental obligations of Holdings,
the Borrower or such Subsidiary unless, after giving effect thereto, the
aggregate outstanding amount of Attributable Debt, when added to the aggregate
amount utilized pursuant to Section 7.3(l), does not exceed $10,000,000.
. Changes in Fiscal Periods. Permit the fiscal year of the Borrower to end
on a day other than December 31 or change the Borrower's method of determining
fiscal quarters.
. Negative Pledge Clauses. Enter into or suffer to exist or become
effective any agreement that prohibits or limits the ability of Holdings, the
Borrower or any of its Subsidiaries to create, incur, assume or suffer to exist
any Lien upon any of its property or revenues, whether now owned or hereafter
acquired, to secure its obligations under the Loan Documents to which it is a
party (without regard to the amount of such obligations), other than (a) this
Agreement and the other Loan Documents, (b) any agreements governing any
purchase money Liens or Capital Lease Obligations otherwise permitted hereby (in
which case, any prohibition or limitation shall only be effective against the
assets financed thereby) and (c) pursuant to Contractual Obligations assumed in
connection with Investments (but not created in contemplation thereof) so long
as the maximum aggregate liabilities of Holdings and its Subsidiaries pursuant
thereto do not exceed $2,000,000 at any time.
. Clauses Restricting Subsidiary Distributions. Enter into or suffer to
exist or become effective any consensual encumbrance or restriction on the
ability of any Subsidiary of the Borrower to (a) make Restricted Payments in
respect of any Equity Interests of such Subsidiary held by, or pay any
Indebtedness owed to, the Borrower or any other Subsidiary of the Borrower, (b)
make loans or advances to, or other Investments in, the Borrower or any other
Subsidiary of the Borrower or (c) transfer any of its assets to the Borrower or
any other Subsidiary of the Borrower, except for such encumbrances or
restrictions existing under or by reason of (i) any restrictions existing under
the Loan Documents and (ii) any restrictions with respect to a Subsidiary
imposed pursuant to an agreement that has been entered into in connection with
the Disposition of all or substantially all of the Equity Interests or assets of
such Subsidiary in a transaction otherwise permitted by this Agreement.
. Lines of Business; Holding Company Status. (a) Enter into any business,
either directly or through any Subsidiary, except for (i) those businesses in
which the Borrower and its Subsidiaries are significantly engaged on the date of
this Agreement and (ii) businesses which are reasonably similar or related
thereto or reasonable extensions thereof but not, in the case of this clause
(ii), in the aggregate, material to the overall business of the Borrower and its
Subsidiaries (collectively, "Permitted Lines of Business"), provided, that, in
any event, the Borrower and its Subsidiaries will continue to be primarily
engaged in the businesses in which they are primarily engaged on the date of
this Agreement.
(b) In the case of Holdings and the Borrower, (i) conduct, transact or
otherwise engage in, or commit to conduct, transact or otherwise engage in, any
business or operations other than those incidental to its ownership of the
Equity Interests in other Persons or (ii) own, lease, manage or otherwise
operate any properties or assets other than Equity Interests in other Persons.
<PAGE> 55
. Investments by Holdings in the Borrower. In the case of Holdings, make
any Investment in the Borrower other than in the form of a capital contribution,
unless such Investment is evidenced by a note and pledged to the Administrative
Agent pursuant to the Guarantee and Collateral Agreement.
SECTION . EVENTS OF DEFAULT
If any of the following events shall occur and be continuing:
() the Borrower shall fail to pay any principal of any Loan or
Reimbursement Obligation when due in accordance with the terms hereof; or the
Borrower shall fail to pay any interest on any Loan or Reimbursement Obligation,
or any other amount payable hereunder or under any other Loan Document, within
five days after any such interest or other amount becomes due in accordance with
the terms hereof; or
() any representation or warranty made or deemed made by any Loan Party
herein or in any other Loan Document or that is contained in any certificate,
document or financial or other statement furnished by it at any time under or in
connection with this Agreement or any such other Loan Document shall prove to
have been inaccurate in any material respect on or as of the date made or deemed
made; or
() any Loan Party shall default in the observance or performance of any
agreement contained in clause (i) or (ii) of Section 6.4(a) (with respect to
Holdings and the Borrower only), Section 6.7(a) or Section 7 of this Agreement
or Sections 6.4 and 6.6(b) of the Guarantee and Collateral Agreement; or
() any Loan Party shall default in the observance or performance of any
other agreement contained in this Agreement or any other Loan Document (other
than as provided in paragraphs (a) through (c) of this Section), and such
default shall continue unremedied for a period of 30 days after notice to the
Borrower from the Administrative Agent or the Required Lenders; or
() Holdings, the Borrower or any of its Subsidiaries shall (i) default in
making any payment of any principal of any Indebtedness (including any Guarantee
Obligation, but excluding the Loans) on the scheduled or original due date with
respect thereto; or (ii) default in making any payment of any interest on any
such Indebtedness beyond the period of grace, if any, provided in the instrument
or agreement under which such Indebtedness was created; or (iii) default in the
observance or performance of any other agreement or condition relating to any
such Indebtedness or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event shall occur or condition exist,
the effect of which default or other event or condition is to cause, or to
permit the holder or beneficiary of such Indebtedness (or a trustee or agent on
behalf of such holder or beneficiary) to cause, with the giving of notice if
required, such Indebtedness to become due prior to its stated maturity or (in
the case of any such Indebtedness constituting a Guarantee Obligation) to become
payable; provided, that a default, event or condition described in clause (i),
(ii) or (iii) of this paragraph (e) shall not at any time constitute an Event of
Default unless, at such time, one or more defaults, events or conditions of the
type described in clauses (i), (ii) and (iii) of this paragraph (e) shall have
occurred and be continuing with respect to Indebtedness of Holdings, the
Borrower and its Subsidiaries the outstanding principal amount of which exceeds
in the aggregate $25,000,000; or
() (i) Holdings, the Borrower or any of its Subsidiaries shall commence any
case, proceeding or other action (A) under any existing or future law of any
jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for relief entered
with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or
<PAGE> 56
seeking reorganization, arrangement, adjustment, winding-up, liquidation,
dissolution, composition or other relief with respect to it or its debts, or (B)
seeking appointment of a receiver, trustee, custodian, conservator or other
similar official for it or for all or any substantial part of its assets, or
Holdings, the Borrower or any of its Subsidiaries shall make a general
assignment for the benefit of its creditors; or (ii) there shall be commenced
against Holdings, the Borrower or any of its Subsidiaries any case, proceeding
or other action of a nature referred to in clause (i) above that (A) results in
the entry of an order for relief or any such adjudication or appointment or (B)
remains undismissed, undischarged or unbonded for a period of 60 days; or (iii)
there shall be commenced against Holdings, the Borrower or any of its
Subsidiaries any case, proceeding or other action seeking issuance of a warrant
of attachment, execution, distraint or similar process against all or any
substantial part of its assets that results in the entry of an order for any
such relief that shall not have been vacated, discharged, or stayed or bonded
pending appeal within 60 days from the entry thereof; or (iv) Holdings, the
Borrower or any of its Subsidiaries shall take any action in furtherance of, or
indicating its consent to, approval of, or acquiescence in, any of the acts set
forth in clause (i), (ii), or (iii) above; or (v) Holdings, the Borrower or any
of its Subsidiaries shall generally not, or shall be unable to, or shall admit
in writing its inability to, pay its debts as they become due; or
() (i) Commonly Controlled Entities shall fail to pay when due amounts
(other than amounts being contested in good faith through appropriate
proceedings) for which they shall have become liable under Title IV of ERISA to
pay to the PBGC or to a Plan, (ii) the PBGC shall institute proceedings under
Title IV of ERISA to terminate or to cause a trustee to be appointed to
administer any Plan or a proceeding shall be instituted by a fiduciary of any
Plan against any Commonly Controlled Entity to enforce Sections 515 or
4219(c)(5) of ERISA and such proceeding shall not have been dismissed within 30
days thereafter, or (iii) a condition shall exist which would require the PBGC
to obtain a decree adjudicating that any Plan must be terminated; and in each
case in clauses (i) through (iii) above, such event or condition, together with
all other such events or conditions, if any, could, in the sole judgment of the
Required Lenders, reasonably be expected to result in a Material Adverse Effect;
or
() one or more judgments or decrees shall be entered against Holdings, the
Borrower or any of its Subsidiaries involving in the aggregate for all such
Persons a liability (to the extent not paid or fully covered by insurance as to
which the relevant insurance company has acknowledged coverage) of $25,000,000
or more, and all such judgments or decrees shall not have been vacated,
discharged, stayed or bonded pending appeal within 30 days from the entry
thereof; or
() the Guarantee and Collateral Agreement shall cease, for any reason
(other than the gross negligence or willful misconduct of the Administrative
Agent), to be in full force and effect, or any Loan Party or any Affiliate of
any Loan Party shall so assert, or any Lien created by the Guarantee and
Collateral Agreement shall cease to be enforceable and of the same effect and
priority purported to be created thereby; or
() (i) the Paul Allen Group shall cease to have the power, directly or
indirectly, to vote or direct the voting of Equity Interests having at least 51%
(determined on a fully diluted basis) of the ordinary voting power for the
management of the Borrower; (ii) the Paul Allen Group shall cease to own of
record and beneficially, directly or indirectly, Equity Interests of the
Borrower representing at least 51% (determined on a fully diluted basis) of the
economic interests therein (provided that such percentage shall be reduced to
25% after the consummation of an Initial Public Offering); (iii) a Specified
Change of Control shall occur; (iv) Charter Communications Holding Company, LLC
shall cease to own of record and beneficially, directly or indirectly, Equity
Interests of the Borrower representing at least 51% (determined on a fully
diluted basis) of the economic interests therein; or (v) the Borrower shall
cease to be a direct Wholly Owned Subsidiary of Holdings; or
<PAGE> 57
() the Borrower or any of its Subsidiaries shall have received a notice of
termination or suspension with respect to any of its CATV Franchises or CATV
Systems from the FCC or any Governmental Authority or other franchising
authority or the Borrower or any of its Subsidiaries or the grantors of any CATV
Franchises or CATV Systems shall fail to renew such CATV Franchises or CATV
Systems at the stated expiration thereof if the percentage represented by such
CATV Franchises or CATV Systems and any other CATV Franchises or CATV Systems
which are then so terminated, suspended or not renewed of Consolidated Operating
Cash Flow for the 12-month period preceding the date of the termination,
suspension or failure to renew, as the case may be, (giving pro forma effect to
any acquisitions or Dispositions that have occurred since the beginning of such
12-month period as if such acquisitions or Dispositions had occurred at the
beginning of such 12-month period), would exceed 10%, unless (i) an alternative
CATV Franchise or CATV System in form and substance reasonably satisfactory to
the Required Lenders shall have been procured and come into effect prior to or
concurrently with the termination or expiration date of such terminated,
suspended or non-renewed CATV Franchise or CATV System or (ii) the Borrower or
such Subsidiary continues to operate and retain the revenues received from such
systems after the stated termination or expiration and is engaged in
negotiations to renew or extend such franchise rights and obtains such renewal
or extension within one year following the stated termination or expiration,
provided that such negotiations have not been terminated by either party
thereto, such franchise rights or the equivalent thereof have not been awarded
on an exclusive basis to a third Person and no final determination (within the
meaning of Section 635 of the Communications Act of 1934, as amended) has been
made that the Borrower or such Subsidiary is not entitled to the renewal or
extension thereof;
then, and in any such event, (A) if such event is an Event of Default specified
in clause (i) or (ii) of paragraph (f) above with respect to the Borrower,
automatically the Commitments shall immediately terminate and the Loans
hereunder (with accrued interest thereon) and all other amounts owing under this
Agreement and the other Loan Documents (including all amounts of L/C
Obligations, whether or not the beneficiaries of the then outstanding Letters of
Credit shall have presented the documents required thereunder) shall immediately
become due and payable, and (B) if such event is any other Event of Default,
either or both of the following actions may be taken: (i) with the consent of
the Required Lenders, the Administrative Agent may, or upon the request of the
Required Lenders, the Administrative Agent shall, by notice to the Borrower
declare the Revolving Commitments to be terminated forthwith, whereupon the
Revolving Commitments shall immediately terminate; and (ii) with the consent of
the Required Lenders, the Administrative Agent may, or upon the request of the
Required Lenders, the Administrative Agent shall, by notice to the Borrower,
declare the Loans hereunder (with accrued interest thereon) and all other
amounts owing under this Agreement and the other Loan Documents (including all
amounts of L/C Obligations, whether or not the beneficiaries of the then
outstanding Letters of Credit shall have presented the documents required
thereunder) to be due and payable forthwith, whereupon the same shall
immediately become due and payable. With respect to all Letters of Credit with
respect to which presentment for honor shall not have occurred at the time of an
acceleration pursuant to this paragraph, the Borrower shall at such time deposit
in a cash collateral account opened by the Administrative Agent an amount equal
to the aggregate then undrawn and unexpired amount of such Letters of Credit.
Amounts held in such cash collateral account shall be applied by the
Administrative Agent to the payment of drafts drawn under such Letters of
Credit, and the unused portion thereof after all such Letters of Credit shall
have expired or been fully drawn upon, if any, shall be applied to repay other
obligations of the Borrower hereunder and under the other Loan Documents. After
all such Letters of Credit shall have expired or been fully drawn upon, all
Reimbursement Obligations shall have been satisfied and all other obligations of
the Borrower hereunder and under the other Loan Documents shall have been paid
in full, the balance, if any, in such cash collateral account shall be returned
to the Borrower (or such other Person as may be lawfully entitled thereto).
Except as expressly provided above in this Section, presentment, demand, protest
and all other notices of any kind are hereby expressly waived by the Borrower.
<PAGE> 58
SECTION . THE AGENTS
. Appointment. Each Lender hereby irrevocably designates and appoints the
Administrative Agent as the agent of such Lender under this Agreement and the
other Loan Documents, and each such Lender irrevocably authorizes the
Administrative Agent, in such capacity, to take such action on its behalf under
the provisions of this Agreement and the other Loan Documents and to exercise
such powers and perform such duties as are expressly delegated to the
Administrative Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Administrative Agent shall not have any duties or responsibilities, except those
expressly set forth herein, or any fiduciary relationship with any Lender, and
no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against the Administrative Agent.
. Delegation of Duties. The Administrative Agent may execute any of its
duties under this Agreement and the other Loan Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Administrative Agent shall not be
responsible for the negligence or misconduct of any agents or attorneys in-fact
selected by it with reasonable care.
. Exculpatory Provisions. Neither any Agent nor any of their respective
officers, directors, employees, agents, attorneys-in-fact or affiliates shall be
(i) liable for any action lawfully taken or omitted to be taken by it or such
Person under or in connection with this Agreement or any other Loan Document
(except to the extent that any of the foregoing are found by a final and
nonappealable decision of a court of competent jurisdiction to have resulted
from its or such Person's own gross negligence or willful misconduct) or (ii)
responsible in any manner to any of the Lenders for any recitals, statements,
representations or warranties made by any Loan Party or any officer thereof
contained in this Agreement or any other Loan Document or in any certificate,
report, statement or other document referred to or provided for in, or received
by the Agents under or in connection with, this Agreement or any other Loan
Document or for the value, validity, effectiveness, genuineness, enforceability
or sufficiency of this Agreement or any other Loan Document or for any failure
of any Loan Party a party thereto to perform its obligations hereunder or
thereunder. The Agents shall not be under any obligation to any Lender to
ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of any Loan Party.
. Reliance by Administrative Agent. The Administrative Agent shall be
entitled to rely, and shall be fully protected in relying, upon any instrument,
writing, resolution, notice, consent, certificate, affidavit, letter, telecopy,
telex or teletype message, statement, order or other document or conversation
believed by it to be genuine and correct and to have been signed, sent or made
by the proper Person or Persons and upon advice and statements of legal counsel
(including counsel to Holdings or the Borrower), independent accountants and
other experts selected by the Administrative Agent. The Administrative Agent may
deem and treat the payee of any Note as the owner thereof for all purposes
unless a written notice of assignment, negotiation or transfer thereof shall
have been filed with the Administrative Agent. The Administrative Agent shall be
fully justified in failing or refusing to take any action under this Agreement
or any other Loan Document unless it shall first receive such advice or
concurrence of the Required Lenders (or, if so specified by this Agreement, all
Lenders) as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense that may
be incurred by it by reason of taking or continuing to take any such action. The
Administrative Agent shall in all cases be fully protected in acting, or in
refraining from acting,
<PAGE> 59
under this Agreement and the other Loan Documents in accordance with a request
of the Required Lenders (or, if so specified by this Agreement, all Lenders),
and such request and any action taken or failure to act pursuant thereto shall
be binding upon all the Lenders and all future holders of the Loans.
. Notice of Default. The Administrative Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless the Administrative Agent has received notice from a Lender,
Holdings or the Borrower referring to this Agreement, describing such Default or
Event of Default and stating that such notice is a "notice of default". In the
event that the Administrative Agent receives such a notice, the Administrative
Agent shall promptly give notice thereof to the Lenders. The Administrative
Agent shall take such action with respect to such Default or Event of Default as
shall be reasonably directed by the Required Lenders (or, if so specified by
this Agreement, all Lenders); provided that unless and until the Administrative
Agent shall have received such directions, the Administrative Agent may (but
shall not be obligated to) take such action, or refrain from taking such action,
with respect to such Default or Event of Default as it shall deem advisable in
the best interests of the Lenders.
. Non-Reliance on Agents and Other Lenders. Each Lender expressly
acknowledges that neither the Agents nor any of their respective officers,
directors, employees, agents, attorneys-in-fact or affiliates have made any
representations or warranties to it and that no act by any Agent hereinafter
taken, including any review of the affairs of a Loan Party or any affiliate of a
Loan Party, shall be deemed to constitute any representation or warranty by any
Agent to any Lender. Each Lender represents to the Agents that it has,
independently and without reliance upon any Agent or any other Lender, and based
on such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of the Loan Parties and their
affiliates and made its own decision to make its Loans hereunder and enter into
this Agreement. Each Lender also represents that it will, independently and
without reliance upon any Agent or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit analysis, appraisals and decisions in taking or not taking action
under this Agreement and the other Loan Documents, and to make such
investigation as it deems necessary to inform itself as to the business,
operations, property, financial and other condition and creditworthiness of the
Loan Parties and their affiliates. Except for notices, reports and other
documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative Agent shall not have any duty
or responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, condition (financial or
otherwise), prospects or creditworthiness of any Loan Party or any affiliate of
a Loan Party that may come into the possession of the Administrative Agent or
any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates.
. Indemnification. The Lenders agree to indemnify each Agent in its
capacity as such (to the extent not reimbursed by Holdings or the Borrower and
without limiting the obligation of Holdings or the Borrower to do so), ratably
according to their respective Aggregate Exposure Percentages in effect on the
date on which indemnification is sought under this Section (or, if
indemnification is sought after the date upon which the Commitments shall have
terminated and the Loans shall have been paid in full, ratably in accordance
with such Aggregate Exposure Percentages immediately prior to such date), from
and against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind
whatsoever that may at any time (whether before or after the payment of the
Loans) be imposed on, incurred by or asserted against such Agent in any way
relating to or arising out of, the Commitments, this Agreement, any of the other
Loan Documents or any documents contemplated by or referred to herein or therein
or the transactions contemplated hereby or thereby or any action taken or
omitted by such Agent under or in connection with any
<PAGE> 60
of the foregoing; provided that no Lender shall be liable for the payment of any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements that are found by a final and
nonappealable decision of a court of competent jurisdiction to have resulted
from such Agent's gross negligence or willful misconduct. The agreements in this
Section shall survive the payment of the Loans and all other amounts payable
hereunder.
. Agent in Its Individual Capacity. Each Agent and its affiliates may make
loans to, accept deposits from and generally engage in any kind of business with
any Loan Party as though such Agent was not an Agent. With respect to its Loans
made or renewed by it and with respect to any Letter of Credit issued or
participated in by it, each Agent shall have the same rights and powers under
this Agreement and the other Loan Documents as any Lender and may exercise the
same as though it were not an Agent, and the terms "Lender" and "Lenders" shall
include each Agent in its individual capacity.
. Resignation of Agents. (a) The Administrative Agent may resign at any
time by giving at least 60 days' prior written notice of its intention to do so
to each of the other Lenders and the Borrower pending the appointment by the
Borrower of a successor Administrative Agent reasonably satisfactory to the
Required Lenders. If no successor Administrative Agent shall have been so
appointed and shall have accepted such appointment within 45 days after the
retiring Administrative Agent's giving of such notice of resignation, then the
retiring Administrative Agent may with the consent of the Borrower, which shall
not be unreasonably withheld or delayed, appoint a successor Administrative
Agent which shall be a bank or a trust company organized, or having a branch
that is licensed, under the laws of the United States of America or any state
thereof and having a combined capital, surplus and undivided profit of at least
$100,000,000.
(b) Any Agent other than the Administrative Agent may resign at any time by
giving at least 60 days' prior written notice of its intention to do so to each
of the other Lenders and the Borrower. Upon any such resignation, the Borrower
may, but shall not be obligated to, appoint a successor Agent in the relevant
capacity reasonably satisfactory to the Required Lenders, provided, that the
effectiveness of such resignation shall not be conditioned upon the appointment
of a successor.
(c) After any retiring Agent's resignation hereunder as Agent, the
provisions of this Agreement shall continue to inure to the benefit of such
Agent as to any actions taken or omitted to be taken by it while it was an Agent
under this Agreement and the other Loan Documents.
. Other Agents. Notwithstanding any provision to the contrary elsewhere in
this Agreement (including the circumstance that the Syndication Agents shall
have certain rights regarding notification, consents and other matters, to the
extent expressly provided herein), no Agent other than the Administrative Agent
shall have any duties or responsibilities hereunder or under any other Loan
Document, or any fiduciary relationship with any Lender, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities shall
be read into this Agreement or any other Loan Document or otherwise exist
against any Agent.
SECTION . MISCELLANEOUS
. Amendments and Waivers. Neither this Agreement, any other Loan Document,
nor any terms hereof or thereof may be amended, supplemented or modified except
in accordance with the provisions of this Section 10.1. The Required Lenders and
each Loan Party party to the relevant Loan Document may, or, with the written
consent of the Required Lenders, each Loan Party party to the relevant Loan
Document and any Specified Agent selected by the Borrower
<PAGE> 61
may, from time to time, (a) enter into written amendments, supplements or
modifications hereto and to the other Loan Documents for the purpose of adding
any provisions to this Agreement or the other Loan Documents or changing in any
manner the rights of the Lenders or of the Loan Parties hereunder or thereunder
or (b) waive, on such terms and conditions as the Required Lenders or such
Specified Agent, as the case may be, may specify in such instrument, any of the
requirements of this Agreement or the other Loan Documents or any Default or
Event of Default and its consequences; provided, however, that no such waiver
and no such amendment, supplement or modification shall (i) forgive the
principal amount or extend the final scheduled date of maturity of any Loan,
extend the scheduled date of any amortization payment in respect of any Term
Loan, extend the scheduled date of any reduction of the Revolving Commitments,
reduce the stated rate of any interest or fee payable hereunder or extend the
scheduled date of any payment thereof, or increase the amount or extend the
expiration date of any Lender's Commitment, in each case without the consent of
each Lender directly affected thereby; (ii) eliminate or reduce any voting
rights under this Section 10.1 or reduce any percentage specified in the
definition of Required Lenders, consent to the assignment or transfer by the
Borrower of any of its rights and obligations under this Agreement and the other
Loan Documents, release all or substantially all of the Collateral or release
any material Subsidiary Guarantor from its obligations under the Guarantee and
Collateral Agreement (in each case except in connection with Dispositions
consummated or approved in accordance with the other terms of this Agreement),
in each case without the written consent of all Lenders; (iii) reduce the
percentage specified in the definition of Majority Facility Lenders with respect
to any Facility without the written consent of all Lenders under such Facility;
(iv) amend or modify the definition of "Required Prepayment Lenders" without the
written consent of the Required Prepayment Lenders; (v) amend, modify or waive
any provision of Section 2.9(a) without the written consent of the Required
Prepayment Lenders; (vi) amend, modify or waive any provision of Section 9
without the written consent of each affected Agent; (vii) amend, modify or waive
any provision of Section 2.4 or 2.5 without the written consent of the Swingline
Lender; or (viii) amend, modify or waive any provision of Section 3 without the
written consent of each affected Issuing Lender. Any such waiver and any such
amendment, supplement or modification shall apply equally to each of the Lenders
and shall be binding upon the Loan Parties, the Lenders, the Agents and all
future holders of the Loans. In the case of any waiver, the Loan Parties, the
Lenders and the Agents shall be restored to their former position and rights
hereunder and under the other Loan Documents, and any Default or Event of
Default waived shall be deemed to be cured and not continuing; but no such
waiver shall extend to any subsequent or other Default or Event of Default, or
impair any right consequent thereon. It is understood that, with respect to any
voting required by this Section 10.1, each Lender and its related Approved
Funds, if any, shall vote as a single unit.
. Notices. All notices, requests and demands to or upon the respective
parties hereto to be effective shall be in writing (including by telecopy), and,
unless otherwise expressly provided herein, shall be deemed to have been duly
given or made when delivered, or three Business Days after being deposited in
the mail, postage prepaid, or, in the case of telecopy notice, when received,
addressed as follows in the case of Holdings, the Borrower and the
Administrative Agent, and as set forth in an administrative questionnaire
delivered to the Administrative Agent in the case of the Lenders, or to such
other address as may be hereafter notified by the respective parties hereto:
Any Loan Party: c/o CC VI Operating Company, LLC
12444 Powerscourt Drive, Suite 100
St. Louis, Missouri 63131
Attention: Kent D. Kalkwarf
Telecopy: (314) 965-8793
Telephone: (314) 543-2309
<PAGE> 62
with a copy to: Paul, Hastings, Janofsky & Walker LLP
600 Peachtree Street, N.E., Suite 2400
Atlanta, Georgia 30308
Attention: Kevin Conboy, Esq.
Telecopy: (404) 815-2444
Telephone: (404) 815-2211
The Administrative Agent: Toronto Dominion (Texas), Inc.
909 Fannin, Suite 1700
Houston, Texas 77010
Attention: Giovanny Pieternelle
Telecopy: (713) 951-0033
Telephone: (713) 653-8235
provided that any notice, request or demand to or upon the Administrative Agent
or the Lenders shall not be effective until received.
. No Waiver; Cumulative Remedies. No failure to exercise and no delay in
exercising, on the part of any Agent or any Lender, any right, remedy, power or
privilege hereunder or under the other Loan Documents shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The rights, remedies,
powers and privileges herein provided are cumulative and not exclusive of any
rights, remedies, powers and privileges provided by law.
. Survival of Representations and Warranties. All representations and
warranties made hereunder, in the other Loan Documents and in any document,
certificate or statement delivered pursuant hereto or in connection herewith
shall survive the execution and delivery of this Agreement and the making of the
Loans and other extensions of credit hereunder.
. Payment of Expenses and Taxes. The Borrower agrees (a) to pay or
reimburse the Administrative Agent for all its reasonable out-of-pocket costs
and expenses incurred in connection with the development, preparation and
execution of, and any amendment, supplement or modification to, this Agreement
and the other Loan Documents and any other documents prepared in connection
herewith or therewith, and the consummation and administration of the
transactions contemplated hereby and thereby, including the reasonable fees and
disbursements of one firm of counsel to the Administrative Agent and filing and
recording fees and expenses, with statements with respect to the foregoing to be
submitted to the Borrower prior to the Closing Date (in the case of amounts to
be paid on the Closing Date) and from time to time thereafter on a quarterly
basis or such other periodic basis as the Administrative Agent shall deem
appropriate, (b) to pay or reimburse each Lender and each Agent for all its
costs and expenses incurred in connection with the enforcement or preservation
of any rights under this Agreement, the other Loan Documents and any such other
documents, including the fees and disbursements of one firm of counsel selected
by the Administrative Agent and reasonably acceptable to the Syndication Agents
(or, in the event that either Syndication Agent determines in good faith that
issues apply to it that are not applicable to the Administrative Agent or, with
respect to an issue as to which another counsel is proposed to be engaged, that
its interests are different from those of the Administrative Agent, one
additional firm of counsel selected by Chase Securities Inc.), together with any
special or local counsel to the Administrative Agent, and not more than one
other firm of counsel to the Lenders, (c) to pay, indemnify, and hold each
Lender and each Agent harmless from, any and all recording and filing fees and
any and all liabilities with respect to, or resulting from any delay in paying,
stamp, excise and other taxes, if any, that may be payable or determined to be
payable in connection with the execution and delivery of, or consummation or
administration of any of the transactions contemplated by, or any amendment,
supplement or
<PAGE> 63
modification of, or any waiver or consent under or in respect of, this
Agreement, the other Loan Documents and any such other documents, and (d) to
pay, indemnify, and hold each Lender, each Agent, their affiliates and their
respective officers, directors, trustees, employees, agents and controlling
persons (each, an "Indemnitee") harmless from and against any and all other
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever with respect
to the execution, delivery, enforcement, performance and administration of this
Agreement, the other Loan Documents and any such other documents, including any
of the foregoing relating to the use of proceeds of the Loans or the violation
of, noncompliance with or liability under, any Environmental Law applicable to
the operations of Holdings, the Borrower any of its Subsidiaries or any of the
Properties and the reasonable fees and expenses of legal counsel in connection
with claims, actions or proceedings by any Indemnitee against any Loan Party
under any Loan Document (all the foregoing in this clause (d), collectively, the
"Indemnified Liabilities"), provided, that the Borrower shall have no obligation
hereunder to any Indemnitee with respect to Indemnified Liabilities to the
extent such Indemnified Liabilities are found by a final and nonappealable
decision of a court of competent jurisdiction to have resulted from the gross
negligence or willful misconduct of such Indemnitee. Without limiting the
foregoing, and to the extent permitted by applicable law, the Borrower agrees
not to assert and to cause its Subsidiaries not to assert, and hereby waives and
agrees to cause its Subsidiaries to so waive, all rights for contribution or any
other rights of recovery with respect to all claims, demands, penalties, fines,
liabilities, settlements, damages, costs and expenses of whatever kind or
nature, under or related to Environmental Laws, that any of them might have by
statute or otherwise against any Indemnitee. All amounts due under this Section
10.5 shall be payable not later than 15 days after written demand therefor.
Statements payable by the Borrower pursuant to this Section 10.5 shall be
submitted to Kent Kalkwarf (Telephone No. 314-543-2309) (Telecopy No.
314-965-8793), at the address of the Borrower set forth in Section 10.2, or to
such other Person or address as may be hereafter designated by the Borrower in a
written notice to the Administrative Agent. The agreements in this Section 10.5
shall survive repayment of the Loans and all other amounts payable hereunder.
. Successors and Assigns; Participations and Assignments. () This Agreement
shall be binding upon and inure to the benefit of Holdings, the Borrower, the
Lenders, the Agents, all future holders of the Loans and their respective
successors (which shall include, in the case of any Lender, any entity resulting
from a merger or consolidation) and assigns, except that the Borrower may not
assign or transfer any of its rights or obligations under this Agreement without
the prior written consent of each Lender.
() Any Lender other than any Conduit Lender may, without the consent of the
Borrower or the Administrative Agent, in accordance with applicable law, at any
time sell to one or more banks, financial institutions or other entities (each,
a "Participant"), including, without limitation, any Conduit Participant,
participating interests in any Loan owing to such Lender, any Commitment of such
Lender or any other interest of such Lender hereunder and under the other Loan
Documents. In the event of any such sale by a Lender of a participating interest
to a Participant, such Lender's obligations under this Agreement to the other
parties to this Agreement shall remain unchanged, such Lender shall remain
solely responsible for the performance thereof, such Lender shall remain the
holder of any such Loan for all purposes under this Agreement and the other Loan
Documents, and the Borrower and the Agents shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under this Agreement and the other Loan Documents. In no event shall
any Participant under any such participation have any right to approve any
amendment or waiver of any provision of any Loan Document, or any consent to any
departure by any Loan Party therefrom, except to the extent that such amendment,
waiver or consent would reduce the principal of, or interest on, the Loans or
any fees payable hereunder, or postpone the date of the final maturity of the
Loans, in each case
<PAGE> 64
to the extent subject to such participation. The Borrower agrees that if amounts
outstanding under this Agreement and the Loans are due or unpaid, or shall have
been declared or shall have become due and payable upon the occurrence of an
Event of Default, each Participant shall, to the maximum extent permitted by
applicable law, be deemed to have the right of setoff in respect of its
participating interest in amounts owing under this Agreement to the same extent
as if the amount of its participating interest were owing directly to it as a
Lender under this Agreement, provided that, in purchasing such participating
interest, such Participant shall be deemed to have agreed to share with the
Lenders the proceeds thereof as provided in Section 10.7(a) as fully as if it
were a Lender hereunder. The Borrower also agrees that each Participant shall be
entitled to the benefits of Sections 2.16, 2.17 and 2.18 with respect to its
participation in the Commitments and the Loans outstanding from time to time as
if it was a Lender; provided that, in the case of Section 2.17, such Participant
shall have complied with the requirements of said Section and provided, further,
that no Participant shall be entitled to receive any greater amount pursuant to
any such Section than the transferor Lender would have been entitled to receive
in respect of the amount of the participation transferred by such transferor
Lender to such Participant had no such transfer occurred.
() Any Lender other than any Conduit Lender (an "Assignor") may, in
accordance with applicable law, at any time and from time to time assign to any
Lender, any affiliate of any Lender or any Approved Fund or, with the consent of
the Borrower and the Administrative Agent (which, in each case, shall not be
unreasonably withheld or delayed), to an additional bank, financial institution
or other entity (an "Assignee") all or any part of its rights and obligations
under this Agreement pursuant to an Assignment and Acceptance, executed by such
Assignee, such Assignor and any other Person whose consent is required pursuant
to this paragraph, and delivered to the Administrative Agent for its acceptance
and recording in the Register; provided that, except in the case of an
assignment of all of a Lender's interests under this Agreement, no such
assignment to an Assignee (other than any Lender, any affiliate of any Lender or
any Approved Fund) shall (i) be in an aggregate principal amount of less than
$5,000,000 or (ii) cause the Assignor to have Aggregate Exposure of less than
$3,000,000, in each case unless otherwise agreed by the Borrower and the
Administrative Agent. For purposes of clauses (i) and (ii) of the preceding
sentence, the amounts described therein shall be aggregated in respect of each
Lender and its related Approved Funds, if any. Any such assignment need not be
ratable as among the Facilities. Upon such execution, delivery, acceptance and
recording, from and after the effective date determined pursuant to such
Assignment and Acceptance, (x) the Assignee thereunder shall be a party hereto
and, to the extent provided in such Assignment and Acceptance, have the rights
and obligations of a Lender hereunder with a Commitment and/or Loans as set
forth therein, and (y) the Assignor thereunder shall, to the extent provided in
such Assignment and Acceptance, be released from its obligations under this
Agreement (and, in the case of an Assignment and Acceptance covering all of an
Assignor's rights and obligations under this Agreement, such Assignor shall
cease to be a party hereto). Notwithstanding any provision of this Section 10.6,
the consent of the Borrower shall not be required for any assignment that occurs
when an Event of Default pursuant to Section 8(a) or 8(f) shall have occurred
and be continuing. On the effective date of any Assignment and Acceptance, the
Administrative Agent shall give notice of the terms thereof to the Syndication
Agents. Notwithstanding the foregoing, any Conduit Lender may assign at any time
to its designating Lender hereunder without the consent of the Borrower or the
Administrative Agent any or all of the Loans it may have funded hereunder and
pursuant to its designation agreement and without regard to the limitations set
forth in the first sentence of this Section 10.6(c).
() The Administrative Agent shall, on behalf of the Borrower, maintain at
its address referred to in Section 10.2 a copy of each Assignment and Acceptance
delivered to it and a register (the "Register") for the recordation of the names
and addresses of the Lenders and the Commitment of, and the principal amount of
the Loans owing to, each Lender from time to time. The entries in the Register
shall be conclusive, in the absence of manifest error, and the
<PAGE> 65
Borrower, each other Loan Party, the Agents and the Lenders shall treat each
Person whose name is recorded in the Register as the owner of the Loans and any
Notes evidencing the Loans recorded therein for all purposes of this Agreement.
Any assignment of any Loan, whether or not evidenced by a Note, shall be
effective only upon appropriate entries with respect thereto being made in the
Register (and each Note shall expressly so provide). Any assignment or transfer
of all or part of a Loan evidenced by a Note shall be registered on the Register
only upon surrender for registration of assignment or transfer of the Note
evidencing such Loan, accompanied by a duly executed Assignment and Acceptance,
and thereupon one or more new Notes shall be issued to the designated Assignee.
The Administrative Agent will promptly send a copy of the Register to the
Borrower upon request.
() Upon its receipt of an Assignment and Acceptance executed by an
Assignor, an Assignee and any other Person whose consent is required by Section
10.6(c), together with payment to the Administrative Agent of a registration and
processing fee of $3,500, the Administrative Agent shall (i) promptly accept
such Assignment and Acceptance and (ii) record the information contained therein
in the Register on the effective date determined pursuant thereto.
() For avoidance of doubt, the parties to this Agreement acknowledge that
the provisions of this Section 10.6 concerning assignments relate only to
absolute assignments and that such provisions do not prohibit assignments
creating security interests, including any pledge or assignment by a Lender of
any Loan to any Federal Reserve Bank in accordance with applicable law.
() Each of Holdings, the Borrower, each Lender and the Administrative Agent
hereby confirms that it will not institute against a Conduit Lender or join any
other Person in instituting against a Conduit Lender any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceeding under any
state bankruptcy or similar law, for one year and one day after the payment in
full of the latest maturing commercial paper note issued by such Conduit Lender;
provided, however, that each Lender designating any Conduit Lender hereby agrees
to indemnify, save and hold harmless each other party hereto for any loss, cost,
damage or expense arising out of its inability to institute such a proceeding
against such Conduit Lender during such period of forbearance.
. Adjustments; Set-off. () Except to the extent that this Agreement
expressly provides for payments to be allocated to a particular Lender or to the
Lenders under a particular Facility, if any Lender (a "Benefitted Lender") shall
receive any payment of all or part of the amounts owing to it hereunder, or
receive any collateral in respect thereof (whether voluntarily or involuntarily,
by set-off, pursuant to events or proceedings of the nature referred to in
Section 8(f), or otherwise), in a greater proportion than any such payment to or
collateral received by any other Lender, if any, in respect of the amounts owing
to such other Lender hereunder, such Benefitted Lender shall purchase for cash
from the other Lenders a participating interest in such portion of the amounts
owing to each such other Lender hereunder, or shall provide such other Lenders
with the benefits of any such collateral, as shall be necessary to cause such
Benefitted Lender to share the excess payment or benefits of such collateral
ratably with each of the Lenders; provided, however, that if all or any portion
of such excess payment or benefits is thereafter recovered from such Benefitted
Lender, such purchase shall be rescinded, and the purchase price and benefits
returned, to the extent of such recovery, but without interest, unless such
Benefitted Lender is required to pay interest thereon, in which case each Lender
returning funds to such Benefitted Lender shall pay its pro rata share of such
interest.
() In addition to any rights and remedies of the Lenders provided by law,
each Lender shall have the right, without prior notice to Holdings or the
Borrower, any such notice being expressly waived by Holdings and the Borrower to
the extent permitted by applicable law,
<PAGE> 66
upon any amount becoming due and payable by Holdings or the Borrower hereunder
(whether at the stated maturity, by acceleration or otherwise), to set off and
appropriate and apply against such amount any and all deposits (general or
special, time or demand, provisional or final), in any currency, and any other
credits, indebtedness or claims, in any currency, in each case whether direct or
indirect, absolute or contingent, matured or unmatured, at any time held or
owing by such Lender or any branch or agency thereof to or for the credit or the
account of Holdings or the Borrower, as the case may be. Each Lender agrees
promptly to notify the Borrower and the Administrative Agent after any such
setoff and application made by such Lender, provided that the failure to give
such notice shall not affect the validity of such setoff and application.
. Counterparts. This Agreement may be executed by one or more of the
parties to this Agreement on any number of separate counterparts, and all of
said counterparts taken together shall be deemed to constitute one and the same
instrument. Delivery of an executed signature page of this Agreement by
facsimile transmission shall be effective as delivery of a manually executed
counterpart hereof. A set of the copies of this Agreement signed by all the
parties shall be lodged with the Borrower and the Administrative Agent.
. Severability. Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
. Integration. This Agreement and the other Loan Documents represent the
agreement of Holdings, the Borrower, the Agents and the Lenders with respect to
the subject matter hereof, and there are no promises, undertakings,
representations or warranties by the any Agent or any Lender relative to subject
matter hereof not expressly set forth or referred to herein or in the other Loan
Documents.
. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
. Submission To Jurisdiction; Waivers. Each of Holdings and the Borrower
hereby irrevocably and unconditionally:
() submits for itself and its property in any legal action or proceeding
relating to this Agreement and the other Loan Documents to which it is a party,
or for recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the courts of the State of New York, the
courts of the United States for the Southern District of New York, and appellate
courts from any thereof;
() consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the venue
of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;
() agrees that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to Holdings or the
Borrower, as the case may be at its address set forth in Section 10.2 or at such
other address of which the Administrative Agent shall have been notified
pursuant thereto;
<PAGE> 67
() agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to sue in
any other jurisdiction; and
() waives, to the maximum extent not prohibited by law, any right it may
have to claim or recover in any legal action or proceeding referred to in this
Section any special, exemplary, punitive or consequential damages.
. Acknowledgments. Each of Holdings and the Borrower hereby acknowledges
that:
() it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Loan Documents;
() neither any Agent nor any Lender has any fiduciary relationship with or
duty to Holdings or the Borrower arising out of or in connection with this
Agreement or any of the other Loan Documents, and the relationship between the
Agents and Lenders, on one hand, and Holdings and the Borrower, on the other
hand, in connection herewith or therewith is solely that of debtor and creditor;
and
() no joint venture is created hereby or by the other Loan Documents or
otherwise exists by virtue of the transactions contemplated hereby among the
Agents and the Lenders or among Holdings, the Borrower and the Agents and the
Lenders.
. Releases of Guarantees and Liens. (a) Notwithstanding anything to the
contrary contained herein or in any other Loan Document, the Administrative
Agent is hereby irrevocably authorized by each Lender (without requirement of
notice to or consent of any Lender except as expressly required by Section 10.1)
to take any action requested by the Borrower having the effect of releasing any
Collateral or Guarantee Obligations (i) to the extent necessary to permit
consummation of any transaction not prohibited by any Loan Document or that has
been approved in accordance with Section 10.1 or (ii) under the circumstances
described in paragraph (b) below.
(b) At such time as the Loans, the Reimbursement Obligations and the other
obligations under the Loan Documents (other than obligations under or in respect
of Hedge Agreements or letters of credit obtained other than pursuant to this
Agreement) shall have been paid in full, the Commitments have been terminated
and no Letters of Credit shall be outstanding, the Collateral shall be released
from the Liens created by the Guarantee and Collateral Agreement, and the
Guarantee and Collateral Agreement and all obligations (other than those
expressly stated to survive such termination) of the Administrative Agent and
each Loan Party under the Guarantee and Collateral Agreement shall terminate,
all without delivery of any instrument or performance of any act by any Person.
. Confidentiality. Each Agent and each Lender agrees to keep confidential
all non- public information provided to it by any Loan Party pursuant to this
Agreement that is designated by such Loan Party as confidential; provided that
nothing herein shall prevent any Agent or any Lender from disclosing any such
information (a) to any Agent, any Lender or any affiliate of any Lender or any
Approved Fund, (b) to any Transferee or prospective Transferee that agrees to
comply with the provisions of this Section, (c) to its employees, directors,
agents, attorneys, accountants and other professional advisors or those of any
of its affiliates who have a need to know, (d) upon the request or demand of any
Governmental Authority, (e) in response to any order of any court or other
Governmental Authority or as may otherwise be required pursuant to any
Requirement of Law, (f) if requested or required to do so in connection with any
litigation or similar proceeding, (g) that has been publicly disclosed, (h) any
nationally recognized rating agency that requires access to information about a
Lender's investment portfolio in connection
<PAGE> 68
with ratings issued with respect to such Lender, (i) in connection with the
exercise of any remedy hereunder or under any other Loan Document or (j) to any
direct or indirect contractual counterparty in swap agreements or such
contractual counterparty's professional advisor (so long as such contractual
counterparty or professional advisor to such contractual counterparty agrees to
be bound by the provisions of this Section 10.15).
. WAIVERS OF JURY TRIAL. HOLDINGS, THE BORROWER, THE AGENTS AND THE LENDERS
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION
OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY
COUNTERCLAIM THEREIN.
<PAGE> 69
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their proper and duly authorized officers as of
the day and year first above written.
CC VI HOLDINGS, LLC
By: \s\ Eloise Engman
-----------------
Name: Eloise Engman
Title: Vice President
CC VI OPERATING COMPANY, LLC
By: \s\ Eloise Engman
-----------------
Name: Eloise Engman
Title: Vice President
The Administrative Agent:
------------------------
TORONTO DOMINION (TEXAS), INC.
By:
-----------------
Name:
Title:
The Syndication Agents:
----------------------
CHASE SECURITIES INC.
By:
-----------------
Name:
Title:
BANC OF AMERICA SECURITIES LLC
By:
-----------------
Name:
Title:
The Documentation Agents:
------------------------
CITIBANK, N.A.
By:
-----------------
Name:
Title:
ABN AMRO BANK N.V.
By:
-----------------
Name:
Title:
<PAGE> 70
Annex A
PRICING GRID
<TABLE>
<CAPTION>
Applicable Margin Applicable
for Eurodollar Margin for ABR Commitment
Consolidated Leverage Ratio Loans Loans Fee Rate
--------------------------- ----------------- -------------- --------
A/RC B A/RC B
---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Greater than 6.75 to 1.0 2.25% 3.00% 1.25% 2.00% 0.375%
Greater than 6.25 to 1.0 but 2.00% 2.75% 1.00% 1.75% 0.375%
less than or equal to 6.75 to 1.0
Greater than 6.00 to 1.0 but 1.75% 2.75% 0.75% 1.75% 0.375%
less than or equal to 6.25 to 1.0
Greater than 5.50 to 1.0 but 1.50% 2.50% 0.50% 1.50% 0.250%
less than or equal to 6.00 to 1.0
Greater than 5.00 to 1.0 but 1.25% 2.50% 0.25% 1.50% 0.250%
less than or equal to 5.50 to 1.0
Less than or equal to 5.00 to 1.0 1.00% 2.50% 0% 1.50% 0.250%
</TABLE>
As used above, (a) "A/RC" refers to Tranche A Term Loans, Revolving Loans
and Swingline Loans and (b) "B" refers to Tranche B Term Loans.
Until the date on which financial statements are delivered to the Lenders
pursuant to Section 6.1 in respect of the first fiscal quarter commencing after
the Closing Date, rates corresponding to a Consolidated Leverage Ratio of less
than or equal to 6.25 to 1.0 will not be available.
Changes in the Applicable Margin or in the Commitment Fee Rate resulting
from changes in the Consolidated Leverage Ratio and the Consolidated Interest
Coverage Ratio shall become effective on the date (the "Adjustment Date") on
which financial statements are delivered to the Lenders pursuant to Section 6.1
(but in any event not later than the 45th day after the end of each of the first
three quarterly periods of each fiscal year or the 90th day after the end of
each fiscal year, as the case may be) and shall remain in effect until the next
change to be effected pursuant to this paragraph. Until financial statements are
first delivered pursuant to Section 6.1 after the Closing Date, the Consolidated
Leverage Ratio for the purposes of the Pricing Grid shall be deemed to be
greater than 6.25 to 1.0 but less than or equal to 6.75 to 1.0. If any financial
statements referred to above are not delivered within the time periods specified
above, then, until such financial statements are delivered, the highest rates
referred to in the Pricing Grid shall be applicable. In addition, the highest
rates referred to in the Pricing Grid shall be applicable at all times while an
Event of Default shall have occurred and be continuing.
<PAGE> 71
EXECUTION COPY
$1,200,000,000
CREDIT AGREEMENT
CC VI OPERATING COMPANY, LLC,
as Borrower
CC VI HOLDINGS, LLC,
as Guarantor
CHASE SECURITIES INC. and BANC OF AMERICA SECURITIES LLC,
as Joint Lead Arrangers and Joint Book Managers
CHASE SECURITIES INC. and BANC OF AMERICA SECURITIES LLC, as Syndication Agents
TORONTO DOMINION (TEXAS), INC.,
as Administrative Agent
CITIBANK, N.A. and ABN AMRO BANK N.V., as Documentation Agents
Dated as of November 12, 1999
<PAGE> 72
TABLE OF CONTENTS
Page
SECTION 1. DEFINITIONS 1
1.1 Defined Terms 1
1.2 Other Definitional Provisions; Pro Forma Calculations 20
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS 22
2.1 Commitments; Increases in the Tranche A Term Facility and
the Revolving Facility; Incremental Term Loans 22
2.2 Procedure for Borrowing 23
2.3 Repayment of Loans 24
2.4 Swingline Commitment 25
2.5 Procedure for Swingline Borrowing; Refunding of Swingline Loans 25
2.6 Commitment Fees, etc. 26
2.7 Termination or Reduction of Revolving Commitments 27
2.8 Optional Prepayments 27
2.9 Mandatory Prepayments 27
2.10 Conversion and Continuation Options 27
2.11 Limitations on Eurodollar Tranches 28
2.12 Interest Rates and Payment Dates 28
2.13 Computation of Interest and Fees 28
2.14 Inability to Determine Interest Rate 29
2.15 Pro Rata Treatment and Payments 29
2.16 Requirements of Law 31
2.17 Taxes 32
2.18 Indemnity 33
2.19 Change of Lending Office 34
2.20 Replacement of Lenders 34
SECTION 3. LETTERS OF CREDIT 34
3.1 L/C Commitment 34
3.2 Procedure for Issuance of Letter of Credit 35
3.3 Fees and Other Charges 35
3.4 L/C Participations 35
3.5 Reimbursement Obligation of the Borrower 36
3.6 Obligations Absolute 36
3.7 Letter of Credit Payments 37
3.8 Applications 37
SECTION 4. REPRESENTATIONS AND WARRANTIES 37
4.1 Financial Condition 37
4.2 No Change 37
4.3 Existence; Compliance with Law 37
4.4 Power; Authorization; Enforceable Obligations 38
4.5 No Legal Bar 38
4.6 Litigation 38
4.7 No Default 38
- 77 -
<PAGE> 73
Page
4.8 Ownership of Property; Liens 38
4.9 Intellectual Property 38
4.10 Taxes 39
4.11 Federal Regulations 39
4.12 Labor Matters 39
4.13 ERISA 39
4.14 Investment Company Act; Other Regulations 39
4.15 Subsidiaries 39
4.16 Use of Proceeds 39
4.17 Environmental Matters 39
4.18 Certain Cable Television Matters 40
4.19 Accuracy of Information, etc 41
4.20 Security Interests 41
4.21 Solvency 41
4.22 Certain Tax Matters 41
4.23 Year 2000 Matters 42
SECTION 5. CONDITIONS PRECEDENT 42
5.1 Conditions to Initial Extension of Credit 42
5.2 Conditions to Each Extension of Credit 43
SECTION 6. AFFIRMATIVE COVENANTS 44
6.1 Financial Statements 44
6.2 Certificates; Other Information 44
6.3 Payment of Obligations 45
6.4 Maintenance of Existence; Compliance. 45
6.5 Maintenance of Property; Insurance 46
6.6 Inspection of Property; Books and Records; Discussions 46
6.7 Notices 46
6.8 Environmental Laws 47
6.9 Interest Rate Protection 47
6.10 Additional Collateral 47
6.11 Organizational Separateness 47
6.12 ERISA Reports 48
6.13 ERISA, etc 48
SECTION 7. NEGATIVE COVENANTS 48
7.1 Financial Condition Covenants 48
7.2 Indebtedness 49
7.3 Liens 50
7.4 Fundamental Changes 51
7.5 Disposition of Property 52
7.6 Restricted Payments 53
7.7 Investments 54
7.8 Certain Payments and Modifications Relating to
Indebtedness and Management Fees. 55
7.9 Transactions with Affiliates 56
7.10 Sales and Leasebacks 56
7.11 Changes in Fiscal Periods 56
7.12 Negative Pledge Clauses 56
7.13 Clauses Restricting Subsidiary Distributions 56
7.14 Lines of Business; Holding Company Status 57
- 78 -
<PAGE> 74
Page
7.15 Investments by Holdings in the Borrower 57
SECTION 8. EVENTS OF DEFAULT 57
SECTION 9. THE AGENTS 60
9.1 Appointment 60
9.2 Delegation of Duties 60
9.3 Exculpatory Provisions 60
9.4 Reliance by Administrative Agent 61
9.5 Notice of Default 61
9.6 Non-Reliance on Agents and Other Lenders 61
9.7 Indemnification 62
9.8 Agent in Its Individual Capacity 62
9.9 Resignation of Agents 62
9.10 Other Agents 63
SECTION 10. MISCELLANEOUS 63
10.1 Amendments and Waivers 63
10.2 Notices 64
10.3 No Waiver; Cumulative Remedies 64
10.4 Survival of Representations and Warranties 64
10.5 Payment of Expenses and Taxes 64
10.6 Successors and Assigns; Participations and Assignments 65
10.7 Adjustments; Set-off 67
10.8 Counterparts 68
10.9 Severability 68
10.10 Integration 68
10.11 GOVERNING LAW 68
10.12 Submission To Jurisdiction; Waivers 68
10.13 Acknowledgments 69
10.14 Releases of Guarantees and Liens 69
10.15 Confidentiality 70
10.16 WAIVERS OF JURY TRIAL 70
- 79 -
<PAGE> 75
ANNEX:
A Pricing Grid
SCHEDULES:
1.1 Commitments on Closing Date
4.15 Subsidiaries
4.20 UCC Filing Jurisdictions
7.2(d) Existing Indebtedness
EXHIBITS:
A Form of Guarantee and Collateral Agreement
B Form of Compliance Certificate
C Form of Closing Certificate
D-1 Form of Addendum
D-2 Form of New Lender Supplement
D-3 Form of Increased Facility Activation Notice
E Form of Assignment and Acceptance
F Form of Prepayment Option Notice
G Form of Exemption Certificate
H Form of Specified Subordinated Note
- 80 -
<PAGE> 1
EXHIBIT 10.42
CREDIT AGREEMENT, dated as of November 15, 1999, among AVALON CABLE LLC, a
Delaware limited liability company ("Holdings"); CC MICHIGAN, LLC, a Delaware
limited liability company, and CC NEW ENGLAND, LLC, a Delaware limited liability
company, as joint and several borrowers (collectively, the "Borrowers"); the
several banks and other financial institutions or entities from time to time
parties to this Agreement (the "Lenders"); FIRST UNION NATIONAL BANK ("First
Union") and PNC BANK, NATIONAL ASSOCIATION ("PNC Bank"), as syndication agents
(in such capacity, collectively, the "Syndication Agents"); BANK OF MONTREAL,
CHICAGO BRANCH ("Bank of Montreal") and MERCANTILE BANK NATIONAL ASSOCIATION
("Mercantile"), as co-documentation agents (in such capacity, collectively, the
"Co-Documentation Agents"); and Bank of Montreal, as administrative agent (in
such capacity, the "Administrative Agent").
The parties hereto hereby agree as follows:
DEFINITIONS
Defined Terms. As used in this Agreement, the terms listed in this Section 1.1
shall have the respective meanings set forth in this Section 1.1.
"ABR": for any day, a rate per annum (rounded upwards, if necessary, to the
next 1/100th of 1%) equal to the greater of (a) the Prime Rate in effect on such
day and (b) the Federal Funds Effective Rate in effect on such day plus 1/2 of
1%. Any change in the ABR due to a change in the Prime Rate or the Federal Funds
Effective Rate shall be effective as of the opening of business on the effective
day of such change in the Prime Rate or the Federal Funds Effective Rate,
respectively.
"ABR Loans": Loans the rate of interest applicable to which is based upon
the ABR.
"Acquired Systems": the collective reference to (i) "Systems" as defined in
the Securities Purchase Agreement dated as of May 13, 1999, among Avalon Cable
Holdings, LLC, Avalon Investors, L.L.C., Avalon Cable of Michigan Holdings,
Inc., Holdings, Charter Communications Holdings LLC and Charter Communications,
Inc., as such agreement is in effect on the Closing Date, and (ii) "Systems" as
defined in the Asset Purchase Agreement dated as of May 13, 1999, among
Interlake Cablevision Enterprises Holdings, LLC, Charter Communications Holdings
LLC and Charter Communications, Inc., as such agreement is in effect on the
Closing Date.
"Acquisition": as defined in Section 4.1(b).
"Accumulated Benefit Obligations": the actuarial present value of the
accumulated benefit obligations under any Plan, calculated in a manner
consistent with Statement No. 87 of the Financial Accounting Standards Board.
"Addendum": an instrument, substantially in the form of Exhibit D-1, by
which a Lender becomes a party to this Agreement as of the Closing Date.
"Adjustment Date": as defined in the Pricing Grid.
"Administrative Agent": as defined in the preamble hereto.
81
<PAGE> 2
"Affiliate": as to any Person, any other Person that, directly or
indirectly, is in control of, is controlled by, or is under common control with,
such Person. For purposes of this definition, "control" of a Person means the
power, directly or indirectly, either to (a) vote 10% or more of the securities
having ordinary voting power for the election of directors (or persons
performing similar functions) of such Person or (b) direct or cause the
direction of the management and policies of such Person, whether by contract or
otherwise.
"Agents": the collective reference to the Syndication Agents, the
Co-Documentation Agents and the Administrative Agent.
"Aggregate Exposure": with respect to any Lender at any time, an amount
equal to the sum of (a) the aggregate then unpaid principal amount of such
Lender's Term Loans and (b) the amount of such Lender's Revolving Commitment
then in effect or, if the Revolving Commitments have been terminated, the amount
of such Lender's Revolving Extensions of Credit then outstanding.
"Aggregate Exposure Percentage": with respect to any Lender at any time,
the ratio (expressed as a percentage) of such Lender's Aggregate Exposure at
such time to the Aggregate Exposures of all Lenders at such time.
"Agreement": this Credit Agreement, as amended, supplemented or otherwise
modified from time to time.
"Annualized Asset Cash Flow Amount": with respect to any Disposition of
assets, an amount equal to the portion of Consolidated Operating Cash Flow for
the most recent Asset Disposition Test Period ending prior to the date of such
Disposition which was contributed by such assets multiplied by four.
"Annualized Operating Cash Flow": for any fiscal quarter, an amount equal
to Consolidated Operating Cash Flow for such period multiplied by four.
"Annualized Pro Forma Operating Cash Flow": an amount, determined on any
Disposition Date in connection with any proposed Disposition pursuant to Section
6.5(e) or 6.5(f), equal to Consolidated Operating Cash Flow for the most recent
Asset Disposition Test Period multiplied by four, calculated in the manner
contemplated by Section 1.2(e) but excluding the effect of such Disposition.
"Applicable Margin": (a) with respect to Term B Loans, Revolving Loans and
Swingline Loans, the per annum rates determined in accordance with the Pricing
Grid and (b) with respect to Incremental Term Loans, such per annum rates as
shall be agreed to by the Borrowers and the applicable Incremental Term Lenders
as shown in the applicable Increased Facility Activation Notice.
"Approved Fund": with respect to any Lender that is a fund that invests in
commercial loans, any other fund that invests in commercial loans and is managed
or advised by the same investment advisor as such Lender or by an Affiliate of
such investment advisor.
"Asset Disposition Test Period": as of any date of determination, the most
recent fiscal quarter as to which financial statements have been delivered
pursuant to Section 5.1.
"Asset Sale": any Disposition of property or series of related Dispositions
of property (excluding (a) Exchanges pursuant to which no cash consideration is
received by any of the Borrowers or any of their respective Subsidiaries and (b)
any such Disposition permitted by clause (a), (b), (c) or (d) of
82
<PAGE> 3
Section 6.5) that yields gross cash proceeds to any of the Borrowers or any of
their respective Subsidiaries in excess of $1,000,000.
"Assignee": as defined in Section 9.6(c).
"Assignment and Acceptance": an Assignment and Acceptance, substantially in
the form of Exhibit E.
"Assignor": as defined in Section 9.6(c).
"Attributable Debt": in respect of a sale and leaseback transaction entered
into by Holdings, any of the Borrowers or any of their respective Subsidiaries,
at the time of determination, the present value of the obligation of the lessee
for net rental payments during the remaining term of the lease included in such
sale and leaseback transaction including any period for which such lease has
been extended or may, at the sole option of the lessor, be extended. Such
present value shall be calculated using a discount rate equal to the rate of
interest implicit in such transaction, determined in accordance with GAAP.
"Authorizations": all filings, recordings and registrations with, and all
validations or exemptions, approvals, orders, authorizations, consents,
Licenses, certificates and permits from, the FCC, applicable public utilities
and other Governmental Authorities, including, without limitation, CATV
Franchises, FCC Licenses and Pole Agreements.
"Available Revolving Commitment": as to any Revolving Lender at any time,
an amount equal to the excess, if any, of (a) such Lender's Revolving Commitment
then in effect over (b) such Lender's Revolving Extensions of Credit then
outstanding; provided, that in calculating any Lender's Revolving Extensions of
Credit for the purpose of determining such Lender's Available Revolving
Commitment pursuant to Section 2.6(a), the aggregate principal amount of
Swingline Loans then outstanding shall be deemed to be zero.
"Avalon Michigan": Avalon Cable of Michigan LLC, a Delaware limited
liability company, which after the Acquisition will be renamed "CC Michigan,
LLC".
"Avalon New England": Avalon Cable of New England LLC, a Delaware limited
liability company, which after the Acquisition will be renamed "CC New England,
LLC".
"Bank of Montreal": as defined in the preamble hereto.
"Benefitted Lender": as defined in Section 9.7(a).
"Board": the Board of Governors of the Federal Reserve System of the United
States (or any successor).
"Borrowers": as defined in the preamble hereto.
"Borrowing Date": any Business Day specified by the Borrowers as a date on
which the Borrowers request the relevant Lenders to make Loans hereunder.
"Budget": as defined in Section 5.2(c).
"Business": as defined in Section 3.17(b).
83
<PAGE> 4
"Business Day": a day other than a Saturday, Sunday or other day on which
commercial banks in New York City or Chicago, Illinois are authorized or
required by law to close, provided, that with respect to notices and
determinations in connection with, and payments of principal and interest on,
Eurodollar Loans, such day is also a day for trading by and between banks in
Dollar deposits in the London, England interbank eurodollar market.
"Capital Lease Obligations": as to any Person, the obligations of such
Person to pay rent or other amounts under any lease of (or other arrangement
conveying the right to use) real or personal property, or a combination thereof,
which obligations are required to be classified and accounted for as capital
leases on a balance sheet of such Person under GAAP and, for the purposes of
this Agreement, the amount of such obligations at any time shall be the
capitalized amount thereof at such time determined in accordance with GAAP.
"Cash Equivalents": (a) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States government or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one year from the date of acquisition; (b)
certificates of deposit, time deposits, eurodollar time deposits or overnight
bank deposits having maturities of six months or less from the date of
acquisition issued by any Lender or by any commercial bank organized under the
laws of the United States or any state thereof having combined capital and
surplus of not less than $500,000,000; (c) commercial paper of an issuer rated
at the time of acquisition at least A-1 by Standard & Poor's Ratings Services
("S&P") or P-1 by Moody's Investors Service, Inc. ("Moody's"), or carrying an
equivalent rating by a nationally recognized rating agency, if both of the two
named rating agencies cease publishing ratings of commercial paper issuers
generally, and maturing within six months from the date of acquisition; (d)
repurchase obligations of any Lender or of any commercial bank satisfying the
requirements of clause (b) of this definition, having a term of not more than 30
days, with respect to securities issued or fully guaranteed or insured by the
United States government; (e) securities with maturities of one year or less
from the date of acquisition issued or fully guaranteed by any state,
commonwealth or territory of the United States, by any political subdivision or
taxing authority of any such state, commonwealth or territory or by any foreign
government, the securities of which state, commonwealth, territory, political
subdivision, taxing authority or foreign government (as the case may be) are
rated at the time of acquisition at least A by S&P or A by Moody's; (f)
securities with maturities of six months or less from the date of acquisition
backed by standby letters of credit issued by any Lender or any commercial bank
satisfying the requirements of clause (b) of this definition; or (g) shares of
money market mutual or similar funds which invest exclusively in assets
satisfying the requirements of clauses (a) through (f) of this definition.
"CATV Franchise": collectively, with respect to the Borrowers and their
respective Subsidiaries, (a) any franchise, license, permit, wire agreement or
easement granted by any political jurisdiction or unit or other local, state or
federal franchising authority (other than licenses, permits and easements not
material to the operations of a CATV System) pursuant to which such Person has
the right or license to operate a CATV System and (b) any law, regulation,
ordinance, agreement or other instrument or document setting forth all or any
part of the terms of any franchise, license, permit, wire agreement or easement
described in clause (a) of this definition.
"CATV System": any cable distribution system owned or acquired by any of
the Borrowers or any of their respective Subsidiaries which receives audio,
video, digital, other broadcast signals or information or telecommunications by
cable, optical, antennae, microwave or satellite transmission and which
amplifies and transmits such signals to customers of any of the Borrowers or any
of their respective Subsidiaries.
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"CC Michigan": CC Michigan, LLC, a Delaware limited liability company,
known prior to the Closing Date as Avalon Cable of Michigan LLC.
"CC New England": CC New England, LLC, a Delaware limited liability
company, known prior to the Closing Date as Avalon Cable of New England LLC.
"Charter Group": the collective reference to Charter Communications, Inc.,
Charter Communications Holding Company, LLC, the Borrowers and their respective
Subsidiaries, together with any member of the Paul Allen Group or any Affiliate
of any such member that, in each case, directly or indirectly owns Equity
Interests (determined on the basis of economic interests) in any of the
Borrowers or any of their respective Subsidiaries. Notwithstanding the
foregoing, no individual and no entity organized for estate planning purposes
shall be deemed to be a member of the Charter Group.
"Closing Date": the date on which the conditions precedent set forth in
Section 4.1 shall have been satisfied, which date is November 15, 1999.
"Code": the Internal Revenue Code of 1986, as amended from time to time.
"Co-Documentation Agents": as defined in the preamble hereto.
"Collateral": all property of the Loan Parties, now owned or hereafter
acquired, upon which a Lien is purported to be created by the Guarantee and
Collateral Agreement.
"Commitment": as to any Lender, the sum of the Term B Commitment and the
Revolving Commitment of such Lender.
"Commitment Fee Rate": the per annum rate determined in accordance with the
Pricing Grid.
"Commonly Controlled Entity": an entity, whether or not incorporated, that
is under common control with any Borrower within the meaning of Section 4001 of
ERISA or is part of a group that includes a Borrower and that is treated as a
single employer under Section 414 of the Code.
"Compliance Certificate": a certificate duly executed by a Responsible
Officer substantially in the form of Exhibit B.
"Confidential Information Memorandum": the collective reference to (a) the
Confidential Information Memorandum dated October 1999 and furnished to certain
of the Lenders in connection with the syndication of certain of the Facilities
prior to the Closing Date and (b) any other information memorandum authorized by
any of the Borrowers to be distributed to one or more Lenders or prospective
Lenders in connection with any other syndication of any of the Facilities
(including in connection with any increase in the amount thereof).
"Consideration": with respect to any Investment or Disposition, (a) any
cash or other property (valued at fair market value in the case of such other
property) paid or transferred in connection therewith, (b) the principal amount
of any Indebtedness assumed in connection therewith and (c) any letters of
credit, surety arrangements or security deposits posted in connection therewith.
"Consolidated Debt Service Coverage Ratio": as of the last day of any
period, the ratio of (a) Annualized Operating Cash Flow determined in respect of
the fiscal quarter ending on such day to (b) the sum of (i) Consolidated
Interest Expense for the period of four consecutive fiscal quarters ending
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on such day and (ii) scheduled principal payments on Indebtedness of any of the
Borrowers or any of their respective Subsidiaries for the period of four
consecutive fiscal quarters commencing immediately after such day (or, in the
case of the Revolving Facility, the excess, if any, of the Total Revolving
Extensions of Credit outstanding on such day over the amount of the Total
Revolving Commitments scheduled to be in effect at the end of such period of
four consecutive fiscal quarters); provided, however, that the final scheduled
installment of principal of the Term Facility and the Incremental Term Facility
shall be excluded from the calculation of amounts under this clause (ii).
"Consolidated Interest Coverage Ratio": as of the last day of any period,
the ratio of (a) Consolidated Operating Cash Flow for the period of four
consecutive fiscal quarters ending on such day to (b) Consolidated Interest
Expense for the period of four consecutive fiscal quarters ending on such day.
"Consolidated Interest Expense": for any period, the sum of (a) total cash
interest expense (including that attributable to Capital Lease Obligations) of
each of the Borrowers and their respective Subsidiaries for such period with
respect to all outstanding Indebtedness of any of the Borrowers and their
respective Subsidiaries (including all commissions, discounts and other fees and
charges owed with respect to letters of credit and bankers' acceptance financing
and net costs under Hedge Agreements in respect of interest rates to the extent
such net costs are allocable to such period in accordance with GAAP) and (b) all
Restricted Payments made by any Borrower during such period in order to enable
any of its Affiliates to pay cash interest expense (including the Mandatory
Payment of Accrued Interest) in respect of Indebtedness of such Affiliate.
"Consolidated Leverage Ratio": as of the last day of any period, the ratio
of (a) Consolidated Total Debt on such day to (b) Annualized Operating Cash Flow
determined in respect of the fiscal quarter ending on such day.
"Consolidated Net Income": for any period, the consolidated net income (or
loss) of the Borrowers and their respective Subsidiaries, determined on a
consolidated basis in accordance with GAAP; provided that, GAAP to the contrary
notwithstanding, there shall be excluded (a) the income (or deficit) of any
Person accrued prior to the date it becomes a Subsidiary of a Borrower or is
merged into or consolidated with any of the Borrowers or any of their respective
Subsidiaries, (b) the income (or deficit) of any Person (other than a Subsidiary
of any of the Borrowers) in which any of the Borrowers or any of their
respective Subsidiaries has an ownership interest, except to the extent that any
such income is actually received by any of the Borrowers or such Subsidiary in
the form of dividends or similar distributions, (c) the undistributed earnings
of any Subsidiary of any of the Borrowers (including any Excluded Acquired
Subsidiary) to the extent that the declaration or payment of dividends or
similar distributions by such Subsidiary is not at the time permitted by the
terms of any Contractual Obligation (other than under any Loan Document) or
Requirement of Law applicable to such Subsidiary and (d) the income of any
Non-Recourse Subsidiary (except to the extent distributed in cash to any of the
Borrowers or any of their respective Subsidiaries).
"Consolidated Operating Cash Flow": for any period with respect to the
Borrowers and their respective Subsidiaries, Consolidated Net Income for such
period plus, without duplication and to the extent reflected as a charge in the
statement of Consolidated Net Income for such period, the sum of (i) total
income tax expense, (ii) interest expense, amortization or writeoff of debt
discount and debt issuance costs and commissions, discounts and other fees and
charges associated with Indebtedness, (iii) depreciation and amortization
expense, (iv) management fees expensed during such period, (v) any extraordinary
or non-recurring non-cash expenses or non-cash losses, provided that in the
event that any Borrower or any Subsidiary makes any cash payment in respect of
any such extraordinary or non-recurring non-cash expense, such cash payment
shall be deducted from Consolidated Operating Cash
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Flow in the period in which such cash payment is made, (vi) losses on
Dispositions of assets outside of the ordinary course of business, and (vii)
other noncash items reducing such Consolidated Net Income and minus, without
duplication and to the extent included in the statement of Consolidated Net
Income for such period, the sum of (i) any extraordinary or non-recurring
non-cash income or non-cash gains, (ii) gains on Dispositions of assets outside
of the ordinary course of business and (iii) other noncash items increasing such
Consolidated Net Income, all as determined on a consolidated basis in accordance
with GAAP.
"Consolidated Senior Debt": at any date, the aggregate principal amount of
Consolidated Total Debt minus the aggregate principal amount of any Specified
Opco Subordinated Indebtedness.
"Consolidated Senior Leverage Ratio": as of the last day of any period, the
ratio of (a) Consolidated Senior Debt on such day to (b) Annualized Operating
Cash Flow determined in respect of the fiscal quarter ending on such day.
"Consolidated Total Debt": at any date, the aggregate principal amount of
all Indebtedness (other than contingent obligations of the type described in
clause (f) of the definition of "Indebtedness"; provided, however, that
Consolidated Total Debt shall include the amount of any letters of credit which
support third-party Indebtedness) of each of the Borrowers and their respective
Subsidiaries at such date, determined on a consolidated basis in accordance with
GAAP.
"Contractual Obligation": as to any Person, any provision of any debt or
equity security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Default": any of the events specified in Section 7, whether or not any
requirement for the giving of notice, the lapse of time, or both, has been
satisfied.
"Designated Lenders": as defined in Section 4.1(a).
"Disposition": with respect to any property, any sale, lease (other than
leases in the ordinary course of business, including leases of excess office
space and fiber leases), sale and leaseback, assignment, conveyance, transfer or
other disposition thereof, including pursuant to an exchange for other property.
The terms "Dispose" and "Disposed of" shall have correlative meanings.
"Disposition Date": as defined in Section 6.5(e).
"Dollars" and "$": dollars in lawful currency of the United States.
"Domestic Subsidiary": any Subsidiary of any of the Borrowers organized
under the laws of any jurisdiction within the United States.
"Environmental Laws": any and all foreign, federal, state, local or
municipal laws, rules, orders, regulations, statutes, ordinances, codes,
decrees, requirements of any Governmental Authority or other Requirements of Law
(including common law) regulating, relating to or imposing liability or
standards of conduct concerning protection of human health or the environment,
as now or may at any time hereafter be in effect.
"Equity Interests": any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, any and all
classes of membership interests in a limited liability company, any and all
classes of partnership interests in a partnership and any and all other
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equivalent ownership interests in a Person, and any and all warrants, rights or
options to purchase any of the foregoing.
"ERISA": the Employee Retirement Income Security Act of 1974, as amended
from time to time.
"Eurocurrency Reserve Requirements": for any day as applied to a Eurodollar
Loan, the aggregate (without duplication) of the maximum rates (expressed as a
decimal fraction) of reserve requirements in effect on such day (including
basic, supplemental, marginal and emergency reserves under any regulations of
the Board or other Governmental Authority having jurisdiction with respect
thereto) dealing with reserve requirements prescribed for eurocurrency funding
(currently referred to as "Eurocurrency Liabilities" in Regulation D of the
Board) maintained by a member bank of the Federal Reserve System.
"Eurodollar Base Rate": with respect to each day during each Interest
Period pertaining to a Eurodollar Loan, the rate per annum determined on the
basis of the rate for deposits in Dollars for a period equal to such Interest
Period commencing on the first day of such Interest Period appearing on Page
3750 of the Dow Jones Markets screen as of 11:00 A.M., London time, two Business
Days prior to the beginning of such Interest Period. In the event that such rate
does not appear on Page 3750 of the Dow Jones Markets screen (or otherwise on
such screen), the "Eurodollar Base Rate" shall be determined by reference to
such other comparable publicly available service for displaying eurodollar rates
as may be selected by the Administrative Agent or, in the absence of such
availability, by reference to the rate at which the Administrative Agent is
offered Dollar deposits at or about 10:00 A.M., Chicago time, two Business Days
prior to the beginning of such Interest Period in the interbank eurodollar
market where its eurodollar and foreign currency and exchange operations are
then being conducted for delivery on the first day of such Interest Period for
the number of days comprised therein.
"Eurodollar Loans": Loans for which the applicable rate of interest is
based upon the Eurodollar Rate.
"Eurodollar Rate": with respect to each day during each Interest Period
pertaining to a Eurodollar Loan, a rate per annum determined for such day in
accordance with the following formula (rounded upward to the nearest 1/100th of
1%):
Eurodollar Base Rate
1.00 - -------------------------------------------
Burocurrency Reserve Requirements
"Eurodollar Tranche": the collective reference to Eurodollar Loans under a
particular Facility the then current Interest Periods with respect to all of
which begin on the same date and end on the same later date (whether or not such
Loans shall originally have been made on the same day).
"Event of Default": any of the events specified in Section 7, provided that
any requirement for the giving of notice, the lapse of time, or both, has been
satisfied.
"Exchange": any exchange of operating assets for other operating assets in
a Permitted Line of Business and, subject to the last sentence of this
definition, of comparable value and use to those assets being exchanged,
including exchanges involving the transfer or acquisition (or both transfer and
acquisition) of Equity Interests of a Person so long as 100% of the Equity
Interests of such Person are transferred or acquired, as the case may be. It is
understood that exchanges of the kind described above as to which a portion of
the consideration paid or received is in the form of cash shall nevertheless
constitute "Exchanges" for the purposes of this Agreement so long as the
aggregate consideration
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received by any of the Borrowers and any of their respective Subsidiaries in
connection with such exchange represents fair market value for the assets and
cash being transferred by any of the Borrowers and any of their respective
Subsidiaries.
"Exchange Excess Amount": as defined in Section 6.5(f).
"Excluded Acquired Subsidiary": any Subsidiary described in Section 6.2(g)
to the extent that the documentation governing the Indebtedness referred to in
said paragraph prohibits such Subsidiary from becoming a Subsidiary Guarantor,
but only so long as such Indebtedness remains outstanding.
"Existing Senior Discount Debt": the Indebtedness of Holdings outstanding
under the 11.875% Senior Discount Notes due December 1, 2008.
"Existing Senior Subordinated Debt": the Indebtedness of the Borrowers
outstanding under the 9.375% Senior Subordinated Notes due December 1, 2008.
"Existing Subordinated Debt": the collective reference to the Existing
Senior Subordinated Debt and the Existing Senior Discount Debt.
"Facility": each of (a) the Term B Commitments and the Term B Loans made
thereunder (the "Term B Facility"), (b) the Incremental Term Loans (the
"Incremental Term Facility") and (c) the Revolving Commitments and the
extensions of credit made thereunder (the "Revolving Facility").
"FCC": the Federal Communications Commission and any successor thereto.
"FCC License": any community antenna relay service, broadcast auxiliary
license, earth station registration, business radio, microwave or special safety
radio service license issued by the FCC pursuant to the Communications Act of
1934, as amended.
"Federal Funds Effective Rate": for any day, the weighted average of the
rates on overnight federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day that is a Business Day, the average of the
quotations for the day of such transactions received by the Administrative Agent
from three federal funds brokers of recognized standing selected by it.
"First Union": as defined in the preamble hereto.
"Flow-Through Entity": any Person that is not treated as a separate tax
paying entity for United States federal income tax purposes.
"Foreign Subsidiary": any Subsidiary of any of the Borrowers that is not a
Domestic Subsidiary.
"Funded Opco Debt": all Indebtedness of any of the Borrowers and any of
their respective Subsidiaries consisting of Indebtedness for borrowed money
which by its terms or by the terms of any instrument or agreement relating
thereto matures more than one year from, or is directly renewable or extendible
at the option of the obligor thereunder to a date more than one year from
(including an option of such obligor under a revolving credit or similar
agreement obligating the lender or lenders to extend credit over a period of one
year or more from), the date of creation thereof, including the Loans.
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"Funding Office": the office of the Administrative Agent specified in
Section 9.2 or such other office as may be specified from time to time by the
Administrative Agent as its funding office by written notice to the Borrowers
and the Lenders.
"GAAP": generally accepted accounting principles in the United States as in
effect from time to time, except that for purposes of Section 6.1, GAAP shall be
determined on the basis of such principles in effect on the date hereof and
consistent with those used in the preparation of the most recent audited
financial statements delivered pursuant to Section 3.1. In the event that any
"Accounting Change" (as defined below) shall occur and such change results in a
change in the method of calculation of financial covenants, standards or terms
in this Agreement, then the Borrowers and the Administrative Agent agree to
enter into negotiations in order to amend such provisions of this Agreement so
as to equitably reflect such Accounting Changes with the desired result that the
criteria for evaluating the Borrowers' financial condition shall be the same
after such Accounting Changes as if such Accounting Changes had not been made.
Until such time as such an amendment shall have been executed and delivered by
the Borrowers, the Administrative Agent and the Required Lenders, all financial
covenants, standards and terms in this Agreement shall continue to be calculated
or construed as if such Accounting Changes had not occurred. "Accounting
Changes" refers to changes in accounting principles required by the promulgation
of any rule, regulation, pronouncement or opinion by the Financial Accounting
Standards Board of the American Institute of Certified Public Accountants or, if
applicable, the SEC.
"Governmental Authority": any nation or government, any state or other
political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, central bank or other entity exercising executive,
legislative, judicial, taxing, regulatory or administrative functions of or
pertaining to government, any securities exchange and any self-regulatory
organization (including the National Association of Insurance Commissioners).
"Guarantee and Collateral Agreement": the Guarantee and Collateral
Agreement to be executed and delivered by Holdings, the Borrowers and each
Subsidiary Guarantor, substantially in the form of Exhibit A, as the same may be
amended, supplemented or otherwise modified from time to time.
"Guarantee Obligation": as to any Person (the "guaranteeing person"), any
obligation of (a) the guaranteeing person or (b) another Person (including any
bank under any letter of credit) to induce the creation of which the
guaranteeing person has issued a reimbursement, counterindemnity or similar
obligation, in either case guaranteeing or in effect guaranteeing any
Indebtedness, leases, dividends or other obligations (the "primary obligations")
of any other third Person (the "primary obligor") in any manner, whether
directly or indirectly, including any obligation of the guaranteeing person,
whether or not contingent, (i) to purchase any such primary obligation or any
property constituting direct or indirect security therefor, (ii) to advance or
supply funds (1) for the purchase or payment of any such primary obligation or
(2) to maintain working capital or equity capital of the primary obligor or
otherwise to maintain the net worth or solvency of the primary obligor, (iii) to
purchase property, securities or services primarily for the purpose of assuring
the owner of any such primary obligation of the ability of the primary obligor
to make payment of such primary obligation or (iv) otherwise to assure or hold
harmless the owner of any such primary obligation against loss in respect
thereof; provided, however, that the term "Guarantee Obligation" shall not
include endorsements of instruments for deposit or collection in the ordinary
course of business. The amount of any Guarantee Obligation of any guaranteeing
person shall be deemed to be the lower of (a) an amount equal to the stated or
determinable amount of the primary obligation in respect of which such Guarantee
Obligation is made and (b) the maximum amount for which such guaranteeing person
may be liable pursuant to the terms of the instrument embodying such Guarantee
Obligation, unless such primary obligation and the maximum amount for which such
guaranteeing person may be liable are not stated or determinable, in which case
the amount of such
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Guarantee Obligation shall be such guaranteeing person's maximum reasonably
anticipated liability in respect thereof as determined by the Borrowers in good
faith.
"Guarantors": the collective reference to Holdings and the Subsidiary
Guarantors.
"Hedge Agreements": all interest rate swaps, caps or collar agreements or
similar arrangements dealing with interest rates or currency exchange rates or
the exchange of nominal interest obligations, either generally or under specific
contingencies.
"Holdings": as defined in the preamble hereto, together with any successor
thereto pursuant to Section 6.4(e). Effective upon the consummation of any
transaction described in Section 6.4(e)(ii), (a) each reference to "Holdings" in
this Agreement or any other Loan Document shall be deemed to be a reference to
the Subsidiary of Holdings referred to in said Section and (b) the predecessor
Holdings shall automatically be released from all of its obligations under the
Loan Documents to which it is a party.
"Holdings Debt": any Indebtedness of Holdings consisting of Indebtedness
for borrowed money.
"Increased Facility Activation Notice": a notice substantially in the form
of Exhibit D-3.
"Increased Facility Closing Date": any Business Day designated as such in
an Increased Facility Activation Notice.
"Incremental Term Facility": as defined in the definition of "Facility".
"Incremental Term Lenders": (a) on any Increased Facility Closing Date
relating to Incremental Term Loans, the Lenders signatory to the relevant
Increased Facility Activation Notice and (b) thereafter, each Lender that is a
holder of an Incremental Term Loan.
"Incremental Term Loans": as defined in Section 2.1(a).
"Incremental Term Maturity Date": with respect to the Incremental Term
Loans to be made pursuant to any Increased Facility Activation Notice, the
maturity date specified in such Increased Facility Activation Notice, which date
shall be a date not earlier than the Revolving Termination Date.
"Indebtedness": of any Person at any date, without duplication, (a) all
indebtedness of such Person for borrowed money, (b) all obligations of such
Person for the deferred purchase price of property or services (other than
current trade payables incurred in the ordinary course of such Person's
business), (c) all obligations of such Person evidenced by notes, bonds,
debentures or other similar instruments, (d) all indebtedness created or arising
under any conditional sale or other title retention agreement with respect to
property acquired by such Person (even though the rights and remedies of the
seller or lender under such agreement in the event of default are limited to
repossession or sale of such property), (e) all Capital Lease Obligations of
such Person, (f) all obligations of such Person, contingent or otherwise, as an
account party under acceptances, letters of credit, surety bonds or similar
arrangements, (g) the liquidation value of all redeemable preferred Equity
Interests of such Person, (h) all Guarantee Obligations of such Person in
respect of obligations of the kind referred to in clauses (a) through (g) above,
(i) all obligations of the kind referred to in clauses (a) through (h) above
secured by (or for which the holder of such obligation has an existing right,
contingent or otherwise, to be secured by) any Lien on property (including
accounts and contract rights) owned by such Person, whether or not such Person
has assumed or become liable for the payment of such obligation, and (j) for the
purposes of
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Section 7(e) only, all obligations of such Person in respect of Hedge
Agreements. The Indebtedness of any Person shall include the Indebtedness of any
other entity (including any partnership in which such Person is a general
partner) to the extent such Person is liable therefor as a result of such
Person's ownership interest in or other relationship with such entity, except to
the extent the terms of such Indebtedness expressly provide that such Person is
not liable therefor.
"Insolvency": with respect to any Multiemployer Plan, the condition that
such Plan is insolvent within the meaning of Section 4245 of ERISA.
"Insolvent": pertaining to a condition of Insolvency.
"Intellectual Property": the collective reference to all rights, priorities
and privileges relating to intellectual property, whether arising under United
States, multinational or foreign laws or otherwise, including copyrights,
copyright licenses, patents, patent licenses, trademarks, trademark licenses,
technology, know-how and processes, and all rights to sue at law or in equity
for any infringement or other impairment thereof, including the right to receive
all proceeds and damages therefrom.
"Interest Payment Date": (a) as to any ABR Loan, the last day of each
March, June, September and December to occur while such Loan is outstanding and
the final maturity date of such Loan, (b) as to any Eurodollar Loan having an
Interest Period of three months or less, the last day of such Interest Period,
(c) as to any Eurodollar Loan having an Interest Period longer than three
months, each day that is three months, or a whole multiple thereof, after the
first day of such Interest Period and the last day of such Interest Period and
(d) as to any Loan (other than any Revolving Loan that is an ABR Loan and any
Swingline Loan), the date of any repayment or prepayment made in respect
thereof.
"Interest Period": as to any Eurodollar Loan, (a) initially, the period
commencing on the borrowing or conversion date, as the case may be, with respect
to such Eurodollar Loan and ending one, two, three, six or, if consented to by
(which consent shall not be unreasonably withheld) each Lender under the
relevant Facility, twelve months thereafter, as selected by the Borrowers in
their notice of borrowing or notice of conversion, as the case may be, given
with respect thereto; and (b) thereafter, each period commencing on the last day
of the next preceding Interest Period applicable to such Eurodollar Loan and
ending one, two, three, six or, if consented to by (which consent shall not be
unreasonably withheld) each Lender under the relevant Facility, twelve months
thereafter, as selected by the Borrowers by irrevocable notice to the
Administrative Agent not less than three Business Days prior to the last day of
the then current Interest Period with respect thereto; provided that, all of the
foregoing provisions relating to Interest Periods are subject to the following:
if any Interest Period would otherwise end on a day that is not a Business
Day, such Interest Period shall be extended to the next succeeding Business
Day unless the result of such extension would be to carry such Interest
Period into another calendar month in which event such Interest Period
shall end on the immediately preceding Business Day;
the Borrowers may not select an Interest Period under a particular Facility
that would extend beyond the Revolving Termination Date or beyond the date
final payment is due on the Term B Loans or the relevant Incremental Term
Loans, as the case may be;
any Interest Period that begins on the last Business Day of a calendar month
(or on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the last
Business Day of a calendar month; and
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the Borrowers shall select Interest Periods so as not to require a payment or
prepayment of any Eurodollar Loan during an Interest Period for such Loan.
"Investments": as defined in Section 6.7.
"Lenders": as defined in the preamble hereto.
"License": as to any Person, any license, permit, certificate of need,
authorization, certification, accreditation, franchise, approval, or grant of
rights by any Governmental Authority or other Person necessary or appropriate
for such Person to own, maintain, or operate its business or property, including
FCC Licenses.
"Lien": any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge or other security
interest or any preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever (including any conditional sale or
other title retention agreement and any capital lease having substantially the
same economic effect as any of the foregoing).
"Loan": any loan made or held by any Lender pursuant to this Agreement.
"Loan Documents": this Agreement and the Guarantee and Collateral
Agreement.
"Loan Parties": Holdings, the Borrowers and each Subsidiary of any of the
Borrowers that is a party to a Loan Document.
"Majority Facility Lenders": with respect to any Facility, the holders of
more than 50% of the aggregate unpaid principal amount of the Term Loans or the
Total Revolving Extensions of Credit, as the case may be, outstanding under such
Facility (or, in the case of the Revolving Facility, prior to any termination of
the Revolving Commitments, the holders of more than 50% of the Total Revolving
Commitments).
"Management Fee Agreement": Schedule I to the limited liability company
operating agreement of each of the Borrowers, as each such Schedule I may be
amended, replaced, supplemented or otherwise modified from time to time.
"Mandatory Payment of Accrued Interest": the redemption on December 1, 2003
by the issuers of the Existing Senior Discount Debt of an aggregate principal
amount equal to $369.79 per $1,000 principal amount thereof then outstanding,
which principal amount to be redeemed represents (i) unpaid accreted principal
of the Existing Senior Discount Debt (over the issue price thereof), accreted at
an annual rate of 11 7/8% per annum, compounded semi-annually, less (ii) an
amount equal to one year's simple uncompounded interest on the aggregate issue
price of the Existing Senior Discount Notes, at a rate per annum equal to the
stated interest rate thereon.
"Material Acquisition": as defined in Section 1.2(e).
"Material Adverse Effect": a material adverse effect on (a) the business,
property, operations or condition (financial or otherwise) of the Borrowers and
their respective Subsidiaries, taken as a whole, or (b) the validity or
enforceability of any material provision of this Agreement or any of the other
Loan Documents, including the rights or remedies of the Administrative Agent or
the Lenders hereunder or thereunder.
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"Material Disposition": as defined in Section 1.2(e).
"Materials of Environmental Concern": any gasoline or petroleum (including
crude oil or any fraction thereof) or petroleum products or any hazardous or
toxic substances, materials or wastes, defined or regulated as such in or under
any Environmental Law, including asbestos, polychlorinated biphenyls and
urea-formaldehyde insulation.
"Mercantile": as defined in the preamble hereto.
"Multiemployer Plan": a Plan that is a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.
"Net Cash Proceeds": (a) in connection with any Asset Sale or any Recovery
Event, the proceeds thereof in the form of cash and Cash Equivalents (including
any such proceeds received by way of deferred payment of principal pursuant to a
note or installment receivable or purchase price adjustment receivable or
otherwise, but only as and when received) of such Asset Sale or Recovery Event,
net of attorneys' fees, accountants' fees, investment banking fees, amounts
required to be applied to the repayment of Indebtedness secured by a Lien
expressly permitted hereunder on any asset that is the subject of such Asset
Sale or Recovery Event (other than any Lien pursuant to the Guarantee and
Collateral Agreement), other customary fees and expenses actually incurred in
connection therewith and reserves established in accordance with GAAP for
contingencies arising from such Asset Sale or Recovery Event (provided that at
the time any such amounts are no longer so reserved, such amounts shall become
Net Cash Proceeds) and net of taxes paid or reasonably estimated to be payable
as a result thereof (after taking into account any available tax credits or
deductions and any tax sharing arrangements) and (b) in connection with any
issuance or sale of Equity Interests or any incurrence of Indebtedness, the cash
proceeds received from such issuance or incurrence, net of attorneys' fees,
investment banking fees, accountants' fees, underwriting discounts and
commissions and other customary fees and expenses actually incurred in
connection therewith.
"New Lender": as defined in Section 2.1(d).
"New Lender Supplement": as defined in Section 2.1(d).
"Non-Excluded Taxes": as defined in Section 2.17(a).
"Non-Executing Persons": as defined in Section 4.1(a).
"Non-Recourse Subsidiary": (a) any Subsidiary of any of the Borrowers
created, acquired or activated by any of the Borrowers or any of their
respective Subsidiaries in connection with any Investment made pursuant to
Section 6.7(g) and designated as such by the Borrowers substantially
concurrently with such creation, acquisition or activation and (b) any
Subsidiary of such designated Subsidiary, provided, that (i) at no time shall
any creditor of any such Subsidiary have any claim (whether pursuant to a
Guarantee Obligation, by operation of law or otherwise) against any of the
Borrowers or any of its other Subsidiaries (other than another Non-Recourse
Subsidiary) in respect of any Indebtedness or other obligation of any such
Subsidiary (other than in respect of a non-recourse pledge of Equity Interests
in such Subsidiary or in respect of the interest of such Non-Recourse Subsidiary
in any lease of its assets otherwise permitted under this Agreement to any of
the Borrowers or any of their respective Subsidiaries); (ii) neither the
Borrowers nor any of their respective Subsidiaries (other than another
Non-Recourse Subsidiary) shall become a general partner of any such Subsidiary;
(iii) no default with respect to any Indebtedness of any such Subsidiary
(including any right which the holders thereof may have to take enforcement
action against any such Subsidiary) shall permit (upon notice, lapse of time or
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both) any holder of any Indebtedness of any of the Borrowers or their respective
other Subsidiaries (other than another Non-Recourse Subsidiary) to declare a
default on such other Indebtedness or cause the payment thereof to be
accelerated or payable prior to its final scheduled maturity; (iv) no such
Subsidiary shall own any Equity Interests of, or own or hold any Lien on any
property of, the Borrowers or any other Subsidiary of any of the Borrowers
(other than another Non-Recourse Subsidiary) (it being understood that for
purposes of this clause (iv), Liens will not be deemed to include lease
arrangements otherwise permitted under this Agreement between any of the
Borrowers or any of their respective Subsidiaries, on the one hand, as lessees,
and any Non-Recourse Subsidiary, on the other hand, as lessor); (v) no
Investments may be made in any such Subsidiary by any of the Borrowers or any of
their respective Subsidiaries (other than another Non-Recourse Subsidiary)
except pursuant to Section 6.7(g); (vi) the Borrowers shall not directly own any
Equity Interests in such Subsidiary; and (vii) at the time of such designation,
no Default or Event of Default shall have occurred and be continuing or would
result therefrom. It is understood that Non-Recourse Subsidiaries shall be
disregarded for the purposes of any calculation pursuant to this Agreement
relating to financial matters with respect to the Borrowers.
"Non-U.S. Lender": as defined in Section 2.17(d).
"Notes": the collective reference to any promissory notes evidencing Loans.
"Organizational Documents": (i) with respect to any corporation, its
certificate or articles of incorporation, by-laws and other constitutional
documents, including the certificate of designation for any series of its
preferred stock; (ii) with respect to any limited liability company, its
articles of organization and operating agreement, or other comparable documents
however named; and (iii) with respect to any partnership, its certificate of
partnership, if any, and its partnership agreement.
"Other Taxes": any and all present or future stamp or documentary taxes or
any other excise or property taxes, charges or similar levies arising from any
payment made hereunder or from the execution, delivery or enforcement of, or
otherwise with respect to, this Agreement or any other Loan Document.
"Participant": as defined in Section 9.6(b).
"Paul Allen Contributions": any and all capital contributions made by Paul
G. Allen, directly or indirectly, to any of the Borrowers or any of their
respective Subsidiaries.
"Paul Allen Group": the collective reference to (a) Paul G. Allen, (b) his
estate, spouse, immediate family members and heirs and (c) any trust,
corporation, partnership or other entity, the beneficiaries, stockholders,
partners or other owners of which consist exclusively of Paul G. Allen or such
other Persons referred to in clause (b) above or a combination thereof.
"PBGC": the Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA (or any successor).
"Permitted Lines of Business": as defined in Section 6.14(a).
"Person": an individual, partnership, corporation, limited liability
company, business trust, joint stock company, trust, unincorporated association,
joint venture, Governmental Authority or other entity of whatever nature.
"Plan": at a particular time, any employee pension benefit plan subject to
the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 or
ERISA or any welfare plan providing
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post-employment healthcare benefits, and in respect of which any of the
Borrowers or a Commonly Controlled Entity is (or, if such plan were terminated
at such time, would under Section 4069 of ERISA be deemed to be) an "employer"
as defined in Section 3(5) of ERISA.
"PNC Bank": as defined in the preamble hereto.
"Pole Agreement": any pole attachment agreement or underground conduit use
agreement entered into in connection with the operation of any CATV System.
"Pricing Grid": the pricing grid attached hereto as Annex A.
"Prime Rate": the rate of interest per annum publicly announced from time
to time by the Administrative Agent or its relevant affiliate as its prime
lending rate in effect for commercial loans in Dollars to United States
residents located in the United States (the Prime Rate not being intended to be
the lowest rate of interest charged by the Administrative Agent or its relevant
affiliate in connection with extensions of credit to debtors).
"Pro Forma Period": as defined in Section 1.2(e).
"Properties": as defined in Section 3.17(a).
"Qualified Indebtedness": (a) with respect to a Qualified Parent Company,
any Indebtedness (i) which is issued in a Rule 144A private placement or
registered public offering, (ii) which is not held by any Affiliate of a
Borrower and (iii) as to which 100% of the Net Cash Proceeds thereof are used by
such Qualified Parent Company to make Investments in one or more of the
Borrowers or their respective Subsidiaries engaged substantially in businesses
of the type described in Section 6.14(a) and/or to refinance other Qualified
Indebtedness or Indebtedness of a Borrower and (b) with respect to an Affiliate
of any of the Borrowers, any Indebtedness as to which 100% of the Net Cash
Proceeds thereof were contributed to any of the Borrowers.
"Qualified Parent Company": Charter Communications Holding Company, LLC or
any of its direct or indirect Subsidiaries, in each case provided that each of
the Borrowers shall be a Subsidiary of such Person.
"Recovery Event": any settlement of or payment in respect of any property
or casualty insurance claim or any condemnation proceeding relating to any asset
of any of the Borrowers or any of their respective Subsidiaries.
"Refunded Swingline Loans": as defined in Section 2.5(b).
"Refunding Date": as defined in Section 2.5(c).
"Register": as defined in Section 9.6(c).
"Regulation U": Regulation U of the Board as in effect from time to time.
"Reinvestment Deadline": as defined in the definition of "Reinvestment
Notice".
"Reinvestment Deferred Amount": with respect to any Reinvestment Event, the
aggregate Net Cash Proceeds received by any of the Borrowers or any of their
respective Subsidiaries in
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connection therewith that are not applied to prepay the Loans pursuant to
Section 2.9(a) as a result of the delivery of a Reinvestment Notice.
"Reinvestment Event": any Asset Sale or Recovery Event in respect of which
the Borrowers have delivered a Reinvestment Notice.
"Reinvestment Notice": a written notice executed by a Responsible Officer
and delivered to the Administrative Agent within twelve months after any Asset
Sale or Recovery Event, stating that (a) no Event of Default has occurred and is
continuing, (b) the Borrowers (directly or indirectly through a Subsidiary)
intend and expect to use, or have used, all or a specified portion of the Net
Cash Proceeds of such Asset Sale or Recovery Event to acquire assets useful in
their business, on or prior to the earlier of (i) the date that is (x) eighteen
months from the date of receipt of such Net Cash Proceeds of such Asset Sale or
(y) 270 days from the date of receipt of such Net Cash Proceeds of such Recovery
Event, and (ii) the date on which such proceeds would be required to be applied,
or to be offered to be applied, to prepay, redeem or defease any Indebtedness of
any Borrower or any of its Affiliates (other than Indebtedness under this
Agreement) if not applied as described above (such earlier date, the
"Reinvestment Deadline"), and (c) such use will not require redemptions or
prepayments (or offers to make redemptions or prepayments) of any other
Indebtedness of any Borrower or any of its Affiliates.
"Reinvestment Prepayment Amount": with respect to any Reinvestment Event,
the Reinvestment Deferred Amount relating thereto less any amount expended prior
to the relevant Reinvestment Prepayment Date to acquire assets useful in the
Borrowers' business (directly or indirectly through a Subsidiary of any
Borrower).
"Reinvestment Prepayment Date": with respect to any Reinvestment Event, the
earlier of (a) the relevant Reinvestment Deadline and (b) the date on which the
Borrowers shall have determined not to, or shall have otherwise ceased to,
acquire assets useful in the Borrowers' business (directly or indirectly through
a Subsidiary of any Borrower) with all or any portion of the relevant
Reinvestment Deferred Amount.
"Reorganization": with respect to any Multiemployer Plan, the condition
that such plan is in reorganization within the meaning of Section 4241 of ERISA.
"Reportable Event": any of the events set forth in Section 4043(c) of
ERISA, other than those events as to which the thirty day notice period is
waived under subsections .27, .28, .29, .30, .31, .32, .34 or .35 of PBGC Reg.
Section 4043.
"Required Lenders": at any time, the holders of more than 50% of the sum of
(a) the aggregate unpaid principal amount of the Term Loans then outstanding,
and (b) the Total Revolving Commitments then in effect or, if the Revolving
Commitments have been terminated, the Total Revolving Extensions of Credit then
outstanding.
"Required Prepayment Lenders": the Majority Facility Lenders in respect of
each Facility (with the Term B Facility and the Incremental Term Facility being
treated for this purpose as a single Facility).
"Requirement of Law": as to any Person, the Certificate of Incorporation
and By-Laws or other organizational or governing documents of such Person, and
any law, treaty, rule or regulation or determination of an arbitrator or a court
or other Governmental Authority, in each case applicable to or binding upon such
Person or any of its property or to which such Person or any of its property is
subject.
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"Responsible Officer": the chief executive officer, president or chief
financial officer of the Borrowers, but in any event, with respect to financial
matters, any of the chief financial officer or any other financial officer of
the Borrowers.
"Restricted Payments": as defined in Section 6.6.
"Revolving Aggregate Committed Amount": the sum of the Total Revolving
Commitments as in effect on the Closing Date and the amount of any increases
therein effected pursuant to Section 2.1(c).
"Revolving Commitment": as to any Lender, the obligation of such Lender, if
any, to make Revolving Loans and participate in Swingline Loans in an aggregate
principal amount not to exceed the amount set forth under the heading "Revolving
Commitment" opposite such Lender's name on Schedule 1.1 or in the Assignment and
Acceptance or New Lender Supplement pursuant to which such Lender became a party
hereto, as the same may be changed from time to time pursuant to the terms
hereof. The original amount of the Total Revolving Commitments is $175,000,000.
"Revolving Commitment Period": the period from and including the Closing
Date to the Revolving Termination Date.
"Revolving Extensions of Credit": as to any Revolving Lender at any time,
an amount equal to the sum of (a) the aggregate principal amount of all
Revolving Loans held by such Lender then outstanding, and (b) such Lender's
Revolving Percentage of the aggregate principal amount of Swingline Loans then
outstanding.
"Revolving Facility": as defined in the definition of "Facility".
"Revolving Lender": each Lender that has a Revolving Commitment or that
holds Revolving Loans.
"Revolving Loans": as defined in Section 2.1(b).
"Revolving Percentage": as to any Revolving Lender at any time, the
percentage which such Lender's Revolving Commitment then constitutes of the
Total Revolving Commitments (or, at any time after the Revolving Commitments
shall have expired or terminated, the percentage which the aggregate principal
amount of such Lender's Revolving Loans then outstanding constitutes of the
aggregate principal amount of the Revolving Loans then outstanding).
"Revolving Termination Date": May 15, 2008, or such earlier date on which
the Revolving Commitments shall terminate hereunder.
"SEC": the Securities and Exchange Commission, any successor thereto and
any analogous Governmental Authority.
"Shell Subsidiary": any Subsidiary of any of the Borrowers that is a
"shell" company having (a) assets (either directly or through any Subsidiary or
other Equity Interests) with an aggregate value not exceeding $10,000 and (b) no
operations.
"Solvent": when used with respect to any Person, means that, as of any date
of determination, (a) the amount of the "present fair saleable value" of the
assets of such Person will, as of such date, exceed the amount of all
"liabilities of such Person, contingent or otherwise", as of such date,
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as such quoted terms are determined in accordance with applicable federal and
state laws governing determinations of the insolvency of debtors, (b) the
present fair saleable value of the assets of such Person will, as of such date,
be greater than the amount that will be required to pay the liability of such
Person on its debts as such debts become absolute and matured, (c) such Person
will not have, as of such date, an unreasonably small amount of capital with
which to conduct its business, and (d) such Person will be able to pay its debts
as they mature. For purposes of this definition, (i) "debt" means liability on a
"claim", and (ii) "claim" means any (x) right to payment, whether or not such a
right is reduced to judgment, liquidated, unliquidated, fixed, contingent,
matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured
or (y) right to an equitable remedy for breach of performance if such breach
gives rise to a right to payment, whether or not such right to an equitable
remedy is reduced to judgment, fixed, contingent, matured or unmatured,
disputed, undisputed, secured or unsecured.
"Specified Agents": the collective reference to the Administrative Agent
and the Syndication Agents.
"Specified Holdings Subsidiary": each Subsidiary of Holdings other than the
Borrowers and their respective Subsidiaries.
"Specified Long-Term Indebtedness": any Indebtedness incurred pursuant to
Section 6.2(f).
"Specified Opco Subordinated Indebtedness": any Existing Senior
Subordinated Debt, any Specified Subordinated Debt and any Specified Long-Term
Indebtedness.
"Specified Subordinated Debt": any Indebtedness of the Borrowers issued
directly or indirectly to Paul G. Allen or any of his Affiliates, so long as (i)
no Default or Event of Default shall have occurred and be continuing or would
result from the incurrence thereof, (ii) such Indebtedness shall have no
scheduled amortization prior to the date that is one year after the final
maturity of the Term Loans outstanding on the date such Indebtedness is
incurred, (iii) such Indebtedness is unsecured, and (iv) such Indebtedness has
terms and conditions substantially identical to those set forth in Exhibit G.
"Subsidiary": as to any Person, a corporation, partnership, limited
liability company or other entity of which shares of stock or other ownership
interests having ordinary voting power (other than stock or such other ownership
interests having such power only by reason of the happening of a contingency) to
elect a majority of the board of directors or other managers of such
corporation, partnership or other entity are at the time owned, or the
management of which is otherwise controlled, directly or indirectly, through one
or more intermediaries, or both, by such Person; provided, that Non-Recourse
Subsidiaries shall be deemed not to constitute "Subsidiaries" for the purposes
of this Agreement (other than the definition of "Non-Recourse Subsidiary").
Unless otherwise qualified, all references to a "Subsidiary" or to
"Subsidiaries" in this Agreement shall refer to a Subsidiary or Subsidiaries of
a Borrower.
"Subsidiary Guarantor": each Subsidiary of any of the Borrowers other than
any Foreign Subsidiary and any Excluded Acquired Subsidiary.
"Swingline Commitment": the obligation of the Swingline Lender to make
Swingline Loans pursuant to Section 2.4 in an aggregate principal amount at any
one time outstanding not to exceed $15,000,000.
"Swingline Lender": Bank of Montreal, in its capacity as the lender of
Swingline Loans.
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"Swingline Loans": as defined in Section 2.4.
"Swingline Participation Amount": as defined in Section 2.5(c).
"Syndication Agents": as defined in the preamble hereto.
"Term B Commitment": as to any Term B Lender, the obligation of such Lender
to make a Term B Loan to the Borrowers hereunder in a principal amount not to
exceed the amount set forth under the heading "Term B Commitment" opposite such
Lender's name on Schedule 1.1. The original aggregate amount of the Term B
Commitments is $125,000,000.
"Term B Facility": as defined in the definition of "Facility".
"Term B Lender": each Lender that has a Term B Commitment or that holds a
Term B Loan.
"Term B Loan": as defined in Section 2.1(a).
"Term B Loan Aggregate Funded Amount": the aggregate principal amount of
Term B Loans made on the Closing Date.
"Term B Percentage": as to any Term B Lender at any time, the percentage
which the aggregate principal amount of such Lender's Term B Loans then
outstanding constitutes of the aggregate principal amount of all Term B Loans
then outstanding.
"Term Lenders": the collective reference to the Term B Lenders and the
Incremental Term Lenders.
"Term Loans": the collective reference to the Term B Loans and Incremental
Term Loans.
"Test Period": as defined in Section 1.2(e).
"Threshold Management Fee Date": any date on which, both before and after
giving pro forma effect to the payment of any previously deferred management
fees pursuant to Section 6.8(c) (including any Indebtedness incurred in
connection therewith), the Consolidated Leverage Ratio, determined as of the
last day of the most recent fiscal quarter for which the relevant financial
information is available, is less than 4.50 to 1.0.
"Threshold Transaction Date": any date on which, both before and after
giving pro forma effect to a particular transaction (including any Indebtedness
incurred in connection therewith), the Consolidated Interest Coverage Ratio,
determined in respect of the most recent period of four consecutive fiscal
quarters for which the relevant financial information is available, is greater
than 2.10 to 1.0.
"Total Revolving Commitments": at any time, the aggregate amount of the
Revolving Commitments then in effect.
"Total Revolving Extensions of Credit": at any time, the aggregate amount
of the Revolving Extensions of Credit of the Revolving Lenders outstanding at
such time.
"Transferee": any Assignee or Participant.
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"Type": as to any Loan, its nature as an ABR Loan or a Eurodollar Loan.
"United States": the United States of America.
"Wholly Owned Subsidiary": as to any Person, any other Person all of the
Equity Interests of which (other than directors' qualifying shares required by
law) is owned by such Person directly or through other Wholly Owned Subsidiaries
or a combination thereof.
"Wholly Owned Subsidiary Guarantor": any Subsidiary Guarantor that is a
Wholly Owned Subsidiary of any of the Borrowers.
Other Definitional Provisions; Pro Forma Calculations.
Unless otherwise specified therein, all terms defined in this Agreement shall
have the defined meanings when used in the other Loan Documents or any
certificate or other document made or delivered pursuant hereto or thereto.
As used herein and in the other Loan Documents, and any certificate or other
document made or delivered pursuant hereto or thereto, (i) accounting terms
relating to Holdings, the Borrowers and their respective Subsidiaries not
defined in Section 1.1 and accounting terms partly defined in Section 1.1,
to the extent not defined, shall have the respective meanings given to them
under GAAP, (ii) the words "include", "includes" and "including" shall be
deemed to be followed by the phrase "without limitation", (iii) the word
"incur" shall be construed to mean incur, create, issue, assume, become
liable in respect of or suffer to exist (and the words "incurred" and
"incurrence" shall have correlative meanings), and (iv) the words "asset"
and "property" shall be construed to have the same meaning and effect and
to refer to any and all tangible and intangible assets and properties,
including cash, Equity Interests, securities, revenues, accounts, leasehold
interests, contract rights and any other "assets" as such term is defined
under GAAP.
The words "hereof", "herein" and "hereunder" and words of similar import when
used in this Agreement shall refer to this Agreement as a whole and not to
any particular provision of this Agreement, and Section, Schedule and
Exhibit references are to this Agreement unless otherwise specified.
The meanings given to terms defined herein shall be equally applicable to both
the singular and plural forms of such terms.
For the purposes of calculating Annualized Operating Cash Flow, Annualized Pro
Forma Operating Cash Flow, Consolidated Operating Cash Flow and
Consolidated Interest Expense for any period (a "Test Period"), (i) if at
any time from the period (a "Pro Forma Period") commencing on the second
day of such Test Period and ending on the last day of such Test Period (or,
in the case of any pro forma calculation made pursuant hereto in respect of
a particular transaction, ending on the date such transaction is
consummated and, unless otherwise expressly provided herein, after giving
effect thereto), any of the Borrowers or any Subsidiary shall have made any
Material Disposition, the Consolidated Operating Cash Flow for such Test
Period shall be reduced by an amount equal to the Consolidated Operating
Cash Flow (if positive) attributable to the property which is the subject
of such Material Disposition for such Test Period or increased by an amount
equal to the Consolidated Operating Cash Flow (if negative) attributable
thereto for such Test Period, and Consolidated Interest Expense for such
Test Period shall be reduced by an amount equal to the Consolidated
Interest Expense for such Test Period attributable to any Indebtedness of
any of the Borrowers or any Subsidiary repaid, repurchased, defeased or
otherwise discharged with respect to any of the Borrowers and their
respective Subsidiaries in connection with such Material Disposition (or,
if the
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Equity Interests of any Subsidiary is sold, the Consolidated Interest
Expense for such Test Period directly attributable to the Indebtedness of
such Subsidiary to the extent the Borrowers and their respective continuing
Subsidiaries are no longer liable for such Indebtedness after such
Disposition); (ii) if during such Pro Forma Period any of the Borrowers or
any Subsidiary shall have made a Material Acquisition, Consolidated
Operating Cash Flow and Consolidated Interest Expense for such Test Period
shall be calculated after giving pro forma effect thereto (including the
incurrence or assumption of any Indebtedness in connection therewith) as if
such Material Acquisition (and the incurrence or assumption of any such
Indebtedness) occurred on the first day of such Test Period; (iii) if
during such Pro Forma Period any Person that subsequently became a
Subsidiary or was merged with or into any of the Borrowers or any
Subsidiary since the beginning of such Pro Forma Period shall have entered
into any disposition or acquisition transaction that would have required an
adjustment pursuant to clause (i) or (ii) above if made by any of the
Borrowers or a Subsidiary during such Pro Forma Period, Consolidated
Operating Cash Flow and Consolidated Interest Expense for such Test Period
shall be calculated after giving pro forma effect thereto as if such
transaction occurred on the first day of such Test Period; and (iv) in the
case of determinations in connection with transactions involving the
incurrence of Indebtedness, Consolidated Interest Expense shall be
calculated after giving pro forma effect thereto (and all other incurrences
of Indebtedness during such Pro Forma Period) as if such Indebtedness was
incurred on the first day of such Test Period. For the purposes of this
paragraph, pro forma calculations regarding the amount of income or
earnings relating to any Material Disposition or Material Acquisition and
the amount of Consolidated Interest Expense associated with any discharge
or incurrence of Indebtedness shall in each case be determined in good
faith by a Responsible Officer of the Borrowers. If any Indebtedness bears
a floating rate of interest and the incurrence or assumption thereof is
being given pro forma effect, the interest expense on such Indebtedness
shall be calculated as if the rate in effect on the last day of the
relevant Pro Forma Period had been the applicable rate for the entire
relevant Test Period (taking into account any interest rate protection
agreement applicable to such Indebtedness if such interest rate protection
agreement has a remaining term in excess of 12 months). As used in this
Section 1.2(e), "Material Acquisition" means any acquisition of property or
series of related acquisitions of property that (i) constitutes assets
comprising all or substantially all of an operating unit of a business or
constitutes all or substantially all of the Equity Interests of a Person
and (ii) involves the payment of Consideration by the Borrowers and their
respective Subsidiaries in excess of $1,000,000; and "Material Disposition"
means any Disposition of property or series of related Dispositions of
property that yields gross proceeds to any of the Borrowers or any of their
respective Subsidiaries in excess of $1,000,000.
AMOUNT AND TERMS OF COMMITMENTS
Commitments; Increases in the Revolving Facility; Incremental Term Loans.
Subject to the terms and conditions hereof, (i) each Term B Lender severally
agrees to make a term loan (each, a "Term B Loan") to the Borrowers in an
amount not to exceed the amount of the Term B Commitment of such Lender and
(ii) each Incremental Term Lender severally agrees to make one or more term
loans (each, an "Incremental Term Loan") to the extent provided in Section
2.1(c). The Term Loans may from time to time be Eurodollar Loans or ABR
Loans, as determined by the Borrowers and notified to the Administrative
Agent in accordance with Sections 2.2 and 2.10. Term B Loans may only be
made on the Closing Date.
Subject to the terms and conditions hereof, each Revolving Lender severally
agrees to make revolving credit loans ("Revolving Loans") to the Borrowers
from time to time during the Revolving Commitment Period in an aggregate
principal amount at any one time outstanding which, when added to such
Lender's Revolving Percentage of the aggregate principal amount of the
Swingline Loans
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then outstanding, does not exceed the amount of such Lender's Revolving
Commitment. During the Revolving Commitment Period the Borrowers may use
the Revolving Commitments by borrowing, prepaying the Revolving Loans in
whole or in part, and reborrowing, all in accordance with the terms and
conditions hereof. The Revolving Loans may from time to time be Eurodollar
Loans or ABR Loans, as determined by the Borrowers and notified to the
Administrative Agent in accordance with Sections 2.2 and 2.10.
The Borrowers and any one or more Lenders (including New Lenders) may, from
time to time (but on no more than three (3) occasions) on or before
December 31, 2003, agree that such Lenders shall make, obtain or increase
the amount of their Incremental Term Loans or Revolving Commitments, as
applicable, by executing and delivering to the Administrative Agent an
Increased Facility Activation Notice specifying (i) the amount of such
Loans to be made or the amount of such increase (which shall on each
occasion be no less than $25,000,000), as the case may be, and the Facility
or Facilities involved, (ii) the applicable Increased Facility Closing Date
and (iii) in the case of Incremental Term Loans, (x) the applicable
Incremental Term Maturity Date, (y) the amortization schedule for such
Incremental Term Loans, which shall comply with Section 2.3 hereof, and (z)
the Applicable Margin for such Incremental Term Loans. Unless otherwise
consented to by Required Lenders, the aggregate Incremental Term Loans and
Revolving Commitments available to the Borrowers pursuant to the foregoing
shall not exceed $75,000,000 plus the lesser of (i) $37,500,000 and (ii)
the sum of (x) optional permanent reductions in the Revolving Commitments
effected pursuant to Section 2.7 hereof, and (y) optional prepayments of
the Term Loans effected pursuant to Section 2.8 hereof. No Lender shall
have any obligation to participate in any increase described in this
Section 2.1(c) unless it agrees to do so in its sole discretion.
Any additional bank, financial institution or other entity which, with the
consent of the Borrowers and the Administrative Agent (which consent shall
not be unreasonably withheld), elects to become a "Lender" under this
Agreement in connection with any transaction described in Section 2.1(c)
shall execute a New Lender Supplement (each, a "New Lender Supplement"),
substantially in the form of Exhibit D-2, whereupon such bank, financial
institution or other entity (a "New Lender") shall become a Lender for all
purposes and to the same extent as if originally a party hereto and shall
be bound by and entitled to the benefits of this Agreement.
Unless otherwise agreed by the Administrative Agent, on each Increased Facility
Closing Date (other than in respect of Incremental Term Loans), the
Borrowers shall borrow Revolving Loans under the increased Revolving
Commitments from each Lender participating in the increase in an amount
determined by reference to the amount of each Type of Loan (and, in the
case of Eurodollar Loans, of each Eurodollar Tranche) which would then have
been outstanding from such Lender if (i) each such Type or Eurodollar
Tranche had been borrowed or effected on such Increased Facility Closing
Date and (ii) the aggregate amount of each such Type or Eurodollar Tranche
requested to be so borrowed or effected had been proportionately increased.
The Eurodollar Base Rate applicable to any Eurodollar Loan borrowed
pursuant to the preceding sentence shall equal the Eurodollar Base Rate
then applicable to the Eurodollar Loans of the other Lenders in the same
Eurodollar Tranche (or, until the expiration of the then-current Interest
Period, such other rate as shall be agreed upon between the Borrowers and
the relevant Lender).
Procedure for Borrowing. In order to effect a borrowing hereunder, the Borrowers
shall give the Administrative Agent irrevocable notice (which notice must
be received by the Administrative Agent prior to 12:00 Noon, Chicago time,
(a) three Business Days prior to the requested Borrowing Date, in the case
of Eurodollar Loans, or (b) one Business Day prior to the requested
Borrowing Date, in the case of ABR Loans), specifying (i) the Facility
under which such Loan is to be borrowed, (ii) the amount and Type of Loans
to be borrowed, (iii) the requested Borrowing Date and (iv) in the case of
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Eurodollar Loans, the respective amounts of each such Type of Loan and the
respective lengths of the initial Interest Period therefor. Any Loans made
on the Closing Date shall initially be ABR Loans. Each borrowing shall be
in an aggregate amount equal to (x) in the case of ABR Loans, $5,000,000 or
a whole multiple of $1,000,000 in excess thereof (or, if the then aggregate
Available Revolving Commitments are less than $5,000,000, such lesser
amount) and (y) in the case of Eurodollar Loans, $10,000,000 or a whole
multiple of $1,000,000 in excess thereof; provided, that the Swingline
Lender may request, on behalf of the Borrowers, borrowings under the
Revolving Commitments that are ABR Loans in other amounts pursuant to
Section 2.5. Upon receipt of any such notice from the Borrowers, the
Administrative Agent shall promptly notify each relevant Lender thereof.
Each relevant Lender will make the amount of its pro rata share of each
borrowing available to the Administrative Agent for the account of the
Borrowers at the Funding Office prior to 11:00 A.M., Chicago time, on the
Borrowing Date requested by the Borrowers in funds immediately available to
the Administrative Agent. Such borrowing will then be made available not
later than 2:00 P.M., Chicago time, to the Borrowers by the Administrative
Agent crediting the account of the Borrowers on the books of such office
with the aggregate of the amounts made available to the Administrative
Agent by the relevant Lenders and in like funds as received by the
Administrative Agent.
Repayment of Loans.
The Term B Loans of each Term B Lender shall mature in 24 consecutive quarterly
installments (each due on the last day of each calendar quarter, except for
the last such installment), commencing on March 31, 2003, each of which
shall be in an amount equal to such Lender's Term B Percentage multiplied
by (i) in the case of the first 23 such installments, 0.25% of the Term B
Loan Aggregate Funded Amount and (ii) in the case of the last such
installment (which shall be due on November 15, 2008), 94.25% of the Term B
Loan Aggregate Funded Amount; provided, however, that (anything to the
contrary herein notwithstanding) if any Existing Subordinated Debt shall
remain outstanding on March 31, 2008, the unpaid Term B Loans of each Term
B Lender shall mature and shall be due and payable in full on June 30,
2008.
The Incremental Term Loans of each Incremental Term Lender shall mature in
consecutive installments (which shall be no more frequent than quarterly)
as specified in the Increased Facility Activation Notice pursuant to which
such Incremental Term Loans were made, provided that, the weighted average
life to maturity of the Incremental Term Loans shall not be less than that
of the Revolving Facility, and the final maturity date of the Incremental
Term Loans shall not be earlier than the Revolving Termination Date;
provided, however, that (anything to the contrary herein notwithstanding)
if any Existing Subordinated Debt shall remain outstanding on March 31,
2008, the unpaid Incremental Term Loans of each Incremental Term Lender
shall mature and shall be due and payable in full on June 30, 2008.
The Total Revolving Commitments shall be permanently reduced in quarterly
installments (each on the last day of each calendar quarter) during each of
the years set forth below (except for the year 2008, in which only two
reductions shall occur on March 31, 2008 and the Revolving Maturity Date,
respectively), in an amount in each such quarter equal to 25% (except for
the year 2008, in which each such reduction shall be 50%) of the percentage
of the Revolving Aggregate Committed Amount set forth opposite such year:
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<PAGE> 25
<TABLE>
<CAPTION>
Year Percentage
---- ----------
<S> <C>
2003 5.0%
2004 15.0%
2005 20.0%
2006 22.0%
2007 24.0%
2008 14.0%
</TABLE>
; provided, however, that (anything to the contrary herein
notwithstanding) if any Existing Subordinated Debt shall remain
outstanding on March 31, 2008, the Total Revolving Commitments shall be
permanently reduced in full, and all Revolving Loans shall become due
and payable in full, on such date.
Any reduction or termination of the Revolving Commitments pursuant to this
Section 2.3 shall be accompanied by prepayment of the Revolving Loans
and/or Swingline Loans to the extent that the Total Revolving Extensions of
Credit exceed the amount of the Total Revolving Commitments after giving
effect thereto. The application of any prepayment pursuant to this
paragraph shall be made, first, to ABR Loans and, second, to Eurodollar
Loans. Each prepayment of the Loans under this paragraph (other than ABR
Loans and Swingline Loans) shall be accompanied by accrued interest to the
date of such prepayment on the amount prepaid.
Swingline Commitment. Subject to the terms and conditions hereof, the Swingline
Lender agrees to make a portion of the credit otherwise available to the
Borrowers under the Revolving Commitments from time to time during the
Revolving Commitment Period by making swingline loans ("Swingline Loans")
to the Borrowers; provided that (a) the aggregate principal amount of
Swingline Loans outstanding at any time shall not exceed the Swingline
Commitment then in effect (notwithstanding that the Swingline Loans
outstanding at any time, when aggregated with the Swingline Lender's other
outstanding Revolving Loans hereunder, may exceed the Swingline Commitment
then in effect) and (b) the Borrowers shall not request, and the Swingline
Lender shall not make, any Swingline Loan if, after giving effect to the
making of such Swingline Loan, the aggregate amount of the Available
Revolving Commitments would be less than zero. During the Revolving
Commitment Period, the Borrowers may use the Swingline Commitment by
borrowing, repaying and reborrowing, all in accordance with the terms and
conditions hereof. Swingline Loans shall be ABR Loans only.
Procedure for Swingline Borrowing; Refunding of Swingline Loans.
Whenever the Borrowers desire that the Swingline Lender make Swingline Loans
they shall give the Swingline Lender irrevocable telephonic notice
confirmed promptly in writing (which telephonic notice must be received by
the Swingline Lender not later than 12:00 Noon, Chicago time, on the
proposed Borrowing Date), specifying (i) the amount to be borrowed and (ii)
the requested Borrowing Date (which shall be a Business Day during the
Revolving Commitment Period). Each borrowing under the Swingline Commitment
shall be in an amount equal to $1,000,000 or a whole multiple of $500,000
in excess thereof. Not later than 2:00 P.M., Chicago time, on the Borrowing
Date specified in a notice in respect of Swingline Loans, the Swingline
Lender shall make available to the Administrative Agent at the Funding
Office an amount in immediately available funds equal to the amount of the
Swingline Loan to be made by the Swingline Lender. The Administrative Agent
shall make the proceeds of such Swingline Loan available to the Borrowers
on such Borrowing Date by depositing such proceeds in the account of the
Borrowers with the Administrative Agent on such Borrowing Date in
immediately available funds.
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The Swingline Lender, at any time and from time to time in its sole and
absolute discretion and in consultation with the Borrowers (provided that
the failure to so consult shall not affect the ability of the Swingline
Lender to make the following request) may, on behalf of the Borrowers
(which hereby irrevocably direct the Swingline Lender to act on their
behalf), on one Business Day's notice given by the Swingline Lender no
later than 1:00 P.M., Chicago time, request each Revolving Lender to make,
and each Revolving Lender hereby agrees to make, a Revolving Loan, in an
amount equal to such Revolving Lender's Revolving Percentage of the
aggregate amount of the Swingline Loans (the "Refunded Swingline Loans")
outstanding on the date of such notice, to repay the Swingline Lender. Each
Revolving Lender shall make the amount of such Revolving Loan available to
the Administrative Agent at the Funding Office in immediately available
funds, not later than 11:00 A.M., Chicago time, one Business Day after the
date of such notice. The proceeds of such Revolving Loans shall be
immediately made available by the Administrative Agent to the Swingline
Lender for application by the Swingline Lender to the repayment of the
Refunded Swingline Loans. The Borrowers irrevocably authorize the Swingline
Lender to charge the Borrowers' accounts with the Administrative Agent (up
to the amount available in each such account) in order to immediately pay
the amount of such Refunded Swingline Loans to the extent amounts received
from the Revolving Lenders are not sufficient to repay in full such
Refunded Swingline Loans.
If prior to the time a Revolving Loan would have otherwise been made pursuant
to Section 2.5(b), one of the events described in Section 7(f) shall have
occurred and be continuing with respect to any of the Borrowers or if for
any other reason, as determined by the Swingline Lender in its sole
discretion, Revolving Loans may not be made as contemplated by Section
2.5(b), each Revolving Lender shall, on the date such Revolving Loan was to
have been made pursuant to the notice referred to in Section 2.5(b) (the
"Refunding Date"), purchase for cash an undivided participating interest in
the then outstanding Swingline Loans by paying to the Swingline Lender an
amount (the "Swingline Participation Amount") equal to (i) such Revolving
Lender's Revolving Percentage times (ii) the sum of the aggregate principal
amount of Swingline Loans then outstanding that were to have been repaid
with such Revolving Loans.
Whenever, at any time after the Swingline Lender has received from any Revolving
Lender such Lender's Swingline Participation Amount, the Swingline Lender
receives any payment on account of the Swingline Loans, the Swingline
Lender will distribute to such Lender its Swingline Participation Amount
(appropriately adjusted, in the case of interest payments, to reflect the
period of time during which such Lender's participating interest was
outstanding and funded and, in the case of principal and interest payments,
to reflect such Lender's pro rata portion of such payment if such payment
is not sufficient to pay the principal of and interest on all Swingline
Loans then due); provided, however, that in the event that such payment
received by the Swingline Lender is required to be returned, such Revolving
Lender will return to the Swingline Lender any portion thereof previously
distributed to it by the Swingline Lender.
Each Revolving Lender's obligation to make the Loans referred to in Section
2.5(b) and to purchase participating interests pursuant to Section 2.5(c)
shall be absolute and unconditional and shall not be affected by any
circumstance, including (i) any setoff, counterclaim, recoupment, defense
or other right that such Revolving Lender or the Borrowers may have against
the Swingline Lender, the Borrower or any other Person for any reason
whatsoever; (ii) the occurrence or continuance of a Default or an Event of
Default or the failure to satisfy any of the other conditions specified in
Section 4; (iii) any adverse change in the condition (financial or
otherwise) of the Borrowers; (iv) any breach of this Agreement or any other
Loan Document by any of the Borrowers, any other Loan Party or any other
Revolving Lender; or (v) any other circumstance, happening or event
whatsoever, whether or not similar to any of the foregoing.
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<PAGE> 27
Commitment Fees, etc.
The Borrowers jointly and severally agree to pay to the Administrative Agent
for the account of each Revolving Lender a nonrefundable commitment fee for
the period from and including the Closing Date to the last day of the
Revolving Commitment Period, computed at the Commitment Fee Rate on the
average daily amount of the Available Revolving Commitment of such Lender
during the period for which payment is made, payable quarterly in arrears
on the last day of each March, June, September and December and on the
Revolving Termination Date, commencing on the first of such dates to occur
after the date hereof.
The Borrowers jointly and severally agree to pay to the Administrative Agent
the fees in the amounts and on the dates previously agreed to in writing by
the Borrowers and the Administrative Agent.
Termination or Reduction of Revolving Commitments. The Borrowers shall have the
right, upon not less than three Business Days' notice to the Administrative
Agent, to terminate the Revolving Commitments or, from time to time, to
reduce the amount of the Revolving Commitments; provided that no such
termination or reduction of Revolving Commitments shall be permitted if,
after giving effect thereto and to any prepayments of the Revolving Loans
and Swingline Loans made on the effective date thereof, the Total Revolving
Extensions of Credit would exceed the Total Revolving Commitments. Any such
reduction shall be in an amount equal to $10,000,000, or a whole multiple
of $1,000,000 in excess thereof, shall reduce permanently the Revolving
Commitments then in effect and shall be applied pro rata to the scheduled
reductions thereof.
Optional Prepayments. The Borrowers may at any time and from time to time prepay
the Loans, in whole or in part, without premium or penalty, upon
irrevocable notice delivered to the Administrative Agent at least three
Business Days prior thereto in the case of Eurodollar Loans and at least
one Business Day prior thereto in the case of ABR Loans, which notice shall
specify the date and amount of prepayment and whether the prepayment is of
Eurodollar Loans or ABR Loans; provided, that if a Eurodollar Loan is
prepaid on any day other than the last day of the Interest Period
applicable thereto, the Borrowers shall also pay any amounts owing pursuant
to Section 2.18. Upon receipt of any such notice the Administrative Agent
shall promptly notify each relevant Lender thereof. If any such notice is
given, the amount specified in such notice shall be due and payable on the
date specified therein, together with (except in the case of Revolving
Loans that are ABR Loans and Swingline Loans) accrued interest to such date
on the amount prepaid. Partial prepayments of Term Loans and Revolving
Loans shall be in an aggregate principal amount of $5,000,000 or a whole
multiple of $1,000,000 in excess thereof. Partial prepayments of Swingline
Loans shall be in an aggregate principal amount of $1,000,000 or a whole
multiple of $500,000 in excess thereof.
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<PAGE> 28
Mandatory Prepayments.
Unless the Required Prepayment Lenders shall otherwise agree, if on any date any
of the Borrowers or any of their respective Subsidiaries shall receive Net
Cash Proceeds from any Asset Sale or Recovery Event then, (i) unless a
Reinvestment Notice shall be delivered in respect thereof, such Net Cash
Proceeds shall be applied within two Business Days after the deadline by
which such Reinvestment Notice is otherwise required to be delivered in
respect of such Asset Sale or Recovery Event toward the prepayment of the
Loans (provided that the foregoing requirement shall not apply to the first
$5,000,000 of aggregate Net Cash Proceeds received after the Closing Date)
and (ii) on each Reinvestment Prepayment Date, an amount equal to the
Reinvestment Prepayment Amount with respect to the relevant Reinvestment
Event shall be applied toward the prepayment of the Loans.
The application of any prepayment of the Loans pursuant to this Section 2.9
shall be made, first, to prepayment of the Term Loans to the full extent
thereof. Second, the Revolving Commitments shall be permanently reduced in
an amount equal to any prepayment amounts remaining after the foregoing
application to the Term Loans (such reductions to be applied pro rata to
the scheduled reductions of the Revolving Commitments), and, to the extent
that the Total Revolving Extensions of Credit exceed the Revolving
Commitments as so reduced, then such remaining prepayment amounts shall be
applied to prepay first the Swingline Loans and second the Revolving Loans
to the extent necessary so that immediately after giving effect to such
prepayment the Total Revolving Extensions of Credit are equal to the
Revolving Commitments. The application of any prepayment of Term Loans or
Revolving Loans pursuant to this Section 2.9 shall be made, first, to ABR
Loans and, second, to Eurodollar Loans. Each prepayment of the Loans under
this Section 2.9 shall be accompanied by accrued interest to the date of
such prepayment on the amount prepaid.
Conversion and Continuation Options.
The Borrowers may elect from time to time to convert Eurodollar Loans to ABR
Loans by giving the Administrative Agent at least two Business Days' prior
irrevocable notice of such election, provided that any such conversion of
Eurodollar Loans may only be made on the last day of an Interest Period
with respect thereto. The Borrowers may elect from time to time to convert
ABR Loans to Eurodollar Loans by giving the Administrative Agent at least
three Business Days' prior irrevocable notice of such election (which
notice shall specify the length of the initial Interest Period therefor),
provided that no ABR Loan may be converted into a Eurodollar Loan when any
Event of Default has occurred and is continuing. Upon receipt of any such
notice the Administrative Agent shall promptly notify each relevant Lender
thereof.
Any Eurodollar Loan may be continued as such upon the expiration of the then
current Interest Period with respect thereto by the Borrowers giving
irrevocable notice to the Administrative Agent, in accordance with the
applicable provisions of the term "Interest Period" set forth in Section
1.1, of the length of the next Interest Period to be applicable to such
Loan, provided that (i) no Eurodollar Loan may be continued as such when
any Event of Default has occurred and is continuing and (ii) if the
Borrowers shall fail to give any required notice as described above in this
paragraph, the relevant Eurodollar Loans shall be automatically converted
to Eurodollar Loans having a one-month Interest Period on the last day of
the then expiring Interest Period. Upon receipt of any such notice the
Administrative Agent shall promptly notify each relevant Lender thereof.
Limitations on Eurodollar Tranches. Notwithstanding anything to the contrary in
this Agreement, all borrowings, conversions and continuations of Eurodollar
Loans hereunder and all selections of Interest Periods hereunder shall be
in such amounts and be made pursuant to such elections so that, (a) after
giving effect thereto, the aggregate principal amount of the Eurodollar
Loans comprising
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<PAGE> 29
each Eurodollar Tranche shall be equal to $10,000,000 or a whole multiple
of $1,000,000 in excess thereof and (b) no more than eight Eurodollar
Tranches shall be outstanding at any one time.
Interest Rates and Payment Dates.
Each Eurodollar Loan shall bear interest for each day during each Interest
Period with respect thereto at a rate per annum equal to the Eurodollar
Rate determined for such day plus the Applicable Margin.
Each ABR Loan shall bear interest at a rate per annum equal to the ABR plus the
Applicable Margin.
(i) If all or a portion of the principal amount of any Loan shall not be paid
when due (whether at the stated maturity, by acceleration or otherwise),
all outstanding Loans (whether or not overdue) shall bear interest at a
rate per annum equal to the rate that would otherwise be applicable thereto
pursuant to the foregoing provisions of this Section plus 2%, and (ii) if
all or a portion of any interest payable on any Loan or any commitment fee
or other amount payable hereunder shall not be paid when due (whether at
the stated maturity, by acceleration or otherwise), such overdue amount
shall bear interest at a rate per annum equal to the rate then applicable
to ABR Loans under the relevant Facility plus 2% (or, in the case of any
such other amounts that do not relate to a particular Facility, the rate
then applicable to ABR Loans under the Revolving Facility plus 2%), in each
case, with respect to clauses (i) and (ii) above, from the date of such
non-payment until such amount is paid in full (as well after as before
judgment).
Interest shall be payable in arrears on each Interest Payment Date, provided
that interest accruing pursuant to paragraph (c) of this Section shall be
payable from time to time on demand.
Computation of Interest and Fees.
Interest and fees payable pursuant hereto shall be calculated on the basis of a
360-day year for the actual days elapsed, except that, with respect to ABR
Loans the rate of interest on which is calculated on the basis of the Prime
Rate, the interest thereon shall be calculated on the basis of a 365- (or
366-, as the case may be) day year for the actual days elapsed. The
Administrative Agent shall as soon as practicable notify the Borrowers and
the relevant Lenders of each determination of a Eurodollar Rate. Any change
in the interest rate on a Loan resulting from a change in the ABR or the
Eurocurrency Reserve Requirements shall become effective as of the opening
of business on the day on which such change becomes effective. The
Administrative Agent shall as soon as practicable notify the Borrowers and
the relevant Lenders of the effective date and the amount of each such
change in interest rate.
Each determination of an interest rate by the Administrative Agent pursuant to
any provision of this Agreement shall be conclusive and binding on the
Borrowers and the Lenders in the absence of manifest error. The
Administrative Agent shall, at the request of the Borrowers, deliver to the
Borrowers a statement showing the quotations used by the Administrative
Agent in determining any interest rate pursuant to Section 2.12(a).
Inability to Determine Interest Rate. If prior to the first day of any Interest
Period:
the Administrative Agent shall have determined (which determination shall be
conclusive and binding upon the Borrowers) that, by reason of circumstances
affecting the relevant market, adequate and reasonable means do not exist
for ascertaining the Eurodollar Rate for such Interest Period, or
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<PAGE> 30
the Administrative Agent shall have received notice from the Majority Facility
Lenders in respect of the relevant Facility that the Eurodollar Rate
determined or to be determined for such Interest Period will not adequately
and fairly reflect the cost to such Lenders (as conclusively certified by
such Lenders) of making or maintaining their affected Loans during such
Interest Period, the Administrative Agent shall give telecopy or telephonic
notice thereof to the Borrowers and the relevant Lenders as soon as
practicable thereafter. If such notice is given (x) any Eurodollar Loans
under the relevant Facility requested to be made on the first day of such
Interest Period shall be made as ABR Loans, (y) any Loans under the
relevant Facility that were to have been converted on the first day of such
Interest Period to Eurodollar Loans shall be continued as ABR Loans and (z)
any outstanding Eurodollar Loans under the relevant Facility shall be
converted, on the last day of the then-current Interest Period, to ABR
Loans. Until such notice has been withdrawn by the Administrative Agent, no
further Eurodollar Loans under the relevant Facility shall be made or
continued as such, nor shall the Borrowers have the right to convert Loans
under the relevant Facility to Eurodollar Loans.
Pro Rata Treatment and Payments.
Except in the case of the Incremental Term Facility, each borrowing by the
Borrowers from the Lenders hereunder, each payment by the Borrowers on
account of any commitment fee and any reduction of the Commitments of the
Lenders shall be made pro rata according to the respective Term B
Commitments or Revolving Commitments, as the case may be, of the relevant
Lenders.
Each payment (including each prepayment) by the Borrowers on account of
principal of and interest on the Term Loans shall be made pro rata
according to the respective outstanding principal amounts of the Term Loans
then held by the Term Lenders. The amount of each principal prepayment of
the Term Loans shall be applied to reduce the then remaining installments
of the Term B Loans and Incremental Term Loans, as the case may be, pro
rata based upon the then remaining principal amount thereof. Amounts
prepaid on account of the Term Loans may not be reborrowed.
Each payment (including each prepayment) by the Borrowers on account of
principal of and interest on the Revolving Loans shall be made pro rata
according to the respective outstanding principal amounts of the Revolving
Loans then held by the Revolving Lenders.
All payments (including prepayments) to be made by the Borrowers hereunder,
whether on account of principal, interest, fees or otherwise, shall be made
without setoff or counterclaim and shall be made prior to 12:00 Noon,
Chicago time, on the due date thereof to the Administrative Agent, for the
account of the Lenders, at the Funding Office, in Dollars and in
immediately available funds. The Administrative Agent shall distribute such
payments to the Lenders promptly upon receipt in like funds as received. If
any payment hereunder (other than payments on the Eurodollar Loans) becomes
due and payable on a day other than a Business Day, such payment shall be
extended to the next succeeding Business Day. If any payment on a
Eurodollar Loan becomes due and payable on a day other than a Business Day,
the maturity thereof shall be extended to the next succeeding Business Day
unless the result of such extension would be to extend such payment into
another calendar month, in which event such payment shall be made on the
immediately preceding Business Day. In the case of any extension of any
payment of principal pursuant to the preceding two sentences, interest
thereon shall be payable at the then applicable rate during such extension.
Unless the Administrative Agent shall have been notified in writing by any
Lender prior to a borrowing that such Lender will not make the amount that
would constitute its share of such borrowing available to the
Administrative Agent, the Administrative Agent may assume that such Lender
is making such amount available to the Administrative Agent, and the
Administrative Agent may, in reliance upon such assumption, make available
to the Borrowers a corresponding amount. If such amount is not
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<PAGE> 31
made available to the Administrative Agent by the required time on the
Borrowing Date therefor, such Lender shall pay to the Administrative Agent,
on demand, such amount with interest thereon at a rate equal to the daily
average Federal Funds Effective Rate for the period until such Lender makes
such amount immediately available to the Administrative Agent. A
certificate of the Administrative Agent submitted to any Lender with
respect to any amounts owing under this paragraph shall be conclusive in
the absence of manifest error. If such Lender's share of such borrowing is
not made available to the Administrative Agent by such Lender within three
Business Days of such Borrowing Date, the Administrative Agent shall also
be entitled to recover such amount with interest thereon at the rate per
annum applicable to ABR Loans under the relevant Facility, on demand, from
the Borrowers.
Unless the Administrative Agent shall have been notified in writing by the
Borrowers prior to the date of any payment being made hereunder that the
Borrowers will not make such payment to the Administrative Agent, the
Administrative Agent may assume that the Borrowers are making such payment,
and the Administrative Agent may, but shall not be required to, in reliance
upon such assumption, make available to the Lenders their respective pro
rata shares of a corresponding amount. If such payment is not made to the
Administrative Agent by the Borrowers within three Business Days of such
required date, the Administrative Agent shall be entitled to recover, on
demand, from each Lender to which any amount which was made available
pursuant to the preceding sentence, such amount with interest thereon at
the rate per annum equal to the daily average Federal Funds Effective Rate.
Nothing herein shall be deemed to limit the rights of the Administrative
Agent or any Lender against any of the Borrowers.
Requirements of Law.
If the adoption of or any change in any Requirement of Law or in the
interpretation or application thereof or compliance by any Lender with any
request or directive (whether or not having the force of law) from any
central bank or other Governmental Authority made subsequent to the date
hereof:
(i) shall subject any Lender to any tax of any kind whatsoever
with respect to this Agreement or any Eurodollar Loan made by it, or
change the basis of taxation of payments to such Lender in respect
thereof (except for Non-Excluded Taxes covered by Section 2.17 and
changes in the rate of tax on the overall net income of such Lender);
shall impose, modify or hold applicable any reserve, special deposit, compulsory
loan or similar requirement against assets held by, deposits or other
liabilities in or for the account of, advances, loans or other extensions
of credit by, or any other acquisition of funds by, any office of such
Lender that is not otherwise included in the determination of the
Eurodollar Rate hereunder; or
shall impose on such Lender any other condition; and the result of any of the
foregoing is to increase the cost to such Lender, by an amount that such
Lender deems to be material, of making, converting into, continuing or
maintaining Eurodollar Loans, or to reduce any amount receivable hereunder
in respect thereof, then, in any such case, the Borrowers shall promptly
pay such Lender, upon its demand, any additional amounts necessary to
compensate such Lender for such increased cost or reduced amount
receivable. If any Lender becomes entitled to claim any additional amounts
pursuant to this paragraph, it shall promptly notify the Borrowers (with a
copy to the Administrative Agent) of the event by reason of which it has
become so entitled.
(b) If any Lender shall have determined that the adoption of or
any change in any Requirement of Law regarding capital adequacy or in
the interpretation or application thereof or compliance by such Lender
or any corporation controlling such Lender with any request or
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directive regarding capital adequacy (whether or not having the force
of law) from any Governmental Authority made subsequent to the date
hereof shall have the effect of reducing the rate of return on such
Lender's or such corporation's capital as a consequence of its
obligations hereunder to a level below that which such Lender or such
corporation could have achieved but for such adoption, change or
compliance (taking into consideration such Lender's or such
corporation's policies with respect to capital adequacy) by an amount
deemed by such Lender to be material, then from time to time, after
submission by such Lender to the Borrowers (with a copy to the
Administrative Agent) of a written request therefor, the Borrowers
shall pay to such Lender such additional amount or amounts as will
compensate such Lender for such reduction; provided that the Borrowers
shall not be required to compensate a Lender pursuant to this
paragraph for any amounts incurred more than six months prior to the
date that such Lender notifies the Borrowers of such Lender's
intention to claim compensation therefor; and provided further that,
if the circumstances giving rise to such claim have a retroactive
effect, then such six-month period shall be extended to include the
period of such retroactive effect.
(c) A certificate as to any additional amounts payable pursuant
to this Section submitted by any Lender to the Borrowers (with a copy
to the Administrative Agent) shall be conclusive in the absence of
manifest error. The obligations of the Borrowers pursuant to this
Section shall survive the termination of this Agreement and the
payment of the Loans and all other amounts payable hereunder.
Taxes.
All payments made by the Borrowers under this Agreement shall be made free and
clear of, and without deduction or withholding for or on account of, any
present or future income, stamp or other taxes, levies, imposts, duties,
charges, fees, deductions or withholdings, now or hereafter imposed,
levied, collected, withheld or assessed by any Governmental Authority,
excluding net income taxes and franchise taxes (imposed in lieu of net
income taxes) imposed on the Administrative Agent or any Lender as a result
of a present or former connection between the Administrative Agent or such
Lender and the jurisdiction of the Governmental Authority imposing such tax
or any political subdivision or taxing authority thereof or therein (other
than any such connection arising solely from the Administrative Agent or
such Lender having executed, delivered or performed its obligations or
received a payment under, or enforced, this Agreement or any other Loan
Document). If any such non-excluded taxes, levies, imposts, duties,
charges, fees, deductions or withholdings ("Non-Excluded Taxes") or Other
Taxes are required to be withheld from any amounts payable to the
Administrative Agent or any Lender hereunder, the amounts so payable to the
Administrative Agent or such Lender shall be increased to the extent
necessary to yield to the Administrative Agent or such Lender (after
payment of all Non-Excluded Taxes and Other Taxes) interest or any such
other amounts payable hereunder at the rates or in the amounts specified in
this Agreement, provided, however, that the Borrowers shall not be required
to increase any such amounts payable to any Lender with respect to any
Non-Excluded Taxes (i) that are attributable to such Lender's failure to
comply with the requirements of paragraph (d) or (e) of this Section or
(ii) that are United States withholding taxes imposed on amounts payable to
such Lender at the time the Lender becomes a party to this Agreement,
except to the extent that such Lender's assignor (if any) was entitled, at
the time of assignment, to receive additional amounts from the Borrowers
with respect to such Non-Excluded Taxes pursuant to this paragraph.
In addition, the Borrowers shall jointly and severally pay any Other Taxes to
the relevant Governmental Authority in accordance with applicable law.
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Whenever any Non-Excluded Taxes or Other Taxes are payable by the Borrowers, as
promptly as possible thereafter the Borrowers shall send to the
Administrative Agent for its own account or for the account of the relevant
Lender, as the case may be, a certified copy of an original official
receipt received by the Borrowers showing payment thereof. If the Borrowers
fail to pay any Non-Excluded Taxes or Other Taxes when due to the
appropriate taxing authority or fail to remit to the Administrative Agent
the required receipts or other required documentary evidence, the Borrowers
shall jointly and severally indemnify the Administrative Agent and the
Lenders for any incremental taxes, interest or penalties that may become
payable by the Administrative Agent or any Lender as a result of any such
failure.
Each Lender (or Transferee) that is not a citizen or resident of the United
States of America, a corporation, partnership or other entity created or
organized in or under the laws of the United States of America (or any
jurisdiction thereof), or any estate or trust that is subject to federal
income taxation regardless of the source of its income (a "Non-U.S.
Lender") shall deliver to the Borrowers and the Administrative Agent (or,
in the case of a Participant, to the Lender from which the related
participation shall have been purchased) two copies of either U.S. Internal
Revenue Service Form 1001 or Form 4224, or, in the case of a Non-U.S.
Lender claiming exemption from U.S. federal withholding tax under Section
871(h) or 881(c) of the Code with respect to payments of "portfolio
interest", a statement substantially in the form of Exhibit F and a Form
W-8, or any subsequent versions thereof or successors thereto, properly
completed and duly executed by such Non-U.S. Lender claiming complete
exemption from U.S. federal withholding tax on all payments by the
Borrowers under this Agreement and the other Loan Documents. Such forms
shall be delivered by each Non-U.S. Lender on or before the date it becomes
a party to this Agreement (or, in the case of any Participant, on or before
the date such Participant purchases the related participation). In
addition, each Non-U.S. Lender shall deliver such forms promptly upon the
obsolescence or invalidity of any form previously delivered by such
Non-U.S. Lender. Each Non-U.S. Lender shall promptly notify the Borrowers
at any time it determines that it is no longer in a position to provide any
previously delivered certificate to the Borrowers (or any other form of
certification adopted by the U.S. taxing authorities for such purpose).
Notwithstanding any other provision of this paragraph, a Non-U.S. Lender
shall not be required to deliver any form pursuant to this paragraph that
such Non-U.S. Lender is not legally able to deliver.
A Lender that is entitled to an exemption from non-U.S. withholding tax under
the law of the jurisdiction in which the Borrowers are located, or any
treaty to which such jurisdiction is a party, with respect to payments
under this Agreement shall deliver to the Borrowers (with a copy to the
Administrative Agent), at the time or times prescribed by applicable law or
reasonably requested by the Borrowers, such properly completed and executed
documentation prescribed by applicable law as will permit such payments to
be made without withholding, provided that such Lender is legally entitled
to complete, execute and deliver such documentation and in such Lender's
judgment such completion, execution or submission would not materially
prejudice the legal position of such Lender.
The agreements in this Section shall survive the termination of this Agreement
and the payment of the Loans and all other amounts payable hereunder.
Indemnity. The Borrowers jointly and severally agree to indemnify each Lender
and to hold each Lender harmless from any loss or expense that such Lender
may sustain or incur as a consequence of (a) default by the Borrowers in
making a borrowing of, conversion into or continuation of Eurodollar Loans
after the Borrowers have given a notice requesting the same in accordance
with the provisions of this Agreement, (b) default by the Borrowers in
making any prepayment of or conversion from Eurodollar Loans after the
Borrowers have given a notice thereof in accordance with the provisions of
this Agreement or (c) the making of a prepayment of Eurodollar Loans on a
day that is not the last
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day of an Interest Period with respect thereto. Such indemnification may
include an amount equal to the excess, if any, of (i) the amount of
interest that would have accrued on the amount so prepaid, or not so
borrowed, converted or continued, for the period from the date of such
prepayment or of such failure to borrow, convert or continue to the last
day of such Interest Period (or, in the case of a failure to borrow,
convert or continue, the Interest Period that would have commenced on the
date of such failure) in each case at the applicable rate of interest for
such Loans provided for herein (excluding, however, the Applicable Margin
included therein, if any) over (ii) the amount of interest (as reasonably
determined by such Lender) that would have accrued to such Lender on such
amount by placing such amount on deposit for a comparable period with
leading banks in the interbank eurodollar market. A certificate as to any
amounts payable pursuant to this Section submitted to the Borrowers by any
Lender shall be conclusive in the absence of manifest error. This covenant
shall survive the termination of this Agreement and the payment of the
Loans and all other amounts payable hereunder.
Change of Lending Office. Each Lender agrees that, upon the occurrence of any
event giving rise to the operation of Section 2.16 or 2.17(a) with respect
to such Lender, it will, if requested by the Borrowers, use reasonable
efforts (subject to overall policy considerations of such Lender) to
designate another lending office for any Loans affected by such event with
the object of avoiding the consequences of such event; provided, that such
designation is made on terms that, in the sole judgment of such Lender,
cause such Lender and its lending office(s) to suffer no economic, legal or
regulatory disadvantage, and provided, further, that nothing in this
Section shall affect or postpone any of the obligations of any Borrower or
the rights of any Lender pursuant to Section 2.16 or 2.17(a).
Replacement of Lenders. The Borrowers shall be permitted to replace any Lender
that (a) requests reimbursement for amounts owing pursuant to Section 2.16
or 2.17(a) or (b) defaults in its obligation to make Loans hereunder, with
a replacement financial institution; provided that (i) such replacement
does not conflict with any Requirement of Law, (ii) no Event of Default
shall have occurred and be continuing at the time of such replacement,
(iii) prior to any such replacement, such Lender shall have taken no action
under Section 2.19 which has eliminated the continued need for payment of
amounts owing pursuant to Section 2.16 or 2.17(a), (iv) the replacement
financial institution shall purchase, at par, all Loans and other amounts
owing to such replaced Lender on or prior to the date of replacement, (v)
the Borrowers shall be jointly and severally liable to such replaced Lender
under Section 2.18 if any Eurodollar Loan owing to such replaced Lender
shall be purchased other than on the last day of the Interest Period
relating thereto, (vi) the replacement financial institution, if not
already a Lender, shall be reasonably satisfactory to the Administrative
Agent, (vii) the replaced Lender shall be obligated to make such
replacement in accordance with the provisions of Section 9.6 (provided that
the Borrowers shall be jointly and severally obligated to pay the
registration and processing fee referred to therein), (viii) until such
time as such replacement shall be consummated, the Borrowers shall pay all
additional amounts (if any) required pursuant to Section 2.16 or 2.17(a),
as the case may be, and (ix) any such replacement shall not be deemed to be
a waiver of any rights that the Borrowers, the Agents or any other Lender
shall have against the replaced Lender.
Joint and Several Liability; Payment Indemnifications.
(a) All Loans and other obligations of the Borrowers under the Loan
Documents shall be the joint and several obligations of each Borrower. The Loans
and other obligations of, and the Liens granted by, any Borrower under the Loan
Documents shall not be impaired or released by any action or inaction on the
part of any Agent or any Lender with respect to any other Loan Party, including
any action or inaction which would otherwise release a surety.
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(b) In order to provide for just and equitable contribution between the
Borrowers if any payment is made by any Borrower (a "Funding Borrower") in
discharging any of the Loans and other obligations of the Borrowers under the
Loan Documents, that Funding Borrower shall be entitled to a contribution from
the other Borrower for all payments, damages and expenses incurred by that
Funding Borrower in discharging such obligations, in the manner and to the
extent required to allocate liabilities in an equitable manner among the
Borrowers on the basis of the relative benefits received by the Borrowers. If
and to the extent that a Funding Borrower makes any payment to any Lender or any
other Person in respect of the Loans and other obligations of the Loan Parties
under the Loan Documents, any claim which said Funding Borrower may have against
the other Borrower, any collateral or security or any guarantor of such
obligations by reason thereof shall be subject, junior and subordinate to (i)
any rights any Agent or Lenders may have against the other Borrower, any such
collateral or security or any such guarantor and (ii) the prior cash payment in
full of all such obligations, and until the Loans and other obligations of the
Loan Parties under the Loan Documents shall have been paid in full in cash, each
Borrower shall withhold exercise of any right of subrogation, contribution or
any other right to enforce any remedy which it now has or may hereafter have
against the other Borrower, any such collateral or security or any such
guarantor. The parties hereto acknowledge that the right to contribution
hereunder shall constitute an asset of the party to which such contribution is
owing. Notwithstanding any of the foregoing to the contrary, such contribution
arrangements shall not limit in any manner the joint and several nature of the
obligations of the Borrowers under the Loan Documents, limit, release or
otherwise impair any rights of any Agent or any Lender under the Loan Documents,
or alter, limit or impair the obligation of each Borrower, which is absolute and
unconditional, to repay such obligations.
REPRESENTATIONS AND WARRANTIES
To induce the Agents and the Lenders to enter into this Agreement and to
make the Loans, Holdings and the Borrowers hereby jointly and severally
represent and warrant to the Agents and each Lender that:
Financial Condition. The consolidated financial statements of Cable Michigan,
Inc. and of Holdings for the periods ending and as at November 5, 1998 and
December 31, 1998, respectively, included in Section 8 of the Confidential
Information Memorandum, have been reported on and accompanied by an
unqualified report of the independent public accountant identified therein.
The unaudited consolidated financial statements of Avalon Michigan and of
Avalon New England for the period ending and as at June 30, 1999 included
in Section 8 of the Confidential Information Memorandum, have been prepared
based on the best information available to the Borrowers as of the date of
delivery thereof. All such audited and unaudited financial statements
present fairly the consolidated or combined (as the case may be) financial
condition of such Person as at the respective dates indicated, and the
consolidated or combined (as the case may be) results of its operations and
cash flows for the respective periods indicated. All such audited and
unaudited financial statements, including the related schedules and notes
thereto, have been prepared in accordance with GAAP applied consistently
throughout the periods involved (except as approved by the aforementioned
firm of accountants and disclosed therein). Holdings, the Borrowers and
their respective Subsidiaries do not have any material Guarantee
Obligations, contingent liabilities and liabilities for taxes, or any
long-term leases or unusual forward or long-term commitments, including any
interest rate or foreign currency swap or exchange transaction or other
obligation in respect of derivatives, that are not reflected in the most
recent financial statements referred to in this paragraph. During the
period from December 31, 1998 to and including the date hereof there has
been no Disposition by any of Holdings, the Borrowers or any of their
respective Subsidiaries of any material part of its business or property.
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No Change. Since the dates of the audited financial statements referred to in
Section 3.1, there has been no event, development or circumstance that has
had or could reasonably be expected to have a Material Adverse Effect.
Existence; Compliance with Law. Each of Holdings, the Borrowers and their
respective Subsidiaries (a) is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization, (b) has
the power and authority, and the legal right, to own and operate its
property, to lease the property it operates as lessee and to conduct the
business in which it is currently engaged, (c) is duly qualified as a
foreign entity and in good standing under the laws of each jurisdiction
where its ownership, lease or operation of property or the conduct of its
business requires such qualification and (d) is in compliance with all
Requirements of Law, in each case with respect to clauses (c) and (d),
except as could not, in the aggregate, reasonably be expected to have a
Material Adverse Effect.
Power; Authorization; Enforceable Obligations. Each Loan Party has the power and
authority, and the legal right, to make, deliver and perform the Loan
Documents to which it is a party and, in the case of each of the Borrowers,
to borrow hereunder. Each Loan Party has taken all necessary action to
authorize the execution, delivery and performance of the Loan Documents to
which it is a party and, in the case of each of the Borrowers, to authorize
the borrowings on the terms and conditions of this Agreement. No consent or
authorization of, filing with, notice to or other act by or in respect of,
any Governmental Authority or any other Person is required in connection
with the borrowings hereunder or with the execution, delivery, performance,
validity or enforceability of this Agreement or any of the Loan Documents,
except the filings referred to in Section 3.20. Each Loan Document has been
duly executed and delivered on behalf of each Loan Party party thereto.
This Agreement constitutes, and each other Loan Document upon execution
will constitute, a legal, valid and binding obligation of each Loan Party
party thereto, enforceable against each such Loan Party in accordance with
its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors' rights generally and by general
equitable principles (whether enforcement is sought by proceedings in
equity or at law).
No Legal Bar. The execution, delivery and performance of this Agreement and
the other Loan Documents, the borrowings hereunder and the use of the
proceeds thereof will not violate any Requirement of Law or any material
Contractual Obligation of Holdings, any of the Borrowers or any of their
respective Subsidiaries and will not result in, or require, the creation or
imposition of any Lien on any of their respective properties or revenues
pursuant to any Requirement of Law or any such Contractual Obligation
(other than the Liens created by the Guarantee and Collateral Agreement).
Litigation. No litigation, investigation or proceeding of or before any
arbitrator or Governmental Authority is pending or, to the knowledge of
Holdings or any of the Borrowers, threatened by or against Holdings, any of
the Borrowers or any of their respective Subsidiaries or against any of
their respective properties or revenues (a) with respect to any of the Loan
Documents or any of the transactions contemplated hereby or thereby, or (b)
that could reasonably be expected to have a Material Adverse Effect.
No Default. Neither Holdings, any of the Borrowers nor any of their respective
Subsidiaries is in default under or with respect to any of its Contractual
Obligations in any respect that could reasonably be expected to have a
Material Adverse Effect. No Default or Event of Default has occurred and is
continuing.
Ownership of Property; Liens. Each of Holdings, the Borrowers and their
respective Subsidiaries has good, sufficient and legal title to, or a valid
leasehold interest in, all its real property, and good title to,
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or a valid leasehold interest in, all its other property, in each case
except where failure to have such title or such leasehold interest, singly
or in the aggregate, would not reasonably be expected to have a Material
Adverse Effect, and none of such property is subject to any Lien except as
permitted by Section 6.3.
Intellectual Property. Each of Holdings, the Borrowers and their respective
Subsidiaries owns, or is licensed to use, all material Intellectual
Property necessary for the conduct of its business as currently conducted.
No material claim has been asserted and is pending by any Person
challenging or questioning the use, validity or effectiveness of any
material Intellectual Property owned or licensed by any of Holdings, the
Borrowers or any of their respective Subsidiaries, nor does Holdings or any
of the Borrowers know of any valid basis for any such claim. The use of
Intellectual Property by Holdings, the Borrowers and their respective
Subsidiaries does not infringe on the rights of any Person in any material
respect.
Taxes. Each of Holdings, the Borrowers and each of their respective Subsidiaries
has filed or caused to be filed all federal, state and other material tax
returns that are required to be filed and has paid all taxes shown to be
due and payable on said returns or on any assessments made against it or
any of its property and all other taxes, fees or other charges imposed on
it or any of its property by any Governmental Authority (other than any the
amount or validity thereof that are currently being contested in good faith
by appropriate proceedings and with respect to which reserves in conformity
with GAAP have been provided on the books of Holdings, the Borrowers or
their respective Subsidiaries, as the case may be); no tax Lien has been
filed, and, to the knowledge of Holdings and the Borrowers, no claim is
being asserted, with respect to any such tax, fee or other charge.
Federal Regulations. No part of the proceeds of any Loans will be used for
"buying" or "carrying" any "margin stock" within the respective meanings of
each of the quoted terms under Regulation U as now and from time to time
hereafter in effect or for any purpose that violates the provisions of the
Regulations of the Board. If requested by any Lender or the Administrative
Agent, the Borrowers will furnish to the Administrative Agent and each
Lender a statement to the foregoing effect in conformity with the
requirements of FR Form G-3 or FR Form U-1, as applicable, referred to in
Regulation U.
Labor Matters. Except as, in the aggregate, could not reasonably be expected to
have a Material Adverse Effect: (a) there are no strikes or other labor
disputes against Holdings, any of the Borrowers or any of their respective
Subsidiaries pending or, to the knowledge of Holdings or any of the
Borrowers, threatened; (b) hours worked by and payment made to employees of
Holdings, any of the Borrowers and their respective Subsidiaries have not
been in violation of the Fair Labor Standards Act or any other applicable
Requirement of Law dealing with such matters; and (c) all payments due from
Holdings, any of the Borrowers or any of their respective Subsidiaries on
account of employee health and welfare insurance have been paid or accrued
as a liability on the books of Holdings, such Borrower or the relevant
Subsidiary.
ERISA. Each Plan is in material compliance with the applicable provisions of
ERISA and the Code. No Plan is a Multiemployer Plan or a "defined benefit
plan" (as defined in ERISA). Each Commonly Controlled Entity has met all of
the funding standards applicable to all Plans, and no condition exists
which would permit the institution of proceedings to terminate any Plan
under Section 4042 of ERISA.
Investment Company Act; Other Regulations. No Loan Party is an "investment
company", or a company "controlled" by an "investment company", within the
meaning of the Investment Company Act of
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1940, as amended. No Loan Party is subject to regulation under any
Requirement of Law (other than Regulation X of the Board) that limits its
ability to incur Indebtedness.
Subsidiaries. Except as disclosed to the Administrative Agent by the Borrowers
in writing from time to time after the Closing Date, (a) Schedule 3.15 sets
forth the name and jurisdiction of organization of Holdings and each of its
Subsidiaries and, as to each such Subsidiary, the percentage of each class
of Equity Interests owned by any Loan Party and (b) except as set forth on
Schedule 3.15, there are no outstanding subscriptions, options, warrants,
calls, rights or other agreements or commitments of any nature relating to
any Equity Interests of any of the Borrowers or any of their respective
Subsidiaries, except as created by the Loan Documents.
Use of Proceeds. The proceeds of the Loans shall be used in connection with the
Acquisition and for general purposes, including to finance permitted
Investments.
Environmental Matters. Except as, in the aggregate, could not reasonably be
expected to have a Material Adverse Effect:
the facilities and properties owned, leased or operated by Holdings, any of the
Borrowers or any of their respective Subsidiaries (the "Properties") do not
contain, and have not previously contained, any Materials of Environmental
Concern in amounts or concentrations or under circumstances that constitute
or constituted a violation of, or could give rise to liability under, any
Environmental Law;
neither Holdings, the Borrowers nor any of their respective Subsidiaries has
received or is aware of any notice of violation, alleged violation,
non-compliance, liability or potential liability regarding environmental
matters or compliance with Environmental Laws with regard to any of the
Properties or the business operated by Holdings, any of the Borrowers or
any of their respective Subsidiaries (the "Business"), nor does Holdings or
any of the Borrowers have knowledge or reason to believe that any such
notice will be received or is being threatened;
Materials of Environmental Concern have not been transported or disposed of from
the Properties in violation of, or in a manner or to a location that could
give rise to liability under, any Environmental Law, nor have any Materials
of Environmental Concern been generated, treated, stored or disposed of at,
on or under any of the Properties in violation of, or in a manner that
could give rise to liability under, any applicable Environmental Law;
no judicial proceeding or governmental or administrative action is pending or,
to the knowledge of Holdings or any of the Borrowers, threatened, under any
Environmental Law to which Holdings, any of the Borrowers or any Subsidiary
is or will be named as a party with respect to the Properties or the
Business, nor are there any consent decrees or other decrees, consent
orders, administrative orders or other orders, or other administrative or
judicial requirements outstanding under any Environmental Law with respect
to the Properties or the Business;
there has been no release or threat of release of Materials of Environmental
Concern at or from the Properties, or arising from or related to the
operations of Holdings, any of the Borrowers or any Subsidiary in
connection with the Properties or otherwise in connection with the
Business, in violation of or in amounts or in a manner that could give rise
to liability under Environmental Laws;
the Properties and all operations at the Properties are in compliance, and have
in the last five years been in compliance, with all applicable
Environmental Laws, and there is no contamination at, under or about the
Properties or violation of any Environmental Law with respect to the
Properties or the Business; and
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neither Holdings, any of the Borrowers nor any of their respective Subsidiaries
has assumed any liability of any other Person under Environmental Laws.
Certain Cable Television Matters. Except as, in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect:
(i) Holdings, the Borrowers and their respective Subsidiaries possess all
Authorizations necessary to own, operate and construct the CATV Systems or
otherwise for the operations of their respective businesses and are not in
violation thereof and (ii) all such Authorizations are in full force and
effect and no event has occurred that permits, or after notice or lapse of
time could permit, the revocation, termination or material and adverse
modification of any such Authorization;
neither Holdings, any of the Borrowers nor any of their respective Subsidiaries
is in violation of any duty or obligation required by the Communications
Act of 1934, as amended, or any FCC rule or regulation applicable to the
operation of any portion of any of the CATV Systems;
(i) there is not pending or, to the best knowledge of Holdings or any of the
Borrowers, threatened, any action by the FCC to revoke, cancel, suspend or
refuse to renew any FCC License held by Holdings, any of the Borrowers or
any of their respective Subsidiaries and (ii) there is not pending or, to
the best knowledge of Holdings or any of the Borrowers, threatened, any
action by the FCC to modify adversely, revoke, cancel, suspend or refuse to
renew any other Authorization; and
there is not issued or outstanding or, to the best knowledge of Holdings or any
of the Borrowers, threatened, any notice of any hearing, violation or
complaint against Holdings, any of the Borrowers or any of their respective
Subsidiaries with respect to the operation of any portion of the CATV
Systems and neither Holdings nor any of the Borrowers has any knowledge
that any Person intends to contest renewal of any Authorization.
Accuracy of Information, etc. No statement or information contained in this
Agreement, any other Loan Document, the Confidential Information Memorandum
or any other document, certificate or statement furnished by or on behalf
of any Loan Party to the Agents or the Lenders, or any of them, for use in
connection with the transactions contemplated by this Agreement or the
other Loan Documents, as supplemented from time to time prior to the date
this representation and warranty is made or deemed made, contains any
untrue statement of a material fact or omits to state a material fact
necessary to make the statements contained herein or therein not
misleading. The projections and pro forma financial information contained
in the materials referenced above are based upon good faith estimates and
assumptions believed by management of the Borrowers to be reasonable at the
time made, it being recognized by the Lenders that such financial
information as it relates to future events is not to be viewed as fact and
that actual results during the period or periods covered by such financial
information may differ from the projected results set forth therein by a
material amount. There is no fact known to any Loan Party that could
reasonably be expected to have a Material Adverse Effect that has not been
expressly disclosed herein, in the other Loan Documents, in the
Confidential Information Memorandum or in any other documents, certificates
and statements furnished to the Agents and the Lenders for use in
connection with the transactions contemplated hereby and by the other Loan
Documents.
Security Interests. The Guarantee and Collateral Agreement is effective to
create in favor of the Administrative Agent, for the benefit of the
Lenders, a legal, valid and enforceable security interest in the Collateral
described therein and proceeds thereof. In the case of certificated Pledged
Stock described in the Guarantee and Collateral Agreement, when
certificates representing such Pledged Stock are delivered to the
Administrative Agent, and in the case of the other Collateral described in
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the Guarantee and Collateral Agreement, when financing statements specified
on Schedule 3.20 in appropriate form are filed in the offices specified on
Schedule 3.20, the Guarantee and Collateral Agreement shall constitute a
fully perfected Lien on, and security interest in, all right, title and
interest of the Loan Parties in such Collateral and the proceeds thereof,
as security for the Obligations (as defined in the Guarantee and Collateral
Agreement), in each case prior and superior in right to any other Person.
Solvency. Each Loan Party (other than any Shell Subsidiary) is, and after giving
effect to the financing transactions referred to herein will be and will
continue to be, Solvent.
Certain Tax Matters. As of the Closing Date, each of Holdings, the Borrowers and
each of their respective Subsidiaries (other than any such Subsidiary that
is organized as a corporation) is a Flow-Through Entity.
Year 2000 Matters. Based on a review of the operations of Holdings, the
Borrowers and their respective Subsidiaries as they relate to the
processing, storage and retrieval of data, Holdings, the Borrowers and
their respective Subsidiaries do not believe that a Material Adverse Effect
is reasonably likely to occur as a result of computer software and hardware
that will not function with respect to periods commencing January 1, 2000
at least as effectively as with respect to periods ending on or prior to
December 31, 1999.
CONDITIONS PRECEDENT
Conditions to Initial Extension of Credit. The agreement of each Lender
(including Swingline Lender) to make the initial extension of credit
requested to be made by it is subject to the satisfaction, prior to or
concurrently with the making of such extension of credit on the Closing
Date, of the following conditions precedent (with references to the Lenders
in this Section 4.1 referring only to Lenders as of the Closing Date):
Credit Agreement; Guarantee and Collateral Agreement. The Administrative Agent
shall have received (i) this Agreement, executed and delivered by the
Agents, Holdings and the Borrowers, (ii) an Addendum, executed and
delivered by each Lender listed on Schedule 1.1, (iii) the Guarantee and
Collateral Agreement, executed and delivered by Holdings, the Borrowers and
each Subsidiary Guarantor and (iv) an Acknowledgment and Consent in the
form attached to the Guarantee and Collateral Agreement, executed and
delivered by each Issuer (as defined therein), if any, that is not a Loan
Party.
In the event that an Addendum has not been duly executed and
delivered by each Person listed on Schedule 1.1 on the date scheduled
to be the Closing Date, the condition referred to in clause (i) above
shall nevertheless be deemed satisfied if on such date the Borrowers
and the Administrative Agent shall have designated one or more Persons
(the "Designated Lenders") to assume, in the aggregate, all of the
Commitments that would have been held by the Persons listed on
Schedule 1.1 (the "Non-Executing Persons") which have not so executed
and delivered an Addendum (subject to each such Designated Lender's
consent and its execution and delivery of an Addendum). Schedule 1.1
shall automatically be deemed to be amended to reflect the respective
Commitments of the Designated Lenders and the omission of the
Non-Executing Persons as Lenders hereunder.
Acquisition. The acquisition (the "Acquisition") by Charter Communications
Holding Company, LLC, directly or indirectly, of the outstanding membership
interests of Holdings shall have been consummated, the names of Avalon
Michigan and Avalon New England shall have been changed to
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"CC Michigan, LLC" and "CC New England, LLC", respectively, in their
respective Organizational Documents, and the Borrowers shall hold good
title to all of the Acquired Systems described in clause (i) of the
definition thereof.
Existing Indebtedness. All of the existing credit facilities and other
Indebtedness (other than Existing Senior Subordinated Debt, Indebtedness
under the Loan Documents and Indebtedness otherwise permitted hereunder) of
the Borrowers and their respective Subsidiaries shall have been paid in
full, and any commitments under such credit facilities shall have been
terminated.
Approvals. All material governmental and third party approvals necessary in
connection with the financing contemplated hereby shall have been obtained
and be in full force and effect.
Lien Searches. The Administrative Agent shall have received the results of a
recent Lien search in each of the jurisdictions where assets of the Loan
Parties are located, and such search shall reveal no Liens on any of the
assets of Holdings, any of the Borrowers or any of their respective
Subsidiaries except for Liens permitted by Section 6.3 or Liens which have
been discharged, or for which releases have been tendered, on or prior to
the Closing Date pursuant to documentation satisfactory to the
Administrative Agent.
Financial Statements. The Lenders shall have received the financial statements
referred to in Section 3.1.
Fees. The Lenders and the Agents shall have received all fees required to be
paid, and all expenses for which invoices have been presented (including
the reasonable fees and expenses of legal counsel), on or before the
Closing Date. All such amounts will be paid with proceeds of Loans made on
the Closing Date and will be reflected in the funding instructions given by
the Borrowers to the Administrative Agent on or before the Closing Date.
Closing Certificate; No Material Restrictions; Pro Forma Compliance. The
Administrative Agent shall have received, with a counterpart for each
Lender, a certificate of each Loan Party, dated the Closing Date,
substantially in the form of Exhibit C, with appropriate insertions and
attachments, which (i) in the case of Holdings, shall also certify that
Holdings and its Subsidiaries are not subject to material contractual or
other restrictions that would be violated by the financing transactions
contemplated hereby and (ii) in the case of the Borrowers, shall also
certify, in reasonable detail, pro forma compliance with Section 6.1(a)
for, or as at the end of, as the case may be, the most recent three-month
period for which the relevant financial information is available.
Legal Opinions. The Administrative Agent shall have received one or more signed
legal opinions covering such matters incident to the transactions
contemplated by this Agreement as the Administrative Agent may reasonably
require.
Filings, Registrations, Recordings, etc. Each document (including any Uniform
Commercial Code financing statement) required by the Guarantee and
Collateral Agreement under law or reasonably requested by the
Administrative Agent to be filed, registered or recorded in order to create
in favor of the Administrative Agent, for the benefit of the Lenders, a
perfected Lien on the Collateral described therein, prior and superior in
right to any other Person, shall be in proper form for filing, registration
or recordation. The Administrative Agent shall have received (i) the
certificates, if any, representing the Equity Interests pledged pursuant to
the Guarantee and Collateral Agreement, together with an undated stock
power for each such certificate executed by the pledgor thereof, and (ii)
each promissory note (if any) pledged to the Administrative Agent pursuant
to the Guarantee and Collateral Agreement endorsed in blank by the pledgor
thereof.
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Good Standing Certificates. The Administrative Agent shall have received (i) a
good standing certificate with respect to each Loan Party from the
Secretary of State of its jurisdiction of formation and of each other
jurisdiction where the character of the property owned or leased by such
Loan Party or the nature of its activities makes qualification to do
business as a foreign corporation, limited liability company or partnership
(as the case may be) necessary, except where failure to so qualify would
not reasonably be expected to result in a Material Adverse Effect, and (ii)
to the extent generally available, a certificate or other evidence of good
standing as to payment of any applicable franchise or similar taxes from
the taxing authority of such jurisdiction of formation, each dated a recent
date prior to the Closing Date.
Conditions to Each Extension of Credit. The agreement of each Lender (including
Swingline Lender) to make any extension of credit requested to be made by
it on any date (including its initial extension of credit) is subject to
the satisfaction of the following conditions precedent:
Representations and Warranties. Each of the representations and warranties made
by any Loan Party in or pursuant to the Loan Documents shall be true and
correct in all material respects on and as of such date as if made on and
as of such date.
No Default. No Default or Event of Default shall have occurred and be
continuing on such date or after giving effect to the extensions of credit
requested to be made on such date.
Other Documents. In the case of any extension of credit made on an Increased
Facility Closing Date, the Administrative Agent shall have received such
documents and information as it may reasonably request. Each borrowing by
the Borrowers hereunder shall constitute a representation and warranty by
the Borrowers as of the date of such extension of credit that the
conditions contained in Sections 4.2(a) and (b) have been satisfied.
AFFIRMATIVE COVENANTS
Holdings and the Borrowers hereby agree that, so long as the Commitments
remain in effect or any Loan or other amount is owing to any Lender or any Agent
hereunder, each of Holdings and the Borrowers shall, and shall cause each
Subsidiary of each Borrower to:
Financial Statements. Furnish to the Administrative Agent (with sufficient
copies for each Lender):
as soon as available, but in any event within 120 days after the end of each
fiscal year of the Borrowers, a copy of the audited consolidated balance
sheet of the Borrowers and their consolidated Subsidiaries as at the end of
such year and the related audited consolidated statements of income and of
cash flows for such year, setting forth in each case in comparative form
the figures for the previous year, reported on without a "going concern" or
like qualification or exception, or qualification arising out of the scope
of the audit, by Arthur Andersen LLP or other independent certified public
accountants of nationally recognized standing; and
as soon as available, but in any event not later than 60 days after the end of
each of the first three quarterly periods of each fiscal year of the
Borrowers, the unaudited consolidated balance sheet of the Borrowers and
their consolidated Subsidiaries as at the end of such quarter and the
related unaudited consolidated statements of income and of cash flows for
such quarter and the portion of the fiscal year through the end of such
quarter, setting forth in each case in comparative form the figures for the
previous year, certified by a Responsible Officer as being fairly stated in
all material respects (subject to normal year-end audit adjustments).
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All such financial statements shall be complete and correct in all material
respects and shall be prepared in reasonable detail and in accordance with GAAP
applied consistently throughout the periods reflected therein and with prior
periods (except as approved by such accountants or officer, as the case may be,
and disclosed therein).
Certificates; Other Information. Furnish to the Administrative Agent (with
sufficient copies for each Lender) (or (i) in the case of clause (e) below,
to the Administrative Agent and (ii) in the case of clause (g) below, to
the relevant Lender):
concurrently with the delivery of the financial statements referred to in
Section 5.1(a), a certificate of the independent certified public
accountants reporting on such financial statements stating that in making
the examination necessary therefor no knowledge was obtained of any Default
or Event of Default under Section 6.1, except as specified in such
certificate;
concurrently with the delivery of any financial statements pursuant to Section
5.1, (i) a certificate of a Responsible Officer stating that, to the best
of such Responsible Officer's knowledge, each Loan Party during such period
has observed or performed all of its covenants and other agreements, and
satisfied every condition, contained in this Agreement and the other Loan
Documents to which it is a party to be observed, performed or satisfied by
it, and that such Responsible Officer has obtained no knowledge of any
Default or Event of Default except as specified in such certificate and
(ii) a Compliance Certificate containing all information and calculations
necessary for determining compliance by Holdings, the Borrowers and their
respective Subsidiaries with the provisions of this Agreement referred to
therein as of the last day of the fiscal quarter or fiscal year of the
Borrowers, as the case may be;
as soon as available, and in any event no later than 60 days after the end of
each fiscal year of the Borrowers, a budget for the following fiscal year
(which shall include projected Consolidated Operating Cash Flow and
budgeted capital expenditures), and, as soon as available, material
revisions, if any, of such budget with respect to such fiscal year
(collectively, the "Budget"), which Budget shall in each case be
accompanied by a certificate of a Responsible Officer stating that such
Budget is based on reasonable estimates, information and assumptions and
that such Responsible Officer has no reason to believe that such Budget is
incorrect or misleading in any material respect;
upon request by the Administrative Agent and within five days after the same are
sent, copies of all financial statements and reports (including reports on
Form 10-K, 10-Q or 8-K) that Holdings or any of the Borrowers sends to the
holders of any class of its debt securities or public equity securities
and, within five days after the same are filed, copies of all financial
statements and reports that Holdings or any of the Borrowers may make to,
or file with, the SEC;
no later than three Business Days prior to consummating any transaction
described in Section 6.2(f), 6.2(g), 6.5(e), 6.5(f), 6.5(g), 6.6(b),
6.7(f), 6.7(g) or (with respect to payment of deferred management fees)
6.8(c), a certificate of a Responsible Officer demonstrating in reasonable
detail (i) that both before and after giving effect to such transaction, no
Default or Event of Default shall be in effect (including, on a pro forma
basis, pursuant to Section 6.1) and (ii) compliance with any other
financial tests referred to in the relevant Section, provided that, in the
case of Investments, Dispositions or the payment of deferred management
fees, the requirement to deliver such certificate shall not apply to any
Investment or Disposition pursuant to which the Consideration paid is
$40,000,000 or less, to any Exchange of property in which the Annualized
Asset Cash Flow Amount attributable to the assets disposed of is 10% or
less of Annualized Pro Forma Operating Cash Flow determined as of the
relevant Disposition Date, or to any such payment of deferred management
fees in an amount of $3,000,000 or less;
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concurrently with the delivery of the financial statements referred to in
Section 5.1(b), a subscriber report setting forth current subscriber
numbers for the cable systems of the Borrowers and their respective
Subsidiaries;
promptly, such additional financial and other information as any Lender may from
time to time reasonably request.
Payment of Obligations. Pay, discharge or otherwise satisfy at or before
maturity or before they become delinquent, as the case may be, all its
material obligations of whatever nature, except where the amount or
validity thereof is currently being contested in good faith by appropriate
proceedings and reserves in conformity with GAAP with respect thereto have
been provided on the books of Holdings, any of the Borrowers or their
respective Subsidiaries, as the case may be.
Maintenance of Existence; Compliance. (a) (i) Preserve, renew and keep in full
force and effect its existence and (ii) take all reasonable action to
maintain all rights, privileges and franchises necessary or desirable in
the normal conduct of its business, except, in each case, as otherwise
permitted by Section 6.4 and except, in the case of clause (ii) above, to
the extent that failure to do so could not reasonably be expected to have a
Material Adverse Effect; and (b) comply with all Contractual Obligations
and Requirements of Law except to the extent that failure to comply
therewith could not, in the aggregate, reasonably be expected to have a
Material Adverse Effect.
Maintenance of Property; Insurance. (a) Keep all material property useful and
necessary in its business in good working order and condition, ordinary
wear and tear excepted and (b) maintain with reputable insurance companies
insurance on all its material property in at least such amounts and against
at least such risks (but including in any event public liability, product
liability and business interruption) as are usually insured against in the
same general area by companies engaged in the same or a similar business.
Inspection of Property; Books and Records; Discussions. (a) Keep proper books of
records and account in which full, true and correct entries in conformity
with GAAP and all Requirements of Law shall be made of all dealings and
transactions in relation to its business and activities and (b) permit
representatives of any Lender, coordinated through the Administrative
Agent, to visit and inspect any of its properties and examine and make
abstracts from any of its books and records at any reasonable time and as
often as may reasonably be desired and to discuss the business, operations,
properties and financial and other condition of Holdings, the Borrowers and
their respective Subsidiaries with officers and employees of Holdings, the
Borrowers and their respective Subsidiaries and with its independent
certified public accountants.
Notices. Promptly give notice to the Administrative Agent and each Lender of:
the occurrence of any Default or Event of Default;
any (i) default or event of default under any Contractual Obligation of
Holdings, any of the Borrowers or any of their respective Subsidiaries or
(ii) litigation, investigation or proceeding that may exist at any time
between Holdings, any of the Borrowers or any of their respective
Subsidiaries and any Governmental Authority, that, in either case, could
reasonably be expected to have a Material Adverse Effect;
any litigation or proceeding commenced against Holdings, any of the Borrowers
or any of their respective Subsidiaries which could reasonably be expected
to result in a liability of $15,000,000 or more to the
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extent not covered by insurance or which could reasonably be expected to
have a Material Adverse Effect;
the following events, as soon as possible and in any event within 30 days after
any of the Borrowers knows or has reason to know thereof: (i) the
occurrence of any Reportable Event with respect to any Plan, a failure to
make any required contribution to a Plan, the creation of any Lien in favor
of the PBGC or a Plan or any withdrawal from, or the termination,
Reorganization or Insolvency of, any Multiemployer Plan or (ii) the
institution of proceedings or the taking of any other action by the PBGC or
any of the Borrowers or any Commonly Controlled Entity or any Multiemployer
Plan with respect to the withdrawal from, or the termination,
Reorganization or Insolvency of, any Plan; and
any other development or event that has had or could reasonably be expected to
have a Material Adverse Effect.
Each notice pursuant to this Section 5.7 shall be accompanied by a statement of
a Responsible Officer setting forth details of the occurrence referred to
therein and stating what action Holdings, the Borrowers or the relevant
Subsidiary proposes to take with respect thereto.
Environmental Laws.
Except as, in the aggregate, could not reasonably be expected to result in a
Material Adverse Effect, comply with, and ensure compliance by all tenants
and subtenants, if any, with, all applicable Environmental Laws, and obtain
and comply with and maintain, and ensure that all tenants and subtenants
obtain and comply with and maintain, any and all licenses, approvals,
notifications, registrations or permits required by applicable
Environmental Laws.
Except as, in the aggregate, could not reasonably be expected to result in a
Material Adverse Effect, conduct and complete all investigations, studies,
sampling and testing, and all remedial, removal and other actions required
under Environmental Laws and promptly comply with all lawful orders and
directives of all Governmental Authorities regarding Environmental Laws.
Interest Rate Protection. Within 90 days following the Closing Date, and at all
times thereafter so long as the Consolidated Leverage Ratio exceeds 4.50 to
1.00, cause at least 50% of the aggregate outstanding principal amount of
Holdings Debt and Funded Opco Debt to be subject to a fixed rate, whether
directly or pursuant to Hedge Agreements having terms and conditions
reasonably satisfactory to the Administrative Agent.
Additional Collateral. With respect to any new Subsidiary (other than a Shell
Subsidiary so long as it qualifies as such) created or acquired after the
Closing Date by any of the Borrowers or any of their respective
Subsidiaries (which shall be deemed to have occurred in the event that any
Non-Recourse Subsidiary ceases to qualify as such), promptly (a) execute
and deliver to the Administrative Agent such amendments to the Guarantee
and Collateral Agreement as the Administrative Agent deems necessary or
advisable to grant to the Administrative Agent, for the benefit of the
Lenders, a perfected first priority security interest in the Equity
Interests and intercompany obligations of such new Subsidiary that are held
by any of the Borrowers or any of their respective Subsidiaries (limited,
in the case of Equity Interests of any Foreign Subsidiary, to 66% of the
total outstanding Equity Interests of such Foreign Subsidiary), (b) deliver
to the Administrative Agent the certificates, if any, representing such
Equity Interests, and any intercompany notes evidencing such obligations,
together with undated stock powers and endorsements, in blank, executed and
delivered by a duly authorized officer of the applicable Borrower or such
Subsidiary, as the case may be, and (c) except in the case of a Foreign
Subsidiary or an Excluded Acquired Subsidiary (until it ceases to qualify
as such), cause
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such new Subsidiary (i) to become a party to the Guarantee and Collateral
Agreement and (ii) to take such actions necessary or advisable to grant to
the Administrative Agent for the benefit of the Lenders a perfected first
priority security interest in the Collateral described in the Guarantee and
Collateral Agreement with respect to such new Subsidiary, including the
filing of Uniform Commercial Code financing statements in such
jurisdictions as may be required by the Guarantee and Collateral Agreement
or by law or as may be requested by the Administrative Agent.
Organizational Separateness. In the case of Holdings, each Specified Holdings
Subsidiary, each Non-Recourse Subsidiary and each of the Borrowers and
their respective Subsidiaries, (a) satisfy customary formalities with
respect to organizational separateness, including, without limitation, (i)
the maintenance of separate books and records and (ii) the maintenance of
separate bank or other deposit or investment accounts in its own name; (b)
act solely in its own name and through its authorized officers and agents;
(c) in the case of each of the Borrowers or any of their respective
Subsidiaries, not make or agree to make any payment to a creditor of
Holdings, any Specified Holdings Subsidiary or any Non-Recourse Subsidiary;
(d) not commingle any money or other assets of Holdings, any Specified
Holdings Subsidiary or any Non-Recourse Subsidiary with any money or other
assets of any of the Borrowers or any of their respective Subsidiaries; and
(e) not take any action, or conduct its affairs in a manner, which could
reasonably be expected to result in the separate organizational existence
of Holdings, each Specified Holdings Subsidiary and each Non-Recourse
Subsidiary from each of the Borrowers and their respective Subsidiaries
being ignored under any circumstance. Holdings agrees to cause each
Specified Holdings Subsidiary, and each of the Borrowers agrees to cause
each Non-Recourse Subsidiary, to comply with the applicable provisions of
this Section 5.11.
ERISA Reports. Furnish to the Administrative Agent as soon as available to any
of the Borrowers or Holdings the following items with respect to any Plan:
any request for a waiver of the funding standards or an extension of the
amortization period;
any reportable event (as defined in Section 4043 of ERISA), unless the notice
requirement with respect thereto has been waived by regulation;
any notice received by any Commonly Controlled Entity that the PBGC has
instituted or intends to institute proceedings to terminate any Plan, or
that any Multiemployer Plan is insolvent or in reorganization;
notice of the possibility of the termination of any Plan by its administrator
pursuant to Section 4041 of ERISA; and
notice of the intention of any Commonly Controlled Entity to withdraw, in whole
or in part, from any Multiemployer Plan.
ERISA, etc. Comply in all material respects with the provisions of ERISA and the
Code applicable to each Plan. Each of Holdings, the Borrowers and their
respective Subsidiaries will meet all minimum funding requirements
applicable to them with respect to any Plan pursuant to Section 302 of
ERISA or Section 412 of the Code, without giving effect to any waivers of
such requirements or extensions of the related amortization periods which
may be granted. At no time shall the Accumulated Benefit Obligations under
any Plan that is not a Multiemployer Plan exceed the fair market value of
the assets of such Plan allocable to such benefits by more than
$10,000,000. After the Closing Date, Holdings, the Borrowers and their
respective Subsidiaries will not withdraw, in whole or in part, from any
Multiemployer Plan so as to give rise to withdrawal liability exceeding
$10,000,000 in the aggregate.
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At no time shall the actuarial present value of unfunded liabilities for
post-employment health care benefits, whether or not provided under a Plan,
calculated in a manner consistent with Statement No. 106 of the Financial
Accounting Standards Board, exceed $10,000,000.
NEGATIVE COVENANTS
Holdings and the Borrowers hereby agree that, so long as the Commitments
remain in effect or any Loan or other amount is owing to any Lender or any Agent
hereunder, each of Holdings and the Borrowers shall not, and shall not permit
any Subsidiary of any Borrower to, directly or indirectly (provided that only
Sections 6.2, 6.3, 6.4, 6.10, 6.12, 6.13, 6.14(b) and 6.15 shall apply to
Holdings):
Financial Condition Covenants.
Consolidated Leverage Ratio. Permit the Consolidated Leverage Ratio determined
as of the last day of any fiscal quarter of the Borrowers ending during any
period set forth below to exceed the ratio set forth below opposite such
period:
<TABLE>
<CAPTION>
Period Consolidated Leverage Ratio
------ ---------------------------
<S> <C>
Closing Date - 12/30/01 6.25 to 1.0
12/31/01 - 12/30/02 6.00 to 1.0
12/31/02 - 12/30/03 5.50 to 1.0
12/31/03 - 12/30/04 5.00 to 1.0
12/31/04 - 12/30/05 4.75 to 1.0
12/31/05 and thereafter 4.50 to 1.0
</TABLE>
Consolidated Senior Leverage Ratio. If the Consolidated Leverage Ratio
determined as of the last day of any fiscal quarter of the Borrowers equals
or exceeds 5:00 to 1.00, permit the Consolidated Senior Leverage Ratio
determined as of the last day of such fiscal quarter to exceed 4.75 to
1.00.
Consolidated Interest Coverage Ratio. Permit the Consolidated Interest Coverage
Ratio determined as of the last day of any fiscal quarter of the Borrowers
to be less than 1.75 to 1.00.
Consolidated Debt Service Coverage Ratio. Permit the Consolidated Debt Service
Coverage Ratio determined as of the last day of any fiscal quarter of the
Borrowers to be less than 1.25 to 1.0.
For the purposes of paragraphs (c) and (d) above, in calculating the relevant
ratios for any period that is not comprised of four fiscal quarters commencing
after the Closing Date, Consolidated Interest Expense for the relevant period
shall be deemed to equal Consolidated Interest Expense for the number of fiscal
quarters commencing after the Closing Date that fall within such period
multiplied by the appropriate factor necessary to annualize such amount.
Notwithstanding anything to the contrary above, (i) compliance with the
Section 6.1(c) and Section 6.1(d) shall not be required until the fiscal quarter
ending March 31, 2000, and (ii) for purposes of calculating compliance with
Section 6.1(a) and Section 6.1(b) as of December 31, 1999, Consolidated
Operating Cash Flow for purposes of calculating the Consolidated Leverage Ratio
and the Consolidated Senior Leverage Ratio as of such date shall be determined
on a pro forma basis assuming that the acquisition by the Borrowers of all
Acquired Systems described in clause (i) of the definition thereof occurred on
October 1, 1999.
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Indebtedness. Create, issue, incur, assume, become liable in respect of or
suffer to exist any Indebtedness, except:
Indebtedness of any Loan Party pursuant to any Loan Document;
Indebtedness of any of the Borrowers to any Subsidiary and of any Wholly Owned
Subsidiary Guarantor to any of the Borrowers or any other Subsidiary;
Guarantee Obligations incurred in the ordinary course of business by any of the
Borrowers or any of their respective Subsidiaries of obligations of any
Wholly Owned Subsidiary Guarantor;
Indebtedness described on Schedule 6.2(d);
Indebtedness (including, without limitation, Capital Lease Obligations) secured
by Liens permitted by Section 6.3(f) in an aggregate principal amount not
to exceed $10,000,000 at any one time outstanding;
Indebtedness of any of the Borrowers (but not any Subsidiary of any of the
Borrowers), so long as (i) no Default or Event of Default shall have
occurred and be continuing or would result therefrom, (ii) such
Indebtedness shall have no scheduled amortization prior to the date that is
one year after the final maturity of the Term Loans outstanding on the date
such Indebtedness is incurred, (iii) such Indebtedness is unsecured and the
covenants and default provisions applicable to such Indebtedness shall be
no more restrictive than those contained in this Agreement, and (iv) such
Indebtedness shall be subordinated to the Loans and other obligations under
the Loan Documents on terms no less favorable to the Lenders than the
Existing Senior Subordinated Debt or pursuant to subordination terms
otherwise reasonably satisfactory to the Administrative Agent;
Indebtedness of any Person that becomes a Subsidiary pursuant to an Investment
permitted by Section 6.7, so long as (i) no Default or Event of Default
shall have occurred and be continuing or would result therefrom, (ii) such
Indebtedness existed at the time of such Investment and was not created in
anticipation thereof, (iii) the Borrowers shall use their best efforts to
cause such Indebtedness to be repaid no later than 120 days after the date
of such Investment, (iv) if such Indebtedness is not repaid within such
period then, until such Indebtedness is repaid, the operating cash flow of
the relevant Subsidiary shall be excluded for the purposes of calculating
Consolidated Operating Cash Flow (whether or not distributed to any of the
Borrowers or any of their respective other Subsidiaries) and (v) the
aggregate outstanding principal amount of Indebtedness incurred pursuant to
this paragraph shall not exceed $50,000,000;
letters of credit for the account of any of the Borrowers or any of their
respective Subsidiaries, so long as the aggregate undrawn face amount
thereof, together with any unreimbursed reimbursement obligations in
respect thereof, does not exceed $10,000,000 at any one time;
Indebtedness of Holdings (but not of any of the Borrowers or any of their
respective Subsidiaries) so long as (i) such Indebtedness shall have no
scheduled amortization prior to the date that is one year after the final
maturity of the Term Loans outstanding on the date such Indebtedness is
incurred and (ii) 100% of the Net Cash Proceeds thereof shall be (x)
applied by Holdings to refinance the Existing Senior Discount Debt and (y)
to the extent not applied to refinance the Existing Senior Discount Debt,
contributed to the Borrowers for their uses, including the repayment (to
the extent permitted hereunder) of Indebtedness of the Borrowers and their
respective Subsidiaries;
Specified Subordinated Debt; and
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additional Indebtedness of any of the Borrowers or any of their respective
Subsidiaries in an aggregate principal amount (for the Borrowers and all
Subsidiaries) not to exceed $15,000,000 at any one time outstanding.
Liens. Create, incur, assume or suffer to exist any Lien upon any of its
property, whether now owned or hereafter acquired, except:
Liens for taxes, assessments and other governmental charges not yet due or that
are being contested in good faith by appropriate proceedings, provided that
adequate reserves with respect thereto are maintained on the books of
Holdings, the Borrowers or their respective Subsidiaries, as the case may
be, in conformity with GAAP;
carriers', warehousemen's, mechanics', materialmen's, repairmen's or other like
Liens arising in the ordinary course of business that are not overdue for a
period of more than 30 days or that are being contested in good faith by
appropriate proceedings;
pledges or deposits in connection with workers' compensation, unemployment
insurance and other social security legislation;
deposits made to secure the performance of bids, tenders, trade contracts,
leases, statutory or regulatory obligations, surety and appeal bonds,
bankers acceptances, government contracts, performance bonds and other
obligations of a like nature incurred in the ordinary course of business,
in each case excluding obligations for borrowed money;
easements, rights-of-way, municipal and zoning ordinances, title defects,
restrictions and other similar encumbrances incurred in the ordinary course
of business that, in the aggregate, are not substantial in amount and that
do not in any case materially detract from the value of the property
subject thereto or materially interfere with the ordinary conduct of the
business of Holdings, any of the Borrowers or any of their respective
Subsidiaries;
Liens securing Indebtedness of Holdings, any of the Borrowers or any of their
respective Subsidiaries incurred pursuant to Section 6.2(e) to finance the
acquisition of fixed or capital assets, provided that (i) such Liens shall
be created substantially simultaneously with the acquisition of such fixed
or capital assets, (ii) such Liens do not at any time encumber any property
other than the property financed by such Indebtedness and (iii) the amount
of Indebtedness secured thereby is not increased;
Liens created pursuant to the Guarantee and Collateral Agreement securing
obligations of the Loan Parties under (i) the Loan Documents, (ii) Hedge
Agreements provided by any Lender or any Affiliate of any Lender and (iii)
letters of credit issued pursuant to Section 6.2(h) by any Lender or any
Affiliate of any Lender;
any landlord's Lien or other interest or title of a lessor under any lease or a
licensor under a license entered into by Holdings, any of the Borrowers or
any of their respective Subsidiaries in the ordinary course of its business
and covering only the assets so leased or licensed;
Liens created under Pole Agreements on cables and other property affixed to
transmission poles or contained in underground conduits;
Liens of or restrictions on the transfer of assets imposed by any franchisors,
utilities or other regulatory bodies or any federal, state or local
statute, regulation or ordinance, in each case arising in the ordinary
course of business in connection with franchise agreements or Pole
Agreements;
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Liens arising from judgments or decrees not constituting an Event of Default
under Section 7(h); and
Liens not otherwise permitted by this Section so long as neither (i) the
aggregate outstanding principal amount of the obligations secured thereby
nor (ii) the aggregate fair market value (determined as of the date such
Lien is incurred) of the assets subject thereto exceeds (as to Holdings,
the Borrowers and all Subsidiaries), when added to the aggregate
outstanding amount of Attributable Debt, $10,000,000 at any one time.
Fundamental Changes. Enter into any merger, consolidation or amalgamation, or
liquidate, wind up or dissolve itself (or suffer any liquidation or
dissolution), except that:
any Subsidiary of any of the Borrowers may be merged or consolidated with or
into any Wholly Owned Subsidiary Guarantor (provided that the Wholly Owned
Subsidiary Guarantor shall be the continuing or surviving entity);
any Subsidiary of any of the Borrowers may be merged or consolidated with or
into any of the Borrowers (provided that the relevant Borrower shall be the
continuing or surviving entity);
any Subsidiary of the Borrower may Dispose of any or all of its assets (upon
voluntary liquidation or otherwise) to any Wholly Owned Subsidiary
Guarantor;
any Shell Subsidiary may be dissolved; and
so long as no Default or Event of Default has occurred or is continuing or
would result therefrom, (i) Holdings may be merged or consolidated with any
Affiliate of Paul G. Allen (provided that either (x) Holdings is the
continuing or surviving entity or (y) if Holdings is not the continuing or
surviving entity, such continuing or surviving entity assumes the
obligations of Holdings under the Loan Documents to which it is a party
pursuant to an instrument in form and substance reasonably satisfactory to
the Administrative Agent and, in connection therewith, the Administrative
Agent shall receive such legal opinions, certificates and other documents
as it may reasonably request) and (ii) Holdings may transfer all of the
Equity Interests of the Borrowers to a Subsidiary of Holdings created for
the purpose of holding such Equity Interests (provided that such Subsidiary
assumes the obligations of Holdings under the Loan Documents to which it is
a party pursuant to an instrument in form and substance reasonably
satisfactory to the Administrative Agent and, in connection therewith, the
Administrative Agent shall receive such legal opinions, certificates and
other documents as it may reasonably request).
Disposition of Property. Dispose of any of its property, whether now owned or
hereafter acquired, or, in the case of any Subsidiary, issue or sell any
Equity Interests to any Person, except:
the Disposition of obsolete or worn out property in the ordinary course of
business;
the sale of inventory in the ordinary course of business;
Dispositions expressly permitted by Section 6.4;
the sale or issuance of any Subsidiary's Equity Interests to any of the
Borrowers or any Wholly Owned Subsidiary Guarantor;
the Disposition (directly or indirectly through the Disposition of 100% of the
Equity Interests of a Subsidiary) of operating assets by any of the
Borrowers or any of their respective Subsidiaries (it
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being understood that Exchange Excess Amounts shall be deemed to constitute
usage of availability in respect of Dispositions pursuant to this Section
6.5(e)), provided that (i) on the date of such Disposition (the
"Disposition Date"), no Default or Event of Default shall have occurred and
be continuing or would result therefrom; (ii) the Annualized Asset Cash
Flow Amount attributable to the assets being disposed of shall not exceed
an amount equal to 25% of Annualized Pro Forma Operating Cash Flow
determined as of such Disposition Date; (iii) the Annualized Asset Cash
Flow Amount attributable to the assets being disposed of, when added to the
Annualized Asset Cash Flow Amount attributable to all other assets
previously disposed of pursuant to this Section 6.5(e) during the period
from the Closing Date to such Disposition Date, shall not exceed an amount
equal to 35% of Annualized Pro Forma Operating Cash Flow determined as of
such Disposition Date; (iv) at least 75% of the proceeds of such
Disposition shall be in the form of cash; and (v) the Net Cash Proceeds of
such Disposition shall be applied to prepay the Loans to the extent
required by Section 2.9(a);
any Exchange by any of the Borrowers and their respective Subsidiaries,
provided that (i) on the Disposition Date on which such Exchange occurs, no
Default or Event of Default shall have occurred and be continuing or would
result therefrom; (ii) the assets received in connection with such Exchange
shall be received by a Wholly Owned Subsidiary of a Borrower (or, in the
case of any Equity Interests so received, by a Borrower); (iii) in the
event that (x) any cash consideration is paid to any of the Borrowers or
any of their respective Subsidiaries in connection with such Exchange and
(y) the Annualized Asset Cash Flow Amount attributable to the assets being
Exchanged exceeds the annualized asset cash flow amount (determined in a
manner comparable to the manner in which Annualized Asset Cash Flow Amounts
are determined hereunder) of the assets received in connection with such
Exchange (such excess amount, an "Exchange Excess Amount"), then, the
Disposition of such Exchange Excess Amount is permitted by clauses (ii) and
(iii) of Section 6.5(e); and (iv) the Net Cash Proceeds of such Exchange,
if any, shall be applied to prepay the Loans to the extent required by
Section 2.9(a);
Dispositions of property acquired after the Closing Date, (other than property
acquired in connection with Exchanges of property owned on the Closing
Date), so long as (i) no Default or Event of Default shall have occurred
and be continuing or would result therefrom, (ii) a definitive agreement to
consummate such Disposition is executed no later than twelve months after
the date on which relevant property is acquired and (iii) such Disposition
is consummated within eighteen months after the date on which the relevant
property is acquired; and
the Disposition of other property having a fair market value not to exceed
$5,000,000 in the aggregate for any fiscal year of the Borrowers.
Restricted Payments. Declare or pay any dividend (other than dividends payable
solely in common stock of the Person making such dividend) on, or make any
payment on account of, or set apart assets for a sinking or other analogous
fund for, the purchase, redemption, defeasance, retirement or other
acquisition of, any Equity Interests of Holdings, any of the Borrowers or
any Subsidiary, whether now or hereafter outstanding, or make any other
distribution in respect thereof, either directly or indirectly, whether in
cash or property or in obligations of Holdings, any of the Borrowers or any
Subsidiary (collectively, "Restricted Payments"), except that:
any Subsidiary may make Restricted Payments to any of the Borrowers or any
Wholly Owned Subsidiary Guarantor;
each of the Borrowers may make Restricted Payments (directly or indirectly) to
any Qualified Parent Company or any Affiliate of the Borrowers for the
purpose of enabling such Person to make scheduled interest payments
(including the Mandatory Payment of Accrued Interest with respect to
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the Existing Senior Discount Debt) in respect of its Qualified
Indebtedness, provided that (i) no Default or Event of Default shall have
occurred and be continuing or would result therefrom, (ii) each such
Restricted Payment shall be made on a Threshold Transaction Date (except in
the case of any Restricted Payment made for the purpose of paying interest
on Qualified Indebtedness as to which 100% of the Net Cash Proceeds thereof
were (x) contributed to the Borrowers as a capital contribution or (y)
applied to refinance all or a portion of the Existing Senior Discount Debt)
and (iii) each such Restricted Payment shall be made no earlier than three
Business Days prior to the date the relevant interest payment is due;
so long as no Default or Event of Default has occurred and is continuing or
would result therefrom, (i) the Borrowers may make Restricted Payments to
Holdings or direct Restricted Payments to be used to repurchase, redeem or
otherwise acquire or retire for value any Equity Interests of any Qualified
Parent Company held by any member of management of Holdings, any of the
Borrowers or any of their respective Subsidiaries pursuant to any
management equity subscription agreement or stock option agreement in
effect as of the Closing Date, provided that the aggregate amount of such
Restricted Payments shall not exceed $5,000,000 in any fiscal year of the
Borrowers and (ii) the Borrowers may also make Restricted Payments to
Holdings as described in Section 6.8(c) and the last sentence of Section
6.9;
so long as no Default or Event of Default has occurred and is continuing or
would result therefrom, the Borrowers may make Restricted Payments to
Holdings for any purpose, provided that, after giving effect to any such
Restricted Payment, the Consolidated Leverage Ratio shall be less than 3.50
to 1.0;
the Borrowers may make Restricted Payments to Holdings to permit Holdings (or
any parent company thereof) to pay (i) attorneys' fees, investment banking
fees, accountants' fees, underwriting discounts and commissions and other
customary fees and expenses actually incurred in connection with any
issuance, sale or incurrence by Holdings (or any such parent company) of
Equity Interests or Indebtedness (other than any such amounts customarily
paid out of the proceeds of transactions of such type), provided, that such
amounts shall be allocated in an appropriate manner (determined after
consultation with the Administrative Agent) among the Borrowers and the
other Subsidiaries, if any, of the issuer or obligor in respect of such
Equity Interests or Indebtedness and (ii) other administrative expenses
(including legal, accounting, other professional fees and costs, printing
and other such fees and expenses) incurred in the ordinary course of
business, in an aggregate amount in the case of this clause (ii) not to
exceed $2,000,000 in any fiscal year; and
in respect of any calendar year or portion thereof during which any of the
Borrowers is a Flow-Through Entity, so long as no Default or Event of
Default has occurred and is continuing or would result therefrom, such
Borrower may make Restricted Payments (directly or indirectly) to the
direct or indirect holders of the Equity Interests of such Borrower that
are not Flow-Through Entities, in proportion to their ownership interests,
sufficient to permit each such holder to pay income taxes that are required
to be paid by it with respect to its Equity Interests in such Borrower for
such calendar year, as estimated by such Borrower in good faith.
Investments. Make any advance, loan, extension of credit (by way of guaranty or
otherwise) or capital contribution to, or purchase any Equity Interests,
bonds, notes, debentures or other debt securities of, or any assets
constituting a significant part of a business unit of, or make any other
investment in, any Person (all of the foregoing, "Investments"), except:
extensions of trade credit in the ordinary course of business;
investments in Cash Equivalents;
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Guarantee Obligations permitted by Section 6.2;
loans and advances to employees of any of the Borrowers or any of their
respective Subsidiaries in the ordinary course of business (including for
travel, entertainment and relocation expenses) in an aggregate amount not
to exceed $1,000,000 at any one time outstanding;
Investments by any of the Borrowers or any of their respective Subsidiaries in
any of the Borrowers or any Person that, prior to and after giving effect
to such investment, is a Wholly Owned Subsidiary Guarantor;
acquisitions (other than the acquisition permitted under clause (i) below) by
any of the Borrowers or any Wholly Owned Subsidiary Guarantor of operating
assets (substantially all of which consist of cable systems), directly
through an asset acquisition or indirectly through the acquisition of 100%
of the Equity Interests of a Person substantially all of whose assets
consist of cable systems, provided, that (i) no Default or Event of Default
shall have occurred and be continuing or would result therefrom and (ii)
the aggregate Consideration (excluding Consideration paid with the proceeds
of Paul Allen Contributions and Consideration consisting of operating
assets transferred in connection with Exchanges) paid in connection with
such acquisitions, other than acquisitions consummated on a Threshold
Transaction Date, shall not exceed $100,000,000 during the term of this
Agreement;
any of the Borrowers or any of their respective Subsidiaries may contribute
cable systems to any Non-Recourse Subsidiary so long as (i) such
Disposition is permitted pursuant to Section 6.5(e), (ii) no Default or
Event of Default shall have occurred and be continuing or would result
therefrom, (iii) after giving effect thereto, the Consolidated Leverage
Ratio shall be equal to or lower than the Consolidated Leverage Ratio in
effect immediately prior thereto and (iv) the Equity Interests received by
any of the Borrowers or any of their respective Subsidiaries in connection
therewith shall be pledged as Collateral (either directly or through a
holding company parent of such Non-Recourse Subsidiary so long as such
parent is a Wholly Owned Subsidiary Guarantor);
in addition to Investments otherwise expressly permitted by this Section,
Investments by any of the Borrowers or any of their respective Subsidiaries
in an aggregate amount (valued at cost) not to exceed $25,000,000 during
the term of this Agreement; and
the acquisition by any of the Borrowers of the Acquired Systems described in
clause (ii) of the definition thereof on substantially the terms set forth
in the asset purchase agreement described in such clause (as such agreement
is in effect on the Closing Date).
Certain Payments and Modifications Relating to Indebtedness and Management Fees.
Make or offer to make any payment, prepayment, repurchase or redemption in
respect of, or otherwise optionally or voluntarily defease or segregate
funds with respect to (collectively, "prepayment"), any Specified
Subordinated Debt or Specified Long-Term Indebtedness, other than (i) the
payment of scheduled interest payments required to be made in cash, (ii)
the prepayment of Specified Subordinated Debt with the proceeds of other
Specified Long-Term Indebtedness or other Specified Subordinated Debt or of
Loans and (iii) the prepayment of any such Indebtedness with the proceeds
of other Specified Subordinated Debt or other Specified Long-Term
Indebtedness.
Amend, modify, waive or otherwise change, or consent or agree to any amendment,
modification, waiver or other change to, any of the terms of any
Indebtedness of any of the Borrowers or any of their respective
Subsidiaries, other than any such amendment, modification, waiver or other
change that
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(i) would not cause such Indebtedness to be prohibited under Section 6.2
and (ii) does not involve the payment of a consent fee which is
unreasonable in the judgment of the Administrative Agent.
Make, agree to make or expense any payment in respect of management fees,
directly or indirectly, except that the Borrowers may expense and pay
management fees pursuant to the Management Fee Agreement so long as (i) no
Default or Event of Default shall have occurred and be continuing or would
result therefrom, (ii) the aggregate amount of such payments expensed
during any fiscal year of the Borrowers shall not exceed 3.50% of
consolidated gross revenues of the Borrowers and their consolidated
Subsidiaries for such fiscal year, (iii) the aggregate amount of such
payments made during any fiscal year of the Borrowers shall not exceed
2.00% of consolidated gross revenues of the Borrowers and their
consolidated Subsidiaries for such fiscal year (provided that cash payments
of management fees may be made in respect of amounts that have been
expensed, but have not been paid, on any Threshold Management Fee Date),
(iv) the obligation of the Borrowers to pay such management fees shall be
subordinated to the obligations of the Borrowers under the Loan Documents
pursuant to terms in form and substance reasonably satisfactory to the
Administrative Agent, and (v) each such payment shall be made no earlier
than three Business Days prior to the date such payment is due.
Amend, modify, waive or otherwise change, or consent or agree to any amendment,
modification, waiver or other change to, any of the terms of the Management
Fee Agreement, other than any such amendment, modification, waiver or other
change that (i) (x) would extend the due date or reduce the amount of any
payment thereunder or (y) does not adversely affect the interests of the
Lenders (it being understood that a change in the manager thereunder to
another member of the Charter Group does not adversely affect the interests
of the Lenders) and (ii) does not involve the payment of a consent fee.
Transactions with Affiliates. Enter into any transaction, including any
purchase, sale, lease or exchange of property, the rendering of any service
or the payment of any management, advisory or similar fees, with any
Affiliate (other than any of the Borrowers or any Wholly Owned Subsidiary
Guarantor) unless such transaction is (a) not prohibited under this
Agreement, (b) in the ordinary course of business of such Borrower or such
Subsidiary, as the case may be, and (c) upon fair and reasonable terms no
less favorable to the Borrowers or such Subsidiary, as the case may be,
than it would obtain in a comparable arm's length transaction with a Person
that is not an Affiliate. The foregoing restrictions shall not apply to
transactions expressly permitted by Section 6.6 or Section 6.8(c).
Notwithstanding anything to the contrary in this Section 6.9, so long as no
Default or Event of Default shall have occurred and be continuing or would
result therefrom, the Borrowers shall be permitted to pay (either directly
or by way of a distribution to Holdings) amounts not in excess of 1.0% of
the aggregate enterprise value of Investments permitted hereby made after
the Closing Date to certain members of the Charter Group.
Sales and Leasebacks. Enter into any arrangement with any Person (other than a
Wholly Owned Subsidiary Guarantor) providing for the leasing by Holdings,
any of the Borrowers or any Subsidiary of real or personal property that
has been or is to be sold or transferred by Holdings, such Borrower or such
Subsidiary to such Person or to any other Person to whom funds have been or
are to be advanced by such Person on the security of such property or
rental obligations of Holdings, such Borrower or such Subsidiary unless,
after giving effect thereto, the aggregate outstanding amount of
Attributable Debt, when added to the aggregate amount utilized pursuant to
Section 6.3(l), does not exceed $10,000,000.
Changes in Fiscal Periods. Permit the fiscal year of the Borrowers to end on a
day other than December 31 or change the Borrowers' method of determining
fiscal quarters.
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Negative Pledge Clauses. Enter into or suffer to exist or become effective any
agreement that prohibits or limits the ability of Holdings, any of the
Borrowers or any of their respective Subsidiaries to create, incur, assume
or suffer to exist any Lien upon any of its property or revenues, whether
now owned or hereafter acquired, to secure its obligations under the Loan
Documents to which it is a party (without regard to the amount of such
obligations), other than (a) this Agreement and the other Loan Documents,
(b) any agreements governing any purchase money Liens or Capital Lease
Obligations otherwise permitted hereby (in which case, any prohibition or
limitation shall only be effective against the assets financed thereby) and
(c) pursuant to Contractual Obligations assumed in connection with
Investments (but not created in contemplation thereof) so long as the
maximum aggregate liabilities of Holdings and its Subsidiaries pursuant
thereto do not exceed $2,000,000 at any time.
Clauses Restricting Subsidiary Distributions. Enter into or suffer to exist or
become effective any consensual encumbrance or restriction on the ability
of any Subsidiary of any of the Borrowers to (a) make Restricted Payments
in respect of any Equity Interests of such Subsidiary held by, or pay any
Indebtedness owed to, any of the Borrowers or any other Subsidiary of any
of the Borrowers, (b) make loans or advances to, or other Investments in,
any of the Borrowers or any other Subsidiary of any of the Borrowers or (c)
transfer any of its assets to any of the Borrowers or any other Subsidiary
of any of the Borrowers, except for such encumbrances or restrictions
existing under or by reason of (i) any restrictions existing under the Loan
Documents or the documentation in existence on the Closing Date relating to
the Existing Senior Subordinated Debt and (ii) any restrictions with
respect to a Subsidiary imposed pursuant to an agreement that has been
entered into in connection with the Disposition of all or substantially all
of the Equity Interests or assets of such Subsidiary in a transaction
otherwise permitted by this Agreement.
Lines of Business; Holding Company Status. (a) Enter into any business, either
directly or through any Subsidiary, except for (i) those businesses in
which the Borrowers and their respective Subsidiaries are significantly
engaged on the date of this Agreement and (ii) businesses which are
reasonably similar or related thereto or reasonable extensions thereof but
not, in the case of this clause (ii), in the aggregate, material to the
overall business of the Borrowers and their respective Subsidiaries
(collectively, "Permitted Lines of Business"), provided, that, in any
event, the Borrowers and their respective Subsidiaries will continue to be
primarily engaged in the businesses in which they are primarily engaged on
the date of this Agreement.
(b) In the case of Holdings, (i) conduct, transact or otherwise engage in,
or commit to conduct, transact or otherwise engage in, any business or
operations other than those incidental to its ownership of the Equity Interests
in other Persons or (ii) own, lease, manage or otherwise operate any properties
or assets other than Equity Interests in other Persons.
Investments by Holdings in the Borrowers. In the case of Holdings, make any
Investment in the Borrowers other than in the form of a capital
contribution, unless such Investment is evidenced by a note and pledged to
the Administrative Agent pursuant to the Guarantee and Collateral
Agreement.
EVENTS OF DEFAULT
If any of the following events shall occur and be continuing:
the Borrowers shall fail to pay any principal of any Loan when due in
accordance with the terms hereof; or the Borrowers shall fail to pay any
interest on any Loan, or any other amount payable hereunder or under any
other Loan Document, within five days after any such interest or other
amount becomes due in accordance with the terms hereof; or
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any representation or warranty made or deemed made by any Loan Party herein or
in any other Loan Document or that is contained in any certificate,
document or financial or other statement furnished by it at any time under
or in connection with this Agreement or any such other Loan Document shall
prove to have been inaccurate in any material respect on or as of the date
made or deemed made; or
any Loan Party shall default in the observance or performance of any agreement
contained in clause (i) or (ii) of Section 5.4(a) (with respect to Holdings
and the Borrowers only), Section 5.7(a) or Section 6 of this Agreement or
Sections 6.4 and 6.6(b) of the Guarantee and Collateral Agreement; or
any Loan Party shall default in the observance or performance of any other
agreement contained in this Agreement or any other Loan Document (other
than as provided in paragraphs (a) through (c) of this Section), and such
default shall continue unremedied for a period of 30 days after notice to
the Borrowers from the Administrative Agent or the Required Lenders; or
Holdings, any of the Borrowers or any of their respective Subsidiaries shall (i)
default in making any payment of any principal of any Indebtedness
(including any Guarantee Obligation, but excluding the Loans) on the
scheduled or original due date with respect thereto; or (ii) default in
making any payment of any interest on any such Indebtedness beyond the
period of grace, if any, provided in the instrument or agreement under
which such Indebtedness was created; or (iii) default in the observance or
performance of any other agreement or condition relating to any such
Indebtedness or contained in any instrument or agreement evidencing,
securing or relating thereto, the effect of which default is to cause, or
to permit the holder or beneficiary of such Indebtedness (or a trustee or
agent on behalf of such holder or beneficiary) to cause, with the giving of
notice if required, such Indebtedness to become due prior to its stated
maturity or (in the case of any such Indebtedness constituting a Guarantee
Obligation) to become payable; provided, that a default described in clause
(i), (ii) or (iii) of this paragraph (e) shall not at any time constitute
an Event of Default unless, at such time, one or more defaults of the type
described in clauses (i), (ii) and (iii) of this paragraph (e) shall have
occurred and be continuing with respect to Indebtedness the outstanding
principal amount of which exceeds in the aggregate $20,000,000; or
(i) Holdings, any of the Borrowers or any of their respective Subsidiaries
shall commence any case, proceeding or other action (A) under any existing
or future law of any jurisdiction, domestic or foreign, relating to
bankruptcy, insolvency, reorganization or relief of debtors, seeking to
have an order for relief entered with respect to it, or seeking to
adjudicate it a bankrupt or insolvent, or seeking reorganization,
arrangement, adjustment, winding-up, liquidation, dissolution, composition
or other relief with respect to it or its debts, or (B) seeking appointment
of a receiver, trustee, custodian, conservator or other similar official
for it or for all or any substantial part of its assets, or Holdings, any
of the Borrowers or any of their respective Subsidiaries shall make a
general assignment for the benefit of its creditors; or (ii) there shall be
commenced against Holdings, any of the Borrowers or any of their respective
Subsidiaries any case, proceeding or other action of a nature referred to
in clause (i) above that (A) results in the entry of an order for relief or
any such adjudication or appointment or (B) remains undismissed,
undischarged or unbonded for a period of 60 days; or (iii) there shall be
commenced against Holdings, any of the Borrowers or any of their respective
Subsidiaries any case, proceeding or other action seeking issuance of a
warrant of attachment, execution, distraint or similar process against all
or any substantial part of its assets that results in the entry of an order
for any such relief that shall not have been vacated, discharged, or stayed
or bonded pending appeal within 60 days from the entry thereof; or (iv)
Holdings, any of the Borrowers or any of their respective Subsidiaries
shall take any action in furtherance of, or indicating its consent to,
approval of, or acquiescence in, any of the acts set forth in clause (i),
(ii), or (iii) above; or (v) Holdings, any of the Borrowers or any of their
respective Subsidiaries shall generally not, or shall be unable to, or
shall admit in writing its inability to, pay its debts as they become due;
or
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(i) Commonly Controlled Entities shall fail to pay when due amounts (other than
amounts being contested in good faith through appropriate proceedings) for
which they shall have become liable under Title IV of ERISA to pay to the
PBGC or to a Plan, (ii) the PBGC shall institute proceedings under Title IV
of ERISA to terminate or to cause a trustee to be appointed to administer
any Plan or a proceeding shall be instituted by a fiduciary of any Plan
against any Commonly Controlled Entity to enforce Sections 515 or
4219(c)(5) of ERISA and such proceeding shall not have been dismissed
within 30 days thereafter, or (iii) a condition shall exist which would
require the PBGC to obtain a decree adjudicating that any Plan must be
terminated; and in each case in clauses (i) through (iii) above, such event
or condition, together with all other such events or conditions, if any,
could, in the sole judgment of the Required Lenders, reasonably be expected
to result in a Material Adverse Effect; or
one or more judgments or decrees shall be entered against Holdings, any of the
Borrowers or any of their respective Subsidiaries involving in the
aggregate a liability (to the extent not paid or fully covered by insurance
as to which the relevant insurance company has acknowledged coverage) of
$25,000,000 or more, and all such judgments or decrees shall not have been
vacated, discharged, stayed or bonded pending appeal within 30 days from
the entry thereof; or
the Guarantee and Collateral Agreement shall cease, for any reason (other than
the gross negligence or willful misconduct of the Administrative Agent), to
be in full force and effect, or any Loan Party or any Affiliate of any Loan
Party shall so assert, or any Lien created by the Guarantee and Collateral
Agreement shall cease to be enforceable and of the same effect and priority
purported to be created thereby; or
(i) the Paul Allen Group shall cease to have the power, directly or indirectly,
to vote or direct the voting of Equity Interests having at least 51%
(determined on a fully diluted basis) of the ordinary voting power for the
management of each Borrower; (ii) the Paul Allen Group shall cease to own
of record and beneficially, directly or indirectly, Equity Interests of
each Borrower representing at least 25% (determined on a fully diluted
basis) of the economic interests therein; (iii) Charter Communications
Holding Company, LLC shall cease to own of record and beneficially,
directly or indirectly, Equity Interests of each Borrower representing at
least 51% (determined on a fully diluted basis) of the economic interests
therein; or (iv) any of the Borrowers shall cease to be a direct Wholly
Owned Subsidiary of Holdings; or
any of the Borrowers or any of their respective Subsidiaries shall have
received a notice of termination or suspension with respect to any of its
CATV Franchises or CATV Systems from the FCC or any Governmental Authority
or other franchising authority or any of the Borrowers or any of their
respective Subsidiaries or the grantors of any CATV Franchises or CATV
Systems shall fail to renew such CATV Franchises or CATV Systems at the
stated expiration thereof if the percentage represented by such CATV
Franchises or CATV Systems and any other CATV Franchises or CATV Systems
which are then so terminated, suspended or not renewed of Consolidated
Operating Cash Flow for the 12-month period preceding the date of the
termination, suspension or failure to renew, as the case may be, (giving
pro forma effect to any acquisitions or Dispositions that have occurred
since the beginning of such 12-month period as if such acquisitions or
Dispositions had occurred at the beginning of such 12-month period), would
exceed 10%, unless (i) an alternative CATV Franchise or CATV System in form
and substance reasonably satisfactory to the Required Lenders shall have
been procured and come into effect prior to or concurrently with the
termination or expiration date of such terminated, suspended or non-renewed
CATV Franchise or CATV System or (ii) such Borrower or such Subsidiary
continues to operate and retain the revenues received from such systems
after the stated termination or expiration and is engaged in negotiations
to renew or extend such franchise rights and obtains such renewal or
extension within one year following the stated termination or
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expiration, provided that such negotiations have not been terminated by
either party thereto, such franchise rights or the equivalent thereof have
not been awarded on an exclusive basis to a third Person and no final
determination (within the meaning of Section 635 of the Communications Act
of 1934, as amended) has been made that such Borrower or such Subsidiary is
not entitled to the renewal or extension thereof;
then, and in any such event, (A) if such event is an Event of Default specified
in clause (i) or (ii) of paragraph (f) above with respect to any Borrower,
automatically the Commitments shall immediately terminate and the Loans
hereunder (with accrued interest thereon) and all other amounts owing under this
Agreement and the other Loan Documents shall immediately become due and payable,
and (B) if such event is any other Event of Default, either or both of the
following actions may be taken: (i) with the consent of the Required Lenders,
the Administrative Agent may, or upon the request of the Required Lenders, the
Administrative Agent shall, by notice to the Borrowers declare the Revolving
Commitments to be terminated forthwith, whereupon the Revolving Commitments
shall immediately terminate; and (ii) with the consent of the Required Lenders,
the Administrative Agent may, or upon the request of the Required Lenders, the
Administrative Agent shall, by notice to the Borrowers, declare the Loans
hereunder (with accrued interest thereon) and all other amounts owing under this
Agreement and the other Loan Documents to be due and payable forthwith,
whereupon the same shall immediately become due and payable. Except as expressly
provided above in this Section, presentment, demand, protest and all other
notices of any kind are hereby expressly waived by the Borrowers.
THE AGENTS
Appointment. Each Lender hereby irrevocably designates and appoints the
Administrative Agent as the agent of such Lender under this Agreement and
the other Loan Documents, and each such Lender irrevocably authorizes the
Administrative Agent, in such capacity, to take such action on its behalf
under the provisions of this Agreement and the other Loan Documents and to
exercise such powers and perform such duties as are expressly delegated to
the Administrative Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental
thereto. Notwithstanding any provision to the contrary elsewhere in this
Agreement, the Administrative Agent shall not have any duties or
responsibilities, except those expressly set forth herein, or any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into
this Agreement or any other Loan Document or otherwise exist against the
Administrative Agent.
Delegation of Duties. The Administrative Agent may execute any of its duties
under this Agreement and the other Loan Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Administrative Agent shall not be
responsible for the negligence or misconduct of any agents or attorneys
in-fact selected by it with reasonable care.
Exculpatory Provisions. Neither any Agent nor any of their respective officers,
directors, employees, agents, attorneys-in-fact or affiliates shall be (i)
liable for any action lawfully taken or omitted to be taken by it or such
Person under or in connection with this Agreement or any other Loan
Document (except to the extent that any of the foregoing are found by a
final and nonappealable decision of a court of competent jurisdiction to
have resulted from its or such Person's own gross negligence or willful
misconduct) or (ii) responsible in any manner to any of the Lenders for any
recitals, statements, representations or warranties made by any Loan Party
or any officer thereof contained in this Agreement or any other Loan
Document or in any certificate, report, statement or other document
referred to or provided for in, or received by the Agents under or in
connection with, this Agreement or any other Loan Document or for the
value, validity, effectiveness, genuineness, enforceability or
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sufficiency of this Agreement or any other Loan Document or for any failure
of any Loan Party a party thereto to perform its obligations hereunder or
thereunder. The Agents shall not be under any obligation to any Lender to
ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of any Loan Party.
Reliance by Administrative Agent. The Administrative Agent shall be entitled to
rely, and shall be fully protected in relying, upon any instrument,
writing, resolution, notice, consent, certificate, affidavit, letter,
telecopy, telex or teletype message, statement, order or other document or
conversation believed by it to be genuine and correct and to have been
signed, sent or made by the proper Person or Persons and upon advice and
statements of legal counsel (including counsel to Holdings or any of the
Borrowers), independent accountants and other experts selected by the
Administrative Agent. The Administrative Agent may deem and treat the payee
of any Note as the owner thereof for all purposes unless a written notice
of assignment, negotiation or transfer thereof shall have been filed with
the Administrative Agent. The Administrative Agent shall be fully justified
in failing or refusing to take any action under this Agreement or any other
Loan Document unless it shall first receive such advice or concurrence of
the Required Lenders (or, if so specified by this Agreement, all Lenders)
as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense that
may be incurred by it by reason of taking or continuing to take any such
action. The Administrative Agent shall in all cases be fully protected in
acting, or in refraining from acting, under this Agreement and the other
Loan Documents in accordance with a request of the Required Lenders (or, if
so specified by this Agreement, all Lenders), and such request and any
action taken or failure to act pursuant thereto shall be binding upon all
the Lenders and all future holders of the Loans.
Notice of Default. The Administrative Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless the Administrative Agent has received notice from a
Lender, Holdings or the Borrowers referring to this Agreement, describing
such Default or Event of Default and stating that such notice is a "notice
of default". In the event that the Administrative Agent receives such a
notice, the Administrative Agent shall give notice thereof to the Lenders.
The Administrative Agent shall take such action with respect to such
Default or Event of Default as shall be reasonably directed by the Required
Lenders (or, if so specified by this Agreement, all Lenders); provided that
unless and until the Administrative Agent shall have received such
directions, the Administrative Agent may (but shall not be obligated to)
take such action, or refrain from taking such action, with respect to such
Default or Event of Default as it shall deem advisable in the best
interests of the Lenders.
Non-Reliance on Agents and Other Lenders. Each Lender expressly acknowledges
that neither the Agents nor any of their respective officers, directors,
employees, agents, attorneys-in-fact or affiliates have made any
representations or warranties to it and that no act by any Agent
hereinafter taken, including any review of the affairs of a Loan Party or
any affiliate of a Loan Party, shall be deemed to constitute any
representation or warranty by any Agent to any Lender. Each Lender
represents to the Agents that it has, independently and without reliance
upon any Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, operations, property, financial and other
condition and creditworthiness of the Loan Parties and their affiliates and
made its own decision to make its Loans hereunder and enter into this
Agreement. Each Lender also represents that it will, independently and
without reliance upon any Agent or any other Lender, and based on such
documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in
taking or not taking action under this Agreement and the other Loan
Documents, and to make such investigation as it deems necessary to inform
itself as to the business, operations, property,
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financial and other condition and creditworthiness of the Loan Parties and
their affiliates. Except for notices, reports and other documents expressly
required to be furnished to the Lenders by the Administrative Agent
hereunder, the Administrative Agent shall not have any duty or
responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, condition (financial or
otherwise), prospects or creditworthiness of any Loan Party or any
affiliate of a Loan Party that may come into the possession of the
Administrative Agent or any of its officers, directors, employees, agents,
attorneys-in-fact or affiliates.
Indemnification. The Lenders agree to indemnify each Agent in its capacity as
such (to the extent not reimbursed by Holdings or the Borrowers and without
limiting the obligation of Holdings or the Borrowers to do so), ratably
according to their respective Aggregate Exposure Percentages in effect on
the date on which indemnification is sought under this Section (or, if
indemnification is sought after the date upon which the Commitments shall
have terminated and the Loans shall have been paid in full, ratably in
accordance with such Aggregate Exposure Percentages immediately prior to
such date), from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind whatsoever that may at any time (whether before
or after the payment of the Loans) be imposed on, incurred by or asserted
against such Agent in any way relating to or arising out of, the
Commitments, this Agreement, any of the other Loan Documents or any
documents contemplated by or referred to herein or therein or the
transactions contemplated hereby or thereby or any action taken or omitted
by such Agent under or in connection with any of the foregoing; provided
that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements that are found by a final and
nonappealable decision of a court of competent jurisdiction to have
resulted from such Agent's gross negligence or willful misconduct. The
agreements in this Section shall survive the payment of the Loans and all
other amounts payable hereunder.
Agent in Its Individual Capacity. Each Agent and its affiliates may make loans
to, accept deposits from and generally engage in any kind of business with
any Loan Party as though such Agent was not an Agent. With respect to its
Loans made or renewed by it, each Agent shall have the same rights and
powers under this Agreement and the other Loan Documents as any Lender and
may exercise the same as though it were not an Agent, and the terms
"Lender" and "Lenders" shall include each Agent in its individual capacity.
Resignation of Agents.
The Administrative Agent may resign at any time by giving at least 60 days'
prior written notice of its intention to do so to each of the other Lenders
and the Borrowers pending the appointment by the Borrowers of a successor
Administrative Agent reasonably satisfactory to the Required Lenders. If no
successor Administrative Agent shall have been so appointed and shall have
accepted such appointment within 45 days after the retiring Administrative
Agent's giving of such notice of resignation, then the retiring
Administrative Agent may with the consent of the Borrowers, which shall not
be unreasonably withheld or delayed, appoint a successor Administrative
Agent which shall be a bank or a trust company organized, or having a
branch that is licensed, under the laws of the United States of America or
any state thereof and having a combined capital, surplus and undivided
profit of at least $100,000,000.
Any Agent other than the Administrative Agent may resign at any time by giving
at least 60 days' prior written notice of its intention to do so to each of
the other Lenders and the Borrowers. Upon any such resignation, the
Borrowers may, but shall not be obligated to, appoint a successor Agent in
the
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relevant capacity reasonably satisfactory to the Required Lenders,
provided, that the effectiveness of such resignation shall not be
conditioned upon the appointment of a successor.
After any retiring Agent's resignation hereunder as Agent, the provisions of
this Agreement shall continue to inure to the benefit of such Agent as to
any actions taken or omitted to be taken by it while it was an Agent under
this Agreement and the other Loan Documents.
Other Agents. Notwithstanding any provision to the contrary elsewhere in this
Agreement (including the circumstance that the Syndication Agents shall
have certain rights regarding notification, consents and other matters, to
the extent expressly provided herein), no Agent other than the
Administrative Agent shall have any duties or responsibilities hereunder or
under any other Loan Document, or any fiduciary relationship with any
Lender, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or any other
Loan Document or otherwise exist against any Agent.
MISCELLANEOUS
Amendments and Waivers. Neither this Agreement, any other Loan Document, nor any
terms hereof or thereof may be amended, supplemented or modified except in
accordance with the provisions of this Section 9.1. The Required Lenders
and each Loan Party party to the relevant Loan Document may, or, with the
written consent of the Required Lenders, each Loan Party party to the
relevant Loan Document and any Specified Agent selected by the Borrowers
may, from time to time, (a) enter into written amendments, supplements or
modifications hereto and to the other Loan Documents for the purpose of
adding any provisions to this Agreement or the other Loan Documents or
changing in any manner the rights of the Lenders or of the Loan Parties
hereunder or thereunder or (b) waive, on such terms and conditions as the
Required Lenders or such Specified Agent, as the case may be, may specify
in such instrument, any of the requirements of this Agreement or the other
Loan Documents or any Default or Event of Default and its consequences;
provided, however, that no such waiver and no such amendment, supplement or
modification shall (i) forgive the principal amount or extend the final
scheduled date of maturity of any Loan, extend the scheduled date of any
amortization payment in respect of any Term Loan, extend the scheduled date
of any reduction of the Revolving Commitments, reduce the stated rate of
any interest or fee payable hereunder or extend the scheduled date of any
payment thereof, or increase the amount or extend the expiration date of
any Lender's Commitment, in each case without the consent of each Lender
directly affected thereby; (ii) eliminate or reduce any voting rights under
this Section 9.1 or reduce any percentage specified in the definition of
Required Lenders, consent to the assignment or transfer by any of the
Borrowers of any of its rights and obligations under this Agreement and the
other Loan Documents, release all or substantially all of the Collateral or
release any material Subsidiary Guarantor from its obligations under the
Guarantee and Collateral Agreement (in each case except in connection with
Dispositions consummated or approved in accordance with the other terms of
this Agreement), in each case without the written consent of all Lenders;
(iii) reduce the percentage specified in the definition of Majority
Facility Lenders with respect to any Facility without the written consent
of all Lenders under such Facility; (iv) amend, modify or waive any
provision of Section 8 without the written consent of each affected Agent;
(v) amend, modify or waive any provision of Section 2.4 or 2.5 without the
written consent of the Swingline Lender; or (vi) amend, modify or waive any
provision of Section 2.15(a) or 2.15(c) or of the first sentence of Section
2.15(b) without the written consent of each Lender affected thereby. Any
such waiver and any such amendment, supplement or modification shall apply
equally to each of the Lenders and shall be binding upon the Loan Parties,
the Lenders, the Agents and all future holders of the Loans. In the case of
any waiver, the Loan Parties, the Lenders and the Agents shall be restored
to their former position and rights hereunder and under the other Loan
Documents, and any Default or Event of Default waived shall be deemed to be
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cured and not continuing; but no such waiver shall extend to any subsequent
or other Default or Event of Default, or impair any right consequent
thereon. It is understood that, with respect to any voting required by this
Section 9.1, each Lender and its related Approved Funds, if any, shall vote
as a single unit.
Notices. All notices, requests and demands to or upon the respective parties
hereto to be effective shall be in writing (including by telecopy), and,
unless otherwise expressly provided herein, shall be deemed to have been
duly given or made when delivered, or three Business Days after being
deposited in the mail, postage prepaid, or, in the case of telecopy notice,
when received, addressed as follows in the case of Holdings, the Borrowers
and the Administrative Agent, and as set forth in an administrative
questionnaire delivered to the Administrative Agent in the case of the
Lenders, or to such other address as may be hereafter notified by the
respective parties hereto:
Any Loan Party: c/o Charter Communications, Inc.
12444 Powerscourt Drive, Suite 100
St. Louis, Missouri 63131
Attention: Kent D. Kalkwarf
Telecopy: (314) 965-8793
Telephone: (314) 543-2309
with a copy to: Irell & Manella
1800 Avenue of the Stars, Suite 900
Los Angeles, California 90067
Attention: Alvin G. Segel, Esq.
Telecopy: (310) 277-1010
Telephone: (310) 203-7199
The Administrative Agent: Bank of Montreal, Chicago Branch
430 Park Avenue
New York, New York 10022
Attention: Sarah Kim
Telecopy: (212) 605-1664
Telephone: (212) 605-1648
with a copy to: Bank of Montreal
115 S. LaSalle Street, 11th Floor
Chicago, Illinois 60603
Attention: Terri Perez-Ford
Telecopy: (312) 750-3827
Telephone: (312) 750-3456
provided that any notice, request or demand to or upon the Administrative Agent
or the Lenders shall not be effective until received.
No Waiver; Cumulative Remedies. No failure to exercise and no delay in
exercising, on the part of any Agent or any Lender, any right, remedy,
power or privilege hereunder or under the other Loan Documents shall
operate as a waiver thereof; nor shall any single or partial exercise of
any right, remedy, power or privilege hereunder preclude any other or
further exercise thereof or the exercise of any other right, remedy, power
or privilege. The rights, remedies, powers and privileges herein provided
are cumulative and not exclusive of any rights, remedies, powers and
privileges provided by law.
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Survival of Representations and Warranties. All representations and warranties
made hereunder, in the other Loan Documents and in any document,
certificate or statement delivered pursuant hereto or in connection
herewith shall survive the execution and delivery of this Agreement and the
making of the Loans and other extensions of credit hereunder.
Payment of Expenses and Taxes. The Borrowers jointly and severally agree (a) to
pay or reimburse the Administrative Agent for all its reasonable
out-of-pocket costs and expenses incurred in connection with the
development, preparation and execution of, and any amendment, supplement or
modification to, this Agreement and the other Loan Documents and any other
documents prepared in connection herewith or therewith, and the
consummation and administration of the transactions contemplated hereby and
thereby, including the reasonable fees and disbursements of one firm of
counsel to the Administrative Agent and filing and recording fees and
expenses, with statements with respect to the foregoing to be submitted to
the Borrowers prior to the Closing Date (in the case of amounts to be paid
on the Closing Date) and from time to time thereafter on a quarterly basis
or such other periodic basis as the Administrative Agent shall deem
appropriate, (b) to pay or reimburse each Lender and each Agent for all its
costs and expenses incurred in connection with the enforcement or
preservation of any rights under this Agreement, the other Loan Documents
and any such other documents, including the fees and disbursements of one
firm of counsel selected by the Administrative Agent, together with any
special or local counsel to the Administrative Agent, and not more than one
other firm of counsel to the Lenders, (c) to pay, indemnify, and hold each
Lender and each Agent harmless from, any and all recording and filing fees
and any and all liabilities with respect to, or resulting from any delay in
paying, stamp, excise and other taxes, if any, that may be payable or
determined to be payable in connection with the execution and delivery of,
or consummation or administration of any of the transactions contemplated
by, or any amendment, supplement or modification of, or any waiver or
consent under or in respect of, this Agreement, the other Loan Documents
and any such other documents, and (d) to pay, indemnify, and hold each
Lender, each Agent, their affiliates and their respective officers,
directors, trustees, employees, agents and controlling persons (each, an
"Indemnitee") harmless from and against any and all other liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever with respect to
the execution, delivery, enforcement, performance and administration of
this Agreement, the other Loan Documents and any such other documents,
including any of the foregoing relating to the use of proceeds of the Loans
or the violation of, noncompliance with or liability under, any
Environmental Law applicable to the operations of Holdings, any of the
Borrowers, any Subsidiaries or any of the Properties and the reasonable
fees and expenses of legal counsel in connection with claims, actions or
proceedings by any Indemnitee against any Loan Party under any Loan
Document (all the foregoing in this clause (d), collectively, the
"Indemnified Liabilities"), provided, that the Borrowers shall have no
obligation hereunder to any Indemnitee with respect to Indemnified
Liabilities to the extent such Indemnified Liabilities are found by a final
and nonappealable decision of a court of competent jurisdiction to have
resulted from the gross negligence or willful misconduct of such
Indemnitee. Without limiting the foregoing, and to the extent permitted by
applicable law, Holdings and the Borrowers agree not to assert and to cause
their respective Subsidiaries not to assert, and hereby waive and agree to
cause their respective Subsidiaries to so waive, all rights for
contribution or any other rights of recovery with respect to all claims,
demands, penalties, fines, liabilities, settlements, damages, costs and
expenses of whatever kind or nature, under or related to Environmental
Laws, that any of them might have by statute or otherwise against any
Indemnitee. All amounts due under this Section 9.5 shall be payable not
later than 15 days after written demand therefor. Statements payable by the
Borrowers pursuant to this Section 9.5 shall be submitted to Kent Kalkwarf
(Telephone No. 314-543-2309) (Telecopy No. 314-965-8793), at the address of
the Borrowers set forth in Section 9.2, or to such other Person or address
as may be hereafter designated by the Borrowers in a written notice to the
Administrative Agent. The
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agreements in this Section 9.5 shall survive repayment of the Loans and all
other amounts payable hereunder.
Successors and Assigns; Participations and Assignments.
This Agreement shall be binding upon and inure to the benefit of Holdings, the
Borrowers, the Lenders, the Agents, all future holders of the Loans and
their respective successors and assigns, except that no Borrower may assign
or transfer any of its rights or obligations under this Agreement without
the prior written consent of each Lender.
Any Lender may, without the consent of any of the Borrowers or the
Administrative Agent, in accordance with applicable law, at any time sell
to one or more banks, financial institutions or other entities (each, a
"Participant") participating interests in any Loan owing to such Lender,
any Commitment of such Lender or any other interest of such Lender
hereunder and under the other Loan Documents. In the event of any such sale
by a Lender of a participating interest to a Participant, such Lender's
obligations under this Agreement to the other parties to this Agreement
shall remain unchanged, such Lender shall remain solely responsible for the
performance thereof, such Lender shall remain the holder of any such Loan
for all purposes under this Agreement and the other Loan Documents, and the
Borrowers and the Agents shall continue to deal solely and directly with
such Lender in connection with such Lender's rights and obligations under
this Agreement and the other Loan Documents. In no event shall any
Participant under any such participation have any right to approve any
amendment or waiver of any provision of any Loan Document, or any consent
to any departure by any Loan Party therefrom, except to the extent that
such amendment, waiver or consent would reduce the principal of, or
interest on, the Loans or any fees payable hereunder, or postpone the date
of the final maturity of the Loans, in each case to the extent subject to
such participation. The Borrowers agree that if amounts outstanding under
this Agreement and the Loans are due or unpaid, or shall have been declared
or shall have become due and payable upon the occurrence of an Event of
Default, each Participant shall, to the maximum extent permitted by
applicable law, be deemed to have the right of setoff in respect of its
participating interest in amounts owing under this Agreement to the same
extent as if the amount of its participating interest were owing directly
to it as a Lender under this Agreement, provided that, in purchasing such
participating interest, such Participant shall be deemed to have agreed to
share with the Lenders the proceeds thereof as provided in Section 9.7(a)
as fully as if it were a Lender hereunder. The Borrowers also agree that
each Participant shall be entitled to the benefits of Sections 2.16, 2.17
and 2.18 with respect to its participation in the Commitments and the Loans
outstanding from time to time as if it was a Lender; provided that, in the
case of Section 2.17, such Participant shall have complied with the
requirements of said Section and provided, further, that no Participant
shall be entitled to receive any greater amount pursuant to any such
Section than the transferor Lender would have been entitled to receive in
respect of the amount of the participation transferred by such transferor
Lender to such Participant had no such transfer occurred.
Any Lender (an "Assignor") may, in accordance with applicable law, at any time
and from time to time assign to any Lender, any affiliate of any Lender or
any Approved Fund or, with the consent of the Borrowers and the
Administrative Agent (which, in each case, shall not be unreasonably
withheld or delayed), to an additional bank, financial institution or other
entity (an "Assignee") all or any part of its rights and obligations under
this Agreement pursuant to an Assignment and Acceptance, executed by such
Assignee, such Assignor and any other Person whose consent is required
pursuant to this paragraph, and delivered to the Administrative Agent for
its acceptance and recording in the Register; provided that, except in the
case of an assignment of all of a Lender's interests under this Agreement,
no such assignment to an Assignee (other than any Lender, any affiliate of
any Lender or any Approved Fund) shall (i) be in an aggregate principal
amount of less than $5,000,000 or (ii) cause the
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Assignor to have Aggregate Exposure of less than $3,000,000, in each case
unless otherwise agreed by the Borrowers and the Administrative Agent. For
purposes of clauses (i) and (ii) of the preceding sentence, the amounts
described therein shall be aggregated in respect of each Lender and its
related Approved Funds, if any. Any such assignment need not be ratable as
among the Facilities. Upon such execution, delivery, acceptance and
recording, from and after the effective date determined pursuant to such
Assignment and Acceptance, (x) the Assignee thereunder shall be a party
hereto and, to the extent provided in such Assignment and Acceptance, have
the rights and obligations of a Lender hereunder with a Commitment and/or
Loans as set forth therein, and (y) the Assignor thereunder shall, to the
extent provided in such Assignment and Acceptance, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all of an Assignor's rights and obligations under this
Agreement, such Assignor shall cease to be a party hereto). Notwithstanding
any provision of this Section 9.6, the consent of the Borrowers shall not
be required for any assignment that occurs when an Event of Default
pursuant to Section 7(a) or 7(f) shall have occurred and be continuing. On
the effective date of any Assignment and Acceptance, the Administrative
Agent shall give notice of the terms thereof to the Syndication Agents. The
Administrative Agent shall, on behalf of the Borrowers, maintain at its
address referred to in Section 9.2 a copy of each Assignment and Acceptance
delivered to it and a register (the "Register") for the recordation of the
names and addresses of the Lenders and the Commitment of, and the principal
amount of the Loans owing to, each Lender from time to time. The entries in
the Register shall be conclusive, in the absence of manifest error, and the
Borrowers, each other Loan Party, the Agents and the Lenders shall treat
each Person whose name is recorded in the Register as the owner of the
Loans and any Notes evidencing the Loans recorded therein for all purposes
of this Agreement. Any assignment of any Loan, whether or not evidenced by
a Note, shall be effective only upon appropriate entries with respect
thereto being made in the Register (and each Note shall expressly so
provide). Any assignment or transfer of all or part of a Loan evidenced by
a Note shall be registered on the Register only upon surrender for
registration of assignment or transfer of the Note evidencing such Loan,
accompanied by a duly executed Assignment and Acceptance, and thereupon one
or more new Notes shall be issued to the designated Assignee. The
Administrative Agent will promptly send a copy of the Register to the
Borrowers upon request.
Upon its receipt of an Assignment and Acceptance executed by an Assignor, an
Assignee and any other Person whose consent is required by Section 9.6(c),
together with payment to the Administrative Agent of a registration and
processing fee of $3,500, the Administrative Agent shall (i) promptly
accept such Assignment and Acceptance and (ii) record the information
contained therein in the Register on the effective date determined pursuant
thereto; provided, however, that no such fee shall be payable in the case
of an assignment by a Lender to any of its Affiliates or to an Approved
Fund of such Lender; and provided further that, in the case of assignments
on the same day by a Lender to more than one fund managed by the same
investment advisor (which funds are not then Lenders hereunder), only a
single $3,500 fee shall be payable for all such assignments by such Lender
to such funds.
For avoidance of doubt, the parties to this Agreement acknowledge that the
provisions of this Section 9.6 concerning assignments relate only to
absolute assignments and that such provisions do not prohibit assignments
creating security interests, including any pledge or assignment by a Lender
of any Loan to any Federal Reserve Bank in accordance with applicable law.
Adjustments; Set-off.
Except to the extent that this Agreement expressly provides for payments to be
allocated to a particular Lender or to the Lenders under a particular
Facility, if any Lender (a "Benefitted Lender") shall receive any payment
of all or part of the amounts owing to it hereunder, or receive any
collateral in
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<PAGE> 66
respect thereof (whether voluntarily or involuntarily, by set-off, pursuant
to events or proceedings of the nature referred to in Section 7(f), or
otherwise), in a greater proportion than any such payment to or collateral
received by any other Lender, if any, in respect of the amounts owing to
such other Lender hereunder, such Benefitted Lender shall purchase for cash
from the other Lenders a participating interest in such portion of the
amounts owing to each such other Lender hereunder, or shall provide such
other Lenders with the benefits of any such collateral, as shall be
necessary to cause such Benefitted Lender to share the excess payment or
benefits of such collateral ratably with each of the Lenders; provided,
however, that if all or any portion of such excess payment or benefits is
thereafter recovered from such Benefitted Lender, such purchase shall be
rescinded, and the purchase price and benefits returned, to the extent of
such recovery, but without interest.
In addition to any rights and remedies of the Lenders provided by law, each
Lender shall have the right, without prior notice to Holdings or any of the
Borrowers, any such notice being expressly waived by Holdings and the
Borrowers to the extent permitted by applicable law, upon any amount
becoming due and payable by Holdings or any of the Borrowers hereunder
(whether at the stated maturity, by acceleration or otherwise), to set off
and appropriate and apply against such amount any and all deposits (general
or special, time or demand, provisional or final), in any currency, and any
other credits, indebtedness or claims, in any currency, in each case
whether direct or indirect, absolute or contingent, matured or unmatured,
at any time held or owing by such Lender or any branch or agency thereof to
or for the credit or the account of Holdings or the Borrowers, as the case
may be. Each Lender agrees promptly to notify the Borrowers and the
Administrative Agent after any such setoff and application made by such
Lender, provided that the failure to give such notice shall not affect the
validity of such setoff and application.
Counterparts. This Agreement may be executed by one or more of the parties to
this Agreement on any number of separate counterparts, and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument. Delivery of an executed signature page of this Agreement by
facsimile transmission shall be effective as delivery of a manually
executed counterpart hereof. A set of the copies of this Agreement signed
by all the parties shall be lodged with the Borrowers and the
Administrative Agent.
Severability. Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
Integration. This Agreement and the other Loan Documents represent the agreement
of Holdings, the Borrowers, the Agents and the Lenders with respect to the
subject matter hereof, and there are no promises, undertakings,
representations or warranties by any Agent or any Lender relative to
subject matter hereof not expressly set forth or referred to herein or in
the other Loan Documents.
GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
Submission To Jurisdiction; Waivers. Each of Holdings and the Borrowers hereby
irrevocably and unconditionally:
submits for itself and its property in any legal action or proceeding relating
to this Agreement and the other Loan Documents to which it is a party, or
for recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the courts of the State of New York,
the
146
<PAGE> 67
courts of the United States for the Southern District of New York, and
appellate courts from any thereof;
consents that any such action or proceeding may be brought in such courts and
waives any objection that it may now or hereafter have to the venue of any
such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or
claim the same;
agrees that service of process in any such action or proceeding may be effected
by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to Holdings or the
Borrowers, as the case may be, at its or their address set forth in Section
9.2 or at such other address of which the Administrative Agent shall have
been notified pursuant thereto;
agrees that nothing herein shall affect the right to effect service of process
in any other manner permitted by law or shall limit the right to sue in any
other jurisdiction; and
waives, to the maximum extent not prohibited by law, any right it may have to
claim or recover in any legal action or proceeding referred to in this
Section any special, exemplary, punitive or consequential damages.
Acknowledgments. Each of Holdings and the Borrowers hereby acknowledges that:
it has been advised by counsel in the negotiation, execution and delivery of
this Agreement and the other Loan Documents;
neither any Agent nor any Lender has any fiduciary relationship with or duty to
Holdings or any of the Borrowers arising out of or in connection with this
Agreement or any of the other Loan Documents, and the relationship between
the Agents and Lenders, on one hand, and Holdings and the Borrowers, on the
other hand, in connection herewith or therewith is solely that of debtor
and creditor; and
no joint venture is created hereby or by the other Loan Documents or otherwise
exists by virtue of the transactions contemplated hereby among the Agents
and the Lenders or among Holdings, the Borrowers and the Agents and the
Lenders.
Releases of Guarantees and Liens.
Notwithstanding anything to the contrary contained herein or in any other Loan
Document, the Administrative Agent is hereby irrevocably authorized by each
Lender (without requirement of notice to or consent of any Lender except as
expressly required by Section 9.1) to take any action requested by the
Borrowers having the effect of releasing any Collateral or Guarantee
Obligations (i) to the extent necessary to permit consummation of any
transaction not prohibited by any Loan Document or that has been approved
in accordance with Section 9.1 or (ii) under the circumstances described in
paragraph (b) below.
At such time as the Loans and the other obligations under the Loan Documents
(other than obligations under or in respect of Hedge Agreements or letters
of credit obtained other than pursuant to this Agreement) shall have been
paid in full and the Commitments have been terminated, the Collateral shall
be released from the Liens created by the Guarantee and Collateral
Agreement, and the Guarantee and Collateral Agreement and all obligations
(other than those expressly stated to survive such termination) of the
Administrative Agent and each Loan Party under the Guarantee and
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Collateral Agreement shall terminate, all without delivery of any
instrument or performance of any act by any Person.
Confidentiality. Each Agent and each Lender agrees to keep confidential all
non-public information provided to it by any Loan Party pursuant to this
Agreement that is designated by such Loan Party as confidential; provided
that nothing herein shall prevent any Agent or any Lender from disclosing
any such information (a) to any Agent, any Lender or any affiliate of any
Lender or any Approved Fund, (b) to any Transferee or prospective
Transferee that agrees to comply with the provisions of this Section, (c)
to its employees, directors, agents, attorneys, accountants and other
professional advisors or those of any of its affiliates who have a need to
know, (d) upon the request or demand of any Governmental Authority, (e) in
response to any order of any court or other Governmental Authority or as
may otherwise be required pursuant to any Requirement of Law, (f) if
requested or required to do so in connection with any litigation or similar
proceeding, (g) that has been publicly disclosed, (h) any nationally
recognized rating agency that requires access to information about a
Lender's investment portfolio in connection with ratings issued with
respect to such Lender, (i) in connection with the exercise of any remedy
hereunder or under any other Loan Document, or (j) to any direct or
indirect contractual counterparty in swap agreements or such contractual
counterparty's professional advisor (so long as such contractual
counterparty or professional advisor to such contractual counterparty
agrees to be bound by the provisions of this Section 9.15).
WAIVERS OF JURY TRIAL. HOLDINGS, THE BORROWERS, THE AGENTS AND THE LENDERS
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL
ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT
AND FOR ANY COUNTERCLAIM THEREIN.
[Remainder of Page Intentionally Left Blank]
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<PAGE> 69
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their proper and duly authorized officers as of
the day and year first above written.
AVALON CABLE LLC
By:
-----------------------------------
Name:
Title:
CC MICHIGAN, LLC
By:
-----------------------------------
Name:
Title:
CC NEW ENGLAND, LLC
By:
-----------------------------------
Name:
Title:
S - 1
<PAGE> 70
The Administrative Agent:
BANK OF MONTREAL, CHICAGO BRANCH
By:
-----------------------------------
Name:
Title:
The Syndication Agents:
FIRST UNION NATIONAL BANK
By:
-----------------------------------
Name:
Title:
PNC BANK, NATIONAL ASSOCIATION
By:
-----------------------------------
Name:
Title:
The Co-Documentation Agents:
BANK OF MONTREAL, CHICAGO BRANCH
By:
-----------------------------------
Name:
Title:
MERCANTILE BANK NATIONAL ASSOCIATION
By:
-----------------------------------
Name:
Title:
S - 2
<PAGE> 71
Annex A
PRICING GRID
<TABLE>
<CAPTION>
Applicable Margin for Applicable Margin for Commitment Fee
Consolidated Leverage Ratio Eurodollar Loans ABR Loans Rate
---------------------------- ------------------------- -------------------------
RC B RC B
<S> <C> <C> <C> <C> <C>
Greater than or equal to 6.00 to 1.0 1.875% 2.750% 0.875% 1.750% 0.375%
Greater than or equal to 5.50 to 1.0 but 1.625% 2.750% 0.625% 1.750% 0.375%
less than 6.00 to 1.0
Greater than or equal to 5.00 to 1.0 but 1.500% 2.750% 0.500% 1.750% 0.375%
less than 5.50 to 1.0
Greater than or equal to 4.50 to 1.0 but 1.375% 2.500% 0.375% 1.500% 0.250%
Less than 5.00 to 1.0
Greater than or equal to 4.00 to 1.0 but 1.250% 2.500% 0.250% 1.500% 0.250%
less than 4.50 to 1.0
Less than 4.00 to 1.0 1.000% 2.500% 0.000% 1.500% 0.250%
</TABLE>
As used above, (a) "RC" refers to Revolving Loans and Swingline Loans and
(b) "B" refers to Term B Loans.
Until the date on which financial statements are delivered to the Lenders
pursuant to Section 5.1 in respect of the fiscal quarter of the Borrowers ending
March 31, 2000, the Consolidated Leverage Ratio for the purposes of the Pricing
Grid shall be deemed to be greater than or equal to 6.00 to 1.0.
Changes in the Applicable Margin or in the Commitment Fee Rate resulting
from changes in the Consolidated Leverage Ratio shall become effective on each
date (the "Adjustment Date") after March 31, 2000 on which financial statements
are delivered to the Lenders pursuant to Section 5.1 (but in any event not later
than the 60th day after the end of each of the first three quarterly periods of
each fiscal year or the 120th day after the end of each fiscal year, as the case
may be) and shall remain in effect until the next change to be effected pursuant
to this paragraph. If any financial statements referred to above are not
delivered within the time periods specified above, then, until such financial
statements are delivered, the highest rates referred to in the Pricing Grid
shall be applicable. In addition, the highest rates referred to in the Pricing
Grid shall be applicable at all times while an Event of Default shall have
occurred and be continuing.
A - 1
<PAGE> 72
EXECUTION
================================================================================
$300,000,000
CREDIT AGREEMENT
CC MICHIGAN, LLC and CC NEW ENGLAND, LLC,
as Borrowers
AVALON CABLE LLC,
as Guarantor
BANK OF MONTREAL,
as Lead Arranger and Book Runner
FIRST UNION NATIONAL BANK,
PNC BANK, NATIONAL ASSOCIATION and MERCANTILE BANK NATIONAL ASSOCIATION,
as Co-Arrangers
FIRST UNION NATIONAL BANK and PNC BANK, NATIONAL ASSOCIATION,
as Syndication Agents
BANK OF MONTREAL, CHICAGO BRANCH,
as Administrative Agent
BANK OF MONTREAL, CHICAGO BRANCH and MERCANTILE BANK NATIONAL ASSOCIATION,
as Co-Documentation Agents
Dated as of November 15, 1999
================================================================================
<PAGE> 73
TABLE OF CONTENTS
Page
----
SECTION 1 DEFINITIONS........................................................1
1.1 Defined Terms......................................................1
1.2 Other Definitional Provisions; Pro Forma Calculations.............21
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS...................................22
2.1 Commitments; Increases in the Revolving Facility;
Incremental Term Loans............................................22
2.2 Procedure for Borrowing...........................................24
2.3 Repayment of Loans................................................24
2.4 Swingline Commitment..............................................25
2.5 Procedure for Swingline Borrowing; Refunding of
Swingline Loans...................................................25
2.6 Commitment Fees, etc..............................................27
2.7 Termination or Reduction of Revolving Commitments.................27
2.8 Optional Prepayments..............................................27
2.9 Mandatory Prepayments.............................................28
2.10 Conversion and Continuation Options...............................28
2.11 Limitations on Eurodollar Tranches................................29
2.12 Interest Rates and Payment Dates..................................29
2.13 Computation of Interest and Fees..................................29
2.14 Inability to Determine Interest Rate..............................30
2.15 Pro Rata Treatment and Payments...................................30
2.16 Requirements of Law...............................................31
2.17 Taxes.............................................................32
2.18 Indemnity.........................................................34
2.19 Change of Lending Office..........................................34
2.20 Replacement of Lenders............................................34
2.21 Joint and Several Liability; Payment Indemnifications.............35
SECTION 3. REPRESENTATIONS AND WARRANTIES....................................35
3.1 Financial Condition...............................................35
3.2 No Change.........................................................36
3.3 Existence; Compliance with Law....................................36
<PAGE> 74
Page
----
3.4 Power; Authorization; Enforceable Obligations.....................36
3.5 No Legal Bar......................................................36
3.6 Litigation........................................................37
3.7 No Default........................................................37
3.8 Ownership of Property; Liens......................................37
3.9 Intellectual Property.............................................37
3.10 Taxes.............................................................37
3.11 Federal Regulations...............................................37
3.12 Labor Matters.....................................................38
3.13 ERISA ............................................................38
3.14 Investment Company Act; Other Regulations.........................38
3.15 Subsidiaries......................................................38
3.16 Use of Proceeds...................................................38
3.17 Environmental Matters.............................................38
3.18 Certain Cable Television Matters..................................39
3.19 Accuracy of Information, etc......................................40
3.20 Security Interests................................................40
3.21 Solvency .........................................................40
3.22 Certain Tax Matters...............................................40
3.23 Year 2000 Matters.................................................40
SECTION 4. CONDITIONS PRECEDENT..............................................40
4.1 Conditions to Initial Extension of Credit.........................40
4.2 Conditions to Each Extension of Credit............................42
SECTION 5. AFFIRMATIVE COVENANTS.............................................43
5.1 Financial Statements..............................................43
5.2 Certificates; Other Information...................................43
5.3 Payment of Obligations............................................44
5.4 Maintenance of Existence; Compliance..............................44
5.5 Maintenance of Property; Insurance................................45
5.6 Inspection of Property; Books and Records; Discussions............45
5.7 Notices .........................................................45
5.8 Environmental Laws................................................46
<PAGE> 75
Page
----
5.9 Interest Rate Protection..........................................46
5.10 Additional Collateral.............................................46
5.11 Organizational Separateness.......................................46
5.12 ERISA Reports.....................................................47
5.13 ERISA, etc........................................................47
SECTION 6. NEGATIVE COVENANTS................................................47
6.1 Financial Condition Covenants.....................................48
6.2 Indebtedness......................................................48
6.3 Liens ............................................................50
6.4 Fundamental Changes...............................................51
6.5 Disposition of Property...........................................51
6.6 Restricted Payments...............................................52
6.7 Investments.......................................................53
6.8 Certain Payments and Modifications Relating to
Indebtedness and Management Fees..................................54
6.9 Transactions with Affiliates......................................55
6.10 Sales and Leasebacks..............................................56
6.11 Changes in Fiscal Periods.........................................56
6.12 Negative Pledge Clauses...........................................56
6.13 Clauses Restricting Subsidiary Distributions......................56
6.14 Lines of Business; Holding Company Status.........................56
6.15 Investments by Holdings in the Borrowers..........................57
SECTION 7. EVENTS OF DEFAULT.................................................57
SECTION 8. THE AGENTS........................................................59
8.1 Appointment.......................................................59
8.2 Delegation of Duties..............................................60
8.3 Exculpatory Provisions............................................60
8.4 Reliance by Administrative Agent..................................60
8.5 Notice of Default.................................................60
8.6 Non-Reliance on Agents and Other Lenders..........................61
8.7 Indemnification...................................................61
8.8 Agent in Its Individual Capacity..................................62
<PAGE> 76
Page
----
8.9 Resignation of Agents.............................................62
8.10 Other Agents......................................................62
SECTION 9. MISCELLANEOUS.....................................................62
9.1 Amendments and Waivers............................................62
9.2 Notices...........................................................63
9.3 No Waiver; Cumulative Remedies....................................64
9.4 Survival of Representations and Warranties........................64
9.5 Payment of Expenses and Taxes.....................................64
9.6 Successors and Assigns; Participations and Assignments............65
9.7 Adjustments; Set-off..............................................67
9.8 Counterparts......................................................68
9.9 Severability......................................................68
9.10 Integration.......................................................68
9.11 GOVERNING LAW.....................................................68
9.12 Submission To Jurisdiction; Waivers...............................68
9.13 Acknowledgments...................................................69
9.14 Releases of Guarantees and Liens..................................69
9.15 Confidentiality...................................................69
9.16 WAIVERS OF JURY TRIAL.............................................70
<PAGE> 77
ANNEX:
A Pricing Grid
SCHEDULES:
1.1 Commitments on Closing Date
3.15 Subsidiaries
3.20 UCC Filing Jurisdictions
6.2(d) Existing Indebtedness
EXHIBITS:
A Form of Guarantee and Collateral Agreement
B Form of Compliance Certificate
C Form of Closing Certificate
D-1 Form of Addendum
D-2 Form of New Lender Supplement
D-3 Form of Increased Facility Activation Notice
E Form of Assignment and Acceptance
F Form of Exemption Certificate
G Form of Specified Subordinated Note
<PAGE> 1
EXHIBIT 99.1
[CHARTER COMMUNICATIONS LOGO]
FOR IMMEDIATE RELEASE
CHARTER COMMUNICATIONS' ACQUISITION
OF FANCH CABLE SYSTEMS FINAL
ST. LOUIS, MO, NOVEMBER 15, 1999 - Charter Communications (Nasdaq: CHTR)
announced that it completed the acquisition of cable systems affiliated with
Fanch Communications, Inc. on Friday, Nov. 12. The acquisition of Fanch adds
approximately 537,000 cable customers to Charter's subscriber base. The purchase
price was $2.4 billion. The majority of Fanch's systems are located in West
Virginia, Pennsylvania and Michigan.
Charter Communications is a Wired World(TM) company offering a full range of
traditional cable television services. The company has also begun to offer
services including digital cable television, high-speed Internet access and
paging and is introducing interactive video programming. All of these services
are important steps toward the realization of the Wired World vision where
cable's ability to transmit voice, video and data at high speeds will enable it
to serve as the primary platform for the delivery of new services to the home
and workplace. Charter is the fourth largest operator of cable television
systems in the United States, serving approximately 6.2 million customers, after
giving effect to a pending acquisition. The chairman of Charter Communications
is Paul G. Allen. Jerald L. Kent is the company's president and CEO. More
information about Charter can be accessed on the Internet at www.chartercom.com.
FOR FURTHER INFORMATION, CONTACT:
Media: Anita Lamont
Charter Communications, Inc.
314/543-2215
[email protected]
###
<PAGE> 1
EXHIBIT 99.2
FOR IMMEDIATE RELEASE
[CHARTER COMMUNICATIONS LOGO]
CHARTER COMMUNICATIONS COMPLETES
ACQUISITION OF AVALON CABLE
ST. LOUIS, MO--NOVEMBER 15, 1999 -- Charter Communications (Nasdaq:CHTR)
announced today that it has completed the acquisition of Avalon Cable and its
cable systems serving customers in Michigan and New England. The purchase of
Avalon added approximately 260,000 customers to Charter's subscriber base. The
purchase price was approximately $845 million.
Charter Communications is a Wired World(TM) company offering a full range of
traditional cable television services. The company has also begun to offer
services including digital cable television, high-speed Internet access and
paging and is introducing interactive video programming. All of these services
are important steps toward the realization of the Wired World vision where
cable's ability to transmit voice, video and data at high speeds will enable it
to serve as the primary platform for the delivery of new services to the home
and workplace. Charter is the fourth largest operator of cable television
systems in the United States, serving approximately 6.2 million customers, after
giving effect to a pending acquisition. The chairman of Charter Communications
is Paul G. Allen. Jerald L. Kent is the company's president and CEO. More
information about Charter can be accessed on the Internet at www.chartercom.com.
FOR FURTHER INFORMATION, CONTACT:
Media: Anita Lamont
Charter Communications, Inc.
314/543-2215
[email protected]
