AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 4, 1999
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
CSC HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 4841 11-2776686
State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
Incorporation or Organization) Classification Code Number) Identification No.)
1111 STEWART AVENUE
BETHPAGE, NEW YORK 11714
(516) 803-2300
(Address, including zip code, and
telephone number,
including area code, of
the registrant's
principal executive
offices)
ROBERT S. LEMLE, ESQ.
EXECUTIVE VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
1111 STEWART AVENUE
BETHPAGE, NEW YORK 11714
(516) 803-2300
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
COPY TO:
JOHN P. MEAD, ESQ.
SULLIVAN & CROMWELL
125 BROAD STREET
NEW YORK, NEW YORK 10004
------------------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED OFFER TO THE PUBLIC: As soon as
practicable after the effective date of this registration statement. If the
securities being registered on this form are being offered in connection with
the formation of a holding company and there is compliance with General
Instruction G, check the following box. |_| If this form is filed to register
additional securities for an offering pursuant to Rule 462(b) under the
Securities Act, check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same
offering. |_|_________ If this form is a post-effective amendment filed pursuant
to Rule 462(d) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. |_|______
------------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
========================================================================================================
PROPOSED PROPOSED
TITLE OF EACH CLASS MAXIMUM OFFERING MAXIMUM
OF SECURITIES TO AMOUNT TO BE PRICE AGGREGATE OFFERING AMOUNT OF
BE REGISTERED REGISTERED PER UNIT (1) PRICE (1) REGISTRATION FEE
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
8 1/8% Series B Senior Notes $500,000,000 100% $500,000,000 $139,000
========================================================================================================
<FN>
(1) Estimated in accordance with Rule 457(f) under the Securities Act of 1933
solely for purposes of calculating the registration fee.
</FN>
</TABLE>
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SECTION 8(A), MAY
DETERMINE.
================================================================================
<PAGE>
[RED HERRING TEXT]
The information in this prospectus is not complete and may be changed. We may
not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these securities and is not soliciting an offer to buy these securities
in any state where the offer or sale is not permitted.
<PAGE>
PROSPECTUS (Subject to Completion)
Dated August 4, 1999
CSC HOLDINGS, INC.
OFFER TO EXCHANGE
$500,000,000
8 1/8% SERIES B SENIOR NOTES DUE 2009
WHICH HAVE BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933
FOR
ALL OUTSTANDING UNREGISTERED
8 1/8% SENIOR NOTES DUE 2009
We are offering to exchange $500,000,000 aggregate principal amount of the
outstanding, unregistered CSC Holdings 8 1/8 % Senior Notes due 2009 that you
now hold for new, substantially identical 8 1/8% Series B Senior Notes due 2009
that will be free of the transfer restrictions of the old notes. THIS OFFER WILL
EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON [DATE], 1999, UNLESS WE EXTEND THE
DEADLINE. You must tender your old, unregistered notes by the deadline to obtain
new, registered notes and the liquidity benefits the new notes offer.
We agreed with the initial purchasers of the old notes to make this offer
and to register the issuance of the new notes after the initial sale of the old
notes. This offer applies to any and all old notes tendered by the deadline.
We will not list the new notes on any established exchange. The new notes
will have the same financial terms and covenants as the old notes, and are
subject to the same business and financial risks.
SEE "RISK FACTORS", BEGINNING ON PAGE 14 FOR A DISCUSSION OF THE FACTORS
THAT YOU SHOULD CONSIDER IN CONNECTION WITH THE EXCHANGE OFFER AND AN EXCHANGE
OF OLD NOTES FOR NEW NOTES.
Neither the SEC nor any state securities commission has approved or
disapproved of these securities or passed on the adequacy or accuracy of this
prospectus. It is illegal for anyone to tell you otherwise.
The date of this prospectus is , 1999
<PAGE>
TABLE OF CONTENTS
PAGE
----
Additional Information About CSC Holdings................................3
Summary..................................................................4
Risk Factors............................................................14
Forward-Looking Statements..............................................23
Use of Proceeds.........................................................23
CSC Holdings, Inc.......................................................24
Recent Developments.....................................................26
The Exchange Offer......................................................29
How to Tender Your Old Notes............................................34
Description of the New Notes............................................43
Material U.S. Federal Income Tax Considerations.........................60
Plan of Distribution....................................................60
Validity of the New Notes...............................................62
Experts.................................................................62
Available Information...................................................62
Where You Can Find More Information.....................................63
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<PAGE>
ADDITIONAL INFORMATION ABOUT CSC HOLDINGS
This document incorporates important business and financial information
about CSC Holdings from documents that are not included in or delivered with
this document. You can obtain documents incorporated by reference in this
document, other than some exhibits to those documents, by requesting them in
writing or by telephone from us at the following:
CSC HOLDINGS, INC.
1111 STEWART AVENUE
BETHPAGE, NEW YORK 11714
ATTENTION: SECRETARY
(516) 803-2300
YOU WILL NOT BE CHARGED FOR ANY OF THE DOCUMENTS THAT YOU REQUEST. IF YOU
WOULD LIKE TO REQUEST DOCUMENTS, PLEASE DO SO BY [DATE], 1999 IN ORDER TO
RECEIVE THEM BEFORE THE EXCHANGE OFFER EXPIRES ON [DATE], 1999.
Financial and other information relating to our business is contained in
this document including "Selected Financial Data" below.
See "Where You Can Find More Information" below to learn how you can obtain
this additional information.
WE ARE NOT MAKING THIS EXCHANGE OFFER TO, NOR WILL WE ACCEPT SURRENDERS FOR
EXCHANGE FROM, HOLDERS OF OLD NOTES IN ANY JURISDICTION IN WHICH THE EXCHANGE
OFFER WOULD VIOLATE SECURITIES OR BLUE SKY LAWS.
-3-
<PAGE>
SUMMARY
This brief summary highlights selected information contained in this
document and documents we have incorporated in this document by reference. It
does not contain all of the information that is important to you. We urge you to
read carefully the entire document, the documents incorporated in this document
by reference and the other documents to which this document refers, including
our consolidated financial statements and the notes to those financial
statements, which are incorporated in this document by reference.
CSC HOLDINGS, INC.
We are one of the largest operators of cable television systems in the
U.S., with about 2,591,000 subscribers in six states as of March 31, 1999, based
on the number of basic subscribers in systems that we currently majority own and
manage. Giving effect to the contribution of the contributed business
subsidiaries on April 5, 1999, described under "Recent Developments" below, we
would have served about 3,438,000 cable television subscribers as of March 31,
1999. We also have ownership interests in companies that produce and distribute
national and regional programming services and provide advertising sales
services for the cable television industry and in the Madison Square Garden
sports and entertainment business, also known as "MSG".
For financing purposes, we are structured as a Restricted Group and an
Unrestricted Group. Our Restricted Group includes:
o all of our cable operations, which are located primarily in and around
metropolitan New York City, including Long Island, in and around the
greater Cleveland, Ohio metropolitan area, and in and around Boston,
Massachusetts and
o the commercial telephone operations of our subsidiary, Cablevision
Lightpath, Inc., on Long Island, New York.
Our Unrestricted Group includes:
o Rainbow Media, our 75%-owned subsidiary that conducts our programming
and entertainment activities and includes AMC, Bravo, a 60% general
partnership interest in Regional Programming Partners, a 50% general
partnership interest in National Sports Partners and a 50% general
partnership interest in National Advertising Partners,
o Rainbow Advertising, which sells advertising time on behalf of our
cable television systems, some of Rainbow Media's programming networks
and some unaffiliated cable television systems,
o CSC Technology, Inc., our subsidiary engaged in research and
development of new technology,
o Cablevision Electronics Investments, Inc., doing business as The Wiz,
o CSC At Home Holding Corporation, our subsidiary that holds warrants to
acquire about 10.2 million shares of common stock of At Home
Corporation,
o Cablevision Cinemas, LLC, doing business as Clearview Cinemas and
o an interest in an entity that holds some licenses to conduct a
personal communications service business.
Our principal executive offices are located at 1111 Stewart Avenue,
Bethpage, New York 11714, and our main telephone number is (516) 803-2300.
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<PAGE>
RECENT DEVELOPMENTS
Under "Recent Developments" below, we describe some pending and recently
completed transactions, including the contribution made to us of some cable
television systems acquired by our parent company, Cablevision Systems
Corporation, which we sometimes refer to as "Cablevision", from
TeleCommunications, Inc., now part of AT&T Corp. (the "Contribution of the
Contributed Business Subsidiaries").
THE EXCHANGE OFFER
THE EXCHANGE OFFER We are offering to exchange $1,000 principal amount of
our 8 1/8% Series B Senior Notes due 2009 registered
under the Securities Act of 1933, which we refer to as
"new notes", for each $1,000 principal amount of our
outstanding 8 1/8% Senior Notes due 2009 issued on July
13, 1999 in a private offering, which we refer to as
"old notes". In order to exchange an old note, you must
follow the required procedures and we must accept the
old note for exchange. We will exchange all notes
validly offered for exchange, or "tendered", and not
validly withdrawn. As of the date of this document,
there is $500 million aggregate principal amount of old
notes outstanding.
EXPIRATION AND Our offer expires at 5:00 p.m., New York City
EXCHANGE DATES time, on [DATE], 1999, unless we extend the deadline.
We will complete the exchange and issue the new notes
as soon as possible after that date.
ACCRUED INTEREST ON The new notes will bear interest from July 13, 1999,
THE NEW NOTES AND the date we issued issued the old notes. If you hold
THE OLD NOTES old notes and they are accepted for exchange:
o you will waive your right to receive any interest
on your old notes accrued from July 13, 1999 to
the date the new notes are issued
o you will receive the same interest payment on
January 15, 2000, which is the first interest
payment date with respect to the old notes and the
new notes, that you would have received had you
not accepted the exchange offer.
REGISTRATION RIGHTS You have the right to exchange old notes that you now
hold for new notes. We intend to satisfy this right by
this exchange offer. The new notes will have
substantially identical terms to the old notes, except
the new notes will be registered under the Securities
Act and will not have any registration rights. After the
exchange offer is complete, you will no longer be
entitled to any exchange or registration rights with
respect to your notes.
CONDITIONS The only condition to this offer is that the exchange
offer does not violate the securities laws. This offer
applies to any and all notes validly tendered by the
deadline.
-5-
<PAGE>
RESALE WITHOUT FURTHER We believe that you may offer for resale, resell and
REGISTRATION otherwise transfer the new notes without complying with
the registration and prospectus delivery provisions of
the Securities Act if the following is true:
o you acquire the new notes issued in the exchange
offer in the ordinary course of your business,
o you are not an "affiliate", as defined under Rule
405 of the Securities Act, of CSC Holdings,
o you are not participating, and do not intend to
participate, and have no arrangement or
understanding with any person to participate, in
the distribution of the new notes issued to you in
the exchange offer.
By signing the letter of transmittal and exchanging your
notes as described below, you will be making
representations to this effect.
If you are a broker-dealer that acquired old notes as a
result of market-making or other trading activities, you
must deliver a prospectus in connection with any resale
of the new notes as described in this summary under
"--Restrictions on Sale by Broker-Dealers" below.
We base our belief on interpretations by the SEC staff
in no-action letters issued to other issuers in exchange
offers like ours. We cannot guarantee that the SEC would
make a similar decision about our exchange offer. If our
belief is wrong, you could incur liability under the
Securities Act. We will not protect you against any loss
incurred as a result of this liability under the
Securities Act.
LIABILITY UNDER THE You also may incur liability under the Securities Act
SECURITIES ACT if:
(1) any of the representations listed above are not
true and
(2) you transfer any new note issued to you in the
exchange offer without:
o delivering a prospectus meeting the
requirements of the Securities Act
or
--
o an exemption from the requirements of the
Securities Act to register your new notes.
We will not protect you against any loss incurred as a
result of this liability under the Securities Act.
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<PAGE>
RESTRICTIONS ON SALE If you are a broker-dealer that has received new notes
BY BROKER-DEALER for your own account in exchange for old notes that were
DEALERS acquired as a result of market-making or other trading
activities, you must acknowledge in a letter of
transmittal that you will deliver a prospectus meeting
the requirements of the Securities Act in connection
with any resale of the new notes. A broker-dealer may
use this prospectus for 90 days after the last exchange
date for an offer to resell, a resale or other
retransfer of the new notes issued to it in the exchange
offer.
PROCEDURES FOR If you hold old notes and want to accept the exchange
TENDERING OLD NOTES offer, you must either:
o complete, sign and date the accompanying letter of
transmittal, and deliver it, together with your
old notes and any other required documents, to the
exchange agent
or
--
o if you hold old notes registered in the name of a
broker-dealer, arrange for The Depository Trust
Company to give the exchange agent the required
information for a book-entry transfer.
You must mail or otherwise deliver this documentation or
information to The Bank of New York, as exchange agent,
or The Depository Trust Company at the address under
"How to Tender Your Old Notes--Exchange Agent" below.
SPECIAL PROCEDURES If you hold old notes registered in the name of a
FOR BENEFICIAL OWNERS broker-dealer, commercial bank, trust company or other
nominee and you wish to exchange your old notes in the
exchange offer, you should promptly contact the
registered holder of the old notes and instruct it to
tender on your behalf.
If you wish to tender on your own behalf, you must,
before completing and executing the letter of
transmittal for the exchange offer and delivering your
old notes, either arrange to have your old notes
registered in your name or obtain a properly completed
bond power from the registered holder. The transfer of
registered ownership may take a long time.
FAILURE TO EXCHANGE If you are eligible to participate in the exchange offer
WILL AFFECT and you do not tender your old notes, you will not have
YOU ADVERSELY any further registration or exchange rights and your old
notes will continue to be subject to transfer
restrictions. These transfer restrictions and the
availability of new notes could adversely affect the
trading market for your old notes.
GUARANTEED DELIVERY If you wish to exchange your old notes and:
PROCEDURES
o you cannot send the required documents to the
exchange agent by the expiration date of the
exchange offer
-7-
<PAGE>
or
--
o you cannot complete the procedure for book-entry
transfer on time
or
--
o your old notes are not immediately available
then you must follow the procedures described under "How
to Tender Your Old Notes--Guaranteed Delivery
Procedures" below.
WITHDRAWAL RIGHTS You may withdraw your tender at any time before
5:00 p.m., New York City time, on [DATE - THE BUSINESS
DAY BEFORE THE DAY THE OFFER EXPIRES], unless we have
already accepted your offer to exchange your old notes.
ACCOUNTING We will not recognize a gain or loss for accounting
TREATMENT purposes as a result of the exchange.
FEDERAL INCOME TAX The exchange will not be a taxable event for U.S.
CONSEQUENCES federal income tax purposes. This means you will not
recognize any taxable gain or loss or any interest
income as a result of the exchange.
EXCHANGE AGENT The Bank of New York is the exchange agent for the
exchange offer. The Bank of New York is also the trustee
under the indenture governing the notes.
ABSENCE OF APPRAISAL As a holder of old notes you are not entitled to
RIGHTS appraisal or dissenters' rights under Delaware law, the
indenture governing the old notes or the indenture that
will govern the new notes. See "The Exchange
Offer--Terms of the Exchange Offer--No Appraisal or
Dissenters' Rights" for more information.
THE NEW NOTES
The new notes have the same financial terms and covenants as the old notes.
In this document we sometimes refer to the old notes and the new notes together
as the "notes". The terms of the new notes are as follows:
ISSUER CSC Holdings, Inc.
SECURITIES OFFERED $500,000,000 principal amount of 8 1/8% Series B Senior
Notes due 2009.
MATURITY July 15, 2009.
INTEREST RATE 8 1/8% per year.
-8-
<PAGE>
INTEREST PAYMENT DATES Interest on the old notes began accruing on July 13,
1999, the date we issued the old notes. Interest is
payable on the old notes, and will be payable on the new
notes, on January 15 and July 15 of each year.
Before the date of this document no interest payments
have been made on the old notes. The first interest
payment date for the new notes will be January 15, 2000.
RANKING The new notes will be senior unsecured obligations of
CSC Holdings and will rank equally in right of payment
with all of our other existing and future unsubordinated
indebtedness. All of our secured indebtedness will have
a prior claim with respect to the assets securing that
indebtedness.
The liabilities, including trade payables,
of our subsidiaries will have a prior claim with respect
to the assets of those subsidiaries. In that regard,
some of our subsidiaries have guaranteed our
indebtedness under our principal bank credit agreement,
but these subsidiaries will not be guarantors of the new
notes.
As of March 31, 1999, after giving effect to the
Contribution of the Contributed Business Subsidiaries,
the sale of the old notes and the application of the net
proceeds from the sale of the old notes on July 13,
1999:
o we would have had $94 million in borrowings under
our credit agreement, $2,692 million of senior
unsecured indebtedness, $1,048 million of senior
subordinated indebtedness and obligations and $10
million of capitalized leases, other than
guarantees of subsidiary debt discussed below,
o subsidiaries in our Restricted Group would have
had $923 million of indebtedness and capitalized
leases, in addition to the guarantees of
borrowings under our credit agreement and
o subsidiaries in our Unrestricted Group would have
had $782 million of indebtedness and capitalized
leases.
We have guaranteed all of the indebtedness of the
subsidiaries in our Restricted Group on a senior basis.
RESTRICTIONS The indenture for the notes, among other things,
restricts our ability and the ability of our Restricted
Subsidiaries to:
o incur additional indebtedness,
o make some dividend payments or payments to redeem
or retire capital,
o invest in unrestricted subsidiaries or affiliates,
o engage in some transactions with affiliates,
-9-
<PAGE>
o incur liens and
o merge or consolidate with or transfer all or
substantially all of our assets.
These covenants are described in greater detail under
"Description of the New Notes" below. These covenants
are subject to important exceptions and qualifications,
which are also described under "Description of the New
Notes" below.
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<PAGE>
SELECTED FINANCIAL DATA
CSC HOLDINGS, INC.
The historical consolidated statement of operations data, except for the
deficiency of earnings available to cover fixed charges and the ratio of
earnings to fixed charges, and consolidated balance sheet data for each year
ended and as of December 31 in each year in the five-year period ended December
31, 1998, included in the following selected financial data, have been derived
from our consolidated financial statements, audited by KPMG LLP, independent
certified public accountants. The historical consolidated statement of
operations data for the periods ended March 31, 1999 and 1998 and balance sheet
data as of March 31, 1999, included in the following selected financial data,
have been derived from our financial statements that have not been audited, but
that, in the opinion of our management, reflect all adjustments necessary for
the fair presentation of that data for the interim periods. The results of
operations for the three-month period ended March 31, 1999 are not necessarily
indicative of the results of operations for the full year, although we expect
that we will incur a substantial loss for the year ending December 31, 1999.
<TABLE>
<CAPTION>
Three Months Ended Year Ended
March 31, December 31,
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1999 1998 1998 1997 1996 1995 1994
==== ==== ==== ==== ==== ==== ====
(Dollars in thousands)
<S> <C> <C> <C> <C> <C> <C> <C>
CONSOLIDATED STATEMENT OF OPERATIONS
DATA(1):
Revenues............................... $824,984 $645,382 $2,912,419 $1,949,358 $1,315,142 $1,078,060 $837,169
Operating expenses:
Technical and operating............. 360,963 300,703 1,133,804 853,800 538,272 412,479 302,885
Cost of sales(2).................... 104,797 31,316 390,751 - - - -
Selling, general and administrative. 308,704(3) 189,181 820,015 514,574 313,476 266,209 195,942
Restructuring charge.............. - - - - - - 4,306(4)
Depreciation and amortization..... 157,781 135,049 577,635 499,809 388,982 319,929 271,343
--------- -------- ---------- ---------- ---------- --------- ---------
Operating profit (loss)................ (107,261) (10,867) (9,786) 81,175 74,412 79,443 62,693
Other income (expense):
Interest expense, net............... (98,238) (87,795) (369,072) (363,208) (265,015) (311,887) (261,781)
Provision for preferential payment
to related party.................. - (980) (980) (10,083) (5,600) (5,600) (5,600)
Write-off of deferred interest and
financing costs(5)................ - - (23,482) (24,547) (37,784) (5,517) (9,884)
Gain on redemption of subsidiary
preferred stock................... - - - 181,738(6) - - -
Loss on redemption of debentures(5). - - - - - - (7,088)
Equity in net loss of affiliates.... (3,395) (13,865) (37,368) (27,165) (82,028) (93,024) (82,864)
Gain on sale of programming interests
and cable assets, net............. - 137,268 171,127 372,053 - 35,989 -
Minority interests.................. 25,825 82 48,378 (60,694) (9,417) (8,637) (3,429)
Miscellaneous, net.................. (3,483) (8,209) (18,350) (12,606) (6,647) (8,225) (7,198)
--------- -------- ---------- ---------- ---------- --------- --------
Net income (loss)..................... (186,552) 15,634 (239,533) 136,663 (332,079) (317,458) (315,151)
Dividend requirements applicable
to preferred stock................ (42,843) (39,095) (161,872) (148,767) (127,780) (20,249) (6,385)
--------- -------- ---------- ---------- ---------- --------- ---------
Net loss applicable to common
stockholder....................... $(229,395) $(23,461) $(401,405) $(12,104) $(459,859) $(337,707) $(321,536)
========== ========= ========== ========= ========== ========== =========
Deficiency of earnings available to
cover fixed charges............... $(186,552) $ - $(239,533) $ - $(332,079) $(317,458) $(315,151)
========== ========= ========== ========= ========== ========== =========
Ratio of earnings to fixed charges.... - 1.16x - 1.36x - - -
========== ========= ========== ========= ========== ========== =========
</TABLE>
<TABLE>
<CAPTION>
As of
March 31, As of December 31,
------------------------------------------------------------------------------------------
1999 1998 1997 1996 1995 1994
==== ==== ==== ==== ==== ====
(Dollars in thousands)
<S> <C> <C> <C> <C> <C> <C>
CONSOLIDATED BALANCE SHEET
DATA(1):
Total assets....................... $5,935,369 $5,935,860 $5,614,788 $3,034,725 $2,502,305 $2,176,413
Total debt......................... 5,062,347 4,834,608 4,694,062 3,334,701 3,157,107 3,169,236
Redeemable preferred stock......... 1,291,847 1,256,339 1,123,808 1,005,265 257,751 -
Stockholder's deficiency........... (3,053,748) (2,824,353) (2,378,773) (2,374,285) (1,891,676) (1,818,535)
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
As of
March 31, As of December 31,
------------------------------------------------------------------------------------------
1999 1998 1997 1996 1995 1994
==== ==== ==== ==== ==== ====
(Dollars in thousands, except average monthly revenue data
<S> <C> <C> <C> <C> <C> <C>
STATISTICAL DATA(1):
Homes passed(7).................... 3,957,000 3,949,000 4,398,000 3,858,000 3,328,000 2,899,000
Basic service subscribers.......... 2,591,000 2,569,000 2,844,000 2,445,000 2,061,000 1,768,000
Basic penetration(8)............... 65.5% 65.0% 64.7% 63.4% 61.9% 61.0%
Number of premium television
units............................ 4,612,000 4,234,000 4,183,000 3,862,000 3,990,000 3,208,000
Average number of premium units
per basic subscriber............. 1.8 1.7 1.5 1.6 1.9 1.8
Average monthly revenue per
basic subscriber(9).............. $44.51 $42.74 $38.53 $36.71 $37.07 $36.33
FINANCIAL RATIO AND OTHER DATA:
Operating profit before
depreciation and amortization
to revenues...................... 6.1% 19.5% 29.8% 35.2% 37.0% 39.9%
Total debt to operating profit
before depreciation and
amortization..................... 25.1x(10) 8.5x 8.1x 7.2x 7.9x 9.5x
Operating profit before
depreciation and amortization
to interest expense.............. 0.5x 1.5x 1.6x 1.7x 1.3x 1.3x
----------------------------------
<FN>
(1) The consolidated statement of operations, balance sheet, statistical,
financial ratio and other data reflect various acquisitions of cable
television systems and other businesses during the periods presented, but
do not include the cable television systems transferred to us by
Cablevision on April 5, 1999. See "Business--Cable Television Operations"
in our Form 10-K and our financial statements in our March 31, 1999 Form
10-Q for a description of these acquisitions and the April 5, 1999
transfer. Acquisitions during the periods presented were accounted for
under the purchase method of accounting and, accordingly, the acquisition
costs were allocated to the net assets acquired based on their fair value.
Acquisitions are reflected in the consolidated statement of operations,
balance sheet, statistical, financial ratio and other data from the time of
acquisition.
(2) Beginning with the acquisition of the assets associated with The Wiz
consumer electronics store locations in February 1998, we record cost of
sales related to these operations, which includes the cost of merchandise
sold, including associated freight costs, as well as store occupancy and
buying costs.
(3) Approximately $78.9 million of the increase in selling, general and
administrative expenses in the first quarter of 1999 compared to the first
quarter of 1998 was due to a higher level of charges related to our
incentive stock plan, primarily attributable to an increase in the market
price of Cablevision's Class A common stock.
(4) We recorded a one-time charge in the first quarter of 1994 to provide for
employee severance and related costs resulting from a restructuring of our
operations.
(5) In October 1994, we entered into a new bank credit agreement and redeemed
$200 million of our reset debentures. The related deferred financing costs
and unamortized discount relating to each were written off (the portions
relating to Cablevision of NYC and Cablevision of New Jersey amounting to
$3.2 million were written off in 1995) and charges of approximately $2.0
million in redemption fees, $4.5 million in deferred financing costs and
$0.6 million in unamortized discount were recorded in connection with the
redemption of the reset debentures. In January 1995, Rainbow Media amended
its credit agreement to refinance its existing borrowings and to provide
funds for the acquisition of the third-party interests in SportsChannel New
York and Rainbow News 12, resulting in an approximate $2.3 million
write-off of deferred financing costs. In April 1996, we wrote off
approximately $24.0 million of deferred interest and financing costs in
connection with the refinancing of all indebtedness of V Cable and VC
Holding, Inc. and the formation of Cablevision of Ohio. In September 1996,
we wrote off approximately $10.3 million of deferred financing costs in
connection with the refinancing of our credit agreement, and in the fourth
quarter of 1996, an additional $3.1 million of deferred financing costs
relating to our MFR subsidiary were written off in connection with a
reorganization and refinancing of Cablevision MFR, Inc. In July 1997, we
paid a premium of approximately $8.4 million to redeem our 10 3/4% Senior
Subordinated Debentures due 2004 and wrote off deferred financing costs of
approximately $5.3 million in connection therewith. Also in 1997, we wrote
off deferred financing costs of $4.1 million in connection with the
repayment of Cablevision of Ohio's bank debt and $6.5 million in connection
with the amendment to and repayment of the term loans under the Madison
Square Garden credit facility. In 1998, we paid a premium of $14.9 million
to redeem the senior notes assumed by our Cablevision Cinemas subsidiary in
the Clearview Cinemas acquisition and wrote off deferred financing costs of
$4.7 million in connection with the refinancing of our credit agreement.
(6) In July 1997, we redeemed the Series A preferred stock of A-R Cable and
recognized a gain principally representing the reversal of accrued
preferred dividends in excess of amounts paid.
</FN>
</TABLE>
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<PAGE>
(footnotes continued from previous page)
(7) Homes passed is based on homes passed by cable actually marketed and does
not include multiple dwelling units passed by the cable plant that are not
connected to it.
(8) Basic penetration represents basic service subscribers at the end of the
period as a percentage of homes passed at the end of the period.
(9) Based on recurring service revenues, excluding installation charges and
certain other revenues such as advertising, pay-per-view and home shopping
revenues, for the month of March or December, as the case may be, divided
by the average number of basic subscribers for that month.
(10) Operating profit before depreciation and amortization is annualized for
purposes of preparing interim financial ratios that include balance sheet
items.
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RISK FACTORS
You should consider carefully the risk factors described below, together
with the other matters described in this document or incorporated by reference,
before deciding to exchange your old notes for new notes. The risk factors below
apply to both the old notes and the new notes.
RISK FACTORS RELATING TO THE NOTES
WE HAVE SUBSTANTIAL INDEBTEDNESS AND WE ARE HIGHLY LEVERAGED AS A RESULT
We have incurred, and we will continue to incur in the future, substantial
amounts of indebtedness to finance operations, expand cable operations and
acquire other cable television systems, programming networks, sources of
programming and other businesses. We also have incurred, and we will continue to
incur, indebtedness in order to offer new services like high speed Internet
access, digital video service and residential telephone service to present and
potential customers. In addition, we have borrowed, and we will continue to
borrow, money from time to time to refinance existing indebtedness and redeem
our mandatorily redeemable preferred stock. At March 31, 1999, our consolidated
debt plus the amount of our two series of mandatorily redeemable preferred stock
totaled $6.4 billion. We urge you to read carefully our consolidated financial
statements contained in our Form 10-K and our March 31, 1999 Form 10-Q, which
provide more detailed information about our indebtedness and our mandatorily
redeemable preferred stock.
Because of our substantial indebtedness and mandatorily redeemable
preferred stock, we are highly leveraged. This means that interest on and
required repayments of our borrowings and dividends on and required redemption
amounts with respect to our mandatorily redeemable preferred stock are
significant in relation to our revenues and cash flow. This leverage exposes us
to significant risk in the event of downturns in our businesses, in our
industries or in the economy generally, because although our cash flows would
decrease in this scenario, our required payments in respect of indebtedness and
preferred stock will not.
THE NEW NOTES WILL BE EFFECTIVELY SUBORDINATED TO ALL EXISTING AND FUTURE
INDEBTEDNESS OF OUR SUBSIDIARIES
We are a holding company whose assets consist primarily of investments in
subsidiaries. Our principal subsidiaries own cable television systems, own
interests in programming networks and own or operate retail electronics stores
and motion picture theaters. Our ability to pay interest on and repay principal
of their indebtedness and to make dividend payments on, and redemptions of, our
preferred stock is dependent primarily on the earnings of our subsidiaries and
the distribution or other payment of these earnings to us in the form of
dividends, loans or advances.
Our subsidiaries are separate and distinct legal entities and have no
obligation, contingent or otherwise, to pay any amounts due on our public
indebtedness or preferred stock or to make any funds available to us to do so.
Rainbow Media and some of its subsidiaries are parties to credit agreements that
contain various financial and operating covenants that restrict the payment of
dividends or other distributions.
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<PAGE>
In addition, our subsidiaries' creditors would be entitled to a claim on
the assets of these subsidiaries before any of our claims as a stockholder.
Therefore, in the event of a liquidation or reorganization of any subsidiary,
creditors of that subsidiary are likely to be paid in full before we receive any
distribution. To the extent that we are a creditor of the subsidiary, our claims
would be subordinated to any security interest in the assets of the subsidiary
and/or any indebtedness of the subsidiary senior to that held by us.
WE MAY SEPARATE RAINBOW MEDIA FROM CSC HOLDINGS AND IF WE DO SO, RAINBOW MEDIA'S
CASH FLOW WOULD NO LONGER BE AVAILABLE TO SUPPORT OUR PAYMENTS
Under our existing debt instruments, we are permitted under some
circumstances to restructure our holdings so that our subsidiary, Rainbow Media,
would become a separate subsidiary of Cablevision and would no longer be our
subsidiary. If we did this, Rainbow Media's cash flow and assets would no longer
be available to support payments due with respect to our securities, including
the notes. Therefore, you should not assume that Rainbow Media's cash flow and
assets will be available to support any of our securities, including the notes,
in the future.
SIGNIFICANT RESTRICTIVE COVENANTS IN OUR FINANCING AGREEMENTS LIMIT OUR
FLEXIBILITY
Our credit agreement and some of our debt instruments contain various
financial and operating covenants which, among other things, require the
maintenance of some financial ratios and restrict the relevant borrower's
ability to incur debt from other sources and to use funds for various purposes,
including investments in some subsidiaries. Violation of these covenants could
result in a default which would permit the parties who have lent money under our
credit agreement and other debt instruments to:
o restrict our ability to borrow undrawn funds under our credit agreement
and
o require the immediate repayment of the borrowings under our credit
agreement and other debt instruments.
THERE IS NO PUBLIC MARKET FOR THE NOTES
Before the offering of the notes, there has been no public market for the
notes. We do not intend to apply for the listing of the notes on any securities
exchange or for quotation of the notes on any automated quotation system. We
have been advised by the initial purchasers that they presently intend to make a
market in the new notes and the old notes, as permitted by applicable laws and
regulations. The initial purchasers are not obligated, however, to make a market
in the new notes. Any market making activity may be discontinued at any time
without notice at the sole discretion of each initial purchaser. This
market-making activity will be restricted by limitations imposed by the
Securities Act and the Exchange Act, and may be limited during our exchange
offer for the notes.
We cannot assure you as to the liquidity of the public market for the new
notes or that an active public market for the new notes will develop. If an
active public market does not develop, the market price and liquidity of the new
notes may be adversely affected. Please refer to "Plan of Distribution" below.
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<PAGE>
Historically, the market for non-investment grade debt has been affected by
disruptions that have caused substantial volatility in the prices of securities
similar to the new notes. We cannot assure you that any market for the new notes
will not be affected by similar disruptions.
IF YOU DO NOT PARTICIPATE IN THE EXCHANGE OFFER, IT MAY BE HARDER FOR YOU TO
RESELL AND TRANSFER YOUR OLD NOTES
The old notes were not registered under the Securities Act or under the
securities laws of any state. Thus, you may not resell the old notes, offer them
for resale or otherwise transfer them unless they are subsequently registered or
resold under an exemption from the registration requirements of the Securities
Act and applicable state securities laws. If you do not exchange your old notes
for new notes by this exchange offer, or if you do not properly tender your old
notes in this exchange offer, you will not be able to resell, offer to resell or
otherwise transfer your old notes unless they are registered under the
Securities Act or unless you resell them, offer to resell or otherwise transfer
them under an exemption from the registration requirements of, or in a
transaction not subject to, the Securities Act. In addition, you will no longer
be able to obligate us to register your old notes under the Securities Act.
RISKS RELATING SPECIFICALLY TO CSC HOLDINGS
OUR FINANCIAL STATEMENTS REFLECT NET LOSSES AND A STOCKHOLDER'S DEFICIENCY
We have reported recent net losses applicable to our common stockholder as
follows:
FOR THE THREE MONTHS ENDED:
March 31, 1999......................................... $229.4 million
FOR THE YEAR ENDED:
December 31, 1998...................................... $401.4 million
December 31, 1997...................................... $ 12.1 million
December 31, 1996...................................... $459.9 million
Net losses are calculated by subtracting from gross revenues:
o operating expenses, including depreciation and amortization,
o interest expense,
o preferred stock dividends,
o other income and expenses and
o net profit or loss from affiliate operations.
The net losses described above primarily reflect our high interest expense,
preferred stock dividends and depreciation and amortization charges, which we
expect to continue. As a result of these net losses, at
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<PAGE>
March 31, 1999, we had a stockholder's deficiency of $3.1 billion. We urge
you to read carefully our consolidated financial statements contained in our
Form 10-K and our March 31, 1999 Form 10-Q, which provide more detailed
information about these net losses.
We expect our net losses to continue and to remain substantial for the
foreseeable future because:
o interest expense, preferred stock dividends and depreciation and
amortization charges relating to our existing indebtedness and
preferred stock and completed acquisitions and capital expenditures
will remain high for the foreseeable future,
o we expect that future indebtedness incurred to fund pending and future
acquisitions and the development of our existing and new businesses,
including, but not limited to, capital expenditures and additional
investments in our cable television plant and programming operations,
will result in significant additional charges to gross revenues and
o we expect expenses and depreciation relating to each new service we
offer to be particularly high in relation to the amount of revenues the
new service will generate in its first years of operations, resulting
in significant net losses each time we begin offering a new service or
supporting a new business we acquire.
WE WILL NEED SIGNIFICANT ADDITIONAL BORROWINGS AND WE HAVE COMMITTED TO
SIGNIFICANT FUTURE CAPITAL EXPENDITURES AND OTHER CAPITAL COMMITMENTS.
Our business is very capital-intensive. Operating, maintaining and
upgrading our cable television plant require significant amounts of cash
payments to third parties. In addition, we have incurred significant expenses to
start up and operate new businesses, like high speed Internet access, digital
video service and residential telephone service, and to roll out the non-Long
Island based commercial telephone businesses. We expect these expenses to
continue or grow as we continue to introduce these and possibly other new
services to our cable television customers.
We also incur significant start-up costs in funding new cable programming
services before they have positive cash flow, typically during their start-up
and development. Our acquisition and development of other businesses, like
electronics retailing and movie theaters, also result in significant
expenditures. We also pay a significant amount of interest in respect of our
outstanding indebtedness, and significant amounts of cash will be required to
repay our existing indebtedness and redeem our mandatorily redeemable preferred
stock.
We will not be able to generate sufficient cash internally to finance these
projects, to repay our indebtedness at maturity and to redeem our mandatorily
redeemable preferred stock at the mandatory redemption date. Because we will be
unable to generate enough cash internally for these purposes, we will have to do
one of the following:
o raise additional capital, through debt or equity issuances or both
or
--
o cancel or scale back current and future spending programs
or
--
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<PAGE>
o sell assets.
However, you should not assume that we will be able to raise any required
additional capital if we are unable to pursue our current and future spending
programs and we may not be able to compete effectively as a result.
Unrestricted Group subsidiaries have substantial future capital commitments
in the form of long-term contracts that require substantial payments over a long
period of time. For example, rights agreements with sports teams under which we
carry games on our programming networks almost always involve multi-year
contracts that are difficult and expensive to terminate. The acquisition and
development activities of Unrestricted Group subsidiaries, like the acquisition
of entertainment businesses and the acquisition and development of entertainment
facilities, will also result in significant expenditures.
Accordingly, if we are forced to cancel or scale back current and future
spending programs as described above, our choice of which spending programs to
cancel or scale back may be limited.
A SIGNIFICANT AMOUNT OF OUR BOOK VALUE CONSISTS OF INTANGIBLE ASSETS
At March 31, 1999, we reported $5.9 billion of consolidated total assets,
of which $2.4 billion were intangible. Intangible assets include assets like
franchises from city and county governments to operate cable television systems,
affiliation agreements, amounts representing the cost of some acquired assets in
excess of their fair value and some deferred costs associated with past
financings, acquisitions and other transactions.
You should not assume that we would receive any cash from the voluntary or
involuntary sale of these intangible assets. We urge you to read carefully our
consolidated financial statements contained in our Form 10-K and our March 31,
1999 Form 10-Q, which provide more detailed information about these intangible
assets.
WE MAY NOT BE ABLE TO COMPLETE OUR PENDING TRANSACTIONS
We have announced and may continue to announce a number of transactions,
some of which are or may be significant to our business. Because of the
conditions required to be fulfilled before we can complete these transactions,
we cannot assure you that any of our announced transactions will be completed on
the terms or schedule we announce, or that any of them will be completed at all.
Our pending transactions are generally described in our Form 10-K, our March 31,
1999 Form 10-Q and under "Recent Developments" below. We urge you to read
carefully the description of our pending transactions contained therein,
particularly the conditions required to be fulfilled in order to complete these
transactions.
WE ARE CONTROLLED BY THE DOLAN FAMILY
The Dolan family is able to prevent or cause a change of control of
Cablevision and also is able to prevent or cause a change in control of CSC
Holdings.
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We are a wholly owned subsidiary of Cablevision. Cablevision has two
classes of common stock:
o Class A common stock, which is entitled to one vote per share and is
entitled collectively to elect 25% of Cablevision's board of directors
and
---
o Class B common stock, which is generally entitled to ten votes per
share and is entitled collectively to elect the remaining 75% of
Cablevision's board of directors.
As of April 30, 1999, Charles F. Dolan, chairman of Cablevision's board of
directors, beneficially owned 0.9% of the Class A common stock, 53.6% of the
Class B common stock and 43.0% of the total voting power of both classes of
common stock. In addition, as of April 30, 1999, trusts established by Dolan for
his family members, as to which he disclaims beneficial ownership, beneficially
owned 3.3% of the Class A common stock, 46.4% of the Class B common stock and
37.7% of the total voting power of both classes of common stock.
As a result of Dolan's stock ownership and the stock ownership of his
family members, Dolan has the power to elect all the directors of Cablevision
subject to election by holders of the Class B common stock. In addition, Dolan
family members may control stockholder decisions on matters in which holders of
Cablevision common stock vote together as a class. These matters include the
amendment of some provisions of Cablevision's certificate of incorporation and
the approval of fundamental corporate transactions, including mergers.
In addition, because the affirmative vote or consent of the holders of at
least 66 2/3% of the outstanding shares of the Class B common stock, voting
separately as a class, is required to approve:
o the authorization or issuance of any additional shares of Class B
common stock and
o any amendment, alteration or repeal of any of the provisions of
Cablevision's certificate of incorporation that adversely affects the
powers, preferences or rights of the Class B common stock,
Dolan family members also have the power to prevent any issuance or amendment.
The voting rights of the Class B common stock beneficially owned by the Dolan
family members will not be modified as a result of any transfer of legal or
beneficial ownership of the Class B common stock.
REGULATORY RISKS ARE INHERENT AND SUBSTANTIAL IN OUR BUSINESSES
GENERAL. The FCC and state and local governments extensively regulate the
rates we may charge our customers for video services. They also regulate us in
other ways that affect the daily conduct of our video delivery and video
programming business, our telephone business and possibly in the future, our
high speed Internet access business. Any action by the FCC, the states of New
York, New Jersey,
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Connecticut, Massachusetts or Ohio or concerted action by local regulators, the
likelihood or extent of which we cannot predict, could have a material financial
effect on us.
For example, in 1992, Congress enacted the Cable Television Consumer
Protection and Competition Act of 1992 (the "1992 Cable Act"), which was a
significant change in the regulatory framework under which cable television
systems operate. In 1993 and 1994, the FCC ordered reductions in cable
television rates based on the 1992 Cable Act. In 1995, a Federal appeals court
upheld the material aspects of the FCC's rate regulation scheme. Congress
subsequently enacted the Telecommunications Act of 1996, which relaxes the
regulation of higher tier cable television rates. This higher tier rate
regulation relaxation went into effect on March 31, 1999. The regulation by
local governments of basic cable rates will continue in most communities in
which we operate.
RECENT FCC AND CONGRESSIONAL ISSUES MAY AFFECT OUR BUSINESSES. The FCC has
established a national limit of 30% on the number of households that any cable
company can serve. Because of court proceedings, this 30% national limit has
never been implemented and the FCC is considering revising this limit and
changing the definition of what type and degree of ownership should be
considered in determining whether a cable company has exceeded whatever limit
the FCC sets. The outcome of these proceedings could affect us because of AT&T's
investment in Cablevision through its recent acquisition of Tele-Communications,
Inc. ("TCI"). This issue recently has been given greater visibility at the FCC
and in Congress as a result of AT&T's proposed acquisition of MediaOne Group.
Some parties, including America Online and some local telephone companies,
have proposed statutory and regulatory requirements that would force cable
systems to provide carriage to third-party Internet access providers. The FCC
thus far has rejected these requests, but legislation has been introduced that
would effectively require that this access be provided. We cannot predict at
this time whether or to what extent this legislation might be successful or
whether the FCC might reevaluate its initial conclusion not to impose this
regulation. One federal district court in Oregon, a state in which we do not
operate, has recently upheld a local franchising authority's requirement that
the cable system in that community provide access to all third-party Internet
access providers, but that decision is currently on appeal. If the federal
district court's opinion is upheld, some local franchising authorities where we
operate might attempt to impose a similar requirement on us.
OUR CURRENT FRANCHISES ARE GENERALLY NON-EXCLUSIVE, AND OUR FRANCHISORS
NEED NOT RENEW OUR FRANCHISES. Our cable television systems are operated
primarily under non-exclusive franchise agreements with local government
franchising authorities, in some cases with the approval of state cable
television authorities. Consequently, our business is dependent on our ability
to obtain and renew our franchises. Although we have never lost a franchise as a
result of a failure to obtain a renewal, our franchises are subject to
non-renewal or termination under some circumstances.
In some cases, franchises have not been renewed at expiration, and we
operate under either temporary operating agreements or without a license while
negotiating renewal terms with the franchising authorities. In the case of one
of our franchises in Ohio with 11,000 subscribers as of
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March 31, 1999, we are operating without a license while we appeal the denial of
the franchise renewal in federal court in accordance with the provisions of the
Cable Communications Policy Act of 1984.
WE ARE EXPOSED TO A SIGNIFICANT AND CREDIBLE RISK OF COMPETITION
GENERAL. Cable operators compete with a variety of television programming
distribution systems, including:
o broadcast television stations,
o direct broadcasting satellite systems,
o multichannel multipoint distribution services,
o satellite master antenna systems and
o private home dish earth stations.
For example, two direct broadcasting satellite systems are now operational in
the U.S. Companies with substantial resources like Hughes Electronics Corp. have
invested in some of these systems. Cable systems also compete with the entities
that make videotaped movies and programs available for home rental.
The Telecommunications Act of 1996 gives telephone companies and other
video providers the option of providing video programming to subscribers through
"open video systems", a wired video delivery system similar to a cable
television system that may not require a local cable franchise. RCN, an open
video system operator that teams with electric utilities, is currently operating
systems in Boston and parts of New York City that compete with us. Additional
video competition to cable systems is possible from new wireless local
multipoint distribution services authorized by the FCC, for which spectrum was
recently auctioned by the FCC.
The 1992 Cable Act prohibits a cable programmer that is owned by or
affiliated with a cable operator, like Rainbow Media, from:
o unreasonably discriminating among or between cable operators and other
multichannel video distribution systems with respect to the price,
terms and conditions of sale or distribution of the programmer's
service and
o unreasonably refusing to sell service to any multichannel video
programming distributor.
COMPETITION FROM TELEPHONE COMPANIES. The Cable Communications Policy Act
of 1984 barred co-ownership of telephone companies and cable television systems
operating in the same service areas. The Telecommunications Act of 1996 repealed
this restriction and permits a telephone company to provide video programming
directly to subscribers in its telephone service territory, subject to some
regulatory requirements, but generally prohibits a telephone company from
acquiring an in-region cable operator, except in some small markets under some
circumstances. Telephone companies like Ameritech
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Corp. in Ohio and Southern New England Telephone Co. in Connecticut have
obtained or applied for local franchises to construct and operate cable
television systems in several communities in which we currently hold cable
franchises, and in some locations have begun offering service in competition
with us.
OUR SYSTEMS AND THE SYSTEMS OF THIRD PARTIES ON WHOM WE RELY MAY NOT
ACHIEVE YEAR 2000 READINESS
Y2K readiness refers to the ability of some computerized systems and
technologies to recognize and/or correctly process dates beyond December 31,
1999 and leap year calculations. As a result of Y2K readiness issues, the
potential exists for computer system failure or miscalculations by computer
programs, which could disrupt our operations. Our plan to identify and address
Y2K issues is described in our Form 10-K and our March 31, 1999 Form 10-Q.
Many of the information technology, or "IT", and non-IT systems that are
necessary for the continued operation of our businesses are dependent on
components that may not be Y2K compliant. Although our Y2K compliance program is
designed to identify and remediate these systems in order to avoid interruption
of our operations, we cannot assure you that we will be able to identify all
noncompliant systems or successfully remediate all those that are identified.
Failure of IT or non-IT systems that are necessary for the operation of our
businesses, including, without limitation, our billing systems, addressable
controller and converter systems, purchasing, finance and inventory systems,
marketing databases and point of sale systems, could have a material adverse
effect on us.
We are dependent on third-party products and services, like utility
services and programming uplinks, for the operation of our businesses. Although
as part of the inventory and assessment phase of our Y2K program we have
contacted third-party product and service providers to ascertain whether Y2K
compliance issues may exist, we have in many cases not received assurances from
these suppliers. Moreover, in most cases we do not have the ability to verify
any assurances we do receive from third-party suppliers. If critical IT or
non-IT systems used by these third-party suppliers fail as a result of a Y2K
compliance issue, and as a result of this failure the ability of this supplier
to continue to provide this product or service to us is interrupted, our ability
to continue to provide services to our customers may be interrupted. Any
interruption could have a material adverse effect on us. We intend to implement
contingency plans to address those risks, although no plans have yet been
identified, and we cannot assure you that any plan would resolve these problems
in a satisfactory manner.
In addition to the risks associated with the failure of IT systems due to
Y2K problems, the failure of non-IT systems would pose significant risks to us.
For example, we and our subsidiaries operate facilities for both employees and
the public. Failure of non-IT systems at these facilities could result in health
and safety risks that could lead to the closure or unavailability of these
facilities. This could result in lost revenues to us and the risk of actions
against us if the businesses of others are disrupted. Also, the failure of these
non-IT systems could result in injury to individuals which could expose us to
actions by or on behalf of these individuals.
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FORWARD-LOOKING STATEMENTS
This document contains or incorporates by reference statements that
constitute forward-looking information within the meaning of the Private
Securities Litigation Reform Act of 1995. We caution you that these
forward-looking statements are not guarantees of future performance or results
and involve risks and uncertainties. Actual results or developments may differ
materially from the forward-looking statements as a result of various factors.
Factors that may cause these differences to occur include, but are not limited
to:
o the level of our revenues,
o subscriber demand, competition, the cost of programming and industry
conditions,
o the regulatory environment in which we operate,
o the level of our capital expenditures,
o pending and future acquisitions and dispositions of assets,
o whether any pending uncompleted transactions are completed on the terms
and at the times set forth, if at all,
o new competitors entering our franchise areas,
o the identification and remediation of Year 2000 issues and the related
risks and uncertainties, and
o other risks and uncertainties inherent in the cable television business
and our other businesses.
We undertake no obligation to update or revise any forward-looking
statements because of new information, future events or otherwise. In light of
these risks, uncertainties and assumptions, the forward-looking events discussed
in this document might not occur. See "Risk Factors" and our March 31, 1999 Form
10-Q delivered herewith and incorporated by reference herein for more
information on the uncertainty of forward-looking statements.
USE OF PROCEEDS
We will not receive any cash proceeds from the issuance of the new notes as
described in this document. We will receive in exchange old notes in like
principal amount. The old notes surrendered in exchange for the new notes will
be retired and canceled and cannot be reissued. Therefore, the issuance of the
new notes will not result in any change in our indebtedness.
We used the cash proceeds from the issuance of the old notes to repay
borrowings under our credit agreement and for general corporate purposes. The
borrowings under our credit agreement bear interest at floating rates, and
mature in installments over the 2001-2007 time periods. The average effective
annual interest rate on all borrowings under our credit agreement as of April
30, 1999 was 6.1%. For more information about our credit agreement, see
"Management's Discussion and Analysis--Liquidity and Capital Resources" in our
Form 10-K and our March 31, 1999 Form 10-Q delivered herewith.
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CSC HOLDINGS, INC.
We are one of the largest operators of cable television systems in the
U.S., with about 2,591,000 subscribers in six states as of March 31, 1999, based
on the number of basic subscribers in systems that we currently majority own and
manage. We also have ownership interests in companies that produce and
distribute national and regional programming services and provide advertising
sales services for the cable television industry and in the Madison Square
Garden sports and entertainment business, also known as "MSG".
For financing purposes, we are structured as a Restricted Group and an
Unrestricted Group. Our Restricted Group includes:
o all of our cable operations, which are located primarily in and around
metropolitan New York City, including Long Island, in and around the
greater Cleveland, Ohio metropolitan area, and in and around Boston,
Massachusetts and
o the commercial telephone operations of our subsidiary, Cablevision
Lightpath, Inc., on Long Island, New York.
Our Unrestricted Group includes:
o Rainbow Media, our 75%-owned subsidiary that conducts our programming
and entertainment activities and includes AMC, Bravo, a 60% general
partnership interest in Regional Programming Partners, a 50% general
partnership interest in National Sports Partners and a 50% general
partnership interest in National Advertising Partners,
o Rainbow Advertising, which sells advertising time on behalf of our
cable television systems, some of Rainbow Media's programming networks
and some unaffiliated cable television systems,
o CSC Technology, Inc., our subsidiary engaged in research and
development of new technology,
o Cablevision Electronics Investments, Inc., doing business as The Wiz,
o CSC At Home Holding Corporation, our subsidiary that holds warrants to
acquire about 10.2 million shares of common stock of At Home
Corporation,
o Cablevision Cinemas, LLC, doing business as Clearview Cinemas and
o an interest in an entity that holds some licenses to conduct a personal
communications service business.
Our Restricted Group and some members of our Unrestricted Group are
individually and separately financed. The indebtedness of each entity in our
Unrestricted Group is non-recourse to us, except that, in some cases, we have
pledged our capital stock in these entities to the relevant lenders. Rainbow
Media's recent cash requirements have been financed by sales of equity interests
in its programming businesses and through separate external debt financing of
Rainbow Media, AMC and MSG, which are, as to the assets of Rainbow Media and
these subsidiaries, senior to the notes and our other indebtedness. Please read
the information under "Management's Discussion and Analysis--Liquidity and
Capital Resources" in our Form 10-K and our March 31, 1999 Form 10-Q for a
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discussion of the restrictions on investments by the Restricted Group and other
matters. See "Where You Can Find More Information" below to learn how you can
obtain this information.
STRATEGY
Our strategy has been to concentrate our cable television systems in and
around three major metropolitan areas, New York City, Boston and Cleveland, with
a view to:
o being a significant cable provider in each of these markets,
o maximizing our revenue per subscriber by marketing premium services,
o developing and promoting niche programming and entertainment services
and
o remaining an industry leader in upgrading the technological
capabilities of our systems.
We believe that our cable television systems on Long Island, New York
comprise the largest contiguous group of cable television systems under common
ownership in the U.S. as measured by number of subscribers. By developing
systems in and around major metropolitan areas, including expansion through
acquisitions in areas in which we have existing systems, we have been able to
realize economies of scale in the operation and management of our systems and to
capitalize on opportunities to create and market programming of regional
interest.
Through the current and planned upgrade of our cable plant, including the
utilization of fiber optic cable and associated electronics, we are seeking to
significantly increase our analog channel capacity and add new digital channel
capacity that will facilitate the startup of adjunct businesses like:
o information services,
o interactive services, including Internet access,
o near video on demand,
o video on demand,
o residential telephone and
o commercial telephone.
To successfully roll out these adjunct new businesses significantly beyond the
initial development phases, we will need additional capital. For more
information regarding the capital we need for our future expenditures, see "Risk
Factors--Risk Factors Relating Specifically to CSC Holdings--We Will Need
Significant Additional Borrowings and We Have Committed to Significant Future
Capital Expenditures and Other Capital Commitments".
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<PAGE>
RECENT DEVELOPMENTS
TCI NY/NJ TRANSACTIONS AND RAINBOW MEDIA SEPARATION
On March 4, 1998, Cablevision completed transactions ("TCI NY/NJ
Transactions") with TCI under which Cablevision acquired cable television
systems owned and operated by TCI and located in New Jersey, on Long Island, and
in New York's Rockland, Orange and Westchester counties (the "Contributed
Business Subsidiaries") and assumed related liabilities.
On April 5, 1999, Cablevision contributed the Contributed Business
Subsidiaries to CSC Holdings in a transaction accounted for in a manner similar
to a pooling of interests, whereby the assets and liabilities of the Contributed
Business Subsidiaries were recorded at historical book value. The Contributed
Business Subsidiaries served an aggregate of about 847,000 subscribers as of
March 31, 1999. The total assets and liabilities of the Contributed Business
Subsidiaries at March 31, 1999 amounted to $1.1 billion and $635 million,
respectively. For the three months ended March 31, 1999, the Contributed
Business Subsidiaries had net revenues of $117 million and a net loss of $9
million.
After the completion of the contribution of the Contributed Business
Subsidiaries, under our existing debt instruments we are permitted to establish
Rainbow Media as a separate subsidiary of Cablevision. If we effect this
transaction, Rainbow Media and its subsidiaries would be subsidiaries of
Cablevision and would no longer be our subsidiaries. We have not made a final
decision as to whether we will separate Rainbow Media. Any full or partial
separation of Rainbow Media also depends on compliance with our debt covenants
and on the receipt of regulatory and other approvals.
The following charts summarize the corporate organization structure of
Cablevision and CSC Holdings immediately after the combination of the
Contributed Business Subsidiaries with CSC Holdings and immediately after a
Rainbow Media separation. We have not decided yet whether the Rainbow Media
separation will be effected.
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[GRAPHIC OMITTED]
- -----------
* CSC Holdings and its Restricted Subsidiaries together constitute the
Restricted Group
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PROPOSED AT&T CT TRANSACTIONS
On January 27, 1998, we entered into a non-binding letter of intent with
Cablevision and TCI, which is now part of AT&T Corp., for either Cablevision or
us to acquire AT&T's cable television systems (the "AT&T Connecticut Systems")
in and around Hartford, Vernon, Branford and Lakeville, Connecticut (the
"Proposed AT&T CT Transactions"). No definitive documentation has been executed
with respect to the Proposed AT&T CT Transactions and we cannot assure you that
the necessary documentation will be executed or that these transactions will be
completed on the proposed terms or at all.
In consideration for the AT&T Connecticut Systems, which have been valued
by the parties solely for the purposes of the non-binding letter of intent at
$380 million, in the Proposed AT&T CT Transactions we would:
o transfer to AT&T our cable television systems serving Kalamazoo,
Michigan, which served about 49,000 subscribers as of December 31, 1998
and have been valued by the parties solely for the purposes of the
non-binding letter of intent at $75 million,
o transfer to AT&T other cable television systems to be identified by
AT&T and purchased with about $25 million of funds provided by
Cablevision,
o issue shares of Cablevision's Class A common stock based on a $28.90
per share valuation and
o assume some indebtedness relating to the AT&T Connecticut Systems,
which is anticipated to total about $110 million.
If the proposed AT&T CT Transactions are completed, we anticipate that the
AT&T Connecticut Systems will be contributed by Cablevision to, and held by
subsidiaries of, CSC Holdings.
The closing of the Proposed AT&T CT Transactions will be conditioned, among
other things, on the expiration or termination of the waiting period under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976 and other regulatory and
other customary approvals. We cannot assure you that definitive agreements will
be completed, that the Hart-Scott-Rodino Act waiting period will expire or be
terminated in a timely fashion, that other approvals will be obtained in a
timely manner or at all or that governmental agencies or others will not take
legal action to prevent the consummation of the Proposed AT&T CT Transactions.
PROPOSED JOINT VENTURE TO BUILD NEW JERSEY SPORTS ARENA AND RETAIL AND SHOPPING
COMPLEX
In May 1999, CSC Holdings and the New Jersey Devils professional hockey
team entered into a non-binding letter of intent to form a joint venture to
develop a hockey arena and an adjacent entertainment and shopping complex in
Hoboken, New Jersey.
No definitive documentation has been executed with respect to the proposed
New Jersey arena and entertainment and shopping complex and we cannot assure you
that the necessary documentation
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<PAGE>
will be executed or that this transaction will be completed. We also have not
determined whether CSC Holdings and its subsidiaries will be involved in the
transaction if the transaction is completed.
THE EXCHANGE OFFER
WHY WE ARE OFFERING TO EXCHANGE YOUR OLD NOTES FOR NEW NOTES
We originally sold the outstanding 8 1/8% Senior Notes due 2009 on July 13,
1999, in a transaction exempt from the registration requirements of the
Securities Act. Bear, Stearns & Co. Inc., Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Donaldson, Lufkin & Jenrette Securities Corporation, Goldman,
Sachs & Co., Morgan Stanley & Co. Incorporated and Salomon Smith Barney Inc., as
the initial purchasers, then resold the notes to qualified institutional buyers
under Rule 144A and to persons in offshore transactions under Regulation S under
the Securities Act. As of the date of this document, $500 million aggregate
principal amount of old notes is outstanding.
As a condition to the initial sale of the old notes, we entered into a
registration rights agreement with the initial purchasers under which we agreed
that we would, at our own cost:
(1) file an exchange offer registration statement under the Securities Act
with the SEC by September 10, 1999
and
---
(2) use our reasonable best efforts to:
o cause the exchange offer registration statement to be declared
effective under the Securities Act by January 9, 2000,
and
---
o keep the exchange offer open for no less than 30 days,
and
---
o complete the exchange 30-40 days after notice of the exchange is
mailed to holders of old notes.
We agreed to issue and exchange the new notes for all old notes
tendered and not withdrawn before the exchange offer expires.
THE SUMMARY IN THIS DOCUMENT OF THE REGISTRATION RIGHTS AGREEMENT IS NOT
COMPLETE AND IS SUBJECT TO, AND IS QUALIFIED IN ITS ENTIRETY BY, ALL THE
PROVISIONS OF THE REGISTRATION RIGHTS AGREEMENT. WE URGE YOU TO READ THE ENTIRE
REGISTRATION RIGHTS AGREEMENT CAREFULLY.
We filed a copy of the registration rights agreement as an exhibit to the
registration statement of which this document is a part. We intend to satisfy
some of our obligations under the registration rights agreement with the
registration statement.
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<PAGE>
TERMS OF THE EXCHANGE OFFER
TIMING OF THE EXCHANGE OFFER. We are offering the new notes in exchange for
your old notes. We will keep the exchange offer open for at least 30 days, or
longer if required by applicable law, after the date notice of the exchange
offer is mailed to the holders of the old notes.
YOU MAY TENDER YOUR OLD NOTES ONLY IN MULTIPLES OF $1,000. On the
terms and subject to the conditions in this document and in the accompanying
letter of transmittal, we will accept any and all old notes validly tendered and
not withdrawn before 5:00 p.m., New York City time, on [EXCHANGE DATE]. We will
issue $1,000 principal amount of new notes in exchange for each $1,000 principal
amount of outstanding old notes accepted in the exchange offer. You may tender
some or all of your old notes under the exchange offer. However, you may tender
old notes only in multiples of $1,000.
FORM AND TERMS OF THE NEW NOTES. The form and terms of the new notes will
be the same as the form and terms of the old notes except that:
o the new notes will have a different CUSIP number from the old notes,
o the new notes will be registered under the Securities Act and will not
have legends restricting their transfer,
o the new notes will not contain terms providing for payment of
liquidated damages under circumstances relating to the timing of the
exchange offer, as described under "Liquidated Damages" below and
o holders of the new notes will not be entitled to any registration
rights under the registration rights agreement because these rights
will terminate when the exchange offer is completed.
The new notes will evidence the same debt as the old notes and will be
issued under, and be entitled to the benefits of, the indenture governing the
old notes. We will treat both series of notes as a single class of debt
securities under the indenture.
WHO WILL RECEIVE THIS DOCUMENT. We will mail this document and the letter
of transmittal to all registered holders of the old notes as of [RECORD DATE].
NO APPRAISAL OR DISSENTERS' RIGHTS. In connection with the exchange offer,
you do not have any appraisal or dissenters' rights under the General
Corporation Law of the State of Delaware or the indenture governing the old
notes. We intend to conduct the exchange offer in accordance with the
registration rights agreement and the applicable requirements of the Securities
Exchange Act of 1934 and the rules and regulations of the SEC related to
exchange offers.
ACCEPTANCE OF TENDERED OLD NOTES. We will be deemed to have accepted
validly tendered old notes when, as and if we have given oral or written notice
of acceptance to The Bank of New York, as the exchange agent for the exchange
offer. The exchange agent will act as agent for the tendering holders for the
purpose of receiving the new notes from us.
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<PAGE>
If we do not accept your old notes tendered for exchange because you:
o invalidly tendered your old notes
or
--
o some other events specified in this document have occurred
or
--
o you submitted your old notes for a greater principal amount than you
wanted to exchange,
we will return the certificates for the unaccepted old notes, without expense,
to you. If you tender old notes by book-entry transfer in the exchange agent
account at The Depository Trust Company in accordance with the book-entry
transfer procedures described below, any non-exchanged old notes will be
credited to an account maintained with The Depositary Trust Company as soon as
possible after the expiration date of the exchange offer.
EXPIRATION DATE
The exchange offer will expire at 5:00 p.m., New York City time, on [DATE],
1999, unless we extend the exchange offer in our sole discretion. If we extend
the exchange offer, the expiration date is the latest date and time to which we
extend the exchange offer.
WE CAN AMEND OR EXTEND THE EXCHANGE OFFER
We can extend the exchange offer. To do so we must:
o notify the exchange agent of any extension either orally or in writing
and
---
o make an announcement of the extension before 9:00 a.m., New York City
time, on the next business day after the previous date the exchange
offer was scheduled to expire.
We also reserve the right to:
o delay accepting any old notes
or
--
o terminate the exchange offer and refuse to accept any old notes not
previously accepted if any of the conditions described below under "How
to Tender Your Old Notes--Conditions" shall have occurred and we have
not waived them.
If we delay, extend or terminate the exchange offer we must give oral or written
notice to the exchange agent.
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<PAGE>
We may also amend the terms of the exchange offer in any way we determine
is advantageous to holders of the old notes. If this change is material, we will
promptly disclose that amendment in a manner reasonably calculated to inform
holders of the old notes.
We do not have to publish, advertise, or otherwise communicate any public
announcement of any delay, extension, amendment or termination that we may
choose to make, other than by making a timely release to the Dow Jones News
Service.
INTEREST ON THE NEW NOTES
Interest is payable on the old notes, and will be payable on the new notes,
on January 15 and July 15 of each year. The new notes will accrue interest on
the same terms as the old notes, at the rate of 8 1/8% per year from July 13,
1999, the date we issued the old notes. If you hold old notes and they are
accepted for exchange you will waive your right to receive any payment in
respect of interest on your old notes accrued from July 13, 1999 to the date the
new notes are issued. Thus, if you exchange your old notes for new notes you
will receive the same interest payment on January 15, 2000, which is the first
interest payment date with respect to the old notes and the new notes, that you
would have received had you not accepted the exchange offer.
RESALE OF THE NEW NOTES
We believe that you will be allowed to resell the new notes to the public
without registration under the Securities Act, and without delivering a
prospectus that satisfies the requirements of the Securities Act, if you can
make the representations set forth in the letter of transmittal, described in
"How To Tender Your Old Notes--Representations on Tendering Old Notes". If you
intend to participate in a distribution of the new notes, however, you must
comply with the registration requirements of the Securities Act and deliver a
prospectus, unless an exemption from registration is otherwise available. In
addition, you cannot be an "affiliate" of CSC Holdings as defined in Rule 405
under the Securities Act. You must represent to us in the letter of transmittal
accompanying this document that you meet these conditions exempting you from the
registration requirements.
We base our view on interpretations by the staff of the SEC in no-action
letters issued to other issuers in exchange offers like ours. We have not,
however, asked the SEC to consider this particular exchange offer in the context
of a no-action letter. Therefore, you cannot be sure that the SEC will treat
this exchange offer in the same way it has treated other exchange offers in the
past. If our belief is wrong, you could incur liability under the Securities
Act. We will not protect you against any loss incurred as a result of this
liability under the Securities Act.
A broker-dealer that has bought old notes for market-making or other
trading activities must deliver a prospectus in order to resell any new notes it
has received for its own account in the exchange. A broker-dealer may use this
prospectus to resell any of its new notes. We agreed in the registration rights
agreement to make this prospectus, and any amendment or supplement to this
prospectus, available to any broker-dealer that requests copies until 90 days
after the last exchange date. See "Plan of Distribution" below for more
information regarding broker-dealers.
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<PAGE>
SHELF REGISTRATION STATEMENT
We will file a shelf registration statement with the SEC if:
(1) applicable law or SEC policy does not permit the exchange offer
or
--
(2) the exchange offer is not completed by January 9, 2000.
The shelf registration statement will register the old notes for public
resale. We will use our best efforts to cause the shelf registration statement
to become effective and to keep the shelf registration statement effective until
July 13, 2001.
LIQUIDATED DAMAGES
We will have to pay higher annual interest rates on the notes if:
o we do not file the exchange offer registration statement
by September 10, 1999
or
--
o the exchange offer is not completed by January 9, 2000
or
--
o the shelf registration statement is not declared effective by
January 9, 2000
The interest rates will increase as follows:
MAXIMUM
INTEREST RATE
EVENT INTEREST RATE INCREASE INCREASE
The exchange offer registration o 1/4% per year each day for 1% per year
statement is not filed by the first 30 days after
September 10, 1999 September 10, 1999 that the
exchange offer registration
statement is not filed
o An additional 1/4% per year
each day at the beginning of
each subsequent 30-day period
that the exchange offer
registration statement is not
filed
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<PAGE>
The exchange offer is not o 1/4% per year each day for the 1% per year
completed by January 9, 2000 first 180 days after January 9,
2000 that the exchange offer
is not completed
o An additional 1/4% per year
each day at the beginning of
each subsequent 90-day period
that the exchange offer is not
completed
The shelf registration statement o 1/4% per year each day for the 1% per year
is not declared effective by first 180 days after January 9,
January 9, 2000 2000 that the shelf
registration statement is not
declared effective
o An additional 1/4% per year
each day at the beginning of
each subsequent 90-day period
that the shelf registration
statement is not declared
effective
The interest rate will be reduced to the original rate once we:
o file the exchange offer registration statement
or
--
o complete the exchange offer
or
--
o the shelf registration statement is declared effective.
HOW TO TENDER YOUR OLD NOTES
PROCEDURES FOR TENDERING
To tender your old notes in the exchange offer, you must do the
following:
o properly complete, sign and date the letter of transmittal, or a
facsimile of the letter of transmittal,
o if the letter of transmittal so requires, have the signatures on the
letter of transmittal or facsimile of the letter of transmittal
guaranteed and
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<PAGE>
o mail or otherwise deliver the letter of transmittal, or facsimile,
together with your old notes and any other required documents, to the
exchange agent before 5:00 p.m., New York City time, on the expiration
date of the exchange offer.
In order for the tender to be effective, the exchange agent must receive
the old notes, a completed letter of transmittal and all other required
documents before 5:00 p.m., New York City time, on the expiration date.
You may also deliver your old notes by using the book-entry transfer
procedures described below. DTC authorizes its participants that hold old notes
on behalf of beneficial owners of old notes through DTC to tender their old
notes as if they were holders. To effect a tender of old notes, DTC participants
should:
o complete and sign the letter of transmittal, or a manually signed
facsimile of the letter,
o have the signature on the letter of transmittal or facsimile of the
letter of transmittal guaranteed if the instructions to the letter of
transmittal so require,
o mail or deliver the letter of transmittal, or the manually signed
facsimile, to the exchange agent according to the procedure described
under "--Procedures for Tendering" above and
o transmit their acceptance to DTC through its automated tender offer
program for which the transaction will be eligible and follow the
procedure for book-entry transfer described below under "--Book-Entry
Transfer".
YOU MUST FOLLOW ALL PROCEDURES TO EFFECT A VALID TENDER. DELIVERY OF
DOCUMENTS TO DTC IN ACCORDANCE WITH ITS PROCEDURES DOES NOT CONSTITUTE DELIVERY
TO THE EXCHANGE AGENT.
By tendering, you will make the representations described under the heading
"--Representations on Tendering Old Notes". In addition, each participating
broker-dealer must acknowledge that it will deliver a prospectus in connection
with any resale of the new notes. See "Plan of Distribution".
Your tender and our acceptance of the tender will constitute the agreement
between you and us set forth in this document and in the letter of transmittal.
YOU HAVE THE SOLE RISK OF THE METHOD YOU CHOOSE TO HAVE THE OLD NOTES AND
THE LETTER OF TRANSMITTAL AND ALL OTHER REQUIRED DOCUMENTS DELIVERED TO THE
EXCHANGE AGENT.
As an alternative to delivery by mail, holders may wish to consider
overnight or hand delivery service. IN ALL CASES, YOU SHOULD ALLOW SUFFICIENT
TIME TO ASSURE DELIVERY TO THE EXCHANGE AGENT BEFORE THE EXPIRATION DATE. No
letter of transmittal, old notes or book-entry confirmation should be sent to
us. Holders may request their respective brokers, dealers, commercial banks,
trust companies or nominees to effect the above transactions on their behalf.
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BENEFICIAL OWNERS
If you hold old notes and your old notes are registered in the name of a
broker-dealer, commercial bank, trust company or other nominee and you wish to
tender your old notes, you should contact the registered holder promptly and
instruct it to tender on your behalf. See "Instructions to Registered Holder
and/or Book-Entry Transfer Facility Participant from Beneficial Owner" included
with the letter of transmittal.
If you hold old notes that are registered as described above and you want
to tender on your own behalf, you must, before completing and executing the
letter of transmittal and delivering your old notes, either make appropriate
arrangements to register ownership of the old notes in your name or obtain a
properly completed bond power from the registered holder. The transfer of
registered ownership may take a long time.
SIGNATURES ON LETTER OF TRANSMITTAL
Generally, an eligible guarantor institution must guarantee signatures on a
letter of transmittal or a notice of withdrawal unless the old notes are
tendered:
o by a registered holder who has not completed the box entitled "Special
Issuance Instructions" or "Special Delivery Instructions" on the letter
of transmittal or
o for the account of an eligible guarantor institution.
An "eligible guarantor institution" is:
o a member firm of a registered national securities exchange or of the
National Association of Securities Dealers, Inc.,
o a commercial bank or trust company having an office or correspondent in
the U.S. or
o an "eligible guarantor institution" within the meaning of Rule 17Ad-15
under the Exchange Act which is a member of one of the recognized
signature guarantee programs identified in the letter of transmittal.
If a person other than the registered holder of any old notes listed in the
letter of transmittal signed the letter of transmittal, the old notes must be
endorsed or accompanied by a properly completed bond power. The bond power must
authorize this person to tender the old notes on behalf of the registered holder
and must be signed by the registered holder as the registered holder's name
appears on the old notes.
If trustees, executors, administrators, guardians, attorneys-in-fact,
officers of corporations or others acting in a fiduciary or representative
capacity sign the letter of transmittal or any old notes or bond powers, these
persons should so indicate when signing, and unless waived by us, submit with
the letter of transmittal evidence satisfactory to us of their authority to so
act.
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<PAGE>
BOOK-ENTRY TRANSFER
Within two business days after the date of this prospectus the exchange
agent will establish a new account or utilize an existing account with respect
to the old notes at the book-entry transfer facility, The Depository Trust
Company, for the purpose of facilitating the exchange offer. Subject to the
establishment of the accounts, any financial institution that is a participant
in DTC's system may make book-entry delivery of old notes by causing DTC to
transfer the old notes into the exchange agent's account with respect to the old
notes in accordance with DTC's procedures. Although delivery of the old notes
may be effected through book-entry transfer into the exchange agent's account at
DTC, the exchange agent must receive an appropriate letter of transmittal
properly completed and duly executed with any required signature guarantee or an
agent's message and all other required documents at its address listed below
under "--Exchange Agent" on or before the expiration date of the exchange offer,
or, if the guaranteed delivery procedures described below are complied with,
within the time period provided under those procedures.
DELIVERY OF DOCUMENTS TO DTC DOES NOT CONSTITUTE DELIVERY TO THE EXCHANGE AGENT
The term "agent's message" means a message transmitted by DTC to, and
received by, the exchange agent, which states that DTC has received an express
acknowledgment from the participant in DTC tendering the old notes stating:
o the aggregate principal amount of old notes which have been tendered by
the participant,
o that the participant has received, and agrees to be bound by, the terms
of the letter of transmittal and
o that we may enforce this agreement against the participant.
Delivery of an agent's message will also constitute an acknowledgment from
the tendering DTC participant that the representations contained in the letter
of transmittal and described below in this document are true and correct.
ACCEPTANCE OF TENDERED NOTES
We will determine, in our sole discretion, all questions as to the
validity, form, acceptance, withdrawal and eligibility, including time of
receipt, of tendered old notes. We reserve the absolute right:
o to reject any and all old notes not properly tendered,
o to reject any old notes if our acceptance would, in the opinion of our
counsel, be unlawful and
o to waive any irregularities or conditions of tender as to particular
old notes.
Our interpretation of the terms and conditions of the exchange offer,
including the instructions in the letter of transmittal, will be final and
binding on all parties.
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<PAGE>
Unless waived, you must cure any defects or irregularities in connection
with tenders of old notes within a period of time that we will determine.
Neither we, nor the exchange agent, nor any other person will be liable for
failure to give notice of any defect or irregularity with respect to any tender
of old notes. We will not deem a tender of an old note to have been made until
the defects or irregularities mentioned above have been cured or waived.
The exchange agent will return to the tendering holders any old notes
received by the exchange agent that are not properly tendered and as to which
the defects or irregularities have not been cured or waived, unless otherwise
provided in the letter of transmittal, as soon as practicable after the exchange
offer expires.
REPRESENTATIONS ON TENDERING OLD NOTES
By surrendering old notes in the exchange offer, you will be telling us
that, among other things:
o you are acquiring the new notes issued in the exchange offer in the
ordinary course of your business,
o you are not an "affiliate", as defined in Rule 405 under the Securities
Act, of CSC Holdings,
o you are not participating, do not intend to participate, and have
no arrangement or understanding with any person to participate, in the
distribution of the new notes issued to you in the exchange offer,
o you have full power and authority to tender, sell, assign and transfer
the old notes tendered,
o we will acquire good, marketable and unencumbered title to the old
notes being tendered, free and clear of all security interests, liens,
restrictions, charges, encumbrances, conditional sale agreements or
other obligations relating to their sale or transfer, and not subject
to any adverse claim when the old notes are accepted by us and
o you acknowledge and agree that if you are a broker-dealer registered
under the Exchange Act or you are participating in the exchange offer
for the purposes of distributing the new notes, you must comply with
the registration and prospectus delivery requirements of the Securities
Act in connection with a secondary resale of the new notes, and you
cannot rely on the position of the SEC's staff in their no-action
letters.
If you are a broker-dealer and you will receive new notes for your own
account in exchange for old notes that were acquired as a result of
market-making activities or other trading activities, you will be required to
acknowledge in the letter of transmittal that you will deliver a prospectus in
connection with any resale of the new notes.
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GUARANTEED DELIVERY PROCEDURES
If you wish to tender your old notes and:
o you cannot deliver your old notes, the letter of transmittal or any
other required documents to the exchange agent before the expiration
date,
o you cannot complete the procedure for book-entry transfer before the
expiration date or
o your old notes are not immediately available in order for you to meet
the expiration date deadline,
then you may participate in the exchange offer if:
(1) the tender is made through an eligible institution,
(2) before the expiration date, the exchange agent receives from the
eligible guarantor institution a properly completed and duly executed
notice of guaranteed delivery, substantially in the form provided by
us, by facsimile transmission, mail or hand delivery, containing:
o the name and address of the holder of the old notes, the
certificate number or numbers of the old notes and the principal
amount of old notes tendered,
o a statement that the tender is being made thereby and
o a guarantee that, within five business days after the expiration
date, the eligible guarantor institution will deposit the letter
of transmittal or facsimiles of the letter of transmittal,
together with the certificate or certificates representing the old
notes in proper form for transfer or an agent's message and a
confirmation of book-entry transfer of the old notes into the
exchange agent's account at DTC, and any other documents required
by the letter of transmittal will be deposited by the eligible
guarantor institution with the exchange agent and
(3) the exchange agent receives, within five business days
after the expiration date
o a properly completed and executed letter of transmittal or
facsimile or an agent's message in the case of a book-entry
transfer,
o the certificate or certificates representing all tendered old
notes in proper form for transfer or a confirmation of book-entry
transfer of the old notes into the exchange agent's account at the
book-entry transfer facility and
o all other documents required by the letter of transmittal.
WITHDRAWAL OF TENDERS
Except as otherwise provided in this document, you may withdraw your tender
of old notes at any time before 5:00 p.m., New York City time, on the date the
exchange offer expires.
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To withdraw a tender of old notes in the exchange offer, the exchange agent
must receive a letter or facsimile notice of withdrawal at its address set forth
below under "--Exchange Agent" before 5:00 p.m., New York City time, on the
expiration date. Any notice of withdrawal must:
o specify the name of the person who deposited the old notes to be
withdrawn,
o identify the old notes to be withdrawn including the certificate number
or numbers and aggregate principal amount of old notes to be withdrawn
or, in the case of old notes transferred by book-entry transfer, the
name and number of the account at DTC to be credited and otherwise
comply with the procedures of the transfer agent,
o be signed by the holder in the same manner as the original signature on
the letter of transmittal by which the old notes were tendered,
including any required signature guarantees, or be accompanied by
documents of transfer sufficient to have the trustee under the
indenture governing the old notes register the transfer of the old
notes into the name of the person withdrawing the tender and
o specify the name in which the old notes being withdrawn are to be
registered, if different from that of the person who deposited the
notes.
We will determine in our sole discretion all questions as to the validity,
form and eligibility, including time of receipt, of notices of withdrawal. Our
determination will be final and binding on all parties. Any old notes withdrawn
in this manner will be deemed not to have been validly tendered for purposes of
the exchange offer. We will not issue new notes unless the old notes withdrawn
in this manner are validly retendered. We will return to you any old notes that
you have tendered but that we have not accepted for exchange without cost as
soon as practicable after withdrawal, rejection of tender or termination of the
exchange offer. You may retender properly withdrawn old notes by following one
of the procedures described above under "--Procedures for Tendering" at any time
before the expiration date.
CONDITIONS
Despite any other term of the exchange offer, we will not be required to
accept for exchange, or exchange new notes for, any old notes and we may
terminate the exchange offer as provided in this document before the old notes
are accepted, if:
o any action or proceeding is instituted or threatened in any court or by
or before any governmental agency with respect to the exchange offer
which, in our reasonable judgment, might materially impair our ability
to proceed with the exchange offer
or
--
o any law, statute, rule or regulation is proposed, adopted or enacted,
or the staff of the SEC interprets any existing law, statute, rule or
regulation in a manner, which, in our reasonable judgment, might
materially impair our ability to proceed with the exchange offer
or
--
o we deem it advisable to terminate the exchange offer.
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The conditions listed above are for our sole benefit and we may assert
these rights regardless of the circumstances giving rise to any of these
conditions. We may waive these conditions in our reasonable discretion in whole
or in part at any time and from time to time. If we fail at any time to exercise
any of the above rights, the failure will not be deemed a waiver of those
rights, and those rights will be deemed ongoing rights which may be asserted at
any time and from time to time.
If we determine in our reasonable discretion that we may terminate the
exchange offer, we may:
o refuse to accept any old notes and return all tendered old notes to the
tendering holders
or
--
o extend the exchange offer and retain all old notes tendered before the
exchange offer expires, subject, however, to the rights of holders to
withdraw these old notes
or
--
o waive unsatisfied conditions with respect to the exchange offer and
accept all properly tendered old notes that have not been withdrawn. If
this waiver constitutes a material change to the exchange offer, we
will disclose this change by means of a prospectus supplement that will
be distributed to the registered holders of the old notes. If the
exchange offer would otherwise expire, we will extend the exchange
offer for 5-10 business days, depending on how significant the waiver
is and the manner of disclosure to registered holders.
EXCHANGE AGENT
We have appointed The Bank of New York as the exchange agent for the
exchange offer. You should direct any questions, requests for assistance and
requests for additional copies of this document or of the letter of transmittal
to The Bank of New York, as follows:
BY MAIL, HAND OR OVERNIGHT COURIER:
The Bank of New York
Corporate Trust Services Window
101 Barclay Street
New York, New York 10286
Attention: [NAME]
BY FACSIMILE:
(212) 571-3080
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CONFIRM BY TELEPHONE:
(212) 815-6333
The Bank of New York is also the trustee under the indenture governing the
notes.
FEES AND EXPENSES
We will pay the expenses of this exchange offer. We are making the
principal solicitation for tenders of old notes by mail. Our officers and
regular employees, however, may make additional solicitation by telegraph,
facsimile, e-mail, telephone or in person. We have not retained any
dealer-manager in connection with the exchange offer and will not make any
payments to brokers, dealers or others soliciting acceptances of the exchange
offer. We will, however, pay the exchange agent reasonable and customary fees
for its services and will reimburse it for its reasonable out-of-pocket expenses
in connection with providing the services. We may also reimburse brokerage
houses and other custodians, nominees and fiduciaries for their out-of-pocket
expenses incurred in forwarding copies of this document, letters of transmittal
and related documents to beneficial holders of the old notes.
We will pay any transfer taxes applicable to the exchange of old notes. If,
however, a transfer tax is imposed for any reason other than the exchange, then
the person surrendering the notes will pay the amount of any transfer taxes. If
you do not submit satisfactory evidence of payment of taxes or of an exemption
with the letter of transmittal, we will bill you directly for the amount of
those transfer taxes.
ACCOUNTING TREATMENT
We will record the new notes at the same carrying value as the old notes as
reflected in our accounting records on the date of exchange. Therefore, we will
not recognize a gain or loss for accounting purposes. We will amortize the
expenses of the exchange offer and the unamortized expenses related to the
issuance of the old notes over the term of the notes.
VOLUNTARY PARTICIPATION
YOU DO NOT HAVE TO PARTICIPATE IN THE EXCHANGE OFFER. You should carefully
consider whether to accept the terms and conditions of this offer. We urge you
to consult your financial and tax advisors in deciding what action to take with
respect to the exchange offer. See "Risk Factors--Risk Factors Relating to the
Notes--If You Do Not Participate in the Exchange Offer, It May Be Harder for You
to Resell and Transfer Your Old Notes" for more information about the risks of
not participating in the exchange offer.
CONSEQUENCES OF FAILURE TO EXCHANGE
If you are eligible to participate in the exchange offer but do not tender
your old notes, you will not have any further registration rights and your old
notes will continue to be subject to transfer restrictions. Accordingly, you may
resell your old notes that are not exchanged only:
o to us, on redemption of notes or otherwise,
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o so long as the old notes are eligible for resale under Rule 144A under
the Securities Act, to a person whom you reasonably believe is a
"qualified institutional buyer" within the meaning of Rule 144A
purchasing for its own account or for the account of a qualified
institutional buyer in a transaction meeting the requirements of Rule
144A,
o in accordance with Rule 144 under the Securities Act or another
exemption from the registration requirements of the Securities Act,
o outside the U.S. to a foreign person in accordance with the
requirements of Regulation S under the Securities Act or
o under an effective registration statement under the Securities Act, in
each case in accordance with all other applicable securities laws.
REGULATORY APPROVALS
We do not have to comply with any federal or state regulatory requirements
and we do not have to obtain any approvals in connection with the exchange
offer.
DESCRIPTION OF THE NEW NOTES
We issued the old notes, and will issue the new notes, under the indenture,
dated as of July 1, 1999, between us and The Bank of New York, as trustee. The
following description of the material provisions of the indenture is only a
summary. It does not set out the indenture in its entirety. WE URGE YOU TO READ
THE INDENTURE BECAUSE IT, AND NOT THIS DESCRIPTION, DEFINES YOUR RIGHTS AS A
HOLDER OF THE NOTES.
In this section, the term "we" refers to CSC Holdings, Inc. and not to any
of the subsidiaries. The definitions of some capitalized terms used in the
following summary are set forth below under "Certain Definitions".
We will consider the old notes and the new notes collectively to be a
single class for all purposes under the indenture, including waivers,
amendments, redemptions and offers to purchase.
GENERAL
The new notes will mature on July 15, 2009, will be limited to $500,00,000
aggregate principal amount and will be our unsecured obligations. The new notes
will bear interest at the rate of 8 1/8% per year from July 13, 1999 or from the
most recent interest payment date to which interest has been paid. Interest is
payable semi-annually on January 15 and July 15 of each year, commencing January
15, 2000, to the person in whose name the note is registered at the close of
business on the January 1 and July 1, as the case may be, next preceding the
interest payment date.
Principal of and interest on the new notes will be payable, and the new
notes will be exchangeable and transferable, at our office or agency in The City
of New York, which initially will be the corporate trust office of the trustee
at 101 Barclay Street, 21st Floor, New York, New York 10286. The new notes will
be issued only in fully registered form without coupons, in denominations of
$1,000
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or any integral multiple thereof. No service charge will be made for any
registration of transfer or exchange of the new notes, except for any tax or
other governmental charge that may be imposed in connection therewith.
The indenture does not contain any provisions that limit our ability to
incur indebtedness or that give holders of the new notes protection in the event
of a highly leveraged or similar transaction, other than as described below
under "Certain Covenants--Limitation on Indebtedness".
OPTIONAL REDEMPTION
The new notes are not subject to redemption at our option before maturity.
SINKING FUND
The new notes will not be entitled to the benefits of a sinking fund.
RANKING
The old notes are, and the new notes will be, senior unsecured obligations
and will rank equally in right of payment with all of our other existing and
future unsubordinated indebtedness. All of our secured indebtedness will have a
prior claim with respect to the assets securing this indebtedness. The
liabilities, including trade payables, of our subsidiaries will have a prior
claim with respect to the assets of those subsidiaries. In that regard, some of
the subsidiaries in our Restricted Group have guaranteed our indebtedness under
our credit agreement, but these subsidiaries will not be guarantors of the new
notes.
As of March 31, 1999, after giving effect to the Contribution of the
Contributed Business Subsidiaries and the sale of the old notes and the
application of the estimated net proceeds from the sale of the old notes:
o we would have had $94 million in borrowings under our credit agreement,
$2,692 million of senior unsecured indebtedness, $1,048 million of
senior subordinated indebtedness and obligations and $10 million of
capitalized leases, other than guarantees of subsidiary debt discussed
below,
o subsidiaries in our Restricted Group would have had $923 million of
indebtedness and capitalized leases, in addition to the guarantees of
borrowings under our credit agreement and
o subsidiaries in our Unrestricted Group would have had $782 million of
indebtedness and capitalized leases.
We have guaranteed all of the indebtedness of subsidiaries in our
Restricted Group on a senior basis.
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CERTAIN DEFINITIONS
The following definitions apply to the indenture relating to the old notes
and the new notes. You should read the indenture for the full definition of all
these terms.
"Acquired Indebtedness" means Indebtedness of a person
o existing at the time the person is merged with or into CSC Holdings or
a subsidiary or becomes a subsidiary or
o assumed in connection with the acquisition of assets from the person.
"Affiliate" means, with respect to any specified person, any other person
directly or indirectly controlling or controlled by or under direct or indirect
common control with the specified person. For the purposes of this definition,
"control" when used with respect to any specified person means the power to
direct the management and policies of the person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise,
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Annualized Operating Cash Flow" means, for any period of three complete
consecutive calendar months, an amount equal to Operating Cash Flow for the
period multiplied by four.
"Average Life" means, at any date of determination with respect to any debt
security, the quotient obtained by dividing
(a) the sum of the products of (1) the number of years from the date of
determination to the dates of each successive scheduled principal
payment of the debt security and (2) the amount of the principal
payment by
(b) the sum of all the principal payments.
"Capitalized Lease Obligation" means any obligation of a person to pay rent
or other amounts under a lease with respect to any property, whether real,
personal or mixed, acquired or leased by the person and used in its business
that is required to be accounted for as a liability on the balance sheet of the
person in accordance with GAAP, and the amount of the Capitalized Lease
Obligation will be the amount so required to be accounted for as a liability.
"Cash Flow Ratio" means, as at any date, the ratio of
(a) the sum of the aggregate outstanding principal amount of all
Indebtedness of CSC Holdings and the Restricted Subsidiaries determined
on a consolidated basis but excluding all Interest Swap Obligations
entered into by CSC Holdings or any Restricted Subsidiary and one of
the lenders under our credit agreement outstanding on the date plus
(but without duplication of Indebtedness supported by letters of
credit) the aggregate undrawn face amount of all letters of credit
outstanding on the date to
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(b) Annualized Operating Cash Flow determined as at the last day of the
most recent month for which financial information is available.
"Consolidated Net Tangible Assets" of any person means, as of any date:
(a) all amounts that would be shown as assets on a consolidated balance
sheet of the person and its Restricted Subsidiaries prepared in
accordance with GAAP, less
(b) the amount thereof constituting goodwill and other intangible assets as
calculated in accordance with GAAP.
"Cumulative Cash Flow Credit" means the sum of:
o cumulative Operating Cash Flow during the period commencing on July 1,
1988 and ending on the last day of the most recent month preceding the
date of the proposed Restricted Payment for which financial information
is available or, if cumulative Operating Cash Flow for the period is
negative, minus the amount by which cumulative Operating Cash Flow is
less than zero plus
o the aggregate net proceeds received by CSC Holdings from the issuance
or sale, other than to a Restricted Subsidiary, of its capital stock,
other than Disqualified Stock, on or after January 1, 1992, plus
o the aggregate net proceeds received by CSC Holdings from the issuance
or sale, other than to a Restricted Subsidiary, of its capital stock,
other than Disqualified Stock, on or after January 1, 1992, on the
conversion of, or exchange for, indebtedness of CSC Holdings or any
Restricted Subsidiary or from the exercise of any options, warrants or
other rights to acquire capital stock of CSC Holdings.
For purposes of this definition, the net proceeds in property other than
cash received by CSC Holdings as contemplated by the second two bullet points
above will be valued at the fair market value of the property, as determined by
our board of directors, whose good faith determination will be conclusive, at
the date of receipt by CSC Holdings.
"Cumulative Interest Expense" means, for the period commencing on July 1,
1988 and ending on the last day of the most recent month preceding the proposed
Restricted Payment for which financial information is available, the aggregate
of the interest expense of CSC Holdings and its Restricted Subsidiaries for the
period, determined on a consolidated basis in accordance with GAAP, including
interest expense attributable to Capitalized Lease Obligations.
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"Debt" with respect to any person means, without duplication, any
liability, whether or not contingent:
o in respect of borrowed money or evidenced by bonds, notes, debentures
or similar instruments or letters of credit, or reimbursement
agreements with respect thereto, but excluding reimbursement
obligations under any surety bond,
o representing the balance deferred and unpaid of the purchase price of
any property, including under Capitalized Lease Obligations, except any
balance that constitutes a trade payable,
o under Interest Swap Agreements, as defined in our credit agreement,
entered into under our credit agreement,
o under any other agreement related to the fixing of interest rates on
any Indebtedness, like an interest swap, or collar agreement, if and to
the extent any of the foregoing would appear as a liability on a
balance sheet of the person prepared on a consolidated basis in
accordance with GAAP, or
o guarantees of items of other persons which would be included within
this definition for other persons, whether or not the guarantee would
appear on the balance sheet.
"Debt" does not include:
o Disqualified Stock,
o any liability for federal, state, local or other taxes owed or owing by
the person or
o any accounts payable or other liability to trade creditors arising in
the ordinary course of business, including guarantees thereof or
instruments evidencing these liabilities.
"Disqualified Stock" means, with respect to the notes, any capital stock of
CSC Holdings or any Restricted Subsidiary which, by its terms, or by the terms
of any security into which it is convertible or for which it is exchangeable, or
on the happening of any event, matures or is mandatorily redeemable, under a
sinking fund obligation or otherwise, or is redeemable at the option of the
holder thereof, in whole or in part, on or before the maturity date of the
notes.
"Generally Accepted Accounting Principles"or "GAAP" means generally
accepted accounting principles in the U.S., consistently applied, which were in
effect as of August 21, 1997.
"Indebtedness" with respect to any person means the Debt of the person,
provided that, for purposes of the definition of "Indebtedness", including the
term "Debt" to the extent incorporated in the definition, and for purposes of
the definition of "Event of Default", the term "guarantee" will not be
interpreted to extend to a guarantee under which recourse is limited to the
capital stock of an entity that is not a Restricted Subsidiary.
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"Interest Swap Obligations" means, with respect to any person, the
obligations of the person under any arrangement with any other person whereby,
directly or indirectly, the person is entitled to receive from time to time
periodic payments calculated by applying either a floating or a fixed rate of
interest on a stated notional amount in exchange for periodic payments made by
the person calculated by applying a fixed or a floating rate of interest on the
same notional amount.
"Investment" means any advance, loan, account receivable, other than an
account receivable arising in the ordinary course of business, or other
extension of credit (excluding, however, accrued and unpaid interest in respect
of any advance, loan or other extension of credit) or any capital contribution
to (by means of transfers of property to others, payments for property or
services for the account or use of others, or otherwise), any purchase or
ownership of any stock, bonds, notes, debentures or other securities, including,
without limitation, any interests in any partnership or joint venture, of, or
any bank accounts with or guarantee of any Indebtedness or other obligations of,
any Unrestricted Subsidiary or Affiliate that is not a subsidiary of CSC
Holdings, provided that
o the term "Investment" will not include any transaction that would
otherwise constitute an Investment of CSC Holdings or a subsidiary of
CSC Holdings to the extent that the consideration provided by CSC
Holdings or the subsidiary in connection therewith consists of capital
stock of CSC Holdings, other than Disqualified Stock, and
o the term "guarantee" will not be interpreted to extend to a guarantee
under which recourse is limited to the capital stock of an entity that
is not a Restricted Subsidiary.
"Lien" means any lien, security interest, charge or encumbrance of any
kind, including any conditional sale or other title retention agreement, any
lease in the nature of a security interest and any agreement to give any
security interest. A person will be deemed to own subject to a Lien any property
which the person has acquired or holds subject to the interest of a vendor or
lessor under a conditional sale agreement, capital lease or other title
retention agreement.
"Mandatorily Redeemable Preferred Stock" means CSC Holdings' Series H
Redeemable Exchangeable Preferred Stock, Series M Redeemable Exchangeable
Preferred Stock and any series of preferred stock of CSC Holdings issued in
exchange for, or the proceeds of which are used to repurchase, redeem, defease
or otherwise acquire, all or any portion of the Series H Redeemable Exchangeable
Preferred Stock, Series M Redeemable Exchangeable Preferred Stock or any other
Mandatorily Redeemable Preferred Stock.
"Operating Cash Flow" means, for any period, the sum of the following for
CSC Holdings and the Restricted Subsidiaries for the period, determined on a
consolidated basis in accordance with GAAP, except for the amortization of
deferred installation income which will be excluded from the calculation of
Operating Cash Flow for all purposes of the indenture:
o aggregate operating revenues
minus
-----
o aggregate operating expenses, including technical, programming, sales,
selling, general and administrative expenses and salaries and other
compensation, net of amounts allocated to Affiliates, paid to any
general partner, director, officer or employee of CSC Holdings or any
Restricted Subsidiary, but excluding interest, depreciation and
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amortization and the amount of non-cash compensation in respect of CSC
Holdings' employee incentive stock programs for the period (not to
exceed in the aggregate for any calendar year 7% of the Operating Cash
Flow for the previous calendar year) and, to the extent otherwise
included in operating expenses, any losses resulting from a write-off
or write-down of Investments by CSC Holdings or any Restricted
Subsidiary in Affiliates.
For purposes of determining Operating Cash Flow, all management fees will be
excluded until actually paid to CSC Holdings or any Restricted Subsidiary in
cash.
"Permitted Liens" means the following types of Liens:
o Liens existing on the issuance date of the old notes,
o Liens on shares of the capital stock of an entity that is not a
Restricted Subsidiary, which Liens solely secure a guarantee by CSC
Holdings or a Restricted Subsidiary, or both, of Indebtedness of the
entity,
o Liens on Receivables and Related Assets, and proceeds thereof, securing
only Indebtedness otherwise permitted to be incurred by a
Securitization Subsidiary,
o Liens on shares of the capital stock of a subsidiary of CSC Holdings
securing Indebtedness under our credit agreement or any renewal of or
replacement of our credit agreement,
o Liens granted in favor of CSC Holdings or any Restricted Subsidiary,
o Liens securing the notes,
o Liens securing Acquired Indebtedness created before, and not in
connection with or in contemplation of, incurrence of the Indebtedness
by CSC Holdings or a Restricted Subsidiary; provided that the Lien does
not extend to any property or assets of CSC Holdings or any Restricted
Subsidiary other than the assets acquired in connection with the
incurrence of Acquired Indebtedness,
o Liens securing Interest Swap Obligations or "margin stock", as defined
in Regulations G and U of the Board of Governors of the Federal Reserve
System,
o statutory Liens of landlords and carriers, warehousemen, mechanics,
suppliers, materialmen, repairmen or other like liens arising in the
ordinary course of business of CSC Holdings or any Restricted
Subsidiary and with respect to amounts not yet delinquent or being
contested in good faith by appropriate proceedings,
o Liens for taxes, assessments, government charges or claims not yet due
or that are being contested in good faith by appropriate proceedings,
o zoning restrictions, easements, rights-of-way, restrictions and other
similar charges or encumbrances or minor defects in title not
interfering in any material respect with the business of CSC Holdings
or
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any of its Restricted Subsidiaries,
o Liens arising by reason of any judgment, decree or order of any court,
arbitral tribunal or similar entity so long as any appropriate legal
proceedings that may have been initiated for the review of the
judgment, decree or order have not been finally terminated or the
period within which the proceedings may be initiated has not expired,
o Liens incurred or deposits made in the ordinary course of business in
connection with workers' compensation, employment insurance and other
types of social security or similar legislation,
o Liens securing the performance of bids, tenders, leases, contracts,
franchises, public or statutory obligations, surety, stay or appeal
bonds, or other similar obligations arising in the ordinary course of
business,
o Leases under which CSC Holdings or any Restricted Subsidiary is the
lessee or the lessor,
o purchase money mortgages or other purchase money liens, including
without limitation any Capital Lease Obligations, on any fixed or
capital assets acquired after the issuance date of these securities, or
purchase money mortgages, including without limitation Capitalized
Lease Obligations, on any like assets hereafter acquired or existing at
the time of acquisition of these assets, whether or not assumed, so
long as (1) the mortgage or lien does not extend to or cover any other
asset of CSC Holdings or any Restricted Subsidiary and (2) the mortgage
or lien secures the obligation to pay the purchase price of the asset,
interest thereon and other charges incurred in connection therewith, or
the obligation under the Capitalized Lease Obligation, only,
o Liens securing reimbursement obligations with respect to commercial
letters of credit which encumber documents and other property relating
to the letters of credit and products and proceeds thereof,
o Liens encumbering deposits made to secure obligations arising from
statutory, regulatory, contractual or warranty requirements of CSC
Holdings or any of its Restricted Subsidiaries, including rights of
offset and set-off,
o Liens to secure other Indebtedness; provided, however, that the
principal amount of any Indebtedness secured by the Liens, together
with the principal amount of any Indebtedness refinancing any
Indebtedness incurred under this clause as permitted by the immediately
following clause, and successive refinancings thereof, may not exceed
15% of CSC Holdings' consolidated Net Tangible Assets as of the last
day of CSC Holdings' most recently completed fiscal year for which
financial information
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is available, and
o any extension, renewal or replacement, in whole or in part, of any Lien
described in the immediately preceding clauses; provided that any
extension, renewal or replacement is no more restrictive in any
material respect than the Lien so extended, renewed or replaced and
does not extend to any additional property or assets.
"Receivables and Related Assets" means:
o accounts receivable, instruments, chattel paper, obligations, general
intangibles, equipment and other similar assets, including interests in
merchandise or goods, the sale or lease of which gives rise to the
foregoing, related contractual rights, guarantees, insurance proceeds,
collections and other related assets,
o equipment,
o inventory, and
o proceeds of all of the above.
"Refinancing Indebtedness" means, with respect to the notes, Indebtedness
of CSC Holdings incurred to redeem, repurchase, defease or otherwise acquire or
retire for value other Indebtedness that is subordinate in right of payment to
the notes, so long as any new Indebtedness
(1) is made subordinate to these securities at least to the same extent as
the Indebtedness being refinanced and
(2) does not
(a) have an Average Life less than the Average Life of the
Indebtedness being refinanced,
(b) have a final scheduled maturity earlier than the final scheduled
maturity of the Indebtedness being refinanced or
(c) permit redemption at the option of the holder earlier than the
earlier of (A) the final scheduled maturity of the Indebtedness
being refinanced or (B) any date of redemption at the option of
the holder of the Indebtedness being refinanced.
"Restricted Payment" means, with respect to the notes:
o any Stock Payment by CSC Holdings or a Restricted Subsidiary,
o any direct or indirect payment to redeem, purchase, defease or
otherwise acquire or retire for value, or permit any Restricted
Subsidiary to redeem, purchase, defease or otherwise acquire or retire
for value, before any scheduled maturity, scheduled repayment or
scheduled sinking fund payment, any Indebtedness of CSC Holdings that
is subordinate in right of payment to the notes; provided, however,
that, with respect to the notes, any
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direct or indirect payment to redeem, purchase, defease or otherwise
acquire or retire for value, or permit any Restricted Subsidiary to
redeem, repurchase, defease or otherwise acquire or retire for value,
before any scheduled maturity, scheduled repayment or scheduled sinking
fund payment, any Indebtedness that is subordinate in right of payment
to these securities will not be a Restricted Payment if either:
(1) after giving effect thereto, the ratio of the Senior Indebtedness
of CSC Holdings and the Restricted Subsidiaries to Annualized
Operating Cash Flow determined as of the last day of the most
recent month for which financial information is available is less
than or equal to 5 to 1 or
(2) the subordinate indebtedness is redeemed, purchased, defeased or
otherwise acquired or retired in exchange for, or out of, (a) the
proceeds of a sale, within one year before or 180 days after the
redemption, purchase, defeasance, acquisition or retirement, of
Refinancing Indebtedness or capital stock of CSC Holdings or
warrants, rights or options to acquire capital stock of CSC
Holdings or (b) any source of funds other than the incurrence of
Indebtedness, or
o any direct or indirect payment to redeem, purchase, defease or
otherwise acquire or retire for value any Qualified Stock at its
mandatory redemption date or other maturity date if and to the extent
that Indebtedness is incurred to finance the redemption, purchase,
defeasance or other acquisition or retirement; provided, however, that
the redemption, purchase, defeasance or other acquisition or retirement
of Mandatorily Redeemable Preferred Stock at its mandatory redemption
or other maturity date will not be a Restricted Payment if and to the
extent any Indebtedness incurred to finance all or a portion of the
purchase redemption price does not have a final scheduled maturity
date, or permit redemption at the option of the holder thereof, earlier
than the original scheduled maturity of the notes.
Notwithstanding the foregoing, Restricted Payments will not include:
o payments by any Restricted Subsidiary to CSC Holdings or any other
Restricted Subsidiary or
o any Investment or designation of a Restricted Subsidiary as an
Unrestricted Subsidiary permitted under the "Limitation on Investments
in Unrestricted Subsidiaries and Affiliates" covenant.
"Restricted Subsidiary" means any subsidiary of CSC Holdings, whether
existing on the date of the indenture or created subsequent thereto, designated
from time to time by CSC Holdings as a "Restricted Subsidiary"; provided,
however, that no subsidiary that is not a Securitization Subsidiary can be or
remain so designated unless (1) at least 67% of each of the total equity
interest and the voting control of the subsidiary is owned, directly or
indirectly, by CSC Holdings or another Restricted Subsidiary and (2) the
subsidiary is not restricted, under the terms of any loan agreement, note,
indenture or other evidence of indebtedness, from
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o paying dividends or making any distribution on the subsidiary's capital
stock or other equity securities or paying any Indebtedness owed to CSC
Holdings or to any Restricted Subsidiary,
o making any loans or advances to CSC Holdings or any Restricted
Subsidiary or
o transferring any of its properties or assets to CSC Holdings or any
Restricted Subsidiary
It being understood that a financial covenant any of the components of which are
directly impacted by the taking of the action, e.g. the payment of a dividend,
itself, like a minimum net worth test, would be deemed to be a restriction on
the foregoing actions, while a financial covenant none of the components of
which is directly impacted by the taking of the action, e.g., the payment of a
dividend, itself, like a debt to cash flow test, would not be deemed to be a
restriction on the foregoing actions and provided further that CSC Holdings may,
from time to time, redesignate any Restricted Subsidiary as an Unrestricted
Subsidiary in accordance with the provisions of the "Limitation on Investments
in Unrestricted Subsidiaries and Affiliates" covenant.
"Securitization Subsidiary" means a Restricted Subsidiary that is
established for the limited purpose of acquiring and financing Receivables and
Related Assets and engaging in activities ancillary thereto; provided that:
o no portion of the Indebtedness of a Securitization Subsidiary is
guaranteed by or is recourse to CSC Holdings or any other Restricted
Subsidiary, other than recourse for customary representations,
warranties, covenants and indemnities, none of which relates to the
collectibility of the Receivables and Related Assets, and
o none of CSC Holdings or any other Restricted Subsidiary has any
obligation to maintain or preserve the Securitization Subsidiary's
financial condition.
"Senior Indebtedness" means, with respect to the notes and any person, all
principal of, premium, if any, and interest, including interest accruing on or
after the filing of any petition in bankruptcy or for reorganization relating to
the person whether or not a claim for post filing interest is allowed in the
proceedings, with respect to all Indebtedness of the person; provided that
Senior Indebtedness will not include:
o any Indebtedness of the person that, by its terms or the terms of the
instrument creating or evidencing the indebtedness, is expressly
subordinate in right of payment to the notes,
o any guarantee of Indebtedness of any subsidiary of the person if
recourse against the guarantee is limited to the capital stock or other
equity interests of the subsidiary,
o any obligation of the person to any subsidiary of the person or, in the
case of a Restricted Subsidiary, to CSC Holdings or any other
subsidiary of CSC Holdings, or
o any Indebtedness of the person, and any accrued and unpaid interest in
respect thereof, which is subordinate or junior in any respect to any
other Indebtedness or other obligation of the person.
"Stock Payment" means, with respect to any person, the payment or
declaration of any dividend, either in cash or in property, except dividends
payable in common stock or common shares of capital stock of the person, or the
making by the person of any other distribution, on account of any shares of
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any class of its capital stock, now or hereafter outstanding, or the redemption,
purchase, retirement or other acquisition or retirement for value by the person,
directly or indirectly, of any shares of any class of its capital stock, now or
hereafter outstanding, other than the redemptions, purchase, defeasance or other
acquisition or retirement for value of any Disqualified Stock at its mandatory
redemption date or other maturity date.
"Unrestricted Subsidiary" means any subsidiary of CSC Holdings which is not
a Restricted Subsidiary.
CERTAIN COVENANTS
The indenture contains, among others, the following covenants:
Limitation on Indebtedness. The indenture provides that CSC Holdings will
not, and will not permit any Restricted Subsidiary to, directly or indirectly,
incur, create, issue, assume, guarantee or otherwise become liable for,
contingently or otherwise, or become responsible for the payment of,
contingently or otherwise, any Indebtedness, other than Indebtedness between or
among any of CSC Holdings and its Restricted Subsidiaries, unless, after giving
effect thereto, the Cash Flow Ratio is less than or equal to 9 to 1.
At March 31, 1999, after giving effect to the Contribution of the
Contributed Business Subsidiaries, the Cash Flow Ratio was 5.7 to 1.
Limitation on Restricted Payments. The indenture provides that CSC Holdings
will not, and will not permit any Restricted Subsidiary to, make any Restricted
Payment if (1) at the time of the proposed Restricted Payment, a Default or
Event of Default has occurred and is continuing or will occur as a consequence
of the Restricted Payment or (2) immediately after giving effect to the
Restricted Payment, the aggregate of all Restricted Payments that have been made
on or after July 1, 1988 would exceed the sum of:
(a) $25,000,000, plus
(b) an amount equal to the difference between (i) the Cumulative Cash Flow
Credit and (ii) 1.2 multiplied by Cumulative Interest Expense.
For purposes of this "Limitation on Restricted Payments" covenant, the
amount of any Restricted Payment, if other than cash, will be based on fair
market value as determined by our board of directors, whose good faith
determination will be conclusive.
The provisions above do not prevent: (1) the payment of any dividend within
60 days after the date of declaration thereof, if at the date of declaration the
payment complied with the above provisions, and (2) the retirement, redemption,
purchase, defeasance or other acquisition of any shares of CSC Holdings' capital
stock or warrants, rights or options to acquire capital stock of CSC Holdings,
in exchange for, or out of the proceeds of a sale, within one year before or 180
days after the retirement, redemption, purchase, defeasance or other
acquisition, of, other shares of CSC Holdings' capital stock or warrants, rights
or options to acquire capital stock of CSC Holdings.
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For purposes of determining the aggregate permissible amount of Restricted
Payments in accordance with clause (2) of the first paragraph of this covenant,
all amounts expended under clause (1) of this paragraph will be included and all
amounts expended or received under clause (2) of this paragraph will be
excluded; provided, however, that amounts paid under clause (1) of this
paragraph will be included only to the extent that the amounts were not
previously included in calculating Restricted Payments.
For the purposes of the provisions above, the net proceeds from the
issuance of shares of CSC Holdings' capital stock on conversion of Indebtedness
will be deemed to be an amount equal to the accreted value of the Indebtedness
on the date of the conversion and the additional consideration, if any, CSC
Holdings receives on the conversion, minus any cash payment on account of
fractional shares, the consideration, if in property other than cash, to be
determined by our board of directors, whose good faith determination will be
conclusive. If CSC Holdings makes a Restricted Payment which, at the time of the
making of the Restricted Payment, would be in CSC Holdings' good faith
determination permitted under the requirements of this covenant, the Restricted
Payment will be deemed to have been made in compliance with this covenant
notwithstanding any subsequent adjustments made in good faith to CSC Holdings'
financial statements affecting Cumulative Cash Flow Credit or Cumulative
Interest Expense for any period.
As of March 31, 1999, we are permitted to make Restricted Payments of about
$940 million. In accordance with the provisions set forth above, Cablevision's
Contribution of the Contributed Business Subsidiaries, which served about
847,000 subscribers as of March 31, 1999, to CSC Holdings on April 5, 1999,
described above under "Recent Developments", increased the amount of Restricted
Payments that we are permitted to make by the fair market value of the
Contributed Business Subsidiaries.
Limitation on Investments in Unrestricted Subsidiaries and Affiliates. The
indenture provides that CSC Holdings will not, and will not permit any
Restricted Subsidiary to, directly or indirectly,
(1) make any Investment or
(2) allow any Restricted Subsidiary to become an Unrestricted Subsidiary,
in each case unless (a) no Default or Event of Default has occurred and
is continuing or will occur as a consequence of the Investment or the
redesignation of a Restricted Subsidiary and (b) after giving effect
thereto, the Cash Flow Ratio is less than or equal to 9 to 1.
The preceding provisions of this covenant will not prohibit any renewal or
reclassification of any Investment existing on the date hereof or trade credit
extended on usual and customary terms in the ordinary course of business.
Transactions with Affiliates. The indenture provides that CSC Holdings will
not, and will not permit any of its subsidiaries to, sell, lease, transfer or
otherwise dispose of any of its properties or assets to or purchase any property
or assets from, or enter into any contract, agreement, understanding, loan,
advance or guarantee with, or for the benefit of, an affiliate of CSC Holdings
that is not a subsidiary of CSC Holdings, having a value, or for consideration
having a value, in excess of $10,000,000 individually or in the aggregate unless
our board of directors makes a good faith determination that the terms of the
transaction are, taken as a whole, no less favorable to CSC Holdings or the
subsidiary, as the case may be, than those which might be available in a
comparable transaction with an unrelated person. For
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purposes of clarification, this provision will not apply to Restricted Payments
permitted under "--Limitation on Restricted Payments".
Limitation on Liens. The indenture provides that CSC Holdings will not, and
will not permit any Restricted Subsidiary to, directly or indirectly, create,
incur, assume or suffer to exist any Lien of any kind, except for Permitted
Liens, on or with respect to any of its property or assets, whether owned at the
date of the indenture or thereafter acquired, or any income, profits or proceeds
therefrom, or assign or otherwise convey any right to receive income thereon,
unless:
o in the case of any Lien securing Indebtedness that is subordinated in
right of payment to the notes, the notes are secured by a Lien on the
property, assets or proceeds that is senior in priority to the Lien and
o in the case of any other Lien, the notes are equally and ratably
secured.
CONSOLIDATION, MERGER AND SALE OF ASSETS
CSC Holdings may not consolidate or merge with or into, or sell, assign,
transfer, lease, convey or otherwise dispose of all or substantially all of its
assets to, any person, unless:
o the person formed by or surviving any consolidation or merger, if other
than CSC Holdings, or to which the sale, assignment, transfer, lease,
conveyance or disposition is made is a corporation organized and
existing under the laws of the U.S., any state thereof or the District
of Columbia, and assumes by a supplemental indenture all of the
obligations of CSC Holdings under the notes and the indenture,
o immediately before and immediately after the transaction, and after
giving effect thereto, no Default or Event of Default has occurred and
is continuing, and
o immediately after the transaction, and after giving effect thereto, the
person formed by or surviving any consolidation or merger, or to which
the sale, assignment, transfer, lease or conveyance or disposition is
made, has a Cash Flow Ratio not in excess of 9 to 1.
EVENTS OF DEFAULT
The following are Events of Default under the indenture:
(1) default for 30 days in payment of interest on the notes,
(2) default in payment of principal of the notes at maturity, on
acceleration or otherwise,
(3) failure to comply with any other covenant or agreement of CSC Holdings,
continued for 60 days, or, with respect to some covenants or
agreements, 30 days, after written notice as provided in the indenture,
(4) default or defaults under any mortgage, indenture or instrument that
secures or evidences any Indebtedness for money borrowed or guaranteed
by CSC Holdings or a Restricted Subsidiary in an aggregate amount of
$10,000,000 or more, but excluding any Indebtedness for
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the deferred purchase price of property or services owed to the person
providing the property or services as to which CSC Holdings or the
Restricted Subsidiary is contesting its obligation to pay in good faith
and by proper proceedings and for which CSC Holdings or the Restricted
Subsidiary has established appropriate reserves, which result from the
failure to pay the Indebtedness at final maturity or which has resulted
in the acceleration of the Indebtedness,
(5) the entry of a final judgment or
final judgments for the payment of money by a court or courts of
competent jurisdiction against CSC Holdings or any Restricted
Subsidiary in an aggregate amount exceeding $10,000,000, which remain
undischarged and unbonded for a period, during which execution has not
been effectively stayed, of 60 days or as to which an enforcement
proceeding has been commenced by any creditor, and
(6) some events of bankruptcy, insolvency or reorganization.
If an Event of Default, other than as specified in (6) above, occurs and is
continuing, either the trustee or the holders of not less than 25% in aggregate
principal amount of the outstanding notes issued under the indenture, by written
notice to CSC Holdings, and to the Trustee if the notice is given by the
holders, may declare all the unpaid principal of and interest on the notes to be
due and payable as provided in the indenture. On a declaration of acceleration,
the principal and accrued interest will be due and payable ten days after
receipt by CSC Holdings of the written notice. No action on the part of the
trustee or any holder of the notes is required for the acceleration if an Event
of Default specified in (6) above has occurred and is continuing.
The holders of at least a majority in principal amount of the notes issued
under the indenture may rescind an acceleration and its consequences if
o all existing Events of Default, other than the nonpayment of principal
of or interest on the notes which have become due solely because of the
acceleration, have been cured or waived and
o the rescission would not conflict with any judgment or decree of a
court of competent jurisdiction.
A declaration of acceleration because of an Event of Default specified in
clause (4) of the preceding paragraph would be automatically annulled if the
Indebtedness referred to therein were discharged, or the holders thereof
rescinded their declaration of acceleration referred to therein, within 30 days
after the acceleration of the notes and no other Event of Default had occurred
and not been cured or waived during the period. The holders of a majority in
principal amount of the notes issued under the indenture also have the right to
waive some past defaults under the indenture.
No holder of any note issued under the indenture has any right to institute
any proceeding with respect to the notes, the indenture or for any remedy
thereunder, unless
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o the holder has previously given to the trustee written notice of a
continuing Event of Default under the indenture,
o the holders of at least 25% in principal amount of the outstanding
notes issued under the indenture have made written request and offered
reasonable indemnity to the trustee to institute the proceeding as the
trustee under the indenture, and
o the trustee has not received from the holders of a majority in
principal amount of the outstanding notes issued under the indenture a
direction inconsistent with the request and the trustee has failed to
institute the proceeding within 60 days after receipt of the notice.
These limitations do not apply, however, to a suit instituted by a holder of a
note for the enforcement of payment of the principal of or interest on the note
on or after the respective due dates expressed in the note.
During the existence of an Event of Default, the trustee is required to
exercise the rights and powers vested in it under the indenture and use the same
degree of care and skill in its exercise thereof as a prudent person would
exercise under the circumstances in the conduct of the person's own affairs.
Subject to the provisions of the indenture relating to the duties of the
trustee, in case an Event of Default has occurred and is continuing, the trustee
is not under any obligation to exercise any of its rights or powers under the
indenture at the request or direction of any of the holders unless the holders
have offered to the trustee reasonable security or indemnity.
Subject to the provisions for the indemnification of the trustee, the
holders of a majority in principal amount of the notes issued under the
indenture have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the trustee, or exercising any trust or
power conferred on the trustee under the indenture.
CSC Holdings is required to furnish to the trustee an annual statement as
to the performance by CSC Holdings of its obligations under the indenture and as
to any default in the performance.
DEFEASANCE
CSC Holdings at any time may terminate all of its obligations with respect
to the notes ("defeasance"), except for some obligations, including those
regarding the Defeasance Trust, as defined below, and obligations to register
the transfer or exchange of the notes, to replace mutilated, destroyed, lost or
stolen notes and to maintain agencies in respect of the notes. CSC Holdings may
also at any time terminate its obligations under the covenants set forth in the
indenture, which are described under "Certain Covenants" above, and any omission
to comply with the obligations will not constitute a Default or an Event of
Default with respect to the notes ("covenant defeasance").
In order to exercise either defeasance or covenant defeasance,
o CSC Holdings must irrevocably deposit in trust, for the benefit of the
holders, with the trustee money or U.S. government obligations, or a
combination thereof, in amounts as will be sufficient to pay the
principal of and premium, if any, and interest on the notes being
defeased to redemption or maturity (the "Defeasance Trust"),
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o CSC Holdings must deliver opinions of counsel to the effect that the
holders will not recognize income, gain or loss for federal income tax
purposes as a result of the defeasance or covenant defeasance and will
be subject to federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if the
defeasance or covenant defeasance had not occurred, in the case of
defeasance, the opinion must refer to and be based on a ruling of the
Internal Revenue Service or a change in applicable federal income tax
laws, and
o CSC Holdings must comply with some other conditions.
SATISFACTION AND DISCHARGE OF THE INDENTURE AND THE NOTES
The indenture will cease to be of further effect, except as to surviving
rights of registration of transfer or exchange of securities, as expressly
provided for in the indenture, as to all outstanding notes when either
o all notes theretofore authenticated and delivered, except lost, stolen
or destroyed notes which have been replaced or paid, have been
delivered to the trustee for cancellation and CSC Holdings has paid all
sums payable by it under the indenture or
o all notes not theretofore delivered to the trustee for cancellation (a)
have become due and payable, or (b) will become due and payable within
one year, and CSC Holdings has irrevocably deposited or caused to be
deposited with the trustee funds in an amount sufficient to pay the
entire indebtedness on the notes not theretofore delivered to the
trustee for cancellation, for principal and interest to the date of
deposit, if the notes are then due and payable, or to the maturity
date, and CSC Holdings has paid all other sums payable by it under the
indenture.
MODIFICATION AND WAIVER
Modifications and amendments of the indenture or the notes issued
thereunder may be made by CSC Holdings and the trustee with the consent of the
holders of not less than a majority in aggregate principal amount of the notes
issued thereunder; provided, however, that no modification or amendment may,
without the consent of the holder of each outstanding note issued thereunder,
o change the stated maturity of the principal of, or any installment of
interest on, any notes issued thereunder,
o reduce the principal amount of or interest on the notes issued
thereunder,
o change the coin or currency in which any note or the interest on any
note is payable,
o impair the right to institute suit for the enforcement of any payment
on or with respect to the notes issued thereunder after the stated
maturity,
o reduce the percentage in principal amount of outstanding notes and
registered notes necessary to waive compliance with some provisions of
the indenture or to waive some defaults, or
o modify any of the provisions relating to supplemental
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indentures requiring the consent of holders or relating to the waiver
of past defaults, except to increase the percentage of outstanding
securities required for the actions or to provide that some other
provisions of the indenture cannot be modified or waived without the
consent of the holder of each note affected by the provisions.
The holders of a majority in aggregate principal amount of the notes issued
under the indenture may waive compliance with some restrictive covenants and
provisions of the indenture.
REGARDING THE TRUSTEE
The Bank of New York is the trustee under the indenture and the indentures
relating to our existing senior indebtedness and senior subordinated
indebtedness. The Bank of New York is a party to some credit agreements with us
and our subsidiaries, including our credit agreement. The Bank of New York may
also maintain other banking arrangements with us in the ordinary course of
business.
BOOK-ENTRY DELIVERY AND FORM
The certificates representing the new notes will be issued in fully
registered form, without coupons. The new notes will be deposited with, or on
behalf of, The Depository Trust Company, New York, New York ("DTC"), and
registered in the name of Cede & Co., as DTC's nominee, in the form of a global
certificate.
MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS
The exchange of old notes for new notes will not be treated as a taxable
transaction for U.S. Federal income tax purposes because the terms of the new
notes will not be considered to differ materially in kind or in extent from the
terms of the old notes. Rather, the new notes you receive will be treated as a
continuation of your investment in the old notes. As a result, you will not have
any material U.S. Federal income tax consequences if you exchange your old notes
for new notes.
IF YOU ARE THINKING ABOUT EXCHANGING YOUR OLD NOTES FOR NEW NOTES, YOU SHOULD
CONSULT YOUR OWN TAX ADVISORS CONCERNING THE TAX CONSEQUENCES ARISING UNDER
STATE, LOCAL OR FOREIGN LAWS OF THE EXCHANGE.
PLAN OF DISTRIBUTION
If you want to participate in the exchange offer you must represent, among
other things, that:
o you are acquiring the new notes issued in the exchange offer in the
ordinary course of your business,
o you are not an "affiliate", as defined in Rule 405 under the Securities
Act, of CSC Holdings and
o you are not participating, do not intend to participate, and have
no arrangement or understanding with any person to participate, in a
distribution of the new notes issued in the exchange offer.
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If you are unable to make the above representations you are a "restricted
holder". A restricted holder will not be able to participate in the exchange
offer, and may only sell its old notes under a registration statement containing
the selling securityholder information required by Item 507 of Regulation S-K of
the Securities Act, or under an exemption from the registration requirement of
the Securities Act.
If you are a broker-dealer who holds old notes that were acquired for your
own account as a result of market-marking activities or other trading
activities, you may exchange old notes by the exchange offer. As a
broker-dealer, you may be deemed to be an "underwriter" within the meaning of
the Securities Act, and, consequently, must deliver a prospectus meeting the
requirements of the Securities Act in connection with any resales of the new
notes you receive in the exchange offer.
Each participating broker-dealer is required to acknowledge in the letter
of transmittal that it acquired the old notes as a result of market-making
activities or other trading activities and that it will deliver a prospectus in
connection with the resale of the new notes. We have agreed that, for a period
of up to 90 days after the last exchange date, we will use our best efforts to
o keep the exchange offer registration statement continuously effective,
supplemented and amended as required by the registration rights
agreement to the extent necessary to ensure that it is available for
resale of old notes acquired by broker-dealers for their own accounts
as a result of market-making activities or other trading activities,
o ensure that the exchange offer registration statement conforms with the
requirements of the registration rights agreement, the Securities Act
and the policies, rules and regulations of the SEC as announced from
time to time and
o make this prospectus available to participating broker-dealers for use
in connection with any resale.
During this period of time, delivery of this prospectus, as it may be amended or
supplemented, will satisfy the prospectus delivery requirements of a
participating broker-dealer engaged in market making or other trading
activities.
Based on interpretations by the staff of the SEC, we believe that new notes
issued by the exchange offer may be offered for resale, resold and otherwise
transferred by their holder, other than a participating broker-dealer, without
compliance with the registration and prospectus delivery requirements of the
Securities Act.
We will not receive any proceeds from any sale of new notes by
broker-dealers. New notes received by participating broker-dealers for their own
account under the exchange offer may be sold from time to time in one or more
transactions in the over-the-counter market,
o in negotiated transactions,
o through the writing of options on the new notes or
o a combination of methods of resale.
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The new notes may be sold from time to time:
o at market prices prevailing at the time of resale,
o at prices related to prevailing market prices or
o at negotiated prices.
Any resale may be made directly to purchasers or to or through brokers or
dealers who may receive compensation in the form of commissions or concessions
from any participating broker-dealer and/or the purchasers of any new notes.
Any participating broker-dealer that resells new notes received by it for
its own account under the exchange offer and any broker or dealer that
participates in a distribution of the new notes may be deemed to be an
"underwriter" within the meaning of the Securities Act. Any profit on any resale
of new notes and any commissions or concessions received by these persons may be
deemed to be underwriting compensation under the Securities Act. The letter of
transmittal states that by acknowledging that it will deliver and by delivering
a prospectus, a participating broker-dealer will not be deemed to admit that it
is an "underwriter" within the meaning of the Securities Act.
We have agreed to pay all expenses incidental to the exchange offer other
than commissions and concessions of any brokers or dealers and will indemnify
holders of the notes, including any broker-dealers, against some liabilities,
including liabilities under the Securities Act, as set forth in the registration
rights agreement.
VALIDITY OF THE NEW NOTES
The validity of the new notes will be passed on for us by Sullivan &
Cromwell, New York, New York.
EXPERTS
The consolidated financial statements and schedule of CSC Holdings and its
subsidiaries as of December 31, 1998 and 1997 and for each of the years in the
three-year period ended December 31, 1998 that are incorporated in this
registration statement by reference have been incorporated herein in reliance on
the report of KPMG LLP, independent certified public accountants, incorporated
by reference herein, in reliance upon said firm as experts in accounting and
auditing.
AVAILABLE INFORMATION
We are subject to the information requirements of the Securities Exchange
Act of 1934 and in accordance therewith file reports and other information with
the SEC. The reports and other information that we file with the SEC at Room
1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C 20549, and at the
following regional offices: Seven World Trade Center, Suite 1300, New York, New
York 10048, and Citicorp Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661 and copies of this material can be obtained from the Public
Reference Section of the SEC at Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates.
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Further information on the operation of the SEC's Public Reference Room in
Washington D.C. can be obtained by calling the SEC at 1-800-SEC-0330.
The SEC also maintains a Web site that contains reports, proxy statements
and other information about issuers, like CSC Holdings, who file electronically
with the SEC. The address of that site is http://www.sec.gov. These reports and
other information also may be inspected at the offices of the American Stock
Exchange, 86 Trinity Place, New York, New York 10006.
WHERE YOU CAN FIND MORE INFORMATION
We hereby incorporate by reference into this document the following
documents or information filed with the SEC:
CSC HOLDINGS COMMISSION FILINGS PERIOD COVERED OR DATE FILED
------------------------------- ----------------------------
(FILE NO. 001-09046)
Annual Report on Form 10-K, as amended Fiscal year ended December 31, 1998
by our Form 10-K/A (collectively, our
"Form 10-K")
Quarterly Report on Form 10-Q (our Fiscal quarter ended March 31, 1999
"March 31, 1999 Form 10-Q")
We also incorporate by reference into this document all documents we file
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of
1934 on or after the date of this offering made hereby.
We are delivering a copy of our Form 10-K and our March 31, 1999 Form 10-Q,
without exhibits thereto, with this document.
Any statement contained herein or in any document incorporated or deemed to
be incorporated by reference in this document will be deemed to be modified or
superseded for the purpose of this document to the extent that a subsequent
statement contained herein or in any subsequently filed document that also is or
is deemed to be incorporated by reference herein modifies or supersedes the
statement. Any statement so modified or superseded will not be deemed, except as
so modified or superseded, to constitute a part of this document.
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS DOCUMENT OR THAT
WE HAVE REFERRED YOU TO. WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH
INFORMATION THAT IS DIFFERENT. NEITHER THE MAKING OF THE EXCHANGE OFFER PURSUANT
TO THIS DOCUMENT NOR THE ACCEPTANCE OF OLD NOTES FOR TENDER OR EXCHANGE PURSUANT
THERETO SHALL UNDER ANY CIRCUMSTANCES CREATE ANY IMPLICATION THAT THERE HAS BEEN
NO CHANGE IN THE AFFAIRS OF CSC HOLDINGS, INC. SINCE THE DATE HEREOF OR THAT THE
INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE
HEREOF.
EACH BROKER-DEALER WHO HOLDS OLD NOTES ACQUIRED FOR ITS OWN ACCOUNT AS A
RESULT OF MARKET-MAKING OR OTHER TRADING ACTIVITIES AND WHO RECEIVES NEW NOTES
FOR ITS OWN ACCOUNT IN EXCHANGE FOR OLD NOTES PURSUANT TO THE EXCHANGE OFFER
MUST DELIVER A COPY OF THIS PROSPECTUS IN CONNECTION WITH ANY RESALE OF NEW
NOTES.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
has duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Bethpage, the State of
New York, on this 4th day of August, 1999.
CSC HOLDINGS, INC.
By: /s/ William J. Bell
-----------------------------------
Name: William J. Bell
Title: Vice Chairman
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints William J. Bell and Robert S. Lemle, and
each of them, his true and lawful attorneys-in-fact and agents, with full power
of substitution and resubstitution, for him in his name, place and stead, in any
and all capacities, to sign any and all amendments (including post-effective
amendments) to this registration statement, and file the same, with all exhibits
thereto and other documents in connection therewith, with the Commission,
granting unto said attorneys-in-fact and agents, full power and authority to do
and perform each and every act and thing requisite and necessary to be done as
fully to all intents and purposes as he might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents or any of
them may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed by the following persons in the
capacities indicated on August 4, 1999.
SIGNATURE TITLE
/s/ James L. Dolan
- ------------------------
James L. Dolan President, Chief Executive Officer and Director
(Principal Executive Officer)
/s/ William J. Bell
- ------------------------
William J. Bell Vice Chairman and Director
(Principal Financial Officer)
/s/ Andrew B. Rosengard
- ------------------------
Andrew B. Rosengard Executive Vice President, Finance and Controller
(Principal Accounting Officer)
/s/ Charles F. Dolan
- ------------------------
Charles F. Dolan Chairman of the Board of Directors
I-1
<PAGE>
/s/ Marc A. Lustgarten
- ------------------------
Marc A. Lustgarten Vice Chairman and Director
/s/ Robert S. Lemle
- ------------------------
Robert S. Lemle Executive Vice President, General Counsel,
Secretary and Director
/s/ Sheila A. Mahony
- ------------------------
Sheila A. Mahony Executive Vice President, Communications,
Government and Public Affairs and Director
/s/ Thomas C. Dolan
- ------------------------
Thomas C. Dolan Senior Vice President,
Chief Information Officer and Director
/s/ John Tatta
- ------------------------
John Tatta Director
/s/ Patrick F. Dolan
- ------------------------
Patrick F. Dolan Director
/s/ Charles D. Ferris
- ------------------------
Charles D. Ferris Director
/s/ Richard H. Hochman
- ------------------------
Richard H. Hochman Director
/s/ Victor Oristano
- ------------------------
Victor Oristano Director
/s/ Vincent Tese
- ------------------------
Vincent Tese Director
/s/ William Fitzgerald
- ------------------------
William Fitzgerald Director
/s/ Leo J. Hindery, Jr.
- ------------------------
Leo J. Hindery, Jr. Director
I-2
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporation Law provides that a
corporation may indemnify directors and officers as well as other employees and
individuals against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement in connection with specified actions, suits or
proceedings, whether civil, criminal, administrative or investigative (other
than an action by or in the right of the corporation--a "derivative action"), if
they acted in good faith and in a manner they reasonably believed to be in or
not opposed to the best interests of the corporation, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe their conduct
was unlawful. A similar standard is applicable in the case of derivative
actions, except that indemnification only extends to expenses (including
attorneys' fees) incurred in connection with defense or settlement of such
action, and the statute requires court approval before there can be any
indemnification where the person seeking indemnification has been found liable
to the corporation. The statute provides that it is not exclusive of other
rights to which those seeking indemnification may be entitled under any by-law,
agreement, vote of stockholders or disinterested directors or otherwise.
The first paragraph of Article Ninth of CSC Holdings's Amended and Restated
Certificate of Incorporation provides:
The corporation shall, to the fullest extent permitted by Section 145
of the General Corporation Law of the State of Delaware, as the same may be
amended and supplemented, or by any successor thereto, indemnify any and
all persons whom it shall have power to indemnify under said section from
and against any and all of the expenses, liabilities or other matters
referred to in or covered by said section. Such right to indemnification
shall continue as to a person who has ceased to be a director, officer,
employee or agent and shall inure to the benefit of the heirs, executors
and administrators of such a person. The indemnification provided for
herein shall not be deemed exclusive of any other rights to which those
seeking indemnification may be entitled under any By-Law, agreement, vote
of stockholders or disinterested directors or otherwise.
Article VIII of the By-Laws of CSC Holdings provides:
A. The corporation shall indemnify each person who was or is made a
party or is threatened to be made a party to or is involved in any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (hereinafter a "proceeding"), by
reason of the fact that he or she, or a person of whom he or she is the
legal representative, is or was a director or officer of the corporation or
is or was serving at the request of the corporation as a director, officer,
employee or agent of another corporation or of a partnership, joint
venture, trust or other enterprise, including service with respect to
employee benefit plans, whether the basis of such proceeding is alleged
action in an official capacity as a director, officer, employee or agent or
alleged action in any other capacity while serving as a director, officer,
employee or agent, to the maximum extent authorized by the Delaware General
II-1
<PAGE>
Corporation Law, as the same exists or may hereafter be amended (but, in
the case of any such amendment, only to the extent that such amendment
permits the corporation to provide broader indemnification rights than said
law permitted the corporation to provide before such amendment), against
all expense, liability and loss (including attorney's fees, judgments,
fines, ERISA excise taxes or penalties and amounts paid or to be paid in
settlement) reasonably incurred by such person in connection with such
proceeding. Such indemnification shall continue as to a person who has
ceased to be a director, officer, employee or agent and shall inure to the
benefit of his or her heirs, executors and administrators. The right to
indemnification conferred in this Article shall be a contract right and
shall include the right to be paid by the corporation the expenses incurred
in defending any such proceeding in advance of its final disposition,
provided that, if the Delaware General Corporation Law so requires, the
payment of such expenses incurred by a director or officer in advance of
the final disposition of a proceeding shall be made only on receipt by the
corporation of an undertaking by or on behalf of such person to repay all
amounts so advanced if it shall ultimately be determined that such person
is not entitled to be indemnified by the corporation as authorized in this
Article or otherwise.
B. The right to indemnification and advancement of expenses conferred
on any person by this Article shall not limit the corporation from
providing any other indemnification permitted by law nor shall it be deemed
exclusive of any other right which any such person may have or hereafter
acquire under any statute, provision of the Certificate of Incorporation,
by-law, agreement, vote of stockholders or disinterested directors or
otherwise.
C. The corporation may purchase and maintain insurance, at its expense,
to protect itself and any director, officer, employee or agent of the
corporation or another corporation, partnership, joint venture, or other
enterprise against any expense, liability or loss, whether or not the
corporation would have the power to indemnify such person against such
expense, liability or loss under the Delaware General Corporation Law.
CSC Holdings has entered into indemnification agreements with some of its
officers and directors indemnifying such officers and directors from and against
some expenses, liabilities or other matters referred to in or covered by Section
145 of the Delaware General Corporation Law. CSC Holdings has also entered into
an agreement with Charles F. Dolan ("Mr. Dolan"), the Chairman of CSC Holdings,
pursuant to which Mr. Dolan has agreed to guarantee CSC Holdings's obligation to
indemnify its officers and directors to the fullest extent permitted by Delaware
law. In addition, subject to some limitations, Mr. Dolan has agreed to indemnify
such officers and directors against any loss or expense such person may incur in
connection with any transaction involving Mr. Dolan or entities affiliated with
Mr. Dolan to the extent indemnification is not provided by CSC Holdings. Any
payment required to be made by Mr. Dolan pursuant to such agreement will be
reduced by any proceeds of insurance or reimbursement under any other form of
indemnification reimbursement available to such officer or director. CSC
Holdings maintains directors' and officers' liability insurance.
Section 102(b)(7) of the Delaware General Corporation Law permits a
corporation to provide in its certificate of incorporation that a director of
the corporation shall not be personally liable to the corporation or its
stockholders for monetary damages for breach of fiduciary duty as a director,
except for liability (1) for any breach of the director's duty of loyalty to the
corporation or its stockholders, (2) for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law, (3) for
payments of unlawful dividends or unlawful stock repurchases or redemptions, or
II-2
<PAGE>
(4) for any transaction from which the director derived an improper personal
benefit. The second paragraph of Article Ninth of CSC Holdings's Certificate of
Incorporation provides for such limitation of liability.
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(A) EXHIBITS
EXHIBITS DESCRIPTION
- -------- -----------
1.1 Purchase Agreement, dated July 8, 1999, between the Registrant and
Bear, Stearns & Co. Inc., Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Donaldson, Lufkin & Jenrette Securities Corporation,
Goldman, Sachs & Co., Morgan Stanley & Co. Incorporated and Salomon
Smith Barney Inc.*
3.1 Certificate of Incorporation of the Registrant.*
3.2 Bylaws of the Registrant (incorporated herein by reference to
Exhibit 3.20 to the Registrant's Registration Statement on Form S-4,
File No. 33-62717).
4.1 Registration Rights Agreement, dated July 13, 1999, between the
Registrant and Bear, Stearns & Co. Inc., Merrill Lynch, Pierce,
Fenner & Smith Incorporated, Donaldson, Lufkin & Jenrette Securities
Corporation, Goldman, Sachs & Co., Morgan Stanley & Co. Incorporated
and Salomon Smith Barney Inc.*
4.2 Indenture dated as of July 1, 1999, between the Company and The Bank
of New York, as trustee.*
4.3 Form of New Note (included in Exhibit 4.2).
5.1 Opinion of Sullivan & Cromwell regarding the validity of the 8 1/8%
Senior Notes being registered.**
8.1 Opinion of Sullivan & Cromwell regarding tax matters.**
12.1 Computation of Earnings to Fixed Charges.**
23.1 Consent of KPMG LLP.*
23.2 Consent of Sullivan & Cromwell (included in the opinions filed as
Exhibit 5.1 and Exhibit 8.1 hereto).**
24.1 Power of Attorney (included in the signature page attached hereto).*
25.1 Statement of Eligibility of the Trustee.**
99.1 Form of Letter of Transmittal.*
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<PAGE>
99.2 Form of Notice of Guaranteed Delivery.*
99.3 Form of Exchange Agent Agreement.*
- -------------------------------------
* Filed herewith.
** To be filed by amendment.
(B) FINANCIAL STATEMENT SCHEDULES
All other schedules for which provisions is made in the applicable
accounting regulation of the Securities and Exchange Commission are not required
or are inapplicable and therefore have been omitted, or the required information
has been incorporated by reference herein or disclosed in the financial
statements which form a part of this Proxy Statement/Prospectus.
ITEM 22. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(1) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the registrant's annual report pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (and,
where applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration statement
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
(2) That prior to any public reoffering of the securities registered
hereunder through use of a prospectus which is a part of this
registration statement, by any person or party who is deemed to be an
underwriter within the meaning of Rule 145(c), the issuer undertakes
that such reoffering prospectus will contain the information called for
by the applicable registration form with respect to reofferings by
persons who may be deemed underwriters, in addition to the information
called for by the other items of the applicable form.
(3) That every prospectus: (i) that is filed pursuant to paragraph (2)
immediately preceding, or (ii) that purports to meet the requirements
of Section 10(a)(3) of the Act and is used in connection with an
offering of securities subject to Rule 415, will be filed as a part of
an amendment to the registration statement and will not be used until
such amendment is effective, and that, for purposes of determining any
liability under the Securities Act of 1933, each such post-effective
amendment shall be deemed to be a new registration statement relating
to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
(4) The undersigned registrant hereby undertakes to deliver or cause to be
delivered with the prospectus, to each person to whom the prospectus is
sent or given, the latest annual
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<PAGE>
report, to security holders that is incorporated by reference in the
prospectus and furnished pursuant to and meeting the requirements of
Rule 14a-3 or Rule 14c-3 under the Securities Exchange Act of 1934;
and, where interim financial information required to be presented by
Article 3 of Regulation S-X is not set forth in the prospectus, to
deliver, or cause to be delivered to each person to whom the prospectus
is sent or given, the latest quarterly report that is specifically
incorporated by reference in the prospectus to provide such interim
financial information.
(5) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant, pursuant to the provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy
as expressed in the Securities Act of 1933 and is, therefore,
unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the
registrant in the successful defense of any action, suit or proceeding)
is asserted by any such director, officer or controlling person in
connection with the securities being registered, the registrant will,
unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction
the question of whether or not such indemnification is against public
policy as expressed in the Securities Act of 1933 and will be governed
by the final adjudication of such issue.
(6) To respond to requests for information that is incorporated by
reference into the prospectus pursuant to Item 4, 10(b), 11, or 13 of
this form, within one business day of receipt of such request, and to
send the incorporated documents by first class mail or other equally
prompt means. This includes information contained in documents filed
subsequent to the effective date of the registration statement through
the date of responding to the request.
II-5
<PAGE>
INDEX TO EXHIBITS
Certain of the following documents are filed herewith. Certain other of the
following documents have been previously filed with the Securities and Exchange
Commission and, pursuant to Rule 12b-32, are incorporated herein by reference.
EXHIBITS DESCRIPTION
- -------- -----------
1.1 Purchase Agreement, dated July 8, 1999, between the Registrant and
Bear, Stearns & Co. Inc., Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Donaldson, Lufkin & Jenrette Securities Corporation,
Goldman, Sachs & Co., Morgan Stanley & Co. Incorporated and Salomon
Smith Barney Inc.*
3.1 Certificate of Incorporation of the Registrant.*
3.2 Bylaws of the Registrant (incorporated herein by reference to
Exhibit 3.20 to the Registrant's Registration Statement on Form S-4,
File No. 33-62717).
4.1 Registration Rights Agreement, dated July 13, 1999, between the
Registrant and Bear, Stearns & Co. Inc., Merrill Lynch, Pierce,
Fenner & Smith Incorporated, Donaldson, Lufkin & Jenrette Securities
Corporation, Goldman, Sachs & Co., Morgan Stanley & Co. Incorporated
and Salomon Smith Barney Inc.*
4.2 Indenture dated as of July 1, 1999, between the Company and The Bank
of New York, as trustee.*
4.3 Form of New Note (included in Exhibit 4.2).
5.1 Opinion of Sullivan & Cromwell regarding the validity of the 8 1/8%
Senior Notes being registered.**
8.1 Opinion of Sullivan & Cromwell regarding tax matters.**
12.1 Computation of Earnings to Fixed Charges.**
23.1 Consent of KPMG LLP.*
23.2 Consent of Sullivan & Cromwell (included in the opinions filed as
Exhibit 5.1 and Exhibit 8.1 hereto).**
24.1 Power of Attorney (included in the signature page attached hereto).*
25.1 Statement of Eligibility of the Trustee.**
99.1 Form of Letter of Transmittal.*
II-6
<PAGE>
99.2 Form of Notice of Guaranteed Delivery.*
99.3 Form of Exchange Agent Agreement.*
- -------------------------------------
* Filed herewith.
** To be filed by amendment.
II-7
(Exhibit 1.1)
CSC HOLDINGS, INC.
(a Delaware corporation)
8 1/8% Senior Notes due 2009
PURCHASE AGREEMENT
Dated: July 8, 1999
<PAGE>
CSC HOLDINGS, INC.
(a Delaware corporation)
$500,000,000 8 1/8% Senior Notes due 2009
PURCHASE AGREEMENT
July 8, 1999
To the Initial Purchasers Named in Schedule I
Ladies and Gentlemen:
CSC Holdings, Inc., a Delaware corporation (the "Company"), proposes to
issue and sell to you (the "Initial Purchasers") $500,000,000 aggregate
principal amount of its 8 1/8% Senior Notes due 2009 (the "Securities"). The
Securities are to be sold to each Initial Purchaser, acting severally and not
jointly, in the respective principal amounts as are set forth in Schedule I
opposite the name of the Initial Purchaser. The Securities are to be issued
pursuant to an indenture to be dated as of July 1, 1999 (the "Indenture"),
between the Company and The Bank of New York, as trustee (the "Trustee"). The
Securities and the Indenture are more fully described in the Offering Memorandum
referred to below. Capitalized terms used herein without definition have the
respective meanings specified in the Offering Memorandum.
The Securities will be offered and sold to you without each being
registered under the Securities Act of 1933, as amended (the "1933 Act"), in
reliance on an exemption therefrom. The Company has prepared an offering
memorandum, dated July 8, 1999 (such offering memorandum, together with the
documents incorporated by reference therein in the form first furnished to the
Initial Purchasers for use in connection with the offering of the Securities,
being hereinafter referred to as the "Offering Memorandum"), setting forth
information regarding the Company and the Securities. The Company hereby
confirms that it has authorized the use of the Offering Memorandum in connection
with the offering and resale of the Securities.
The Company understands that you propose to make an offering of the
Securities on the terms set forth in the Offering Memorandum, as soon as you
deem advisable after this Agreement has been executed and delivered, (i) to
persons in the United
<PAGE>
2
States whom you reasonably believe to be qualified institutional buyers
("Qualified Institutional Buyers") as defined in Rule 144A under the 1933 Act,
as such rule may be amended from time to time ("Rule 144A"), in a transaction
under Rule 144A and/or (ii) to non-U.S. persons outside the United States to
whom offers and sales of the Securities may be made in reliance upon Regulation
S under the 1933 Act, provided that such offers and sales are made in the manner
contemplated by Section 2(d) hereof.
The holders of the Securities will be entitled to the benefits of the
Registration Rights Agreement, substantially in the form attached hereto as
Exhibit A.
Section 1. Representations and Warranties. (a) The Company represents and
warrants to you and agrees that:
(i) As of the date of the Offering Memorandum, and at all times subsequent
thereto up to the Closing Time referred to below, neither the Offering
Memorandum nor any amendment or supplement thereto will include an untrue
statement of a material fact or omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances under which
they were made, not misleading, except that this representation and warranty
does not apply to statements or omissions made in reliance upon and in
conformity with information furnished in writing by you to the Company expressly
for use in the Offering Memorandum or any amendment or supplement thereto.
(ii) The documents incorporated by reference in the Offering Memorandum, at
the time they were filed with the Securities and Exchange Commission (the
"Commission"), complied in all material respects with the requirements of the
Securities Exchange Act of 1934, as amended (the "1934 Act"), and the rules and
regulations of the Commission thereunder (the "1934 Act Regulations").
(iii) When the Securities are issued and delivered pursuant to this
Agreement, such Securities will not be of the same class (within the meaning of
Rule 144A) as securities of the Company which are listed on a national
securities exchange registered under Section 6 of the 1934 Act or quoted in a
U.S. automated inter-dealer quotation system.
(iv) The Company is subject to Section 13 or 15(d) of the 1934 Act.
(v) Neither the Company nor any affiliate (as defined in Rule 501(b) under
the 1933 Act) of the Company has, directly or through any agent, sold, offered
for sale, solicited offers to buy, or otherwise negotiated in respect of, any
security (as defined in the 1933 Act) which is or will be integrated with the
sale of the Securities in a manner that would require the registration of the
Securities under the 1933 Act.
<PAGE>
3
(vi) None of the Company, any of its affiliates or any person acting on its
or their behalf (other than you, as to whom the Company makes no representation)
has engaged, in connection with the offering of the Securities, in any form of
general solicitation or general advertising within the meaning of Rule 502(c)
under the 1933 Act. With respect to those Securities sold in reliance on
Regulation S, (A) none of the Company, its affiliates or any person acting on
its or their behalf (other than you, as to whom the Company makes no
representation) has engaged in any directed selling efforts within the meaning
of Regulation S and (B) each of the Company, its affiliates and each person
acting on its or their behalf (other than you, as whom the Company makes no
representation) has complied with the offering restrictions requirement of
Regulation S.
(vii) KPMG LLP, who are reporting upon the audited financial statements and
schedules included or incorporated by reference in the Offering Memorandum, are
independent accountants within the meaning of Rule 101 of the American Institute
of Certified Public Accountants.
(viii) The consolidated historical financial statements included or
incorporated by reference in the Offering Memorandum present fairly the
consolidated financial position of the Company and its subsidiaries as of the
dates indicated and the consolidated results of operations and changes in
financial position of the Company and its subsidiaries for the periods
specified. Such financial statements have been prepared in conformity with
generally accepted accounting principles applied on a consistent basis
throughout the periods involved. The selected financial data included in the
Offering Memorandum present fairly the information shown therein and have been
compiled on a basis consistent with that of the audited consolidated financial
statements included or incorporated by reference in the Offering Memorandum.
(ix) The Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware with power and authority
(corporate and other) under such laws to own, lease and operate its properties
and conduct its business as described in the Offering Memorandum; and the
Company is duly qualified to transact business as a foreign corporation and is
in good standing in each other jurisdiction in which it owns or leases property
of a nature, or transacts business of a type, that would make such qualification
necessary, except to the extent that the failure to so qualify or be in good
standing would not have a material adverse effect on the Company and its
subsidiaries, considered as one enterprise.
<PAGE>
4
(x) The subsidiaries of the Company set forth on Schedule III are, as of
the date hereof, all of the "Restricted Subsidiaries", as such term is defined
in the indenture, dated as of July 1, 1998, for the Company's 7 1/4% Senior
Notes due 2008 and its 7 5/8% Senior Debentures due 2018 (the "1998 Indenture")
and the Bank Credit Agreement (as such term is defined in the Indenture). The
subsidiaries of the Company set forth on Schedule IV are "Unrestricted
Subsidiaries", as such term is defined in the 1998 Indenture (the Restricted
Subsidiaries and the Unrestricted Subsidiaries are hereinafter referred to
collectively as the "Subsidiaries"). The Subsidiaries on Schedules III and IV
with an asterisk by their names are the only subsidiaries of the Company which
had at December 31, 1998 assets in excess of 10% of the consolidated assets of
the Company and its subsidiaries as at that date or had, in the aggregate, for
the fiscal year then ended revenues or operating cash flow in excess of 10% of
consolidated revenues or consolidated operating cash flow of the Company and its
subsidiaries for such period (such Subsidiaries are referred to herein as the
"Material Subsidiaries"). In making this determination, any subsidiary acquired
after December 31, 1998 shall be deemed to have been acquired as of such date.
(xi) Each Material Subsidiary that is a corporation is duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
incorporation with power and authority (corporate and other) under such laws to
own, lease and operate its properties and conduct its business; and each such
Material Subsidiary is duly qualified to transact business as a foreign
corporation and is in good standing in each other jurisdiction in which it owns
or leases property of a nature, or transacts business of a type, that would make
such qualification necessary, or the Company is subject to no material liability
or disability by reason of any failure of such Material Subsidiary to be so
qualified or in good standing. All of the outstanding shares of capital stock of
each Material Subsidiary have been duly authorized and validly issued and are
fully paid and nonassessable and, except as disclosed on Schedule III or IV to
this Agreement or as disclosed or contemplated by the Offering Memorandum, are
owned by the Company, directly or through one or more subsidiaries, free and
clear of any pledge, lien, security interest, charge, claim, equity or
encumbrance of any kind.
(xii) Each of the Material Subsidiaries in which the Company or a
subsidiary of the Company is a limited or general partner (hereinafter called
the "Partnerships") has been duly formed and is validly existing as a limited or
general partnership, as the case may be, under the laws of its jurisdiction of
organization, with full power and authority to own, lease and operate properties
and conduct its business; all necessary filings with respect to the formation of
the Partnerships as limited or general partnerships (as the case may be) have
been made under such laws; and each of the Partnerships is duly qualified to
transact business and is in good standing in each other jurisdiction in which it
owns or leases property
<PAGE>
5
of a nature, or transacts business of a type, that would make such qualification
necessary, or the Company is subject to no material liability or disability by
reason of any failure of such Partnerships to be so qualified and in good
standing.
(xiii) The Company had at March 31, 1999 a duly authorized and outstanding
capitalization as set forth in the Offering Memorandum under the caption
"Capitalization"; the Securities conform in all material respects to the
description thereof contained in the Offering Memorandum and such description
conforms in all material respects to the rights set forth in the instruments
defining the same.
(xiv) The Securities have been duly authorized by the Company. When
executed, authenticated, issued and delivered in the manner provided for in the
applicable Indenture and sold and paid for as provided herein, the Securities
will constitute valid and binding obligations of the Company entitled to the
benefits of the applicable Indenture and enforceable against the Company in
accordance with their terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and general principles of equity
(regardless of whether enforcement is considered in a proceeding in equity or at
law).
(xv) All of the outstanding shares of capital stock of the Company have
been duly authorized and validly issued and are fully paid and nonassessable;
and none of the outstanding shares of capital stock of the Company was issued in
violation of the preemptive rights of any stockholder of the Company.
(xvi) This Agreement has been duly authorized, executed and delivered by
the Company.
(xvii) Each of the Indenture and the Registration Rights Agreement has been
duly authorized by the Company, will be substantially in the form heretofore
delivered to you or attached hereto as Exhibit A, respectively, and, when duly
executed and delivered by the Company and the other parties thereto will
constitute a valid and binding obligation of the Company, enforceable against
the Company in accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and general principles
of equity (regardless of whether enforcement is considered in a proceeding in
equity or at law) and, in the case of the Registration Rights Agreement, except
as any rights to indemnity thereunder may be limited by federal and state
securities laws and public policy considerations underlying such laws; and the
form of the Indenture conforms in all material respects to the description
thereof contained in the Offering Memorandum.
<PAGE>
6
(xviii) Since the respective dates as of which information is given in the
Offering Memorandum, except as otherwise stated therein or contemplated thereby,
there has not been (A) any material loss or interference with its business from
fire, explosion, flood or other calamity, whether or not covered by insurance,
or from any labor dispute or court or governmental action, order or decree and
there has not been any change in the capital stock or long-term debt of the
Company or any of its Subsidiaries or any change which the Company has
reasonable cause to believe will involve any material adverse change, or any
development involving a prospective material adverse change, in or affecting the
financial position, stockholder's equity or results of operations of the Company
and its subsidiaries, considered as one enterprise, or (B) any transaction
entered into by the Company or any subsidiary, other than in the ordinary course
of business, that is material to the Company and its subsidiaries, considered as
one enterprise, or (C), except for the cash and stock dividends on the Series H
Preferred Stock and the cash and stock dividends paid on the Series M Preferred
Stock, each paid on April 1, 1999 and July 1, 1999, any dividend or distribution
of any kind declared, paid or made by the Company on its capital stock.
(xix) Neither the Company nor any Subsidiary is in default in the
performance or observance of any obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, loan agreement, note, lease or
other agreement or instrument to which it is a party or by which it may be bound
or to which any of its properties may be subject, except for such defaults that
would not have a material adverse effect on the financial position,
stockholder's equity or results of operations of the Company and its
subsidiaries, considered as one enterprise. The execution and delivery of the
Indenture, the Registration Rights Agreement and this Agreement (collectively,
the "Operative Documents"), the issuance and delivery of the Securities, the
consummation by the Company of the transactions contemplated by the Operative
Documents and the compliance by the Company with the terms of the Operative
Documents have been duly authorized by all necessary corporate action on the
part of the Company and do not and will not result in any violation of the
charter or by-laws of the Company or any Subsidiary, and do not and will not
conflict with, or result in a breach of any of the terms or provisions of, or
constitute a default under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any
Subsidiary under, (A) any contract, indenture, mortgage, loan agreement, note,
lease or other agreement or instrument to which the Company or any Subsidiary is
a party or by which it may be bound or to which any of its properties may be
subject (except for such conflicts, breaches or defaults or liens, charges or
encumbrances that would not have a material adverse effect on the financial
position, stockholder's equity or results of operations of the Company and its
subsidiaries, considered as one enterprise) or (B) any existing applicable law,
rule, regulation, judgment, order or decree of any
<PAGE>
7
government, governmental instrumentality or court, domestic or foreign, having
jurisdiction over the Company or any Subsidiary or any of its properties (except
for such conflicts, breaches or defaults or liens, charges or encumbrances that
would not have a material adverse effect on the financial position,
stockholder's equity or results of operations of the Company and its
subsidiaries, considered as one enterprise) or (C) any material agreement or
other material instrument (including any franchise agreement, license, permit or
other governmental authorization granted by the Federal Communications
Commission (hereinafter called the "FCC"), The New York State Public Service
Commission on Cable Television, The Massachusetts Department of Public Service
or any other governing body having jurisdiction over cable television
operations) binding upon the Company or any of its Subsidiaries (except for such
conflicts, breaches or defaults or liens, charges or encumbrances that would not
have a material adverse effect on the financial position, stockholder's equity
or results of operations of the Company and its subsidiaries, considered as one
enterprise).
(xx) The statements in the Offering Memorandum under "Risk Factors" and
"Description of Securities" and the statements in the Company's annual report on
Form 10-K for the year ended December 31, 1998 (the "1998 Form 10-K"), which is
incorporated by reference in the Offering Memorandum, under "Business --
Competition -- Cable Television" and "Business -- Regulation -- Cable
Television", insofar as such statements constitute a summary of the legal
matters, documents or proceedings referred to therein, with respect to such
legal matters, documents and proceedings, do not contain any untrue statement of
a material fact or omit to state a material fact required to be stated therein
or necessary in order to make the statements therein not misleading.
(xxi) Except as disclosed in the Offering Memorandum, no authorization,
approval, consent or license of any government, governmental instrumentality or
court, domestic or foreign, is required (i) for the valid authorization,
issuance, sale and delivery of the Securities in the United States, or (ii) for
the execution, delivery or performance by the Company of this Agreement, the
Indenture or the Registration Rights Agreement except for registrations in
connection with the registration of the Securities pursuant to the Registration
Rights Agreement under the 1933 Act and registrations under state securities or
blue sky laws and except for any such consent, approval, authorization, order or
registration the failure of which to obtain or make or the absence of which
would result in no material adverse effect on the Company and its subsidiaries,
considered as one enterprise.
(xxii) Except as disclosed in the Offering Memorandum, there is no action,
suit or proceeding before or by any government, governmental instrumentality or
court, domestic or foreign, now pending or, to the best of the Company's
knowledge, threatened against or
<PAGE>
8
affecting the Company or any Subsidiary that the Company has reasonable cause to
believe will result in any material adverse change in the consolidated financial
position, stockholder's equity or results of operations of the Company and its
subsidiaries, considered as one enterprise, or that will materially and
adversely affect the properties or assets of the Company and its subsidiaries,
considered as one enterprise, or that the Company has reasonable cause to
believe will materially adversely affect the consummation of the transactions
contemplated in this Agreement.
(xxiii) The Company and the Subsidiaries each has good and marketable title
to all material properties and assets described in the Offering Memorandum as
owned by it, free and clear of all liens, charges, encumbrances or restrictions,
except such as (A) are described in the Offering Memorandum or (B) are neither
material in amount nor materially significant in relation to the business of the
Company and its subsidiaries, considered as one enterprise; and any material
real property and buildings under lease by the Company and the Subsidiaries are
held by them under valid, subsisting and enforceable leases with such exceptions
as do not interfere, to an extent material to the Company and its subsidiaries,
considered as one enterprise, with the use made and proposed to be made of such
property and buildings by the Company and the Subsidiaries.
(xxiv) Except as disclosed in the Offering Memorandum, the Company and the
Subsidiaries each owns, possesses or has obtained all material agreements,
governmental licenses, permits, certificates, consents, orders, approvals and
other material authorizations (including, without limitation, all material
governmental authorizations and agreements with public utilities and microwave
transmission companies and pole access and rental agreements) necessary to own
or lease, as the case may be, and to operate its properties and to carry on its
business as presently conducted; and neither the Company nor any Subsidiary has
received any notice of proceedings relating to revocation or modification of any
such licenses, permits, certificates, consents, orders, approvals or
authorizations.
(xxv) To the best knowledge of the Company and except as disclosed in the
Offering Memorandum, no labor problem exists with its employees or with
employees of the Subsidiaries that could reasonably be expected to materially
and adversely affect the financial position, stockholder's equity or results of
operations of the Company and its subsidiaries, considered as one enterprise.
(b) Any certificate signed by any officer of the Company or any Subsidiary
and delivered to you or to counsel for the Initial Purchasers in connection with
the offering of the Securities shall be deemed a representation and warranty by
the Company to each Initial Purchaser as to the matters covered thereby.
<PAGE>
9
Section 2. Purchase, Sale and Resale of the Securities; Closing.
(a) On the basis of the representations and warranties herein contained,
and subject to the terms and conditions herein set forth, the Company agrees to
sell to you, and you agree, severally and not jointly, to purchase from the
Company, at the purchase price to be paid by the Initial Purchasers set forth in
Schedule II, the principal amount of Securities set forth opposite your name on
Schedule I, plus accrued interest, if any, from July 13, 1999 plus any
additional principal amount of Securities which you may become obligated to
purchase pursuant to Section 10 hereof.
(b) Payment of the purchase price for, and delivery of, the Securities
shall be made at the offices of Shearman & Sterling, 599 Lexington Avenue, New
York, New York 10022, or at such other place in The City of New York, at 10:00
A.M. on July 13, 1999, or at such other time not more than ten full Business
Days thereafter as shall be agreed upon by the Company and you, or as shall
otherwise be provided in Section 10 (such date and time of payment and delivery
being herein called the "Closing Time"). Payment shall be made by wire transfer
of same day federal funds to the Company to an account designated by the Company
to the Initial Purchasers, against delivery of the Securities to you for the
respective accounts of the several Initial Purchasers. Except as otherwise
provided in Schedule II hereto, the Securities shall be in such denominations
($1,000 or an integral multiple thereof) and registered in such names as you may
request in writing at least two full business days before the Closing Time.
(c) You have advised the Company that you propose to offer the Securities
for sale at the price set forth on Schedule II, upon the terms and conditions
set forth in this Agreement and in the Offering Memorandum. Each of you hereby,
severally, represents and warrants to, and agrees with, the Company that you (i)
are a qualified institutional buyer within the meaning of Rule 144A (a
"Qualified Institutional Buyer"), (ii) have not and will not solicit offers for,
or offer or sell, such Securities by means of any form of general solicitation
or general advertising or in any manner involving a public offering within the
meaning of Section 4(2) of the 1933 Act, including but not limited to the
methods described in Rule 502(c) of the 1933 Act, (iii) have not and will not
engage in any directed selling efforts (as defined in Rule 902 of the 1933 Act)
in the United States in connection with the Securities being offered and sold
pursuant to Regulation S under the 1933 Act and (iv) have solicited and will
solicit offers for such Securities only from, and have offered and will offer,
sell or deliver such Securities, as part of their initial offering, only to (A)
persons in the United States whom you reasonably believe to be Qualified
Institutional Buyers or, if any such person is buying for one or more
institutional accounts for which such person is acting as fiduciary or agent,
only when such person has represented to you that each such account is a
Qualified Institutional Buyer to whom notice has been given that such sale or
<PAGE>
10
delivery is being made in reliance on Rule 144A, and, in each case, in a
transaction under Rule 144A and (B) non-U.S. persons outside the United States
to whom offers and sales of the Securities may be made in reliance upon
Regulation S under the 1933 Act.
(d) In connection with the transactions described in Section 2(c)(iv)(B),
each Initial Purchaser, severally, represents and warrants to, and agrees with,
the Company that such Initial Purchaser will sell the Securities in such
transactions only in accordance with Regulation S under the 1933 Act and has not
offered or sold, and will not offer or sell, the Securities to, or for the
account or benefit of, U.S. persons (i) as part of its distribution at any time
or (ii) otherwise until 40 days after the Closing Time, and each Initial
Purchaser will send to each distributor, dealer or other person receiving a
selling concession, fee or remuneration to which it sells the Securities during
the restricted period a confirmation or other notice setting forth the
restrictions on offers and sales of the Securities within the United States or
to, or for the account or benefit of, U.S. persons. Terms used in this paragraph
have the meanings given to them by Regulation S under the 1933 Act.
(e) Each of you hereby severally represents that (i) it has not offered or
sold, and will not offer or sell, any Securities in the United Kingdom by means
of any document, other than to persons whose ordinary activities involve them in
acquiring, holding, managing or disposing of investments (as principal or agent)
for the purposes of their businesses or otherwise in transactions which have not
resulted and will not result in an offer to the public within the meaning of the
Public Offer of Securities Regulations 1995 (the "Regulations"), (ii) it has
complied and will comply with all applicable provisions of the Financial
Services Act 1986 and the Regulations with respect to anything done by it in
relation to the Securities in, from or otherwise involving the United Kingdom,
and (iii) it has only issued or passed on and will only issue or pass on to any
persons in the United Kingdom any document received by it in connection with the
issue of the Securities if that person is of a kind described in Article 11(3)
of the Financial Services Act 1986 (Investment Advertisements) (Exemptions)
Order 1988 or is a person to whom such document may otherwise lawfully be issued
or passed on.
(f) Each of you severally represents that it has not offered or sold and
will not offer or sell any Securities in transactions described in Section
2(c)(iv)(B) except in compliance with the applicable laws and regulations of the
jurisdictions in which such sales occur.
Section 3. Certain Covenants of the Company. The Company covenants with you
as follows:
<PAGE>
11
(a) The Company has furnished or will furnish to you as many copies of the
Offering Memorandum, as it may then be amended or supplemented, as you may
reasonably request from time to time.
(b) The Company will not at any time make any amendment or supplement to
the Offering Memorandum (other than amendments of the documents incorporated by
reference to the Offering Memorandum or the filing of subsequent documents under
the 1934 Act), of which you shall not have previously been advised and furnished
a copy, or to which you or your counsel shall reasonably object. The Company
shall not file any document under the 1934 Act before the completion of the
offering of the Securities by you, if such document would be deemed to be
incorporated by reference in the Offering Memorandum and if the filing of such
document would cause the Offering Memorandum, as amended or supplemented by the
filing of such document, to contain an untrue statement of a material fact or to
omit to state a material fact necessary to make the statements therein, in light
of the circumstances under which they were made, not misleading.
(c) If at any time prior to completion of the distribution of the
Securities by you to purchasers who are not your affiliates, any event shall
occur or condition exist as a result of which it is necessary, in the opinion of
counsel for you or counsel for the Company to amend or supplement the Offering
Memorandum in order that the Offering Memorandum will not include an untrue
statement of a material fact or omit to state a material fact necessary in order
to make the statements therein not misleading in the light of the circumstances
existing at the time it is delivered to a purchaser, the Company will promptly
prepare such amendment or supplement as may be necessary to correct such untrue
statement or omission and furnish you such number of copies as you may
reasonably request. Except as otherwise required by the preceding sentence, the
Company will not be obligated to update the Offering Memorandum. Such updating
may be done by means of the filing of one or more documents under the 1934 Act
which are deemed incorporated by reference in the Offering Memorandum.
(d) Notwithstanding any provision of paragraph (b) or (c) to the contrary,
however, the Company's obligations under paragraphs (b) and (c) shall terminate
on the earliest to occur of (i) the third anniversary of the Closing Time, (ii)
the closing date of an Exchange Offer pursuant to the Registration Rights
Agreement, (iii) the effective date of a Shelf Registration Statement pursuant
to the Registration Rights Agreement and (iv) the date upon which you and your
affiliates cease to hold Securities acquired by you as part of their initial
distribution.
<PAGE>
12
(e) The Company will use its reasonable best efforts, in cooperation with
you, to qualify the Securities for offering and sale under the applicable
securities laws of such states and other jurisdictions as you may designate, if
any, and to maintain such qualifications in effect for a period of not less than
one year from the date of the Offering Memorandum; provided, however, that the
Company shall not be obligated to file any general consent to service of process
or to qualify as a foreign corporation or as a dealer in securities in any
jurisdiction in which it is not so qualified or to subject itself to taxation in
respect of doing business in any jurisdiction in which it is not otherwise so
subject. The Company will file such statements and reports as may be required by
the laws of each jurisdiction in which the Securities have been qualified as
above provided.
(f) For a period of three years after the Closing Time, the Company will
furnish to you copies of all annual reports, quarterly reports and current
reports filed with the Commission on Forms 10-K, 10-Q and 8-K, or such other
similar forms as may be designated by the Commission, and such other documents,
reports and information as shall be furnished by the Company to its
securityholders generally.
(g) Neither the Company nor any affiliate (as defined in Rule 501(b) of the
1933 Act) will solicit any offer to buy or offer or sell the Securities by means
of any form of general solicitation or general advertising. With respect to
those Securities sold in reliance on Regulation S, (A) none of the Company, its
affiliates or any person acting on its or their behalf (other than you, as to
whom the Company makes no representation) will engage in any directed selling
efforts within the meaning of Regulation S and (B) each of the Company, its
affiliates and each person acting on its or their behalf (other than you, as to
whom the Company makes no representation) will comply with the offering
restrictions requirement of Regulation S.
(h) Neither the Company nor any affiliate (as defined in Rule 501(b) of the
1933 Act) of the Company will offer, sell or solicit offers to buy or otherwise
negotiate in respect of any security (as defined in the 1933 Act) which will be
integrated with the sale of the Securities in a manner that would require the
registration of the Securities under the 1933 Act at a time when such Securities
are not so registered.
(i) The Company will not be or become, at any time prior to the expiration
of three years after the Closing Time, an open-end investment trust, unit
investment trust or face-amount certificate company that is or is required to be
registered under Section 8 of the Investment Company Act of 1940, as amended
(the "Investment Company Act").
<PAGE>
13
(j) During the period from the Closing Time to the earlier of (i) two years
after the Closing Time, or (ii) the date of effectiveness of a registration
statement as contemplated in the Registration Rights Agreement, the Company will
not, and will not permit any of its "affiliates" (as defined in Rule 144 under
the 1933 Act) to, resell any of the Securities that have been reacquired by
them, except for Securities purchased by the Company or any of its affiliates
and resold in a transaction registered under the 1933 Act.
(k) The Company will, so long as the Securities are outstanding and are
"restricted securities" within the meaning of Rule 144(a)(3) under the 1933 Act,
either (i) file reports and other information with the Commission under Section
13 or 15(d) of the 1934 Act, or (ii) in the event it is not subject to Section
13 or 15(d) of the 1934 Act, furnish to holders of Securities and prospective
purchasers of Securities designated by such holders, upon request of such
holders or such prospective purchasers, the information required to be delivered
pursuant to Rule 144A(d)(4) under the 1933 Act to permit compliance with Rule
144A in connection with resales of the Securities.
(l) The Company will use its reasonable best efforts in cooperation with
you to permit the Securities sold in transactions described in Section
2(c)(iv)(A) to be eligible for clearance and settlement through The Depository
Trust Company.
(m) Each of the Securities will bear the following legend until, in the
opinion of counsel to the Company, such legend is no longer advisable because
the Securities are no longer subject to the restrictions on transfer described
therein:
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN
MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION. THE HOLDER OF THIS SECURITY BY ITS
ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY,
PRIOR TO THE DATE WHICH IS TWO YEARS AFTER THE DATE OF ORIGINAL ISSUE HEREOF
ONLY (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN
DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES
ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY
BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED
<PAGE>
14
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (D) PURSUANT TO OFFERS AND
SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES MEETING THE
REQUIREMENTS OF RULE 903 OR 904 OF REGULATION S UNDER THE SECURITIES ACT, OR (E)
PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT; PROVIDED THAT THE COMPANY SHALL HAVE THE RIGHT PRIOR TO ANY
SUCH OFFER, SALE, PLEDGE OR TRANSFER PURSUANT TO CLAUSE (E) ABOVE TO REQUIRE THE
DELIVERY OF AN OPINION (IN FORM AND SUBSTANCE SATISFACTORY TO THE COMPANY) OF
COUNSEL SATISFACTORY TO THE COMPANY, AND CERTIFICATION AND/OR OTHER INFORMATION
SATISFACTORY TO THE COMPANY.
(n) The Company will apply the net proceeds that it receives from the offer
and sale of the Securities in the manner set forth in the Offering Memorandum
under the heading "Use of Proceeds".
(o) The Company has been advised in writing by KPMG LLP, independent public
accountants to the Company, that the consolidated financial statements and
schedules audited by them and included in the Company's 1998 Form 10-K comply in
form in all material respects with the applicable accounting requirements of the
1934 Act and the related published rules and regulations thereunder.
Section 4. Payment of Expenses. The Company will pay and bear all costs and
expenses incident to the performance of its obligations under this Agreement,
including (a) the preparation and printing of the Offering Memorandum and any
amendments or supplements thereto, and the cost of furnishing copies thereof to
the Initial Purchasers, (b) the preparation, printing and distribution of this
Agreement, the Indenture and the Securities, (c) the delivery of the Securities
to the Initial Purchasers, (d) the fees and disbursements of the Company's
counsel and accountants, (e) any fees charged by rating agencies for rating the
Securities and (f) the fees and expenses of the Trustee, including the fees and
disbursements of counsel for the Trustee and the Transfer Agent, in connection
with the Indenture and the Securities.
If this Agreement is terminated by you in accordance with the provisions of
Section 5 or 9(a)(i), the Company shall reimburse the Initial Purchasers for
their reasonable out-of-pocket expenses, including the reasonable fees and
disbursements of counsel for the Initial Purchasers.
<PAGE>
15
Section 5. Conditions of Initial Purchasers' Obligations. The obligations
of the several Initial Purchasers to purchase and pay for the Securities that
they have respectively agreed to purchase hereunder are subject to the accuracy
of the representations and warranties of the Company contained herein or in
certificates of any officer of the Company or any Subsidiary delivered pursuant
to the provisions hereof, to the performance by the Company of its obligations
hereunder, and to the following further conditions:
(a) At the Closing Time, you shall have received a signed opinion of
Sullivan & Cromwell, counsel for the Company, dated as of the Closing Time, in
form and substance satisfactory to counsel for the Initial Purchasers, to the
effect that:
(i) The Company has been duly incorporated and is an existing corporation
in good standing under the laws of the State of Delaware.
(ii) Each of the Indenture and the Registration Rights Agreement, dated
July 13, 1999 (the "Registration Rights Agreement"), between the Company and
you, has been duly authorized, executed and delivered by the Company; the
Securities have been duly authorized, executed, authenticated, issued and
delivered; and the Indenture and the Securities constitute valid and legally
binding obligations of the Company enforceable in accordance with their terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles.
(iii) The execution and delivery by the Company of the Indenture, this
Agreement and the Registration Rights Agreement, the issuance of the Securities
in accordance with the Indenture and the sale of the Securities by the Company
to you pursuant to this Agreement do not, and the performance by the Company of
its obligations under the Indenture and this Agreement will not, violate the
Company's Certificate of Incorporation or By-Laws.
(iv) All regulatory consents, authorizations, approvals and filings
required to be obtained or made by the Company under the Federal laws of the
United States, the laws of the State of New York and the General Corporation Law
of the State of Delaware for the issuance, sale and delivery of the Securities
by the Company to you have been obtained or made.
(v) This Agreement has been duly authorized, executed and delivered by the
Company.
(vi) Neither registration of the Securities under the 1933 Act nor
qualification of the Indenture under the Trust Indenture Act of 1939 is required
for (i) the offer and sale of the Securities by the Company to the Initial
Purchasers or (ii)
<PAGE>
START
16
the reoffer and resale of the Securities by the Initial, in each case (i)
and (ii) in the manner contemplated by the Purchase Agreement and the Offering
Memorandum relating to the Securities.
Such counsel shall also furnish you with a letter to the effect that as
counsel to the Company, they reviewed the Offering Memorandum, participated in
discussions with representatives of the Initial Purchasers and of the Company
and its accountants; between the execution of this Agreement and the Closing
Time, such counsel participated in further discussions with representatives of
the Initial Purchasers and of the Company and its accountants in which the
contents of certain portions of the Offering Memorandum and related matters were
discussed and reviewed, certain documents filed by the Company with the
Commission, certificates of certain officers of the Company, an opinion
addressed to the Initial Purchasers from Robert S. Lemle, Esq. and a letter from
the Company's independent accountants; on the basis of the information that such
counsel gained in the course of the performance of the services referred to
above, considered in the light of such counsel's understanding of the applicable
law and the experience such counsel have gained through their practice, they
confirm to you that, in such counsel's opinion, nothing that came to such
counsel's attention in the course of such review has caused such counsel to
believe that, as of the date of the Offering Memorandum or as of the date
hereof, the Offering Memorandum contained or contains any untrue statement of a
material fact or omitted or omits to state any material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; such counsel shall
state that the limitations inherent in the independent verification of factual
matters and the character of determinations involved in the process of preparing
an offering memorandum are such that such counsel does not assume any
responsibility for the accuracy, completeness or fairness of the statements
contained in the Offering Memorandum except for those made under the captions
"Description of Securities" and "Plan of Distribution" in the Offering
Memorandum insofar as they relate to provisions of documents therein described;
also, such counsel need express no opinion or belief as to the financial
statements, pro forma financial statements or other financial data contained in
the Offering Memorandum, or as to the description of statutes, regulations,
proceedings or matters referred to in Section 5(c) hereof.
In rendering such opinion, such counsel may state that they express no
opinion as to the laws of any jurisdiction other than the Federal laws of the
United States, the laws of the State of New York and the General Corporation Law
of the State of Delaware, and no opinion as to federal or state communications
laws. Such counsel may also state that, insofar as such opinion involves factual
matters, they have relied, to the extent they deem proper, upon certificates of
officers of the Company and the Subsidiaries and certificates of public
officials.
<PAGE>
17
(b) At the Closing Time, you shall have received a signed opinion of Robert
S. Lemle, Esq., Executive Vice President, Secretary and General Counsel for the
Company, in form and substance satisfactory to counsel to the Initial
Purchasers, to the effect that:
(i) The Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware with corporate power and
authority under such laws to own, lease and operate its properties and conduct
its business as described in the Offering Memorandum.
(ii) The Company is duly qualified to transact business as a foreign
corporation and is in good standing in each other jurisdiction in which it owns
or leases property of a nature, or transacts business of a type, that would make
such qualification necessary, except where the failure to be so qualified would
not have a material adverse effect on the Company and its subsidiaries,
considered as one enterprise.
(iii) Each Material Subsidiary that is a corporation is duly incorporated,
validly existing and in good standing under the laws of the jurisdiction of its
incorporation, with corporate power and authority under such laws to own, lease
and operate its properties and conduct its business. Each Material Subsidiary
that is a partnership is duly organized under the laws of the jurisdiction of
its organization.
(iv) All of the outstanding shares of capital stock of each Material
Subsidiary have been duly authorized and validly issued and are fully paid and
nonassessable; except as set forth on Schedules III and IV to this Agreement or
as disclosed in or as contemplated by the Offering Memorandum, all of such
shares are owned by the Company, directly or through one or more subsidiaries,
free and clear of any material pledge, lien, security interest, charge, claim,
equity or encumbrance of any kind; no holder thereof is subject to personal
liability under the certificate of incorporation or by-laws of the respective
Material Subsidiary or the corporation law of the jurisdiction in which such
Material Subsidiary is organized by reason of being such a holder and none of
such shares was issued in violation of the preemptive rights of any stockholder
of such Material Subsidiary under the certificate of incorporation or by-laws of
such Material Subsidiary or the corporation law of the jurisdiction in which
such Material Subsidiary is organized.
(v) To such counsel's knowledge, there are no legal or governmental
proceedings pending or threatened to which the Company or any of its
subsidiaries is or may be a party, or of which any of their properties are or
may be the subject, of a character which are required to be disclosed in the
1998 Form 10-K or any Form 10-Q of the Company, other than those disclosed
therein.
<PAGE>
18
(vi) The documents incorporated by reference in the Offering Memorandum or
any further amendment or supplement thereto made by the Company prior to the
Closing Time (other than the financial statements and related schedules therein
and any untrue statement or omission of a material fact contained therein which
was corrected in the Offering Memorandum, as to which such counsel need express
no opinion), when they were filed with the Commission, complied as to form in
all material respects with the requirements of the Exchange Act and the rules
and regulations of the Commission thereunder; and he has no reason to believe
that such documents, read together, as of the date of the Offering Memorandum or
as of the Closing Time, contained or contain an untrue statement of a material
fact or omitted or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
(vii) Such counsel does not know of any contracts or documents of a
character required to be described or referred to in the documents incorporated
by reference in the Offering Memorandum or to be filed as exhibits to the
documents incorporated by reference in the Offering Memorandum that are not
described, referred to or filed as required.
(viii) To the knowledge of such counsel, no default exists in the
performance or observance of any material obligation, agreement, covenant or
condition contained in any contract, indenture, loan agreement, note, lease or
other agreement or instrument that is described or referred to in the Company's
1998 Form 10-K or filed as an exhibit to the 1998 Form 10-K or any subsequent
Form 10-Q of the Company, which default would have a material adverse effect on
the financial position, stockholder's equity or results of operations of the
Company and its subsidiaries, considered as one enterprise.
(ix) The execution and delivery of this Agreement and the Indenture by the
Company, the issuance and delivery of the Securities, the consummation by the
Company of the transactions contemplated in this Agreement and compliance by the
Company with the terms of this Agreement and the Indenture will not conflict
with the terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument
(including any franchise agreement, license, permit or other governmental
authorization granted by the FCC, The New York State Public Service Commission
on Cable Television, The Massachusetts Department of Public Service or any other
Federal or New York State governing body having jurisdiction over cable
television operations) known to such counsel to which the Company or any
Subsidiary is a party or by which the Company or any Subsidiary is bound or to
which any of the property or assets of the Company or any Subsidiary is subject,
which conflict, breach, violation or default
<PAGE>
19
would have a material adverse effect on the financial position, stockholder's
equity or results of operations of the Company and its subsidiaries, taken as a
whole, nor will such action result in any violation of the provisions of the
Certificate of Incorporation or By-laws of the Company or any Federal, New York
or Delaware General Corporation Law statute or any order, rule or regulation
known to such counsel of any Federal, New York or Delaware court or governmental
agency or body having jurisdiction over the Company or any Subsidiary or any of
their properties, which violation in each case would have a material adverse
effect on the financial position, stockholder's equity or results of operations
of the Company and its subsidiaries, taken as a whole; and no consent, approval,
authorization, order, registration or qualification of or with any such court or
governmental agency or body is required for the issue and sale of the Securities
or the consummation by the Company of the transactions contemplated by this
Agreement, except with respect to such consents, approvals, authorizations,
registrations or qualifications as may be required under state or foreign
securities laws in connection with the purchase and distribution of the
Securities by the Initial Purchasers.
In rendering such opinion, such counsel may state that he expresses no
opinion as to the laws of any jurisdiction other than the Federal laws of the
United States (other than federal communications laws, as to which such counsel
need express no opinion), the laws of the State of New York and the General
Corporation Law of the State of Delaware. In giving such opinion, such counsel
may rely, as to all matters governed by the laws of any other jurisdiction, upon
opinions of other counsel, who shall be counsel satisfactory to counsel for the
Initial Purchasers, in which case the opinion shall state that he believes you
and he are entitled to so rely. Such counsel may also state that, insofar as
such opinion involves factual matters, he has relied, to the extent he deems
proper, upon certificates of officers of the Company and the Subsidiaries and
certificates of public officials.
(c) At the Closing Time, you shall have received a signed opinion of Mintz,
Levin, Cohn, Ferris, Glovsky and Popeo, P.C., as special communications counsel
to the Company, in form and substance satisfactory to counsel to the Initial
Purchasers, to the effect that:
(i) The approvals, if any, required to be obtained from the FCC to
consummate the transactions contemplated by this Agreement have been obtained
and are in full force and effect.
(ii) Such counsel does not know of any federal communications and copyright
statutes that are principally directed to the regulation of cable properties
applicable to the Company that are not described in the Offering Memorandum but
would be material and
<PAGE>
20
relevant to the business of the Company, and the descriptions in the Offering
Memorandum of such statutes therein described are accurate and fairly summarize
the information shown.
(iii) The information in the Offering Memorandum under the captions "Risk
Factors -- Regulatory Risks Are Inherent and Substantial in Our Businesses",
"Risk Factors -- We Are Exposed to a Significant and Credible Risk of
Competition", "Risk Factors -- Recent FCC and Congressional Issues May Affect
Our Businesses" and "Risk Factors -- Competition from Telephone Companies" and
in the 1998 Form 10-K under the captions "Business -- Competition -- Cable
Television" and "Business -- Regulation Cable Television", to the extent that
such sections describe statutes, regulations and governmental proceedings or
matters involving federal communications and copyright law and policy and the
impact thereof on the business in which the Company and its subsidiaries are
engaged, has been reviewed by them and fairly represents the communications and
copyright law described therein applicable to the Company and its subsidiaries
as disclosed in the Offering Memorandum and material and relevant to the
business of the Company and its subsidiaries.
In giving such opinion, such counsel may rely, as to all matters governed by the
laws of jurisdictions other than the law of the District of Columbia, the
Federal law of the United States and the corporate law of the State of Delaware,
upon opinions of other counsel, who shall be counsel satisfactory to counsel for
the Initial Purchasers, in which case the opinion shall state that they believe
you and they are entitled to so rely. Such counsel may also state that, insofar
as such opinion involves factual matters, they have relied, to the extent they
deem proper, upon certificates of officers of the Company and the Subsidiaries
and certificates of public officials.
(d) At the Closing Time, you shall have received the favorable opinion of
Shearman & Sterling, counsel for the Initial Purchasers, dated as of the Closing
Time, to the effect that the opinions delivered pursuant to Sections 5(a), 5(b)
and 5(c) appear on their face to be appropriately responsive to the requirements
of this Agreement except, specifying the same, to the extent waived by you, and
with respect to the incorporation and legal existence of the Company, the
Securities, this Agreement, the Indenture, the Offering Memorandum, the
documents incorporated by reference therein and such other related matters as
you may require. In rendering such opinion, such counsel may state that they
express no opinion as to the laws of any jurisdiction other than the Federal
laws of the United States, the laws of the State of New York and the General
Corporation Law of the State of Delaware, and no opinion as to federal or state
communications laws. Such counsel may also state that, insofar as such opinion
involves factual matters, they have relied, to the extent they deem proper, upon
certificates of officers of the Company and the Subsidiaries and certificates of
public officials.
<PAGE>
21
(e) At the Closing Time, (i) the Offering Memorandum, as it may then be
amended or supplemented, shall not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading, (ii) there shall not have been,
since the respective dates as of which information is given in the Offering
Memorandum, any material adverse change or any development involving a
prospective material adverse change, in or affecting the financial position,
stockholder's equity or results of operations of the Company and its
subsidiaries, considered as one enterprise, (iii) the Company shall have
complied with all agreements and satisfied all conditions on its part to be
performed or satisfied at or prior to the Closing Time and (iv) the other
representations and warranties of the Company set forth in Section 1(a) shall be
accurate as though expressly made at and as of the Closing Time. At the Closing
Time, you shall have received a certificate of the President, a Vice Chairman or
a Vice President, and the Treasurer or Controller, of the Company, dated as of
the Closing Time, to such effect.
(f) You shall have received the letter specified in Sections 1 and 2 of
Exhibit B at the date hereof and the letter specified in Section 3 of Exhibit B
at the Closing Time.
(g) On or after the date hereof, (i) no downgrading shall have occurred in
the rating accorded the Company's debt securities by any "nationally recognized
statistical rating organization," as that term is defined by the Commission for
purposes of Rule 436(g)(2) under the 1933 Act, and (ii) no such organization
shall have publicly announced that it has under surveillance or review, with
possible negative implications, its rating of any of the Company's debt
securities.
(h) At the Closing Time, the Securities shall have been designated as
eligible for trading in the Private Offering, Resale and Trading through
Automatic Linkages (PORTAL) market.
(i) At the Closing Time, counsel for the Initial Purchasers shall have been
furnished with all such documents, certificates and opinions as they may
reasonably request for the purpose of enabling them to pass upon the issuance
and sale of the Securities contemplated in this Agreement and the matters
referred to in Section 5(d) and in order to evidence the accuracy and
completeness of any of the representations, warranties or statements of the
Company, the performance of any of the covenants of the Company, or the
fulfillment of any of the conditions herein contained.
If any of the conditions specified in this Section 5 shall not have been
fulfilled when and as required by this Agreement to be fulfilled, this Agreement
may be terminated
<PAGE>
22
by you on notice to the Company at any time at or prior to the Closing Time, and
such termination shall be without liability of any party to any other party.
Notwithstanding any such termination, the provisions of Sections 6, 7 and 8
shall remain in effect.
Section 6. Indemnification. (a) The Company agrees to indemnify and hold
harmless each Initial Purchaser and each person, if any, who controls any
Initial Purchaser within the meaning of Section 15 of the 1933 Act as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of an untrue statement or alleged untrue
statement of a material fact contained in or included the Offering Memorandum
(or any amendment or supplement thereto), and any documents incorporated therein
by reference, or the omission or alleged omission therefrom of a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or investigation or proceeding by any governmental
agency or body, commenced or threatened, or of any claim whatsoever based upon
any such untrue statement or omission, or any such alleged untrue statement or
omission, if such settlement is effected with the written consent of the
Company; and
(iii) against any and all expense whatsoever, as incurred (including fees
and disbursements of counsel chosen by you), reasonably incurred in
investigating, preparing or defending against any litigation, or investigation
or proceeding by any governmental agency or body, commenced or threatened, or
any claim whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent that any such expense
is not paid under subparagraph (i) or (ii) above;
provided, however, that this indemnity agreement does not apply to any loss,
liability, claim, damage or expense to the extent arising out of an untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Initial Purchaser expressly for use in the Offering Memorandum (or any amendment
or supplement thereto).
(b) Each Initial Purchaser severally agrees to indemnify and hold harmless
the Company, its directors, officers, and each person, if any, who controls the
Company within the meaning of Section 15 of the 1933 Act, against any and all
loss, liability, claim, damage and expense described in the indemnity agreement
in Section 6(a), as incurred, but only with respect to untrue statements or
<PAGE>
23
omissions, or alleged untrue statements or omissions, made in the Offering
Memorandum (or any amendment or supplement thereto) in reliance upon and in
conformity with written information furnished to the Company by such Initial
Purchaser through you expressly for use in the Offering Memorandum (or any
amendment or supplement thereto).
(c) Each indemnified party shall give prompt notice to each indemnifying
party of any action commenced against it in respect of which indemnity may be
sought hereunder, but failure to so notify an indemnifying party shall not
relieve it from any liability which it may have otherwise than on account of
this indemnity agreement. An indemnifying party may participate at its own
expense in the defense of such action; provided, however, that counsel to the
indemnifying party shall not (except with the consent of the indemnified party)
also be counsel to the indemnified party. In no event shall the indemnifying
party or parties be liable for the fees and expenses of more than one counsel
for all indemnified parties in connection with any one action or separate but
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances.
Section 7. Contribution. In order to provide for just and equitable
contribution in circumstances under which the indemnity provided for in Section
6 is for any reason held to be unenforceable by the indemnified parties although
applicable in accordance with its terms, the Company and the Initial Purchasers
shall contribute to the aggregate losses, liabilities, claims, damages and
expenses of the nature contemplated by such indemnity incurred by the Company
and one or more of the Initial Purchasers, as incurred, in such proportions that
the Initial Purchasers are responsible for that portion represented by the
percentage that the discount hereunder with respect to the offering of the
Securities bears to the offering price of the Securities, and the Company is
responsible for the balance; provided, however, that no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933
Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. For purposes of this Section, each person, if
any, who controls an Initial Purchaser within the meaning of Section 15 of the
1933 Act shall have the same rights to contribution as such Initial Purchaser,
and each director or officer of the Company and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act shall have
the same rights to contribution as the Company.
Section 8. Agreements to Survive Delivery. The agreements and other
statements of the Company or its officers and of the Initial Purchasers set
forth in or made pursuant to this Agreement will remain operative and in full
force and effect regardless of any investigation made by or on behalf of the
Company, or any Initial Purchaser or controlling person within the meaning of
Section 15 of the 1933 Act and will survive delivery of and payment for the
Securities.
<PAGE>
24
Section 9. Termination of Agreement. (a) You may terminate this Agreement,
by notice to the Company, at any time at or prior to the Closing Time (i) if
there has been, since the respective dates as of which information is given in
the Offering Memorandum, any material adverse change or any development
involving a prospective material adverse change in or affecting the financial
position, stockholder's equity or results of operations of the Company and its
subsidiaries, considered as one enterprise, or (ii) if there has occurred any
outbreak or escalation of hostilities or other calamity or crisis the effect of
which on the financial markets of the United States is such as to make it, in
your judgment, impracticable to market the Securities or enforce contracts for
the sale of Securities or (iii) if trading in any securities of the Company has
been suspended by the Commission, the National Association of Securities
Dealers, Inc. or the American Stock Exchange, or if trading generally on the New
York Stock Exchange, the American Stock Exchange or in the over-the-counter
market has been suspended, or minimum or maximum prices for trading have been
fixed, or maximum ranges for prices for securities have been required, by such
exchange or by order of the Commission, the National Association of Securities
Dealers, Inc. or any other governmental authority, or (iv) if a banking
moratorium has been declared by either federal or New York authorities.
(b) If this Agreement is terminated pursuant to this Section, such
termination shall be without liability of any party to any other party, except
to the extent provided in Section 4. Notwithstanding any such termination, the
provisions of Sections 6, 7 and 8 shall remain in effect.
Section 10. Default by One or More of the Initial Purchasers. If one or
more of the Initial Purchasers shall fail at the Closing Time to purchase the
Securities that it or they are obligated to purchase pursuant to this Agreement
(the "Defaulted Securities"), you shall have the right, within 24 hours
thereafter, to make arrangements for one or more of the non-defaulting Initial
Purchasers, or any other Initial Purchasers, to purchase all, but not less than
all, of the Defaulted Securities in such amounts as may be agreed upon and upon
the terms set forth in this Agreement; if, however, you have not completed such
arrangements within such 24-hour period, then:
(a) if the aggregate principal amount of Defaulted Securities does not
exceed 10% of the Securities to be purchased pursuant to this Agreement, the
non-defaulting Initial Purchasers shall be obligated to purchase the full amount
thereof in the proportions that their respective purchase obligation proportions
bear to the purchase obligations of all non-defaulting Initial Purchasers, or
<PAGE>
25
(b) if the aggregate principal amount of Defaulted Securities exceeds 10%
of the Securities to be purchased pursuant to this Agreement, this Agreement
shall terminate without liability on the part of any non-defaulting Initial
Purchaser.
No action taken pursuant to this Section shall relieve any defaulting
Initial Purchaser from liability in respect of its default.
In the event of any such default that does not result in a termination of
this Agreement, either you or the Company shall have the right to postpone the
Closing Time for a period not exceeding seven days in order to effect any
required changes in the Offering Memorandum or in any other documents or
arrangements. As used herein, the term "Initial Purchaser" includes any person
substituted for an Initial Purchaser under this Section 10.
Section 11. Notices. All notices and other communications under this
Agreement shall be in writing and shall be deemed to have been duly given if
delivered, mailed or transmitted by any standard form of telecommunication.
Notices to you shall be directed to Bear, Stearns & Co. Inc., 245 Park Avenue,
New York, New York 10167, attention of Carolyn E. Saacke, Merrill Lynch, Pierce,
Fenner & Smith Incorporated, World Financial Center, North Tower - 30th Floor,
250 Vesey Street, New York, New York 10281, attention of Daniel L. Richards,
Morgan Stanley & Co. Incorporated, 1585 Broadway, New York, New York 10036,
attention of Beatrice Cassou, Salomon Smith Barney Inc., 7 World Trade Center,
New York, New York 10048, attention of Craig Larson, Goldman, Sachs & Co., 32
Old Slip - 21st Floor, New York, New York 10004, attention of Donald P. Hansen,
and Donaldson, Lufkin & Jenrette Securities Corporation, 277 Park Avenue, New
York, New York 10172, attention of Jim McVeigh, and notices to the Company shall
be directed to it at CSC Holdings, Inc., 1111 Stewart Avenue, Bethpage, New York
11714, attention of Robert S. Lemle, Esq., Executive Vice President, General
Counsel and Secretary, with a copy to Sullivan & Cromwell, 125 Broad Street, New
York, New York 10004, attention of John P. Mead, Esq.
Section 12. Parties. This Agreement is made solely for the benefit of the
several Initial Purchasers, the Company and, to the extent expressed, any person
controlling the Company or any of the Initial Purchasers, and the directors and
officers of the Company, and their respective executors, administrators,
successors and assigns and, subject to the provisions of Section 10, no other
person shall acquire or have any right under or by virtue of this Agreement. The
term "successors and assigns" shall not include any purchaser, as such
purchaser, from any of the several Initial Purchasers of the Securities. All of
the obligations of the Initial Purchasers hereunder are several and not joint.
<PAGE>
26
Section 13. Governing Law and Time. This Agreement shall be governed by the
laws of the State of New York. Specified times of the day refer to New York City
time.
Section 14. Captions. The captions included in this Agreement are included
solely for convenience of reference and are not considered to be part of this
Agreement.
Section 15. Counterparts. This Agreement may be executed in one or more
counterparts and when a counterpart has been executed by each party, all such
counterparts taken together shall constitute one and the same agreement.
<PAGE>
27
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to us a counterpart hereof, whereupon this instrument
will become a binding agreement between the Company and the Initial Purchasers
in accordance with its terms.
Very truly yours,
CSC HOLDINGS, INC.
By /s/ William J. Bell
----------------------
Name: William J. Bell
Title: Vice Chairman
Confirmed and accepted as of the date first above written:
BEAR, STEARNS & CO. INC.
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
DONALDSON, LUFKIN & JENRETTE SECURITIES CORPORATION
GOLDMAN, SACHS & CO.
MORGAN STANLEY & CO. INCORPORATED
SALOMON SMITH BARNEY INC.
c/o Merrill Lynch, Pierce, Fenner & Smith Incorporated
By: Merrill Lynch, Pierce, Fenner & Smith Incorporated
By /s/ Eric Federman
---------------------------
Name: Eric Federman
Title: Authorized Signatory
<PAGE>
SCHEDULE I
Principal Amount of
8 1/8% Senior
Initial Purchaser Notes due 2009
----------------- --------------
Bear, Stearns & Co. Inc. $150,000,000
Merrill Lynch, Pierce, Fenner & Smith
Incorporated 150,000,000
Donaldson, Lufkin & Jenrette
Securities Corporation 50,000,000
Goldman, Sachs & Co. 50,000,000
Morgan Stanley & Co. Incorporated 50,000,000
Salomon Smith Barney Inc. 50,000,000
Total $500,000,000
============
<PAGE>
SCHEDULE II
CSC HOLDINGS, INC.
8 1/8% Senior Notes
due 2009
Principal amount to be issued: $500,000,000
Interest rate: 8 1/8%
Interest accrues from: July 13, 1999
Date of maturity: July 15, 2009
Redemption Provisions: None
Sinking fund requirements: None
Initial offering price to investors: 99.534% of the principal amount of the
Notes plus accrued interest from July 13, 1999.
Purchase price: 98.159% of the principal amount of the Notes plus accrued
interest from July 13, 1999.
Method of Payment: Payment shall be made to the Company in same day federal
funds by wire transfer.
Closing date, time and location: 10:00 A.M., July 13, 1999 at the offices of
Shearman & Sterling, 599 Lexington Avenue, New York, New York 10022.
Listing requirement: None
<PAGE>
SCHEDULE III
RESTRICTED SUBSIDIARIES(1)
(* - material subsidiary)
3300 Lakeside Corporation
A-R Cable Investments, Inc.
A-R Cable Services - NY, Inc.
Arsenal MSub 2 Inc.
Arsenal MSub 7, Inc.
Cable Science Corporation
Cablevision Area 9 Corporation
Cablevision Fairfield Corporation
Cablevision Lightpath, Inc.
Cablevision MFR, Inc.
Cablevision of Boston, Inc.
Cablevision of Brookhaven, Inc.
Cablevision of Brookline Limited Partnership
Cablevision of Brookline, Inc.
Cablevision of Cleveland G.P., Inc.
Cablevision of Cleveland L.P., Inc.
Cablevision of Cleveland, L.P.
Cablevision of Connecticut Corporation
Cablevision of Connecticut Limited Partnership
Cablevision of Hudson County, Inc.
Cablevision of Massachusetts, Inc. (f/k/a Cablevision of Nashoba, Inc.)
Cablevision of Michigan, Inc.
Cablevision of Monmouth, Inc.
Cablevision of New Jersey, Inc.
*Cablevision of New York City - Master L.P.
Cablevision of New York City - Phase I L.P.
Cablevision of Newark
Cablevision of Oakland, Inc.
Cablevision of Paterson, Inc.
Cablevision of Rockland/Ramapo, Inc.
Cablevision of Southern Westchester, Inc.
Cablevision of the Midwest Holding, Inc.
Cablevision of the Midwest, Inc.
Cablevision of Warwick, Inc.
Cablevision Systems Brookline Corporation
Cablevision Systems Dutchess Corporation
Cablevision Systems East Hampton Corporation
<PAGE>
III-2
Cablevision Systems Great Neck Corporation
Cablevision Systems Huntington Corporation
Cablevision Systems Islip Corporation
Cablevision Systems Long Island Corporation
Cablevision Systems New York City Corporation
Cablevision Systems of Southern Connecticut Limited Partnership
Cablevision Systems Suffolk Corporation
Cablevision Systems Westchester Corporation
Communications Development Corporation
CSC Acquisition - MA, Inc.
CSC Acquisition - NY, Inc.
CSC Acquisition Corporation
CSC Gateway Corporation
CSC TKR, Inc.
CSC TKR I, Inc.
KRC/CCC Investment Partnership
NYC GP Corp.
NYC LP Corp.
Petra Cablevision Corporation
Sampson Cablevision Corp.
Suffolk Cable Corporation
Suffolk Cable of Shelter Island, Inc.
Suffolk Cable of Smithtown, Inc.
Telerama, Inc.
V Cable, Inc.
VC Holding, Inc.
<PAGE>
SCHEDULE IV
UNRESTRICTED SUBSIDIARIES
(* - material subsidiary)
A-R Cable Services, Inc.
AMC II Holding Corporation(1)
AMC Productions, Inc.(2)
American Movie Classics Company
American Movie Classics Holding Corporation(1)
American Pop, LLC(1)
American Sports Classics, L.L.C.
Bravo Company
Bravo Holding Corporation(1)
Bravo International, a division of Bravo Company
Bravo Programming, Inc.(1)
Cable Networks, Inc.(1)
Cablevision Programming Incorporated
Cleveland Radio Holding, Inc.
CV Radio Associates, L.P.
Extra Help Holding Corporation(1)
Extra Help L.L.C.
Florida Holdings I, L.L.C.
Florida Holdings II, L.L.C.
Foxwatch Productions, Inc.
Garden Programming, L.L.C.
IFC Productions I L.L.C.
Independent Film Channel, a division of Bravo Company
*Madison Square Garden, L.P.(4)
Madison Square Garden CT, LLC
Metro Channel, L.L.C.
Metro Channel Holdings I, LLC
Metro Channel Holdings II, LLC
MSG Aircraft Leasing, LLC
MSG Boxing, LLC
MSG Flight Operations, LLC
MSG Eden Corp.
MSG/TJF Scarlet Productions, LLC
MuchMusic U.S.A. Venture
National Advertising Partners
National PSNA Holdings I, LLC
National PSNA Holdings II, LLC
<PAGE>
IV-2
National Sports Partners
Neighborhood News Holdings, Inc.(1)
News 12 Holding Corporation(1)
News 12 New Jersey L.L.C.
News 12 The Bronx, LLC(1)
News 12 The Bronx Holding Corporation(1)
Next Wave Films, L.L.C.(1)
New England Sea Wolves, L.L.C.
New York Rangers Enterprises Company
Northern Ohio Interconnect
Prime SportsChannel Networks Associates
PS Holding Acquisition Corporation
Radio City Networks LLC
Radio City Networks Holdings I, LLC
Radio City Networks Holdings II, LLC
Radio City Productions, L.L.C.
Radio City Trademarks, L.L.C.
Rainbow Advertising Holdings, LLC(1)
Rainbow Advertising Sales Corporation(1)
Rainbow CT Holdings, Inc.(1)
Rainbow DBS Holdings, Inc.
Rainbow Garden Corp.
*Rainbow Media Holdings, Inc.(3)
*Rainbow Media Sports Holdings, Inc.
Rainbow MM Holdings Corporation
Rainbow National Sports Holdings, LLC(1)
Rainbow Network Communications(1)
Rainbow News 12 Company(1)
Rainbow NJ Holdings, Inc.(1)
Rainbow Program Enterprises, L.P.(1)
*Rainbow Regional Holdings, LLC
Rainbow Travel, Inc.(1)
Rainbow Westchester Holdings, Inc.(1)
Regional Chicago Holdings, L.L.C.
Regional Cincinnati Holdings I, LLC
Regional Cincinnati Holdings II, LLC
Regional Detroit Holdings, LLC
*Regional MSG Holdings, LLC
Regional NE Holdings I, LLC
Regional NE Holdings II, L.L.C.
<PAGE>
IV-3
Regional Ohio Holdings I, LLC
Regional Ohio Holdings II, LLC
Regional Pacific Holdings, LLC
*Regional Programming Partners
RNC Holding Corporation(1)
Romance Classics, LLC(1)
Romance Classics Productions, LLC(1)
SC America Holding Corporation
SC Florida Holding Company, L.L.C.
SC Florida Holding Corporation
SC Los Angeles Holding Corporation(1)
Soccer/USA Partners, L.P.
SportsChannel America Associates(1)
SportsChannel America Soccer, Inc.
SportsChannel Associates(4)
SportsChannel Chicago Associates
SportsChannel Cincinnati Associates
SportsChannel Florida Associates
SportsChannel Florida Holding Company L.L.C.
SportsChannel Los Angeles Holding Corporation
SportsChannel New England Limited Partnership
SportsChannel Ohio Associates
SportsChannel Pacific Associates
SportsChannel Prism/Chicago Holding Partnership
SportsChannel Ventures, Inc.
The 31st Street Company, L.L.C.
The Story Channel, L.L.C.
The Story Channel, Inc.(1)
WKNR, Inc.
World Cinema, a division of Bravo Company
1070 Jericho Turnpike Corp.
111 New South Road Corporation
1111 Stewart Corporation
1144 Route 109 Corp.
Cablevision Electronics Investments, Inc.
Cablevision Lightpath - CT, Inc.
Cablevision Lightpath - MA, Inc.
Cablevision Lightpath - MI, Inc.
Cablevision Lightpath - NJ, Inc.
<PAGE>
IV-4
Cablevision Lightpath - NY, Inc.
Cablevision Lightpath - OH, Inc.
Cablevision PCS Investments, Inc.
Cablevision PCS Management, Inc.
Cablevision Real Estate Corporation
CCG Holdings, Inc.
CCC Allwood Cinema Corp.
CCC Anthony Wayne Cinema Corp.
CCC B.C. Realty Corp.
CCC Babylon Cinema Corp.
CCC Bala Cynwyd Cinema Corp.
CCC Bayonne Cinema Corp.
CCC Bedford Cinema Corp.
CCC Bellevue Cinema Corp.
CCC Bergenfield Cinema Corp.
CCC Bronxville Cinema Corp.
CCC Brooklyn Heights Cinema Corp.
CCC Cedar Grove Cinema Corp.
CCC Chester Twin Cinema Corp.
CCC Cinema 100 Corp.
CCC Cinema 304 Corp.
CCC Clairidge Cinema Corp.
CCC Closter Cinema Corp.
CCC Cobble Hill Cinema Corp.
CCC Colony Cinema Corp.
CCC Edison Cinema Corp.
CCC Emerson Cinema Corp.
CCC Franklin Square Cinema Corp.
CCC Grand Avenue Cinema Corp.
CCC Great Neck Cinema Corp.
CCC Herricks Cinema Corp.
CCC Kin Mall Cinema Corp.
CCC Kisco Cinema Corp.
CCC Larchmont Cinema Corp.
CCC Madison Triple Cinema Corp.
CCC Mamaroneck Cinema Corp.
CCC Manasquan Cinema Corp.
CCC Manhasset Cinema Corp.
CCC Mansfield Cinema Corp.
CCC Middlebrook Cinema Corp.
<PAGE>
IV-5
CCC Millburn Cinema Corp.
CCC Morristown Cinema Corp.
CCC Narberth Cinema Corp.
CCC New City Cinema Corp.
CCC Parsippany Cinema Corp.
CCC Plaza Cinema Corp.
CCC Port Washington Cinema Corp.
CCC Roslyn Cinema Corp.
CCC Rye Cinema Corp.
CCC Screening Zone Cinema Corp.
CCC Succasunna Cinema Corp.
CCC Summit Cinema Corp.
CCC Tenafly Cinema Corp.
CCC Washington Cinema Corp.
CCC Wayne Cinema Corp.
CCC West Milford Cinema Corp.
CCC Woodbridge Cinema Corp.
CCC Yonkers Cinema Corp.
CCC At Home Holding Corporation
CSC Art Greenwich Cinema LLC
CSC Beekman Cinema LLC
CSC Chelsea Cinema LLC
CSC Chelsea West Cinema LLC
CSC 34th Street Cinema LLC
CSC 59th Street Cinema LLC
CSC 62nd and Broadway Cinema LLC
CSC 62nd and First Cinema LLC
CSC 86th and Park Cinema LLC
CSC Greenwich Twin Cinema LLC
CSC Metro Cinema LLC
CSC Olympia Twin LLC
CSC Redbank Cinema LLC
CSC Soundview Cinema LLC
CSC Warner Quad Cinema LLC
CSC Waverly Cinema LLC
CSC Ziegfeld Cinema LLC
CSC Investments, Inc.
CSC Nassau, Inc.
CSC Technology, Inc. (f/k/a CSC Realty, Inc.)
CSC Transport, Inc.
<PAGE>
IV-6
CSC Transport II, Inc.
ECC Holding Corporation
Knollwood Development Corp.
Missouri Cable Partners, L.P.
NCC LP Corp.
Northcoast Communications, L.L.C.
U.S. Cable Television Group, L.P.
V Cable G.P., Inc.
V-C Mo. G.P., Inc.
- ----------
(1) All of the capital stock or partnership interests (as the case may be) are
pledged to Toronto-Dominion under the terms of a Borrower Pledge Agreement,
dated as of April 2, 1997, as amended, between Rainbow Media Holdings, Inc.
(RMHI) and Toronto-Dominion (Texas), Inc., as administrative agent for the
Banks.
(2) All of the shares of AMC Productions, Inc. are pledged to Toronto-Dominion
under the terms of a Stock Pledge Agreement, dated as of April 2, 1997,
between American Movie Classics Holding Company and Toronto-Dominion
(Texas), Inc., as agent for the Banks.
(3) All of the shares of Class A and Class B Common Stock of Rainbow Media
Holdings, Inc. are pledged to Toronto-Dominion (Texas), Inc. under the
terms of the Stock Pledge Agreement, dated as of April 2, 1997, between
Cablevision Systems Corporation and Toronto-Dominion (Texas), Inc., as
administrative agent for the Banks.
(4) All of the capital stock, partnership interests or limited liability
company interests are pledged under the Credit Party Pledge Agreement,
dated as of June 6, 1997 to the Madison Square Garden, L.P. Credit
Agreement.
<PAGE>
EXHIBIT A
Form of Registration Rights Agreement
<PAGE>
EXHIBIT B
July 8, 1999
MATTERS TO BE COVERED BY LETTER OR LETTERS OF INDEPENDENT
PUBLIC ACCOUNTANTS
KPMG LLP shall have furnished to you the following letter or letters (in
each case in form and substance satisfactory to you):
(1) At the date hereof, a letter to the effect that:
(a) they are independent accountants with respect to the Company and its
subsidiaries within the meaning of the 1933 Act and the applicable published
1933 Act Regulations;
(b) in their opinion, except as disclosed in the Offering Memorandum, the
audited consolidated financial statements and the related financial statement
schedules of the Company and its subsidiaries included or incorporated by
reference in such annual report on Form 10-K comply as to form in all material
respects with the applicable accounting requirements of the 1934 Act as it
applies to Form 10-K and the related published 1934 Act Regulations; and
(c) in addition to their examinations, inspections, inquiries and other
procedures referred to therein, they have performed such other procedures,
specified by you, not constituting an audit, as they have agreed to perform and
report on with respect to certain amounts, percentages, numerical data and other
financial information in the Form 10-K and have compared certain of such
amounts, percentages, numerical data and financial information with, and have
found such items to be in agreement with or derived from, the detailed
accounting records of the Company and its subsidiaries.
(2) At the date hereof, a letter with respect to each of the Company's
quarterly reports on Form 10-Q (each a "10-Q Letter") filed prior to the date
hereof and subsequent to the Company's most recently filed annual report on Form
10-K, to the effect that:
(a) they reaffirm as of the date of such letter (and as though made on the
date of such letter) all statements made in the 10-K Letter, except that the
procedures specified therein shall have been carried out to a specified date not
more than five days prior to the date of such 10-Q Letter;
<PAGE>
40
(b) on the basis of procedures (but not an examination in accordance with
generally accepted auditing standards) consisting of:
(i) a reading of minutes of all meetings of the stockholders and
directors of the Company and its subsidiaries and the Pricing Committee of
the Company's Board of Directors and any subsidiary committees from the
date of the latest audited consolidated financial statements to the
specified date referred to in Section 2(a);
(ii) a reading of the unaudited condensed consolidated financial
statements of the Company and its subsidiaries included or incorporated by
reference in the quarterly report on Form 10-Q dated the date of such 10-Q
Letter;
(iii) inquiries of certain officials of the Company and its
subsidiaries; and
nothing came to their attention that caused them to believe that the unaudited
condensed consolidated financial statements included or incorporated by
reference in such quarterly report on Form 10-Q do not comply as to form in all
material respects with the applicable accounting requirements of the 1934 Act as
it applies to Form 10-Q and the related published 1934 Act Regulations or that
any material modifications should be made to the unaudited condensed
consolidated financial statements included or incorporated by reference in such
quarterly report for them to be in conformity with generally accepted accounting
principles, except as disclosed in the notes to such unaudited condensed
consolidated financial statements or as otherwise described in such 10-Q Letter;
(c) in addition to their examinations, inspections, inquiries and other
procedures referred to therein, they have performed such other procedures,
specified by you, not constituting an audit, as they have agreed to perform and
report on with respect to certain amounts, percentages, numerical data and other
financial information in the Form 10-Q and have compared certain of such
amounts, percentages, numerical data and financial information with, and have
found such items to be in agreement with or derived from, the detailed
accounting records of the Company and its subsidiaries.
(3) At the Closing Time, a letter dated the Closing Time (the "Closing
Letter"), to the effect that:
(a) they reaffirm as of the date of the Closing Letter (and as though made
on the date of the Closing Letter) all statements made in the 10-K Letter and in
each 10-Q Letter, if any, except that the procedures specified therein shall
have been carried out to a specified date not more than five days prior to the
date of the Closing Letter; and
<PAGE>
(b) based on the procedures set forth in Section 2(b) (but carried out to
the specified date referred to in Section 3(a)), nothing came to their attention
that caused them to believe that, from the date of the latest balance sheet of
the Company and its subsidiaries included or incorporated by reference in the
Prospectus to such specified date, there were any increases or decreases in
financial statement amounts specified by you as they have agreed to perform.
(EXHIBIT 3.1)
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OF
CSC HOLDINGS, INC.
CSC HOLDINGS, INC., a Delaware corporation, hereby certifies as
follows:
FIRST. The Board of Directors of said corporation duly adopted a
resolution setting forth and declaring advisable the amendment of (a) Sections
VII(A) and VII(H)(ii) of the Certificate of Voting Powers, Designations,
Preferences and Relative, Participating, Optional or Other Special Rights and
Qualifications, Limitations and Restrictions Thereof of the 11 3/4% Series H
Redeemable Exchangeable Preferred Stock of CSC Holdings, Inc. (the "Series H
Preferred Stock Certificate of Designations"), (b) Sections VII(A) and
VII(H)(ii) of the Certificate of Voting Powers, Designations, Preferences and
Relative, Participating, Optional or Other Special Rights and Qualifications,
Limitations and Restrictions Thereof of the 8 1/2% Series I Cumulative
Convertible Exchangeable Preferred Stock of CSC Holdings, Inc. (the "Series I
Preferred Stock Certificate of Designations"), and (c) Sections VII(A) and
VII(H)(ii) of the Certificate of Voting Powers, Designations, Preferences and
Relative, Participating, Optional or Other Special Rights and Qualifications,
Limitations and Restrictions Thereof of the 1 11/8% Series M Redeemable
Exchangeable Preferred Stock of CSC Holdings, Inc. (the "Series M Preferred
Stock Certificate of Designations") to provide the voting rights described in
the text of such amendments as set forth below so that, as amended:
1. Section VII(A) of the Series H Certificate of Designations shall
read in its entirety as follows:
"(A) Except as otherwise required under Delaware law and except
as set forth below in this paragraph (A) or in paragraphs (B) and (C)
below, at every meeting of stockholders of the corporation, each
Holder of shares of 11 3/4% Series H Redeemable Exchangeable Preferred
Stock shall be entitled to cast 1/100 of one (1) vote in person or by
proxy for each share of 11 3/4% Series H Redeemable Exchangeable
Preferred
<PAGE>
Stock standing in his or her name on the transfer books of the
corporation. Except (i) as otherwise required under Delaware law, (ii)
pursuant to the Certificate of Incorporation of the corporation, as
the same may be amended from time to time, or (iii) pursuant to the
provisions of any Certificates of Designations filed with respect to
any other series of Additional Preferred Stock, and except as set
forth in paragraphs (B) and (C) below, holders of shares of Common
Stock, Holders of shares of 11 3/4% Series H Redeemable Exchangeable
Preferred Stock and Holders of shares of other series of Additional
Preferred Stock shall vote together as a single class on all matters
required or permitted to be voted upon by the stockholders of the
corporation; provided, however, that, notwithstanding anything in this
Section VII to the contrary, except as otherwise required under
Delaware law and as set forth in paragraphs (B) and (C) below,
following any consolidation or merger in which the entity formed by or
surviving such consolidation or merger is other than the corporation,
the Holders of shares of 11 3/4% Series H Redeemable Exchangeable
Preferred Stock shall no longer be entitled or permitted to vote on
any matter required or permitted to be voted upon by the stockholders
of such resulting or surviving entity."
2. Section VII(H)(ii) of the Series H Certificate of Designations
shall read in its entirety as follows:
"(ii) Except where the holders of shares of Common Stock, Holders
of shares of 11 3/4% Series H Redeemable Exchangeable Preferred Stock
and Holders of shares of other series of Additional Preferred Stock
shall vote together as a single class, as provided in Section VII(A)
above, in any case in which the Holders of shares of the 11 3/4%
Series H Redeemable Exchangeable Preferred Stock shall be entitled to
vote pursuant to this Section VII or pursuant to Delaware law, each
Holder of shares of 11 3/4% Series H Redeemable Exchangeable Preferred
Stock shall be entitled to one vote for each share of 11 3/4% Series H
Redeemable Exchangeable Preferred Stock held."
3. Section VII(A) of the Series I Certificate of Designations shall
read in its entirety as follows:
"(A) Except as otherwise required under Delaware law and except
as set forth below in this paragraph (A) or in paragraphs (B) and (C)
below, at every meeting of stockholders of the corporation, each
Holder of shares of Series I Preferred Stock shall be entitled to cast
1/10 of one (1) vote in person or by proxy for each share of Series I
Preferred
2
<PAGE>
Stock standing in his or her name on the transfer books of the
corporation. Except (i) as otherwise required under Delaware law, (ii)
pursuant to the Certificate of Incorporation of the corporation, as
the same may be amended from time to time, or (iii) pursuant to the
provisions of any Certificates of Designations filed with respect to
any other series of Additional Preferred Stock, and except as set
forth in paragraphs (B) and (C) below, holders of shares of Common
Stock, Holders of shares of Series I Preferred Stock and Holders of
shares of other series of Additional Preferred Stock shall vote
together as a single class on all matters required or permitted to be
voted upon by the stockholders of the corporation; provided, however,
that, notwithstanding anything in this Section VII to the contrary,
except as otherwise required under Delaware law and as set forth in
paragraphs (B) and (C) below, following any consolidation or merger in
which the entity formed by or surviving such consolidation or merger
is other than the corporation, the Holders of shares of Series I
Preferred Stock shall no longer be entitled or permitted to vote on
any matter required or permitted to be voted upon by the stockholders
of such resulting or surviving entity."
4. Section VII(H)(ii) of the Series I Certificate of Designations
shall read in its entirety as follows:
"(ii) Except where the holders of shares of Common Stock, Holders
of shares of Series I Preferred Stock and Holders of shares of other
series of Additional Preferred Stock shall vote together as a single
class, as provided in Section VII(A) above, in any case in which the
Holders of shares of the Series I Preferred Stock shall be entitled to
vote pursuant to this Section VII or pursuant to Delaware law, each
Holder of shares of Series I Preferred Stock shall be entitled to one
vote for each share of Series I Preferred Stock held."
5. Section VII(A) of the Series M Certificate of Designations shall
read in its entirety as follows:
"(A) Except as otherwise required under Delaware law and except
as set forth below in this paragraph (A) or in paragraphs (B) and (C)
below, at every meeting of stockholders of the corporation, each
Holder of shares of 11 1/8% Series M Redeemable Exchangeable Preferred
Stock and Series L Preferred Stock shall be entitled to cast one (1)
vote in person or by proxy for each share of 11 1/8% Series M
Redeemable Exchangeable Preferred Stock or Series L Preferred Stock
standing in his or her name on the transfer books of the corporation.
3
<PAGE>
Except (i) as otherwise required under Delaware law, (ii) pursuant to
the Certificate of Incorporation of the corporation, as the same may
be amended from time to time, or (iii) pursuant to the provisions of
any Certificates of Designations filed with respect to any other
series of Additional Preferred Stock, and except as set forth in
paragraphs (B) and (C) below, holders of shares of Common Stock,
Holders of shares of 11 1/8% Series M Redeemable Exchangeable
Preferred Stock and Holders of shares of other series of Additional
Preferred Stock shall vote together as a single class on all matters
required or permitted to be voted upon by the stockholders of the
corporation; provided, however; that, notwithstanding anything in this
Section VII to the contrary, except as otherwise required under
Delaware law and as set forth in paragraphs (B) and (C) below,
following any consolidation or merger in which the entity formed by or
surviving such consolidation or merger is other than the corporation,
the Holders of shares of 11 1/8% Series M Redeemable Exchangeable
Preferred Stock and Series L Preferred Stock shall no longer be
entitled or permitted to vote on any matter required or permitted to
be voted upon by the stockholders of such resulting or surviving
entity."
6. Section VII(H)(ii) of the Series M Certificate of Designations
shall read in its entirety as follows:
"(ii) Except where the holders of shares of Common Stock, Holders
of shares of 11 1/8% Series M Redeemable Exchangeable Preferred Stock
and Holders of shares of other series of Additional Preferred Stock
shall vote together as a single class, as provided in Section VII(A)
above, in any case in which the Holders of shares of the 11 1/8%
Series M Redeemable Exchangeable Preferred Stock and Series L
Preferred Stock shall be entitled to vote pursuant to this Section VII
or pursuant to Delaware law, each Holder of shares of 11 1/8% Series M
Redeemable Exchangeable Preferred Stock or Series L Preferred Stock,
as the case may be, shall be entitled to one vote for each share of 11
1/8% Series M Redeemable Exchangeable Preferred Stock or Series L
Preferred Stock held."
SECOND. In lieu of a vote of stockholders, written consent to the
foregoing amendment has been given by the holder of all of the outstanding stock
entitled to vote thereon in accordance with the provisions of Section 228 of the
General Corporation Law of the State of Delaware; and such amendment has been
duly adopted in accordance with the provisions of Section 242 of the General
Corporation Law of the State of Delaware.
4
<PAGE>
IN WITNESS WHEREOF, CSC Holdings, Inc. has caused this certificate to
be signed by William J. Bell, its Vice Chairman, on the 1st day of April, 1999.
CSC HOLDINGS, INC.
By /s/ William J. Bell
Name: William J. Bell
Title: Vice Chairman
Attested by:
/s/ David Deitch
Name: David Deitch
Title: Vice President
5
<PAGE>
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OF
CSC HOLDINGS, INC.
CSC HOLDINGS, INC., a Delaware corporation, hereby certifies as
follows:
FIRST. The Board of Directors of said corporation duly adopted a
resolution setting forth and declaring advisable the amendment of Article Fourth
of the certificate of incorporation of said corporation to increase the total
number of shares which the corporation shall have authority to issue from
10,000,000 shares of Capital Stock to 20,000,000 shares of Capital Stock of the
par value of $0.01 per share so that, as amended, said Article shall read as
follows:
"FOURTH. The aggregate number of shares that the corporation
shall have authority to issue is 20,000,000: (a) 10,000,000 shares of
Common Stock, par value $0.01 per share; (b) 10,000,000 shares of
Preferred Stock, par value $.01 per share ("Preferred Stock").
I. Powers of the Board of Directors.
Authority is hereby expressly granted to the Board of Directors
to authorize the issue of one or more series of additional preferred
stock ("Additional Preferred Stock"), and with respect to each series
to set forth in a Certificate or Certificate of Designations
provisions with respect to the issuance of such series:
(a) the maximum number of shares to constitute such series
and the distinctive designation thereof;
(b) whether the shares of such series shall have voting
rights, in addition to any voting rights provided by law and, if
so, the terms of such voting rights;
(c) the dividend rate, if any, on the shares of such series,
the conditions and dates upon which such dividends shall be
payable, the
<PAGE>
preference or relation which such dividends shall bear to the
dividends payable on any other class or classes or on any other
series of capital stock, and whether such dividends shall be
cumulative or non-cumulative;
(d) whether the shares of such series shall be subject to
redemption by the corporation and, if made subject to redemption,
the times, prices and other terms and conditions of such
redemption;
(e) the rights of the holders of shares of such series upon
the liquidation, dissolution or winding-up of the corporation;
(f) whether or not the shares of such series shall be
subject to the operation of a retirement or sinking fund and, if
so, the extent to and manner in which any such retirement or
sinking fund shall be applied to the purchase or redemption of
the shares of such series for retirement or to other corporate
purposes and the terms and provisions relative to the operation
thereof;
(g) whether or not the shares of such series shall be
convertible into, or exchangeable for, shares of stock of any
other class or classes, or of any other series of the same class
and, if so, convertible or exchangeable, the price or prices or
the rate or rates of conversion or exchange and the method, if
any, of adjusting the same;
(h) the limitations and restrictions, if any, to be
effective while any shares of such series are outstanding upon
the payment of dividends or making of other distributions on and,
upon the purchase, redemption or other acquisition by the
corporation of the Class A Common Stock or any other class or
classes of stock of the corporation ranking junior to the shares
of such series either as to dividends or upon liquidation;
(i) the conditions or restrictions, if any, upon the
creation of indebtedness of the corporation or upon the issue of
any additional stock (including additional shares of such series
or of any other series or of any other class) ranking on a parity
with or prior to the shares of such series as to dividends or
distribution of assets on liquidation, dissolution or winding-up;
and
(j) any other preference and relative, participating,
optional or other special rights, and qualifications, limitations
or restrictions thereof as shall not be inconsistent with this
Article FOURTH.
2
<PAGE>
II. Ranking.
All shares of any one series of Additional Preferred Stock shall be
identical with each other in all respects, except that share of any one
series issued at different times may differ as to the dates from which
dividends, if any, thereon shall be cumulative; and all series shall rank
equally and be identical in all respects, except as permitted by the
foregoing provisions of Section I hereof; and all shares of Additional
Preferred Stock shall rank senior to the common stock both as to dividends
and upon liquidation.
III. Liquidation Rights.
In the event of any liquidation, dissolution or winding-up of the
corporation, before any payment or distribution of the assets of the
corporation (whether capital or surplus) shall be made to or set apart for
the holders of any class or classes of stock of the corporation ranking
junior to the Additional Preferred Stock upon liquidation, the holders of
the shares of the Additional Preferred Stock shall be entitled to receive
payment at the rate fixed herein or in the resolution or resolutions
adopted by the Board of Directors providing for the issue of such series,
plus (if dividends on shares of such series of Additional Preferred Stock
shall be cumulative) an amount equal to all dividends (whether or not
earned or declared) accumulated to the date of final distribution to such
holders; but they shall be entitled to no further payment. If, upon any
liquidation, dissolution or winding-up of the corporation, the assets of
the corporation, or proceeds thereof, distributable among the holders of
the shares of the Additional Preferred Stock shall be insufficient to pay
in full the preferential amount aforesaid, then such assets, or the
proceeds thereof, shall be distributed among such holders ratably in
accordance with the respective amounts which would be payable on such
shares if all amounts payable thereon were paid in full. For the purposes
of this Section III, the voluntary sale, conveyance, exchange or transfer
(for cash, shares of stock, securities or other consideration) of all or
substantially all of the property or assets of the corporation shall be
deemed a voluntary liquidation, dissolution or winding-up of the
corporation, but a consolidation or merger of the corporation with one or
more other corporations shall not be deemed to be a liquidation,
dissolution or winding-up, voluntary or involuntary.
V. Voting.
Except as shall be otherwise stated and expressed herein or in the
Certificate or Certificates of Designations adopted by the Board of
Directors with respect to the issuance of any series of Additional
Preferred Stock and except as
3
<PAGE>
otherwise required by laws of the State of Delaware, the holders
of shares of Additional Preferred Stock shall have, with respect
to such shares, no right or power to vote on any question or in
any proceeding or to be represented at, or to receive notice of,
any meeting of stockholders."
and declaring that, simultaneously with the effectiveness of said amendment of
Article Fourth, each of the issued and outstanding shares of Common Stock of the
par value of $1.00 per share shall be changed and reclassified into 5,000 shares
of Common Stock of the par value of $0.01 per share.
SECOND. In lieu of a vote of stockholders, written consent to the
foregoing amendment has been given by the holder of all of the outstanding stock
entitled to vote thereon in accordance with the provisions of Section 228 of the
General Corporation Law of the State of Delaware; and such amendment has been
duly adopted in accordance with the provisions of Section 242 of the General
Corporation Law of the State of Delaware.
IN WITNESS WHEREOF, CSC Holdings, Inc. has caused this certificate to
be signed by William J. Bell, its Vice Chairman, on the 1st day of April, 1999.
CSC HOLDINGS, INC.
By /s/ William J. Bell
Name: William J. Bell
Title: Vice Chairman
Attested by:
/s/ David Deitch
Name: David Deitch
Title: Vice President
4
<PAGE>
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OF
CSC HOLDINGS, INC.
CSC Holdings, Inc., a Delaware corporation (the "corporation"), hereby
certifies as follows:
FIRST. The Board of Directors of said corporation duly adopted a
resolution setting forth and declaring advisable the amendment of Article
FOURTH, of the certificate of incorporation of said corporation to add the
following at the end of the first sentence:
"I Powers of the Board of Directors.
Authority is hereby expressly granted to the Board of Directors to
authorize the issue of one or more series of additional preferred stock
("Additional Preferred Stock"), and with respect to each series to set
forth in a Certificate or Certificate of Designations provisions with
respect to the issuance of such series:
a. the maximum number of shares to constitute such series and the
distinctive designation thereof;
b. whether the shares of such series shall have voting rights, in
addition to any voting rights provided by law and, if so, the terms of
such voting rights;
c. the dividend rate, if any, on the shares of such series, the
conditions and dates upon which such dividends shall be payable, the
preference or relation which such dividends shall bear to the
dividends payable on any either class or classes or on any
<PAGE>
other series of capital stock, and whether such dividends shall be
cumulative or non-cumulative;
d. whether the shares of such series shall be subject to
redemption by the corporation and, if made subject to redemption, the
times, prices and other terms and conditions of such redemption;
e. the rights of the holders of shares of such series upon the
liquidation, dissolution or winding-up of the corporation;
f. whether or not the shares of such series shall be subject to
the operation of a retirement or sinking fund and, if so, the extent
to and manner in which any such retirement or sinking fund shall be
applied to the purchase or redemption of the shares of such series for
retirement or to other corporate purposes and the terms and provisions
relative to the operation thereof;
g. whether or not the shares of such series shall be convertible
into, or exchangeable for, shares of stock of any other class or
classes, or of any other series of the same class and, if so,
convertible or exchangeable, the price or prices or the rate or rates
of conversion or exchange and the method, if any, of adjusting the
same;
h. the limitations and restrictions, if any, to be effective
while any shares of such series are outstanding upon the payment of
dividends or making of other distributions on and, upon the purchase,
redemption or other acquisition by the corporation of the Class A
Common Stock or any other class or classes of stock of the corporation
ranking junior to the shares of such series either as to dividend or
upon liquidation;
i. the conditions or restrictions, if any, upon the creation of
indebtedness of the corporation or upon the issue of any additional
stock (including additional shares of such series or of any other
series or of any other class) ranking on a parity with or prior to the
shares of such series as to dividends or distribution of assets on
liquidation, dissolution or winding-up; and
j. any other preference and relative, participating, optional or
other special rights, and qualifications, limitations or
-2-
<PAGE>
restrictions thereof as shall, not be inconsistent with this Article
FOURTH.
II. Ranking.
All shares of any one series of Additional Preferred Stock shall
be identical with each other in all respects, except that share of any
one series issued at different times may differ as to the dates from
which dividends, if any, thereon shall be cumulative; and all series
shall rank equally and be identical in all respects, except as
permitted by the foregoing provisions of Section I hereof; and all
shares of Additional Preferred Stock shall rank senior to the common
stock both as to dividends and upon liquidation.
III. Liquidation Rights.
In the event of any liquidation, dissolution or winding-up of the
corporation, before any payment or distribution of the assets of the
corporation (whether capital or surplus) shall be made to or set apart
for the holders of any class or classes of stock of the corporation
ranking junior to the Additional Preferred Stock upon liquidation, the
holders of the shares of the Additional Preferred Stock shall be
entitled to receive payment at the rate fixed herein or in the
resolution or resolutions adopted by the Board of Directors providing
for the issue of such series, plus (if dividends on shares of such
series of Additional Preferred Stock shall be cumulative) an amount
equal to all dividends (whether or not earned or declared) accumulated
to the date of final distribution to such holders; but they shall be
entitled to no further payment. If, upon any liquidation, dissolution
or winding-up of the corporation, the assets of the corporation, or
proceeds thereof, distributable among the holders of the shares of the
Additional Preferred Stock shall be insufficient to pay in full the
preferential amount aforesaid, then such assets, or the proceeds
thereof, shall be distributed among such holders ratably in accordance
with the respective amounts which would be payable on such shares if
all amounts payable thereon were paid in full. For the purposes of
this Section III, the voluntary sale, conveyance, exchange or transfer
(for cash, shares of stock, securities or other consideration) of all
or substantially all of the property or assets of the corporation
shall be deemed a voluntary liquidation, dissolution or winding-up of
the corporation, but a consolidation or merger of the corporation with
one or more other corporations shall not be deemed to be a
liquidation, dissolution or winding--up, voluntary or involuntary.
IV. Voting.
-3-
<PAGE>
Except as shall be otherwise stated and expressed herein or in
the Certificate or Certificates of Designations adopted by the Board
of Directors with respect to the issuance of any series of Additional
Preferred Stock and except as otherwise required by laws of the State
of Delaware, the holders of shares of Additional Preferred Stock shall
have, in respect to such shares, no right or power to vote on any
question or in any proceeding or to be represented at, or to receive
notice of, any meeting of stockholders."
SECOND. In lieu of a vote of stockholders, written consent to the
foregoing amendment has been given by the sole stockholder of the
Corporation in accordance with the provisions of Section 228 and
Section 242 of the General Corporate Law of the State of Delaware.
-4-
<PAGE>
IN WITNESS WHEREOF, CSC Holdings, Inc. has caused this amendment to
its Certificate of Incorporation to be executed this 4th day of March, 1998.
CSC HOLDINGS, INC.
By:/s/ Andrew Rosengard
Name: Andrew Rosengard
Title: Executive Vice
President, Financial
Planning & Controller
Attest:
By:/s/ Robert S. Lemle
Name:Robert S. Lemle
Title: Secretary
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CERTIFICATE OF AMENDMENT OF CERTIFICATE
OF INCORPORATION OF
CABLEVISION SYSTEMS CORPORATION
It is hereby certified that:
1. The name of the corporation (hereinafter called the "corporation") is
Cablevision Systems Corporation.
2. The certificate of incorporation of the corporation is hereby amended by
striking out Article FOURTH, Section A. II thereof and by substituting in lieu
thereof the following new Section A. II:
Subject to (a) rights of the holders of Series A Preferred Stock and Series
B Preferred Stock, (b) any other provisions of the Certificate of
Incorporation of the corporation, as amended from time to time, and (c) the
provisions of any Certificates of Designations filed with respect to any
series of Additional Preferred Stock, holders of Class A Common Stock and
Class B Common Stock shall be entitled to receive equally on a per share
basis such dividends and other distributions in cash, stock or property of
the corporation as may be declared thereon by the Board of Directors from
time to time out of assets or funds of the corporation legally available
therefor; provided that the Board of Directors shall declare no dividend,
and no dividend shall be paid, with respect to any outstanding share of
Class A Common Stock or Class B Common Stock, whether paid in cash or
property (including, without limitation, shares of Class A Common Stock
paid on or with respect to shares of Class A Common Stock or shares of
Class B Common Stock paid on or with respect to shares of Class B Common
Stock (collectively, "Stock Dividends")), unless, simultaneously, the same
dividend (in the case of Stock Dividends, stock of the class on or with
respect to which the dividend is paid in the same percentage, relative to
the total number of shares of such class issued and outstanding immediately
prior to the payment of such dividend, as the Stock Dividend on or with
respect to the other class bears to the number of shares of such class
issued and outstanding immediately prior to the payment of such dividend)
is paid with respect to each share of Class A Common Stock and Class B
Common Stock, except that in the case of any dividend in the form of
capital stock of a subsidiary of the corporation, the capital stock of the
subsidiary distributed to holders of Class A Common Stock may differ from
the capital the capital stock of the subsidiary distributed to holders of
Class B Common
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Stock to the extent and only to the extent that the Class A Common Stock
and the Class B Common Stock differ as provided herein. Stock Dividends
with respect to Class A Common Stock may only be paid with shares of Class
A Common Stock and Stock Dividends with respect to Class B Common Stock may
only be paid with shares of Class B Common Stock.
3. The amendment of the certificate of incorporation herein certified has
been duly adopted in accordance with the provisions of Section 242 of the
General Corporation Law of the State of Delaware.
Signed and attested on June 23, 1994.
/s/ William J. Bell
William J. Bell
Vice Chairman
ATTEST:
/s/ Robert S. Lemle
Robert S. Lemle
Secretary
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CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OF
CABLEVISION SYSTEMS CORPORATION
It is hereby certified that:
1. The name of the corporation is CABLEVISION SYSTEMS CORPORATION (the
"Corporation").
2. Article FOURTH of the Corporation's Certificate of Incorporation shall
be amended in part by deleting the first two paragraphs thereof and inserting in
their place the following:
"FOURTH: The aggregate number of shares which the corporation shall
have authority to issue shall be 80,000,000 shares: (a) 50,000,000 shares
of Class A Common Stock, par value $.0l per share ("Class A Common Stock"),
(b) 20,000,000 shares of Class B Common Stock, par value $.01 per share
("Class B Common Stock"), and (c) 10,000,000 shares of Preferred Stock, par
value $.0l per share ("Preferred Stock"), 200,000 shares of which shall be
designated as Series A Cumulative Convertible Preferred Stock ("Series A
Preferred Stock"), and 200,000 shares of which shall be designated as
Series B Cumulative Convertible Preferred Stock ("Series B Preferred
Stock").
The following is a statement of (a) the designations, preferences and
relative, participating, optional or other special rights, and the
qualifications, limitations or restrictions thereof, of each of the Class A
Common Stocks, the Class B Common Stock, the Series A Preferred Stock and
the Series B Preferred Stock, and (b) the authority expressly vested in the
Board of Directors hereunder with respect to the issuance of additional
series of Preferred Stock (the "Additional Preferred Stock") other than the
Series A Preferred Stock and the Series B Preferred Stock:"
3. Article FOURTH shall be further amended by deleting Paragraph A thereof
and inserting in its place the following:
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"A. Class A Common Stock and Class B Common Stock.
I. Priority of Preferred Stock.
Each of the Class A Common Stock and the Class B Common Stock is
subject to all the powers, rights, privileges, preferences and priorities
of any series of Preferred Stock as are stated and expressed herein and as
shall be stated and expressed in any Certificates of Designations filed
with respect to any series of Additional Preferred Stock pursuant to
authority expressly granted to and vested in the Board of Directors by the
provisions of Paragraph C of this Article FOURTH.
II. Dividends.
Subject to (a) the rights of the holders of Series A Preferred Stock
and Series B Preferred Stock, (b) any other provisions of the Certificate
of incorporation of the corporation, as amended from time to time, and (c)
the provisions of any Certificates of Designations filed with respect to
any series of Additional Preferred Stock, holders of Class A Common Stock
and Class B Common Stock shall be entitled to receive equally on a per
share basis such dividends and other distributions in cash, stock or
property of the corporation as may be declared thereon by the Board of
Directors from time to time out of assets or funds of the corporation
legally available therefor; provided that the Board of Directors shall
declare no dividend, and no dividend shall be paid, with respect to any
outstanding share of Class A Common Stock or Class B Common Stock, whether
paid in cash or property (including, without limitation, shares of Class A
Common Stock paid on or with respect to shares of Class A Common Stock or
shares of Class B Common Stock paid on or with respect to shares of Class B
Common Stock (collectively, "Stock Dividends")), unless, simultaneously,
the same dividend (in the case of Stock Dividends, stock of the class on or
with respect to which the dividend is paid in the same percentage, relative
to the total number of shares of such class issued and outstanding
immediately prior to the payment of such dividend, as the Stock Dividend on
or with respect to the other class bears to the number of shares of such
class issued and outstanding immediately prior to the payment of such
dividend) is paid with respect to each share of Class A Common Stock and
Class B Common Stock. Stock Dividends with respect to Class A Common Stock
may only be paid with shares of Class A Common Stock and Stock Dividends
with respect to Class B Common Stock may only be paid with shares of Class
B Common Stock.
III. Voting.
(a) Except as otherwise required (i) by statute, (ii) pursuant to the
provisions of the Certificate of Incorporation of the corporation, as
amended from time to time, or (iii) pursuant to the provisions of any
Certificates of Designations filed with
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respect to any series of Additional Preferred Stock, the Class A Common
Stock and Class B Common Stock shall have the sole right and power to vote
on all matters on which a vote of stockholders is to be taken. At every
meeting of the stockholders, each holder of Class A Common Stock shall be
entitled to cast one (1) vote in person or by proxy for each share of Class
A Common Stock standing in his or her name on the transfer books of the
corporation and each holder of Class B Common Stock shall be entitled to
cast ten (10) votes in person or by proxy for each share of Class B Common
Stock standing in his or her name on the transfer books of the corporation.
Except in the election of directors of the corporation (voting in respect
of which shall be governed by the terms set forth in subsections {b) and
(c) of this Section III) and as may be otherwise required (i) by statute
(ii) pursuant to the provisions of the Certificate of Incorporation of the
corporation, as the same may be amended from time to time, or (iii)
pursuant to the provisions of any Certificates of Designation filed with
respect to any series of Additional Preferred Stock, the holders of Class A
Common Stock and Class B Common Stock shall vote together as a single
class; provided, however, that the affirmative vote or consent of the
holders of at least 66 2/3% of the outstanding shares of Class B Common
Stock, voting separately as a class, shall be required for (i) the
authorization or issuance of any additional shares of Class B Common Stock
and (ii) any amendment, alteration or repeal of any of the provisions of
the Certificate of Incorporation of the corporation which adversely affects
the powers, preferences or rights of the Class B Common Stock.
(b) With respect to the election of directors, holders of Class A
Common Stock shall vote as a separate class and be entitled to elect 25% of
the total number of directors (the "Class A Directors") elected by the
holders of Class A Common Stock and Class B Common Stock (the "Common Stock
Directors") and, if such 25% is not a whole number, then the holders of
Class A Common Stock shall be entitled to elect the nearest higher whole
number of directors that is at least 25% of the total number of Common
Stock Directors, so long as the number of outstanding shares of Class A
Common Stock is at least 10% of the total number of outstanding shares of
both classes of common stock. Holders of Class B Common Stock, voting as a
separate class, shall be entitled to elect the remaining Common Stock
Directors. If, on the record date for any stockholder meeting at which
directors are to be elected, the number of outstanding shares of Class A
Common Stock is less than 10% of the total number of outstanding shares of
common stock, however, the holders of the Class A Common Stock and the
Class B Common Stock shall vote together as a single class with respect to
the election of Common Stock Directors and the holders of Class A Common
Stock shall not have the right to elect 25% of the number of such
directors, but shall have one (1) vote per share for all Common Stock
Directors and the holders of the Class B Common Stock shall have ten (10)
votes per share for all Common Stock Directors. If, on the record date for
any stockholder meeting at which Common Stock Directors are to be elected,
the number of outstanding shares of Class B Common Stock is less than
12 1/2% of the
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<PAGE>
total number of outstanding shares of both classes of common stock, then
the holders of Class A Common Stock, voting as a separate class, shall
continue to elect a number of Class A Directors equal to 25% of the total
number of Common Stock Directors and, in addition, shall vote together with
the holders of Class B Common Stock to elect the remaining Common Stock
Directors to be elected at such meeting, with the holders of Class A Common
Stock entitled to one (1) vote per share for all Common Stock Directors and
the holders of Class B Common Stock entitled to ten (10) votes per share
for all Common Stock Directors.
(c) Any vacancy in the office of a Common Stock Director elected by
the holders of Class A Common Stock voting as a separate class may be
filled by a vote of such holders voting as a separate class and any vacancy
in the office of a Common Stock Director elected by the holders of Class B
Common Stock voting as a separate class may be filled by a vote of such
holders voting as a separate class or, in the absence of a stockholder
vote, in the case of a vacancy in the office of a Common Stock Director
elected by either class, such vacancy may be filled by the remaining
directors. Any director elected by the Board of Directors to fill a vacancy
shall serve until the next annual meeting of stockholders and until his or
her successor has been elected and has qualified. If the Board of Directors
increases the number of directors in accordance with Article FIFTH of the
Certificate of Incorporation of the corporation, any vacancy so created may
be filled by the Board of Directors; provided that, so long as the holders
of Class A Common Stock have the rights provided in subsections (b) and (c)
of this Section III in respect of the last preceding annual meeting of
stockholders to elect 25% of the total number of Common Stock Directors,
the Board of Directors may be so enlarged by the directors only to the
extent that at least 25% of the enlarged board consists of Common Stock
Directors elected by the holders of Class A Common Stock or of persons
appointed to fill vacancies created by the death, resignation or removal of
persons elected by the holders of Class A Common Stock.
(d) Notwithstanding anything in this Section III to the contrary, the
holders of Class A Common Stock shall have exclusive voting power on all
matters upon which, pursuant to the Certificate of Incorporation of the
corporation or applicable laws, the holders of common stock are entitled to
vote, at any time when no shares of Class B Common Stock are issued and
outstanding.
(e) Wherever any provision of the Certificate of Incorporation of the
corporation sets forth a specific percentage of the shares outstanding and
entitled to vote which is required for approval or ratification of any
action upon which the vote of the stockholders is required or may be
obtained, such provision shall mean such specified percentage of the votes
entitled to be cast by holders of shares then outstanding and entitled to
vote on such action.
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IV. Conversion Rights.
(a) Subject to the terms and conditions of this Article FOURTH, each
share of Class B Common Stock shall be convertible at any time or from time
to time, at the option of the holder thereof, at the office of any transfer
agent for Class B Common Stock, and at such other place or places, if any,
as the Board of Directors may designate, or, if the Board of Directors
shall fail so to designate, at the principal office of the corporation
(attention of the Secretary of the corporation), into one (1) fully paid
and nonassessable share of Class A Common Stock. Upon conversion, the
corporation shall make no payment or adjustment on account of dividends
accrued or in arrears on Class B Common Stock surrendered for conversion or
on account of any dividends on the Class A Common Stock issuable on such
conversion. Before any holder of Class B Common Stock shall be entitled to
convert the same into Class A Common Stock, he or she shall surrender the
certificate or certificates for such Class B Common Stock at the office of
said transfer agent (or other place as provided above), which certificate
or certificates, if the corporation shall so request, shall be duly
endorsed to the corporation or in blank or accompanied by proper
instruments of transfer to the corporation or in blank (such endorsements
or instruments of transfer to be in form satisfactory to the corporation),
and shall give written notice to the corporation at said office that he or
she elects so to convert said Class B Common Stock in accordance with the
terms of this Section IV, and shall state in writing therein the name or
names in which he or she wishes the certificate or certificates for Class A
Common Stock to be registered. Every such notice of election to convert
shall constitute a binding contract between the holder of such Class B
Common Stock and the corporation, whereby the holder of such Class B Common
Stock shall be deemed to subscribe for the amount of Class A Common Stock
which he or she shall be entitled to receive upon such conversion, and, in
satisfaction of such subscription, to deposit the Class B Common Stock to
be converted and to release the corporation from all liability thereunder,
and thereby the corporation shall be deemed to agree that the surrender of
the certificate or certificates therefor and the extinguishment of
liability thereon shall constitute full payment of such subscription for
Class A Common Stock to be issued upon such conversion. The corporation
will as soon as practicable after such deposit of a certificate or
certificates for Class B Common Stock, accompanied by the written notice
and the statement above prescribed, issue and deliver at the office of said
transfer agent (or other place as provided above) to the person for whose
account such Class B Common Stock was so surrendered, or to his nominee or
nominees, a certificate or certificates for the number of full shares of
Class A Common Stock to which he shall be entitled as aforesaid. Subject to
the provisions of subsection (d) of this Section IV, such conversion shall
be deemed to have been made as of the date of such surrender of the Class B
Common Stock to be converted; and the person or persons entitled to receive
the Class A Common Stock issuable upon conversion of such Class B Common
Stock shall be treated for all purposes as the record holder or holders of
such Class A Common Stock on such date. Upon conversion
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<PAGE>
of shares of Class B Common Stock, the shares of Class B Common Stock so
converted will be canceled and retired by the corporation, such shares
shall not be reissued and the number of shares of Class B Common Stock
which the corporation shall have authority to issue shall be decreased by
the number of shares of Class B Common Stock so converted and the Board of
Directors shall take such steps as are required to so retire such shares.
(b) The issuance of certificates for shares of Class A Common Stock
upon conversion of shares of Class B Common Stock shall be made without
charge for any stamp or other similar tax in respect of such issuance.
However, if any such certificate is to be issued in a name other than that
of the holder of the share or shares of Class B Common Stock converted, the
person or persons requesting the issuance thereof shall pay to the
corporation the amount of any tax which may be payable in respect of any
transfer involved in such issuance or shall establish to the satisfaction
of the corporation that such tax has been paid or that no such tax is due.
(c) The corporation shall not be required to convert Class B Common
Stock, and no surrender of Class B Common Stock shall be effective for that
purpose, while the stock transfer books of the corporation are closed for
any purpose; but the surrender of Class B Common Stock for conversion
during any period while such books are so closed shall be deemed effective
for conversion immediately upon the reopening of such books, as if the
conversion had been made on the date such Class B Common Stock was
surrendered.
(d) The corporation will at all times reserve and keep available,
solely for the purpose of issue upon conversion of the outstanding shares
of Class B Common Stock, such number of shares of Class A Common Stock as
shall be issuable upon the conversion of all such outstanding shares,
provided that nothing contained herein shall be construed to preclude the
corporation from satisfying its obligations in respect of the conversion of
the outstanding shares of Class B Common Stock by delivery of shares of
Class A Common Stock which are held in the treasury of the corporation. The
corporation covenants that if any shares of Class A Common Stock, required
to be reserved for purposes of conversion hereunder, require registration
with or approval of any governmental authority under any federal or state
law before such shares of Class A Common Stock may be issued upon
conversion, the corporation will use its best efforts to cause such shares
to be duly registered or approved, as the case may be. The corporation will
endeavor to list the shares of Class A Common Stock required to be
delivered upon conversion prior to such delivery upon each national
securities exchange, if any, upon which the outstanding Class A Common
Stock is listed at the time of such delivery. The corporation covenants
that all shares of Class A Common Stock which shall be issued upon
conversion of the shares of Class B Common Stock,
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will, upon issue, be fully paid and nonassessable and not entitled to any
preemptive rights.
V. Liquidation Rights.
In the event of any dissolution, liquidation or winding up of the
affairs of the corporation, whether voluntary or involuntary, after payment
or provision for payment of the debts and other liabilities of the
corporation and after payment in full of the amounts to be paid to holders
of Series A Preferred Stock and Series B Preferred Stock as set forth in
Section (B)(II) and to holders of Additional Preferred Stock as set forth
in any Certificates of Designations filed with respect thereto, the
remaining assets and funds of the corporation shall be divided among and
paid ratably to the holders of Class A Common Stock and Class B Common
Stock (including those persons who shall become holders of Class A Common
Stock by reason of the conversion of their shares of Class B Common Stock)
as a single class. For the purposes hereof, the voluntary sale, conveyance,
exchange or transfer (for cash, shares of stock, securities or other
consideration) of all or substantially all the property or assets of the
corporation shall be deemed a voluntary liquidation, dissolution or winding
up of the corporation, but a consolidation or merger of the corporation
with one or more other corporations shall not be deemed to be a
liquidation, dissolution or winding up, voluntary or involuntary.
VI. Reclassifications, Etc.
Neither the Class A Common Stock nor the Class B Common Stock may be
subdivided, consolidated, reclassified or otherwise changed unless
contemporaneously therewith the other class of common stock is subdivided,
consolidated, reclassified or otherwise changed in the same proportion and
in the same manner.
VII. Mergers, Consolidations, Etc.
In any merger, consolidation or business combination of the
corporation with or into another corporation, whether or not the
corporation is the surviving corporation, the consideration per share to be
received by holders of either Class A Common Stock or Class B Common Stock
in such merger, consolidation or business combination must be identical to
that received by holders of the other class of common stock, except that in
any such transaction in which shares of capital stock are distributed, such
shares may differ as to voting rights to the extent and only to the extent
that the voting rights of the Class A Common Stock and Class B Common Stock
differ as provided herein.
VIII. Rights or Warrants.
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In case the corporation shall issue rights or warrants to purchase
shares of capital stock of the corporation, the terms of the rights and
warrants, and the number of rights or warrants per share, to be received by
holders of either Class A Common Stock or Class B Common Stock must be
identical to that received by holders of the other class of common stock,
except that the shares of capital stock into which such rights or warrants
are exercisable may differ as to voting rights to the extent and only to
the extent that the voting rights of the Class A Common Stock and Class B
Common Stock differ as provided herein."
4. Article FOURTH shall be further amended by adding the following as a new
Section VII to Paragraph B thereof:
"VII. Priority of Additional Preferred Stock.
Each of the Series A Preferred Stock and the Series B Preferred Stock
is subject to all the powers, rights, privileges, preferences and
priorities of any series of Additional Preferred Stock as shall be stated
and expressed in any Certificates of Designations filed with respect to any
series of Additional Preferred Stock pursuant to authority expressly
granted to and vested in the Board of Directors by the provisions of
Paragraph C of this Article FOURTH."
5. Article FOURTH shall be further amended by inserting at the end thereof
a new Paragraph C, as follows:
"C. Additional Preferred Stock.
I. Issuance.
Additional Preferred Stock may be issued from time to time in one or
more series, the shares of each series to have such powers, designations,
preferences and relative, participation, optional or other special rights,
and qualifications, limitations or restrictions thereof, as are stated and
expressed herein or in a Certificate or Certificates of Designations
providing for the issuance of such series, adopted by the Board of
Directors as hereinafter provided.
II. Powers of the Board of Directors.
Authority is hereby expressly granted to the Board of Directors to
authorize the issue of one or more series of Additional Preferred Stock,
and with respect to each such series to set forth in a Certificate or
Certificates of Designations provisions with respect to the issuance of
such series:
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(a) The maximum number of shares to constitute such series and the
distinctive designation thereof;
(b) Whether the shares of such series shall have voting rights, in
addition to any voting rights provided by law, and, if so, the terms of
such voting rights;
(c) The dividend rate, if any, on the shares of such series, the
conditions and dates upon which such dividends shall be payable, the
preference or relation which such dividends shall bear to the dividends
payable on any other class or classes or on any other series of capital
stock, and whether such dividends shall be cumulative or non-cumulative;
(d) Whether the shares of such series shall be subject to redemption
by the corporation, and, if made subject to redemption, the times, prices
and other terms and conditions of such redemption;
(e) The rights of the holders of shares of such series upon the
liquidation, dissolution or winding up of the corporation;
(f) Whether or not the shares of such series shall be subject to the
operation of a retirement or sinking fund, and, if so, the extent to and
manner in which any such retirement or sinking fund shall be applied to the
purchase or redemption of the shares of such series for retirement or to
other corporate purposes and the terms and provisions relative to the
operation thereof;
(g) Whether or not the shares of such series shall be convertible
into, or exchangeable for, shares of stock of any other class or classes,
or of any other series of the same class, and if so convertible or
exchangeable, the price or prices or the rate or rates of conversion or
exchange and the method, if any, of adjusting the same;
(h) The limitations and restrictions, if any, to be effective while
any shares of such series are outstanding upon the payment of dividends or
making of other distributions on, and upon the purchase, redemption or
other acquisition by the corporation of, the Class A Common Stock, the
Class B Common Stock or any other class or classes of stock of the
corporation ranking junior to the shares of such series either as to
dividends or upon liquidation;
(i) The conditions or restrictions, if any, upon the creation of
indebtedness of the corporation or upon the issue of any additional stock
(including additional shares of such series or of any other series or of
any other class) ranking on a parity with or prior to the shares of such
series as to dividends or distribution of assets on liquidation,
dissolution or winding up; and
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(j) Any other preference and relative, participating, optional, or
other special rights, and qualifications, limitations or restrictions
thereof as shall not be inconsistent with this Article FOURTH.
III. Ranking.
All shares of any one series of Additional Preferred Stock shall be
identical with each other in all respects, except that shares of any one
series issued at different times may differ as to the dates from which
dividends, if any, thereon shall be cumulative; and all series shall rank
equally and be identical in all respects, except as permitted by the
foregoing provisions of Section II hereof; and all shares of Additional
Preferred Stock shall rank senior to the common stock both as to dividends
and upon liquidation.
IV. Liquidation Rights.
In the event of any liquidation, dissolution or winding up of the
corporation, before any payment or distribution of the assets of the
corporation (whether capital or surplus) shall be made to or set apart for
the holders of any class or classes of stock of the corporation ranking
junior to the Additional Preferred Stock upon liquidation, the holders of
the shares of the Additional Preferred Stock shall be entitled to receive
payment at the rate fixed herein or in the resolution or resolutions
adopted by the Board of Directors providing for the issue of such series,
plus (if dividends on shares of such series of Additional Preferred Stock
shall be cumulative) an amount equal to all dividends (whether or not
earned or declared) accumulated to the date of final distribution to such
holders; but they shall be entitled to no further payment. If, upon any
liquidation, dissolution or winding up of the corporation, the assets of
the corporation, or proceeds thereof, distributable among the holders of
the shares of the Additional Preferred Stock shall be insufficient to pay
in full the preferential amount aforesaid, then such assets, or the
proceeds thereof, shall be distributed among such holders ratably in
accordance with the respective amounts which would be payable on such
shares if all amounts payable thereon were paid in full. For the purposes
of this Section IV, the voluntary sale, conveyance, exchange or transfer
(for cash, shares of stock, securities, or other consideration) of all or
substantially all the property or assets of the corporation shall be deemed
a voluntary liquidation, dissolution or winding up of the corporation, but
a consolidation or merger of the corporation with one or more other
corporations shall not be deemed to be a liquidation, dissolution or
winding up, voluntary or involuntary.
V. Voting.
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Except as shall be otherwise stated and expressed herein or in the
Certificate or Certificates of Designations adopted by the Board of
Directors with respect to the issuance of any series of Additional
Preferred Stock and except as otherwise required by the laws of the State
of Delaware, the holders of shares of Additional Preferred Stock shall
have, with respect to such shares, no right or power to vote on any
question or in any proceeding or to be represented at, or to receive notice
of, any meeting of stockholders."
6. Article NINTH of the Corporation's Certificate of Incorporation shall be
amended by adding the following as a new last paragraph of Article NINTH:
"No director of this corporation shall be personally liable to the
corporation or its stockholders for monetary damages for breach of
fiduciary duty as a director, except that this paragraph shall not
eliminate or limit the liability of a director (i) for any breach of the
director's duty of loyalty to this corporation or its stockholders, (ii)
for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law, (iii) under Section 174 of the
Delaware General Corporation Law or (iv) for any transaction from which the
director derived an improper personal benefit."
7. This amendment to the Certificate of Incorporation of CABLEVISION
SYSTEMS CORPORATION was duly adopted in accordance with Section 242 of the
General Corporation Law of the State of Delaware.
IN WITNESS WHEREOF, this certificate has been signed this 24th day of
September, 1987.
CABLEVISION SYSTEMS CORPORATION
By:/s/ William J. Bell
William J. Bell,
Vice Chairman
Attest:
/s/ Robert S. Lemle
Robert S. Lemle, Secretary
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CERTIFICATE OF AMENDMENT OF
CERTIFICATE OF INCORPORATION OF
CABLEVISION SYSTEMS CORPORATION
It is hereby certified that:
1. The name of the corporation (hereinafter called the "corporation")
is Cablevision Systems Corporation.
2. The certificate of incorporation of the corporation is hereby
amended by striking out Article FOURTH thereof and by substituting in lieu
thereof the following new Article FOURTH:
FOURTH: The aggregate number of shares which the corporation shall
have authority to issue shall be 70,400,000 shares: (a) 50,000,000 shares
of Class A Common Stock, par value $.01 per share ("Class A Common Stock"),
(b) 20,000,000 shares of Class B Common Stock, par value $.01 per share
("Class B Common Stock"), (c) 200,000 shares of Series A Cumulative
Convertible Preferred Stock, par value $.01 per share ("Series A Preferred
Stock"), and (d) 200,000 shares of Series B Cumulative Convertible
Preferred Stock, par value $.01 per share ("Series B Preferred Stock").
The designations, preferences and relative, participating, optional or
other special rights, and the qualifications, limitations or restrictions
thereof, of each class of stock are as follows:
A. Class A Common Stock and Class B Common Stock.
I. Dividends.
Subject to the rights of the holders of Series A Preferred Stock
and Series B Preferred Stock, and subject to any other provisions of
this Certificate of Incorporation, as amended from time to time,
holders of Class A Common Stock and Class B Common Stock shall be
entitled to receive equally on a per share basis such dividends and
other distributions in cash, stock or property of the corporation as
may be declared thereon by the Board of
<PAGE>
Directors from time to time out of assets or funds of the corporation
legally available therefor; provided that the Board of Directors shall
declare no dividend, and no dividend shall be paid, with respect to
any outstanding share of Class A Common Stock or Class B Common Stock,
whether paid in cash or property (including, without limitation,
shares of Class A Common Stock paid on or with respect to shares of
Class A Common Stock or shares of Class B Common Stock paid on or with
respect to shares of Class B Common Stock (collectively, "Stock
Dividends")), unless, simultaneously, the same dividend (in the case
of Stock Dividends, stock of the class on or with respect to which the
dividend is paid in the same percentage, relative to the total number
of shares of such class issued and outstanding immediately prior to
the payment of such dividend, as the Stock Dividend on or with respect
to the other class bears to the number of shares of such class issued
and outstanding immediately prior to the payment of such dividend) is
paid with respect to each share of Class A Common Stock and Class B
Common Stock. Stock Dividends with respect to Class A Common Stock may
only be paid with shares of Class A Common Stock and Stock Dividends
with respect to Class B Common Stock may only be paid with shares of
Class B Common Stock.
II. Voting.
(a) Except as otherwise required by statute, the Class A Common
Stock and Class B Common Stock shall have the sole right and power to
vote on all matters on which a vote of stockholders is to be taken. At
every meeting of the stockholders, each holder of Class A Common Stock
shall be entitled to cast one (1) vote in person or by proxy for each
share of Class A Common Stock standing in his or her name on the
transfer books of the corporation and each holder of Class B Common
Stock shall be entitled to cast ten (10) votes in person or by proxy
for each share of Class B Common Stock standing in his or her name on
the transfer books of the corporation. Except in the election of
directors of the corporation (voting in respect of which shall be
governed by the terms set forth in subsections (b) and (c) of this
Section II) and as may be otherwise required by statute, the holders
of Class A Common Stock and Class B Common Stock shall vote together
as a single class; provided, however, that the affirmative vote or
consent of the holders of at least 66-2/3% of the outstanding shares
of Class B Common Stock, voting separately as a class, shall be
required for (i) the authorization or issuance of any additional
shares of Class B Common Stock and (ii) any amendment, alteration or
repeal of any of the provisions of the Certificate of Incorporation of
the corporation which adversely affects the powers, preferences or
rights of the Class B Common Stock.
(b) With respect to the election of directors, holders of Class A
Common Stock shall vote as a separate class and be entitled to elect
25% of the total number of directors constituting the whole Board (the
"Class A Directors") and, if such 25% is not a whole number, then the
holders of Class A Common Stock shall be entitled to elect the nearest
higher whole number of directors that is at least 25% of the total
number of directors,
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so long as the number of outstanding shares of Class A Common Stock is
at least 10% of the total number of outstanding shares of both classes
of common stock. Holders of Class B Common Stock, voting as a separate
class, shall be entitled to elect the remaining directors. If, on the
record date for any stockholder meeting at which directors are to be
elected, the number of outstanding shares of Class A Common Stock is
less than 10% of the total number of outstanding shares of common
stock, however, the holders of the Class A and Class B Common Stock
shall vote together as a single class with respect to the election of
directors and the holders of Class A Common Stock shall not have the
right to elect 25% of the number of the directors, but shall have one
(1) vote per share for all directors and the holders of the Class B
Common Stock shall have ten (10) votes per share for all directors.
If, on the record date for any stockholder meeting at which directors
are to be elected, the number of outstanding shares of Class B Common
Stock is less than 12-1/2% of the total number of outstanding shares
of both classes of common stock, then the holders of Class A Common
Stock, voting as a separate class, shall continue to elect a number of
Class A Directors equal to 25% of the total number of directors
constituting the whole board and, in addition, shall vote together
with the holders of Class B Common Stock to elect the remaining
directors to be elected at such meeting, with the holders of Class A
Common Stock entitled to one (1) vote per share for all directors and
the holders of Class B Common Stock entitled to ten (10) votes per
share for all directors.
(c) Any vacancy in the office of a director elected by the
holders of Class A Common Stock voting as a separate class may be
filled by a vote of such holders voting as a separate class and any
vacancy in the office of a director elected by the holders of Class B
Common Stock voting as a separate class may be filled by a vote of
such holders voting as a separate class or, in the absence of a
stockholder vote, in the case of a vacancy in the office of a director
elected by either class, such vacancy may be filled by the remaining
directors. Any director elected by the Board of Directors to fill a
vacancy shall serve until the next annual meeting of stockholders and
until his or her successor has been elected and has qualified. If the
Board of Directors increases the number of directors in accordance
with Article Fifth of the Certificate of Incorporation of the
corporation, any vacancy so created may be filled by the Board of
Directors; provided that, so long as the holders of Class A Common
Stock have the rights provided in subsections (b) and (c) of this
Section II in respect of the last preceding annual meeting of
stockholders to elect 25% of the total number of directors
constituting the whole board, the Board of Directors may be so
enlarged by the directors only to the extent that at least 25% of the
enlarged board consists of directors elected by the holders of Class A
Common Stock or of persons appointed to fill vacancies created by the
death, resignation or removal of persons elected by the holders of
Class A Common Stock.
(d) Notwithstanding anything in this Section II to the contrary,
the holders of Class A Common Stock shall have exclusive voting power
on all matters upon which, pursuant to the Certificate of
Incorporation of the corporation or applicable laws, the holders
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of common stock are entitled to vote, at any time when no shares of
Class B Common Stock are issued and outstanding.
(e) Wherever any provision of the Certificate of Incorporation of
the corporation sets forth a specific percentage of the shares
outstanding and entitled to vote which is required for approval or
ratification of any action upon which the vote of the stockholders is
required or may be obtained, such provision shall mean such specified
percentage of the votes entitled to be cast by holders of shares then
outstanding and entitled to vote on such action.
III. Conversion Rights.
(a) Subject to the terms and conditions of this Section III, each
share of Class B Common Stock shall be convertible at any time or from
time to time, at the option of the holder thereof, at the office of
any transfer agent for Class B Common Stock, and at such other place
or places, If any, as the Board of Directors may designate, or, if the
Board of Directors shall fail so to designate, at the principal office
of the corporation (attention of the Secretary of the corporation),
into one (1) fully paid and nonassessable share of Class A Common
Stock. Upon conversion, the corporation shall make no payment or
adjustment on account of dividends accrued or in arrears on Class B
Common Stock surrendered for conversion or on account of any dividends
on the Class A Common Stock issuable on such conversion. Before any
holder of Class B Common Stock shall be entitled to convert the same
into Class A Common Stock, he shall surrender the certificate or
certificates for such Class B Common Stock at the office of said
transfer agent (or other place as provided above), which certificate
or certificates, if the corporation shall so request, shall be duly
endorsed to the corporation or in blank or accompanied by proper
instruments of transfer to the corporation or in blank (such
endorsements or instruments of transfer to be in form satisfactory to
the corporation), and shall give written notice to the corporation at
said office that he or she elects so to convert said Class B Common
Stock in accordance with the terms of this Section III, and shall
state in writing therein the name or names in which he or she wishes
the certificate or certificates for Class A Common Stock to be
registered. Every such notice of election to convert shall constitute
a binding contract between the holder of such Class B Common Stock and
the corporation, whereby the holder of such Class B Common Stock shall
be deemed to subscribe for the amount of Class A Common Stock which he
or she shall be entitled to receive upon such conversion, and, in
satisfaction of such subscription, to deposit the Class B Common Stock
to be converted and to release the corporation from all liability
thereunder, and thereby the corporation shall be deemed to agree that
the surrender of the certificate or certificates therefor and the
extinguishment of liability thereon shall constitute full payment of
such subscription for Class A Common Stock to be issued upon such
conversion. The corporation will as soon as practicable after such
deposit of a certificate or certificates for Class B Common Stock,
accompanied by the written notice and the statement above prescribed,
issue and deliver at the office of said
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transfer agent (or other place as provided above) to the person for
whose account such Class B Common Stock was so surrendered, or to his
nominee or nominees, a certificate or certificates for the number of
full shares of Class A Common Stock to which he shall be entitled as
aforesaid. Subject to the provisions of subsection (d) of this Section
III, such conversion shall be deemed to have been made as of the date
of such surrender of the Class B Common Stock to be converted; and the
person or persons entitled to receive the Class A Common Stock
issuable upon conversion of such Class B Common Stock shall be treated
for all purposes as the record holder or holders of such Class A
Common Stock on such date. Upon conversion of shares of Class B Common
Stock, the shares of Class B Common Stock so converted will be
cancelled and retired by the corporation, such shares shall not be
reissued and the number of shares of Class B Common Stock which the
corporation shall have authority to issue shall be decreased by the
number of shares of Class B Common Stock so converted and the Board of
Directors shall take such steps as are required to so retire such
shares.
(b) The issuance of certificates for shares of Class A Common
Stock upon conversion of shares of Class B Common Stock shall be made
without charge for any stamp or other similar tax in respect of such
issuance. However, if any such certificate is to be issued in a name
other than that of the holder of the share or shares of Class B Common
Stock converted, the person or persons requesting the issuance thereof
shall pay to the corporation the amount of any tax which may be
payable in respect of any transfer involved in such issuance or shall
establish to the satisfaction of the corporation that such tax has
been paid or that no such tax is due.
(c) The corporation shall not be required to convert Class B
Common Stock, and no surrender of Class B Common Stock shall be
effective for that purpose, while the stock transfer books of the
corporation are closed for any purpose; but the surrender of Class B
Common Stock for conversion during any period while such books are so
closed shall be deemed effective for conversion immediately upon the
reopening of such books, as if the conversion had been made on the
date such Class B Common Stock was surrendered.
(d) The corporation will at all times reserve and keep available,
solely for the purpose of issue upon conversion of the outstanding
shares of Class B Common Stock, such number of shares of Class A
Common Stock as shall be issuable upon the conversion of all such
outstanding shares, provided that nothing contained herein shall be
construed to preclude the corporation from satisfying its obligations
in respect of the conversion of the outstanding shares of Class B
Common Stock by delivery of shares of Class A Common Stock which are
held in the treasury of the corporation. The corporation covenants
that if any shares of Class A Common Stock, required to be reserved
for purposes of conversion hereunder, require registration with or
approval of any governmental authority under any federal or state law
before such shares of Class A Common Stock may be issued upon
conversion, the corporation will use its best efforts to cause such
shares to be duly registered
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or approved, as the case may be. The corporation will endeavor to list
the shares of Class A Common Stock required to be delivered upon
conversion prior to such delivery upon each national securities
exchange, if any, upon which the outstanding Class A Common Stock is
listed at the time of such delivery. The corporation covenants that
all shares of Class A Common Stock which shall be issued upon
conversion of the shares of Class B Common Stock, will, upon issue, be
fully paid and nonassessable and not entitled to any preemptive
rights.
IV. Liquidation Rights.
In the event of any dissolution, liquidation or winding up of the
affairs of the corporation, whether voluntary or involuntary, after
payment or provision for payment of the debts and other liabilities of
the corporation and after payment in full of the amounts to be paid to
holders of Series A Preferred Stock and Series B Preferred Stock as
set forth in Section (B)(II), the remaining assets and funds of the
corporation shall be divided among and paid ratably to the holders of
Class A Common Stock and Class B Common Stock (including those persons
who shall become holders of Class A Common Stock by reason of the
conversion of their shares of Class B Common Stock) as a single class.
For the purposes hereof, the voluntary sale, conveyance, exchange or
transfer (for cash, shares of stock, securities or other
consideration) of all or substantially all the property or assets of
the corporation shall be deemed a voluntary liquidation, dissolution
or winding up of the corporation, but a consolidation or merger of the
corporation with one or more other corporations shall not be deemed to
be a liquidation, dissolution or winding up, voluntary or involuntary.
V. Reclassifications, Etc.
Neither the Class A Common Stock nor the Class B Common Stock may
be subdivided, consolidated, reclassified or otherwise changed unless
contemporaneously therewith the other class of common stock is
subdivided, consolidated, reclassified or otherwise changed in the
same proportion and in the same manner.
VI. Mergers, Consolidations, Etc.
In any merger, consolidation or business combination of the
corporation with or into another corporation, whether or not the
corporation is the surviving corporation, the consideration per share
to be received by holders of either Class A Common Stock or Class B
Common Stock in such merger, consolidation or business combination
must be identical to that received by holders of the other class of
common stock, except that in any such transaction in which shares of
capital stock are distributed, such shares may differ as to voting
rights to the extent and only to the extent that the voting rights of
the Class A Common Stock and Class B Common Stock differ as provided
herein.
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VII. Rights or Warrants.
In case the corporation shall issue rights or warrants to
purchase shares of capital stock of the corporation, the terms of the
rights and warrants, and the number of rights or warrants per share,
to be received by holders of either Class A Common Stock or Class B
Common Stock must be identical to that received by holders of the
other class of common stock, except that the shares of capital stock
into which such rights or warrants are exercisable may differ as to
voting rights to the extent and only to the extent that the voting
rights of the Class A Common Stock and Class B Common Stock differ as
provided herein.
B. Series A Preferred Stock and Series B Preferred Stock
I. Dividends.
The shares of Series A Preferred Stock and Series B Preferred
Stock shall be entitled to receive, when and as declared by the Board
of Directors, out of funds legally available for the payment of
dividends, cumulative dividends at the annual rate of $12.00 per
share, and no more, payable in cash semiannually on the last business
day of January and July in each year with respect to the semiannual
period ending on the last day of the month in which payment is made in
preference to cash dividends on shares of any class of common stock of
the corporation ("Common Stock"), such dividends with respect to any
share of Series A Preferred Stock and Series B Preferred Stock to
accumulate from the date of issue thereof, with the first dividend to
be paid on the last business day of the semiannual dividend period
during which such share shall have been issued. No cash dividends
shall be declared and set apart for payment of Series A Preferred
Stock or Series B Preferred Stock in respect of any semiannual
dividend period unless there shall likewise be or have been declared
and set apart for payment on all shares of Series A Preferred Stock
and Series B Preferred Stock at the time outstanding cash dividends
ratably in accordance with the sums which would be payable on such
shares if all dividends were declared and paid in full. If and so long
as any dividends payable on the shares of the Series A Preferred Stock
and Series B Preferred Stock in respect of all prior semiannual
dividend periods shall not have been paid in full at the applicable
rate, the corporation shall not declare or pay any dividends or make
any distributions of assets (other than Stock Dividends) on shares of
Common Stock.
II. Liquidation.
The shares of Series A Preferred Stock and Series B Preferred
Stock shall be preferred over the shares of Common Stock as to assets
so that in the event of any liquidation, dissolution or winding up of
the affairs of the corporation, whether voluntary or involuntary, the
holders of the Series A Preferred Stock and Series B Preferred Stock
shall be entitled to receive out of the assets of the corporation
available for distribution to its stockholders, whether from capital,
surplus or earnings, before any distribution is made to
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holders of shares of Common Stock, an amount equal to $100 per share
(the "Liquidation Value") plus an amount equal to all dividends
(whether or not earned or declared) accrued and unpaid on the shares
of Series A Preferred Stock or Series B Preferred Stock, as the case
may be, to the date of final distribution. If, upon any liquidation,
dissolution, or winding up of the corporation, the assets of the
corporation, or proceeds thereof, distributable among the holders of
shares of Series A Preferred Stock and Series B Preferred Stock shall
be insufficient to pay in full the preferential amount aforesaid, then
such assets, or the proceeds thereof, shall be distributable among
such holders ratably in accordance with the respective amounts which
would be payable on such shares if all amounts payable thereon were
payable in full. For the purposes hereof, the voluntary sale,
conveyance, exchange or transfer (for cash, shares of stock,
securities or other consideration) of all or substantially all the
property or assets of the corporation shall be deemed a voluntary
liquidation, dissolution or winding up of the corporation, but a
consolidation or merger of the corporation with one or more other
corporations shall not be deemed to be a liquidation, dissolution or
winding up, voluntary or involuntary.
III. Redemption.
(A) The Board of Directors of the corporation may, but shall not
be required to, redeem, at any time and from time to time commencing
one year after the date of this Certificate of Amendment, all, or any
number less than all, of the outstanding shares of Series A Preferred
Stock and Series B Preferred Stock at a price of $100 per share plus,
in each case, an amount equal to all dividends (whether or not earned
or declared) accrued and unpaid on the shares of Series A Preferred
Stock or Series B Preferred Stock, as the case may be, to the date
fixed for redemption (the "Redemption Price"); provided, however, that
for a period of 30 years following the date of this Certificate of
Amendment, such redemption may be effected only if the Market Price
(as defined in Section (B)(IV)(F)(xi)) per share of Class A Common
Stock on any twenty Trading Days (as defined in Section
(B)(IV)(F)(xi)) within a period of thirty consecutive Trading Days
preceding the date of the notice of redemption is equal to or greater
than 150% of 135% of the price to the public of the Class A Common
Stock offered pursuant to the prospectus forming a part of the
Registration Statement on Form S-1 (File No. 33-1936). Not more than
60 and not less than 30 days previous to the date fixed for
redemption, a notice of the time and place thereof shall be given to
the holders of record of the shares so to be redeemed in such manner
as may be prescribed by the Board of Directors. In the case of the
redemption of less than all the outstanding shares of Series A
Preferred Stock and Series B Preferred Stock, the shares to be
redeemed shall be chosen by lot in such manner as may be prescribed by
the Board of Directors. The corporation may deposit the aggregate
Redemption Price in trust with a bank or trust company (having capital
and surplus of not less than $100,000,000) in the Borough of
Manhattan, City of New York, prior to the redemption date. Upon making
such deposit, or, if no such deposit is made, then upon such
redemption date, holders of the Series A Preferred Stock or Series B
Preferred Stock, as the case may be, called for redemption shall
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cease to be stockholders with respect to such shares and thereafter
such shares shall no longer be transferable on the books of the
corporation and such holders shall have no interest or claim against
the corporation with respect to such shares except the right to
receive payment of the Redemption Price upon surrender of their
certificates. Any funds deposited and unclaimed at the end of two
years from the date fixed for redemption shall be repaid to the
corporation upon its request, after which repayment the holders of
shares called for redemption shall look only to the corporation for
payment of the Redemption Price. The Board of Directors may cause the
transfer books of the corporation to be closed as to the shares to be
redeemed.
(B) Following the death of both Charles F. Dolan ("Dolan") and
his widow, any holder of Series A Preferred Stock may, at the option
of the holder, require the corporation to redeem, in whole or part,
the shares of Series A Preferred Stock owned by such holder, at the
Redemption Price, by delivering, within one year from the date of the
settlement of Dolan's estate or the estate of his widow, as the case
may be, a written notice to the Secretary of the corporation setting
forth the number of shares of Series A Preferred Stock to be redeemed
and the date fixed for redemption. The date fixed for redemption
specified by such holder shall be not less than 180 days from the date
on which such written notice is delivered to the corporation. Upon
such redemption date, such holder shall cease to be a stockholder with
respect to such shares of Series A Preferred Stock redeemed and
thereafter such shares shall no longer be transferable on the books of
the corporation and such holder shall have no interest or claim
against the corporation with respect to such shares except the right
to receive the Redemption Price. The corporation shall redeem the
shares of Series A Preferred Stock offered for redemption pursuant to
such written notice on the date fixed for redemption. If on the
redemption date, funds are not legally available to the corporation
for redemption of the shares of Series A Preferred Stock which have
been tendered to the corporation for redemption, the corporation shall
redeem on such redemption date, at the Redemption Price, that number
of shares of Series A Preferred Stock which it can lawfully redeem and
from time to time thereafter as soon as funds are legally available
the corporation shall redeem at the Redemption Price the shares of
Series A Preferred Stock tendered for redemption until the corporation
has redeemed in total the number of shares of Series A Preferred Stock
it would otherwise have redeemed on the redemption date. Dividends on
shares of Series A Preferred Stock shall continue to accrue until the
Redemption Price is paid by the corporation with respect to such
shares. To this end, the corporation shall sell, and shall cause its
subsidiaries to sell, any and all assets and properties necessary to
raise such funds as promptly as practicable consistent with good
business practice or liquidate the corporation.
(C) Upon any redemption of shares of Series A Preferred Stock or
Series B Preferred Stock, the shares of Series A Preferred Stock or
Series B Preferred Stock so redeemed shall be cancelled and retired by
the corporation, such shares shall not be reissued and the number of
shares of Series A Preferred Stock or Series B Preferred Stock,
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as the case may be, which the corporation shall have authority to
issue shall be decreased by the number of shares of Series A Preferred
Stock or Series B Preferred Stock, as the case may be, so redeemed and
the Board of Directors shall take such steps as are required to so
retire such shares,
IV. Conversion.
(A) Subject to the terms and conditions of this Section (IV),
each share of Series A Preferred Stock and Series B Preferred Stock
shall be convertible at the Liquidation Value plus an amount equal to
all dividends (whether or not earned or declared) accrued or unpaid on
the shares of Series A Preferred Stock or Series B Preferred Stock, as
the case may be, to the date of conversion (the "Accrued Dividends")
at any time or from time to time prior to the third business day prior
to the date fixed for redemption of such shares as provided in Section
(B)(III)(A), at the option of the respective holder thereof, at the
office of any transfer agent for Series A Preferred Stock or Series B
Preferred Stock, as the case may be, and at such other place or
places, if any, as the Board of Directors may designate, or, if the
Board of Directors shall fail so to designate, at the principal office
of the corporation (attention of the Secretary of the corporation),
into (x) in the case of Series A Preferred Stock, that number of fully
paid and nonassessable shares of Class B Common Stock determined by
dividing $100 plus the Accrued Dividends by 135% of the price to the
public of the Class A Common Stock offered pursuant to the prospectus
forming a part of the Registration Statement on Form S-l (File No.
33-1936) or (y) in the case of Series B Preferred Stock, that number
of fully paid and nonassessable shares of Class A Common Stock
determined by dividing $100 plus the Accrued Dividends by 135% of the
price to the public of the Class A Common Stock offered pursuant to
the prospectus forming a part of the Registration Statement on Form
S-1 (File No. 33-1936). The number of shares of Class B Common Stock
or Class A Common Stock, as the case may be, issuable at any time,
after giving effect to the latest prior adjustment pursuant to the
provisions of subsection (F) of this Section (IV), if any, in exchange
for each share of Series A Preferred Stock or Series B Preferred
Stock, as the case may be, at the Liquidation Value plus the Accrued
Dividends, shall hereinafter be called the "Conversion Rate." Upon
conversion, the corporation shall make no payment or adjustment on
account of dividends accrued or in arrears on Series A Preferred Stock
or Series B Preferred Stock, as the case may be, surrendered for
conversion or on account of any dividends on the Class B Common Stock
or Class A Common Stock, as the case may be, issuable on such
conversion. Before any holder of Series A Preferred Stock or Series B
Preferred Stock, as the case may be, shall be entitled to convert the
same into Class B Common Stock or Class A Common Stock, as the case
may be, he or she shall surrender the certificate or certificates for
such Series A Preferred Stock or Series B Preferred Stock, as the case
may be, at the office of said transfer agent (or other place as
provided above), which certificate or certificates, if the corporation
shall so request, shall be duly endorsed to the corporation or in
blank or accompanied by proper instruments of transfer to the
corporation or in blank (such endorsements or instruments of transfer
to be in
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form satisfactory to the corporation), and shall give written notice
to the corporation at said office that he or she elects so to convert
said Series A Preferred Stock or Series B Preferred Stock, as the case
may be, in accordance with the terms of this Section (IV), and shall
state in writing therein the name or names in which he or she wishes
the certificate or certificates for Class B Common Stock or Class A
Common Stock, as the case may be, to be registered. Every such notice
of election to convert shall constitute a binding contract between the
holder of such Series A Preferred Stock or Series B Preferred Stock,
as the case may be, and the corporation, whereby the holder of such
Series B Preferred Stock or Series A Preferred Stock, as the case may
be, shall be deemed to subscribe for the amount of Class B Common
Stock or Class A Common Stock, as the case may be, which he or she
shall be entitled to receive upon such conversion, and, in
satisfaction of such subscription, to deposit the Series A Preferred
Stock or Series B Preferred Stock, as the case may be, to be converted
and to release the corporation from all liability thereunder, and
thereby the corporation shall be deemed to agree that the surrender of
the certificate or certificates therefor and the extinguishment of
liability thereon shall constitute full payment of such subscription
for Class B Common Stock or Class A Common Stock, as the case may be,
to be issued upon such conversion. The corporation will as soon as
practicable after such deposit of a certificate or certificates for
Series A Preferred Stock or Series B Preferred Stock, as the case may
be, accompanied by the written notice and the statement above
prescribed, issue and deliver at the office of said transfer agent (or
other place as provided above) to the person for whose account such
Series A Preferred Stock or Series B Preferred Stock, as the case may
be, was so surrendered, or to his nominee or nominees, a certificate
or certificates for the number of full shares of Class B Common Stock
or Class A Common Stock, as the case may be, to which he shall be
entitled as aforesaid, together with the Fractional Payment (as
defined in subsection (C) of this Section (IV)), if any. Subject to
the provisions of subsection (D) of this Section (IV), such conversion
shall be deemed to have been made as of the date of such surrender of
the Series A Preferred Stock or Series B Preferred Stock, as the case
may be, to be converted; and the person or persons entitled to receive
the Class B Common Stock or Class A Common Stock, as the case may be,
issuable upon conversion of such Series A Preferred Stock or Series B
Preferred Stock, as the case may be, shall be treated for all purposes
as the record holder or holders of such Class B Common Stock or Class
A Common Stock, as the case may be, on such date.
(B) The issuance of certificates for shares of Class B Common
Stock or Class A Common Stock, as the case may be, upon conversion of
shares of Series A Preferred Stock or Series B Preferred Stock, as the
case may be, shall be made without charge for any stamp or other
similar tax in respect of such issuance. However, if any such
certificate is to be issued in a name other than that of the holder of
the share or shares of Series A Preferred Stock or Series B Preferred
Stock, as the case may be, converted, the person or persons requesting
the issuance thereof shall pay to the corporation the amount of any
tax which may be payable in respect of any transfer involved in such
issuance or shall establish to the satisfaction of the corporation
that such tax has been paid or that no such tax is due.
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(C) No fraction of a share of Class B Common Stock or Class A
Common Stock, as the case may be, shall be issued in connection with
the conversion of shares of Series A Preferred Stock or Series B
Preferred Stock, as the case may be, into Class B Common Stock or
Class A Common Stock, as the case may be, but in lieu thereof, each
holder of Series A Preferred Stock or Series B Preferred Stock, as the
case may be, who would otherwise be entitled to a fractional interest
of a share of Class B Common Stock or Class A Common Stock, as the
case may be, shall, upon surrender of such holder's certificate or
certificates representing shares of Series A Preferred Stock or Series
B Preferred Stock, as the case may be, receive a cash payment (without
interest) (the "Fractional Payment") equal to the product resulting
from multiplying (i) the fraction of a share of Class B Common Stock
or Class A Common Stock, as the case may be, to which such holder
would otherwise have been entitled by (ii) the Market Price (as
defined in subsection (F)(xi) of this Section (IV)) per share of Class
A Common Stock on the date such Series A Preferred Stock or Series B
Preferred Stock, as the case may be, was surrendered.
(D) The corporation shall not be required to convert Series A
Preferred Stock or Series B Preferred Stock, and no surrender of
Series A Preferred Stock or Series B Preferred Stock shall be
effective for that purpose, while the stock transfer books of the
corporation are closed for any purpose; but the surrender of Series A
Preferred Stock or Series B Preferred Stock, as the case may be, for
conversion during any period while such books are so closed shall be
deemed effective for conversion immediately upon the reopening of such
books, as if the conversion had been made on the date such Series A
Preferred Stock or Series B Preferred Stock, as the case may be, was
surrendered.
(E) The corporation will at all times reserve and keep available,
solely for the purpose of issue upon conversion of the outstanding
shares of Series A Preferred Stock or Series B Preferred Stock, as the
case may be, such number of shares of Class B Common Stock and Class A
Common Stock as shall be issuable upon the conversion of all such
outstanding shares, provided that nothing contained herein shall be
construed to preclude the corporation from satisfying its obligations
in respect of the conversion of the outstanding shares of Series A
Preferred Stock or Series B Preferred Stock, as the case may be, by
delivery of shares of Class B Common Stock or Class A Common Stock, as
the case may be, which are held in the treasury of the corporation.
The corporation covenants that if any shares of Class B Common Stock
or Class A Common Stock, as the case may be, required to be reserved
for purposes of conversion hereunder, require registration with or
approval of any governmental authority under any federal or state law
before such shares of Class B Common Stock or Class A Common Stock, as
the case may be, may be issued upon conversion, the corporation will
use its best efforts to cause such shares to be duly registered or
approved, as the case may be. The corporation will endeavor to list
the shares of Class B Common Stock or Class A Common Stock, as the
case may be, required to be delivered upon conversion prior to such
delivery upon each national securities exchange, if any, upon which
the outstanding Class B Common Stock or Class A Common Stock, as the
case may
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<PAGE>
be, is listed at the time of such delivery. The corporation covenants
that all shares of Class B Common Stock and Class A Common Stock which
shall be issued upon conversion of the shares of Series A Preferred
Stock or Series B Preferred Stock, as the case may be, will, upon
issue, be fully paid and nonassessable and not entitled to any
preemptive rights.
(F) The Conversion Rate shall be subject to the following
adjustments:
(i) In case the corporation shall at any time after the date of
original issuance of the Series A Preferred Stock or Series B
Preferred Stock, as the case may be, (1) pay a dividend on the Class B
Common Stock or Class A Common Stock, as the case may be, payable in
shares of its capital stock (whether in shares of Class B Common
Stock, Class A Common Stock or capital stock of any other class), (2)
subdivide the outstanding shares of Class B Common Stock or Class A
Common Stock, as the case may be, into a greater number of shares, (3)
combine the outstanding shares of Class B Common Stock or Class A
Common Stock, as the case may be, into a smaller number of shares or
(4) issue any shares of its capital stock in a reclassification of the
Class B Common Stock or Class A Common Stock, as the case may be
(including any such reclassification in connection with a
consolidation or merger in which the corporation is the continuing
corporation), the Conversion Rate at the record date for such dividend
or the effective date of such subdivision, combination or
reclassification, and/or the number or kind of shares of capital stock
issuable on such date, shall be proportionately adjusted so that if a
holder of Series A Preferred Stock or Series B Preferred Stock, as the
case may be, converts his or her shares of Series A Preferred Stock or
Series B Preferred Stock, as the case may be, after such time, such
holder of Series A Preferred Stock or Series B Preferred Stock, as the
case may be, shall be entitled to receive the aggregate number and
kind of shares of capital stock which, if the Series A Preferred Stock
or Series B Preferred Stock, as the case may be, had been converted
immediately prior to such date, such holder of Series A Preferred
Stock or Series B Preferred Stock, as the case may be, would have
owned upon such conversion and have been entitled to receive by virtue
of such dividend, subdivision, combination or reclassification. Such
adjustment shall be made successively whenever any event listed above
in this paragraph (i) of subsection (F) shall occur. In the event
that, as a result of an adjustment made pursuant to this paragraph
(i), when shares of Series A Preferred Stock or Series B Preferred
Stock, as the case may be, are converted, the holder thereof shall
become entitled to receive any shares of capital stock of the
corporation other than shares of Class B Common Stock or Class A
Common Stock, as the case may be, thereafter the number of such other
shares so receivable upon conversion of such shares of Series A
Preferred Stock or Series B Preferred Stock, as the case may be, shall
be subject to adjustment from time to time in a manner and on terms as
nearly equivalent as practicable to the provisions with respect to the
shares of Class B
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<PAGE>
Common Stock or Class A Common Stock, as the case may be, contained in
subsection (F) hereof.
(ii) In case the corporation shall issue rights or warrants to
all holders of its Class B Common Stock or Class A Common Stock, as
the case may be, entitling them to subscribe for or purchase shares of
Class B Common Stock or Class A Common Stock, as the case may be, at a
price per share less than the current Market Price (as defined in
paragraph (xi) below) per share of Class A Common Stock on the date on
which a record is to be taken for the purpose of such rights or
warrants, or if a record is not to be taken, the date as of which the
holders of Class B Common Stock or Class A Common Stock, as the case
may be, of record to be entitled to such rights or warrants are to be
determined, the Conversion Rate at such date shall be adjusted so that
if a holder of Series A Preferred Stock or Series B Preferred Stock,
as the case may be, converts his or her shares of Series A Preferred
Stock or Series B Preferred Stock, as the case may be, after such
time, the number of shares of Class B Common Stock or Class A Common
Stock, as the case may be, into which such shares of Series A
Preferred Stock or Series B Preferred Stock, as the case may be, shall
thereafter be convertible shall be determined by multiplying the
Conversion Rate in effect immediately prior to such issuance by a
fraction, the numerator of which shall be the number of shares of
Class B Common Stock or Class A Common Stock, as the case may be,
outstanding on the date of issuance of such rights or warrants plus
the number of additional shares of Class B Common Stock or Class A
Common Stock, as the case may be, offered for subscription or purchase
and the denominator of which shall be the number of shares of Class B
Common Stock or Class A Common Stock, as the case may be, outstanding
on the date of issuance of such rights or warrants plus the number of
additional shares of Class B Common Stock or Class A Common Stock, as
the case may be, offered for subscription or purchase which the
aggregate offering price of the number of shares of Class B Common
Stock or Class A Common Stock, as the case may be, so offered would
purchase at such current Market Price per share of Class A Common
Stock. Such adjustment shall be made whenever such rights or warrants
are issued and shall become effective immediately after the record
date for the determination of stockholders entitled to receive such
rights or warrants. On the expiration of such rights or warrants, the
number of shares of Class B Common Stock or Class A Common Stock, as
the case may be, into which such shares of Series A Preferred Stock or
Series A Preferred Stock, as the case may be, shall be convertible
shall forthwith be readjusted to such number as would have obtained
had the adjustment made upon the issuance of such rights or warrants
been made only upon the basis of the number of shares of Class B
Common Stock or Class A Common Stock, as the case may be, actually
issued upon the exercise of such rights or warrants.
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<PAGE>
(iii) In case the corporation shall fix a record date for the
making of a distribution to all holders of its Class B Common Stock or
Class A Common Stock, as the case may be (including any such
distribution made in connection with a consolidation or merger in
which the corporation is the continuing corporation), of evidences of
its indebtedness, assets (excluding dividends paid in, or
distributions of, cash) or subscription rights or warrants (excluding
those referred to in subsection (ii) above), the number of shares of
Class B Common Stock or Class A Common Stock, as the case may be, into
which each share of Series A Preferred Stock or Series B Preferred
Stock, as the case may be, shall be convertible after such record date
shall be determined by multiplying the number of shares of Class B
Common Stock or Class A Common Stock, as the case may be, into which
such share of Series A Preferred Stock or Series B Preferred Stock, as
the case may be, was convertible immediately prior to such record date
by a fraction of which the numerator shall be the current Market Price
(as defined in paragraph (xi) below) per share of Class A Common Stock
on such record date and of which the denominator shall be such current
Market Price per share of Class A Common Stock, less the fair market
value (as determined by the Board of Directors, whose determination
shall be conclusive) of the portion of the evidences of indebtedness,
assets or subscription rights or warrants so distributed applicable to
one share of Class B Common Stock or Class A Common Stock, as the case
may be. Such adjustment shall be made successively whenever such a
record date is fixed; and in the event that such distribution is not
so made, the Conversion Rate shall again be adjusted to be the
Conversion Rate which would then be in effect if such record date had
not been fixed.
(iv) In case the corporation shall at any time after the date of
original issuance of the Series A Preferred Stock or Series B
Preferred Stock, as the case may be, effect a capital reorganization,
reclassification, consolidation, merger or any sale of all or
substantially all of the corporation's assets to another person
(collectively, any "Organization Change") in such a way that holders
of Class B Common Stock or Class A Common Stock, as the case may be,
are entitled to receive (either directly or upon subsequent
liquidation) stock, securities, property, assets or cash with respect
to or in exchange for Class B Common Stock or Class A Common Stock, as
the case may be, then, as a condition to such Organization Change,
lawful and adequate provision shall be made so that if a holder of
Series A Preferred Stock or Series B Preferred Stock, as the case may
be, converts his or her shares of Series A Preferred Stock or Series B
Preferred Stock, as the case may be, after such Organization Change,
such holder of Series A Preferred Stock or Series B Preferred Stock,
as the case may be, shall be entitled to receive such shares of stock,
securities, property, assets or cash which, if the Series A Preferred
Stock or Series B Preferred Stock, as the case may be, had been fully
converted immediately prior to such Organization Change, such holder
of Series A Preferred Stock or Series B Preferred Stock, as the case
may be, would have owned upon such conversion and have been entitled
to
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<PAGE>
receive by virtue of such Organization Change. In any such case,
appropriate provision shall be made with respect to such holder's
rights and interests to the end that the provisions of this subsection
(F) will thereafter be applicable in relation to any shares of stock,
securities, property, assets or cash thereafter receivable upon the
conversion of shares of Series A Preferred Stock or Series B Preferred
Stock, as the case may be. The corporation shall not effect any such
consolidation, merger or sale unless prior to the consummation
thereof, the successor corporation (if other than the corporation)
resulting from such consolidation or merger or the corporation
purchasing such assets assumes by written instrument the obligation to
deliver to each holder of Series A Preferred Stock or Series B
Preferred Stock, as the case may be, such shares of stock, securities,
property, assets or cash as, in accordance with the foregoing
provisions, such holder may be entitled to acquire.
(v) In case any event shall occur as to which the provisions of
this subsection (F) are not strictly applicable but the failure to
make any adjustment would not fairly protect the rights of the holders
of the Series A Preferred Stock or Series B Preferred Stock, as the
case may be, in accordance with the essential intent and principles
thereof or the adjustment provisions contained in Section 2 of the
Option Certificate for 840,000 Shares to purchase Class A Common Stock
of the corporation (the "Option") heretofore issued pursuant to the
corporation's 1986 Non-Qualified Stock Option Plan (the "Plan") to
Francis F. Randolph, Jr., without giving effect to Sections 2.10 and
2.12 or to any amendment to the Plan or the Option effected subsequent
to the date of this certificate of Amendment, then, in each case, the
corporation shall appoint a firm of independent certified public
accountants of recognized national standing, which shall give their
opinion upon the adjustment, if any, on a basis consistent with the
essential intent and principles established in this subsection (F) or
such adjustment provisions referred to above, necessary to preserve,
without dilution, the rights of the holders of the Series A Preferred
Stock or Series B Preferred Stock, as the case may be. Upon receipt of
such opinion, the corporation shall make the adjustments described
therein.
(vi) In any case in which this subsection (F) shall require that
an adjustment as a result of any event becomes effective after a
record date for such event, the corporation may elect to defer until
after the occurrence of such event (i) issuing to the holder of any
shares of Series A Preferred Stock or Series B Preferred Stock, as the
case may be, converted after such record date and before the
occurrence of such event the additional shares of Class B Common Stock
or Class A Common Stock, as the case may be, issuable upon such
conversion over and above the shares of Class B Common Stock or Class
A Common Stock, as the case may be, issuable upon such conversion on
the basis of the Conversion Rate prior to adjustment and (ii) paying
to such holder the Fractional Payment; and, in lieu of the shares the
issuance of which is so deferred, the corporation shall issue or cause
its
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<PAGE>
transfer agent to issue due bills or other appropriate evidence of the
right to receive such shares.
(vii) Anything herein to the contrary notwithstanding, no
adjustment in the Conversion Rate shall be required unless such
adjustment, either by itself or with other adjustments not previously
made, would require a change of at least one-tenth of one percent in
such rate; provided, however, that any adjustment which by reason of
this paragraph (vii) of subsection (F) is not required to be made
shall be carried forward and taken into account in any subsequent
adjustment.
(viii) All calculations under this subsection (F) shall be made
to the nearest one--tenth (1/10) of a share.
(ix) Whenever the Conversion Rate shall be adjusted pursuant to
this subsection (F), the corporation shall forthwith obtain, and cause
to be delivered to each holder of Series A Preferred Stock and Series
B Preferred Stock, a certificate signed by the principal financial or
accounting officer of the corporation setting forth in reasonable
detail the event requiring the adjustment and the method by which such
adjustment was calculated and specifying the new Conversion Rate. In
the case referred to in paragraph (iv) of this subsection (F), such a
certificate shall be issued describing the amount and kind of stock,
securities, property, assets or cash which shall be receivable upon
conversion of the Series A Preferred Stock or Series B Preferred
Stock, as the case may be, after giving effect to the provisions of
such paragraph (iv).
(x) The corporation shall send written notice to each holder of
Series A Preferred Stock and Series B Preferred Stock at least five
(5) business days prior to the date on which the corporation closes
its books or sets a record date (A) with respect to any dividend or
distribution upon the Class B Common Stock or Class A Common Stock, as
the case may be, (B) with respect to any pro rata subscription offer
to holders of Class B Common Stock or Class A Common Stock, as the
case may be, or (C) for determining rights to vote with respect to any
Organization Change, dissolution or liquidation. The corporation shall
also give at least five (5) business days' prior written notice to
each holder of Series A Preferred Stock and Series B Preferred Stock
of the date on which any Organization Change, dissolution or
liquidation will take place.
(xi) For purposes of paragraphs (ii) and (iii) of this subsection
(F):
(a) "Market Price" of a share of Class A Common Stock for
any Trading Day shall mean (x) the last reported sale price for
the Class A Common Stock on such Trading Day as published by the
National Association of Securities Dealers Automated Quotation
System ("NASDAQ") (or, if such price is not so
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<PAGE>
published by NASDAQ, the average of the closing bid and asked
prices for the Class A Common Stock on such Trading Day, as
furnished by any New York Stock Exchange member firm selected
from time to time by the corporation for such purpose), or (y) if
the Class A Common Stock is then listed or admitted to trading on
a national securities exchange, the closing price for the Class A
Common Stock on such Trading Day as reported in the consolidated
transaction reporting system for securities listed or traded on
such exchange.
(b) "Trading Day" shall mean any day on which trading takes
place (x) in the over-the-counter market and prices reflecting
such trading are published by NASDAQ or (y) if the Class A Common
Stock is then listed or admitted to trading on a national
securities exchange, on the principal national securities
exchange on which the Class A Common Stock is then listed or
admitted to trading.
(G) Upon any conversion of Series A Preferred Stock or Series B
Preferred Stock, as the case may be, the shares of Series A Preferred
Stock or Series B Preferred Stock, as the case may be, so converted
shall be cancelled and retired by the corporation, such shares shall
not be reissued and the number of shares of Series A Preferred Stock
or Series B Preferred Stock, as the case may be, which the corporation
shall have authority to issue shall be decreased by the number of
shares of Series A Preferred Stock or Series B Preferred Stock, as the
case may be, so converted and the Board of Directors shall take such
steps as are required to so retire such shares.
(H) In the event a holder of shares of Series A Preferred Stock
sells, assigns, transfers or otherwise disposes of such shares to any
person, or any person acting on behalf of any person, who is other
than Dolan, Cablevision Systems Company, an Illinois general
partnership ("CSCO"), the partners of CSCO as of December 31, 1985,
the beneficiaries of such partners or any trust created subsequent to
December 31, 1985 the sole beneficiaries of which are beneficiaries of
such partners, then such sale, assignment, transfer, pledge or other
disposition shall be deemed (i) an election by the holder thereof to
first convert such shares of Series A Preferred Stock into shares of
Series B Preferred Stock on a share-for-share basis and (ii) a sale,
assignment, transfer or other disposition of such shares of Series B
Preferred Stock. Such conversion shall be deemed effective as of the
time of such sale, assignment, transfer or other disposition, and upon
presentation to the corporation's transfer agent of the certificate or
certificates representing such shares of Series A Preferred Stock, a
certificate or certificates representing an equal number of shares of
Series B Preferred Stock shall be issued in the name of the
transferee. For purposes of this subsection (H), a pledge of shares of
Series A Preferred Stock shall not be deemed a sale, assignment,
transfer or other disposition of such shares until the beneficial
ownership of such shares is transferred to the pledgee.
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<PAGE>
V. Voting
The holders of shares of Series A Preferred Stock and Series B
Preferred Stock shall have no voting rights whatsoever, except as to which they
may be entitled under the laws of the State of Delaware.
VI. Consent
No consent of holders of the Series A Preferred Stock or Series B
Preferred Stock shall be required for (A) the creation of any indebtedness of
any kind of the corporation, (B) the creation of any class of stock of the
corporation subordinate as to dividends and upon liquidation to the Series A
Preferred Stock and Series B Preferred Stock or (C) any increase or decrease in
the amount of authorized Common Stock or any increase, decrease or change in the
par value thereof.
3. The amendment of the certificate of incorporation herein certified
has been duly adopted in accordance with the provisions of Sections 228 and 242
of the General Corporation Law of the State of Delaware.
Signed and attested on January 8, 1986.
/s/ Francis F. Randolph
Francis F. Randolph, Jr.
Vice Chairman
ATTEST:
/s/ Robert S. Lemle
Robert S. Lemle, Secretary
[CORPORATE SEAL]
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<PAGE>
STATE OF NEW YORK )
: SS.:
COUNTY OF NEW YORK )
BE IT REMEMBERED that on this 8th day of January, A.D. 1986,
personally came before me Thomas A. Scott, a Notary Public in and for the County
and State aforesaid, FRANCIS F. RANDOLPH, JR., Vice Chairman of Cablevision
Systems Corporation, a corporation of the State of Delaware, and one of the
persons who signed the foregoing certificate, and he, the said FRANCIS F.
RANDOLPH, JR., as such Vice Chairman, duly executed the certificate before me
and acknowledged the said certificate to be his act and deed; that the
signatures of the Vice Chairman and of the Secretary of said corporation to said
foregoing certificate are in the handwriting of said FRANCIS F. RANDOLPH, JR.,
Vice Chairman, and ROBERT S. LEMLE, Secretary, of said corporation,
respectively, and that the seal affixed to said certificate is the common or
corporate seal of said corporation.
IN WITNESS WHEREOF, I have hereunto set my hand and seal of office the
day and year aforesaid.
/s/ Thomas A. Scott
-------------------
[NOTARIAL SEAL]
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<PAGE>
CERTIFICATE OF INCORPORATION
OF
CABLEVISION SYSTEMS CORPORATION
The undersigned, a natural person, for the purpose of organizing a
corporation for conducting the business and promoting the purposes hereinafter
stated, under the provisions and subject to the requirements of the laws of the
State of Delaware (particularly Chapter 1, Title 8 of the Delaware Code and the
acts amendatory thereof and supplemental thereto, and known, identified and
referred to as the "General Corporation Law of the State of Delaware") hereby
certifies that:
FIRST: The name of this corporation (hereinafter called the "corporation")
is Cablevision Systems Corporation.
SECOND: The name and address, including street, number, city and county, of
the registered office of the corporation in the State of Delaware is The
Corporation Trust Company, The Corporation Trust Center, 1209 Orange Street,
City of Wilmington, County of New Castle.
THIRD: The nature of the business and of the purposes to be conducted and
promoted by the corporation are to conduct any lawful business, to promote any
lawful purpose, and to engage in any lawful act or activity for which
corporations may be organized under the General Corporation Law of the State of
Delaware.
FOURTH: The aggregate number of shares which the corporation shall have
authority to issue shall be 65,200,000 shares: (a) 50,000,000 shares of Class A
Common Stock, par value $.01 per share ("Class A Common Stock"), (b) 15,000,000
shares of Class B Common Stock, par value $.01 per share ("Class B Common
Stock"), and (c) 200,000 shares of Preferred Stock, par value $.01 per share
("Preferred Stock").
The designations, preferences and relative, participating, optional or
other special rights, and the qualifications, limitations or restrictions
thereof, of each class of stock, and the express grant of authority to the Board
of Directors to fix by resolution the designations, preferences and relative,
participating, optional or other special rights, and the qualifications,
limitations or restrictions thereof, in respect of each share of Preferred Stock
which are not fixed by this Certificate of Incorporation, are as follows:
<PAGE>
A. Class A Common Stock and Class B Common Stock.
I. Dividends.
Subject to the rights of the holders of Preferred Stock, and subject
to any other provisions of this Certificate of Incorporation, as amended from
time to time, holders of Class A Common Stock and Class B Common Stock shall be
entitled to receive equally on a per share basis such dividends and to receive
equally on a per share basis such dividends and other distributions in cash,
stock or property of the corporation as may be declared thereon by the Board of
Directors from time to time out of assets or funds of the corporation legally
available therefor; provided that the Board of Directors shall declare no
dividend, and no dividend shall be paid, with respect to any outstanding share
of Class A Common Stock or Class B Common Stock, whether paid in cash or
property (including, without limitation, shares of Class A Common Stock paid on
or with respect to shares of Class A Common Stock or shares of Class B Common
Stock paid on or with respect to shares of Class B Common Stock (collectively,
"Stock Dividends")), unless, simultaneously, the same dividend (in the case of
Stock Dividends, stock of the class on or with respect to which the dividend is
paid in the same percentage, relative to the total number of shares of such
class issued and outstanding immediately prior to the payment of such dividend,
as the Stock Dividend on or with respect to the other class bears to the number
of shares of such class issued and outstanding immediately prior to the payment
of such dividend) is paid with respect to each share of Class A Common Stock and
Class B Common Stock.
II. Voting.
(a) Except as otherwise required by statute or specifically provided by the
resolutions providing for the issue of Preferred Stock, the Class A Common Stock
and Class B Common Stock shall have the sole right and power to vote on all
matters on which a vote of stockholders is to be taken. At every meeting of the
stockholders, each holder of Class A Common Stock shall be entitled to cast one
(1) vote in person or by proxy for each share of Class A Common Stock standing
in his or her name on the transfer books of the corporation and each holder of
Class B Common Stock shall be entitled to cast ten (10) votes in person or by
proxy for each share of Class B Common Stock standing in his or her name on the
transfer books of the corporation. Except in the election of directors of the
corporation (voting in respect of which shall be governed by the terms set forth
in subsections (b) and (c) of this Section II) and as may be otherwise required
by statute, the holders of Class A Common Stock and Class B Common Stock shall
vote together as a single class, subject to any votes which may be granted to
holders of Preferred Stock; provided, however, that the affirmative vote or
consent of the holders of at least 66 2/3% of the outstanding shares of Class B
Common Stock, voting separately as a class, shall be required for (i) the
authorization or issuance of any additional shares of Class B Common Stock and
(ii) any amendment, alteration or repeal of any of the provisions of this
Certificate
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<PAGE>
of Incorporation which adversely affects the powers, privileges or rights of the
Class B Common Stock.
(b) With respect to the election of directors, holders of Class A
Common Stock shall vote as a separate class and be entitled to elect 25% of the
total number of directors constituting the whole Board (the "Class A Directors")
and, if such 25% is not a whole number, then the holders of Class A Common Stock
shall be entitled to elect the nearest higher whole number of directors that is
at least 25% of the total number of directors, so long as the number of
outstanding shares of Class A Common Stock is at least 10% of the total number
of outstanding shares of both classes of common stock. Holders of Class B Common
Stock, voting as a separate class, shall be entitled to elect the remaining
directors. If, on the record date for any stockholder meeting at which directors
are to be elected, the number of outstanding shares of Class A Common Stock is
less than 10% of the total number of outstanding shares of common stock,
however, the holders of the Class A and Class B Common Stock shall vote together
as a single class with respect to the election of directors and the holders of
Class A Common Stock shall not have the right to elect 25% of the number of the
directors, but shall have one (1) vote per share for all directors and the
holders of the Class B Common Stock shall have ten (10) votes per share for all
directors. If, on the record date for any stockholder meeting at which directors
are to be elected, the number of outstanding shares of Class B Common Stock is
less than 12 1/2% of the total number of outstanding shares of both classes of
common stock, then the holders of Class A Common Stock, voting as a separate
class, shall continue to elect a number of Class A Directors equal to 25% of the
total number of directors constituting the whole board and, in addition, shall
vote together with the holders of Class B Common Stock to elect the remaining
directors to be elected at such meeting, with the holders of Class A Common
Stock entitled to one (1) vote per share for all directors and the holders of
Class B Common Stock entitled to ten (10) votes per share for all directors.
(c) Any vacancy in the office of a director elected by the holders of
Class A Common Stock voting as a separate class may be filled by a vote of such
holders voting as a separate class and any vacancy in the office of a director
elected by the holders of Class B Common Stock voting as a separate class may be
filled by a vote of such holders voting as a separate class or, in the absence
of a stockholder vote, in the case of a vacancy in the office of a director
elected by either class, such vacancy may be filled by the remaining directors.
Any director elected by the Board of Directors to fill a vacancy shall serve
until the next annual meeting of stockholders and until his or her successor has
been elected and has qualified. If the Board of Directors increases the number
of directors in accordance with Article Fifth of this Certificate of
Incorporation, any vacancy so created may be filled by the Board of Directors,
provided that, so long as the holders of Class A Common Stock have the rights
provided in subsections (b) and (c) of this Section II in respect of the last
preceding annual meeting of stockholders to elect 25% of the total number of
directors constituting the whole board, the Board of Directors may be so
enlarged by the directors only to the extent
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<PAGE>
that at least 25% of the enlarged board consists of directors elected by the
holders of Class A Common Stock or of persons appointed to fill vacancies
created by the death, resignation or removal of persons elected by the holders
of Class A Common Stock.
(d) Notwithstanding anything in this Section II to the contrary,
subject to the voting rights of the holders of Preferred Stock which may be
outstanding, the holders of Class A Common Stock shall have exclusive voting
power on all matters upon which, pursuant to this Certificate of Incorporation
or applicable laws, the holders of common stock are entitled to vote, at any
time when no shares of Class B Common Stock are issued and outstanding.
(e) Wherever any provision of this Certificate of Incorporation sets
forth a specific percentage of the shares outstanding and entitled to vote which
is required for approval or ratification of any action upon which the vote of
the stockholders is required or may be obtained, such provision shall mean such
specified percentage of the votes entitled to be cast by holders of shares then
outstanding and entitled to vote on such action.
III. Conversion Rights.
(a) Subject to the terms and conditions of this Section III, each
share of Class B Common Stock shall be convertible at any time or from time to
time, at the option of the holder thereof, at the office of any transfer agent
for Class B Common Stock, and at such other place or places, if any, as the
Board of Directors may designate, or, if the Board of Directors shall fail so to
designate, at the principal office of the corporation (attention of the
Secretary of the corporation), into one (1) fully paid and nonassessable share
of Class A Common Stock. Upon conversion, the corporation shall make no payment
or adjustment on account of dividends accrued or in arrears on Class B Common
Stock surrendered for conversion or on account of any dividends on the Class A
Common Stock issuable on such conversion. Before any holder of Class B Common
Stock shall be entitled to convert the same into Class A Common Stock, he shall
surrender the certificate or certificates for such Class B Common Stock at the
office of said transfer agent (or other place as provided above), which
certificate or certificates, if the corporation shall so request, shall be duly
endorsed to the corporation or in blank or accompanied by proper instruments of
transfer to the corporation or in blank (such endorsements or instruments of
transfer to be in form satisfactory to the corporation), and shall give written
notice to the corporation at said office that he or she elects so to convert
said Class B Common Stock in accordance with the terms of this Section III, and
shall state in writing therein the name or names in which he or she wishes the
certificate or certificates for Class A Common Stock to be registered. Every
such notice of election to convert shall constitute a binding contract between
the holder of such Class B Common Stock and the corporation, whereby the holder
of such Class B Common Stock shall be deemed to subscribe for the amount of
Class A Common Stock which he or she shall be entitled to receive upon such
conversion, and, in satisfaction of such
-4-
<PAGE>
subscription, to deposit the Class B Common Stock to be converted and to release
the corporation from all liability thereunder, and thereby the corporation shall
be deemed to agree that the surrender of the certificate or certificates
therefor and the extinguishment of liability thereon shall constitute full
payment of such subscription for Class A Common Stock to be issued upon such
conversion. The corporation will as soon as practicable after such deposit of a
certificate or certificates for Class B Common Stock, accompanied by the written
notice and the statement above prescribed, issue and deliver at the office of
said transfer agent (or other place as provided above) to the person for whose
account such Class B Common Stock was so surrendered, or to his nominee or
nominees, a certificate or certificates for the number of full shares of Class A
Common Stock to which he shall be entitled as aforesaid. Subject to the
provisions of subsection (d) of this Section III, such conversion shall be
deemed to have been made as of the date of such surrender of the Class B Common
Stock to be converted; and the person or persons entitled to receive the Class A
Common Stock issuable upon conversion of such Class B Common Stock shall be
treated for all purposes as the record holder or holders of such Class A Common
Stock on such date. Upon conversion of shares of Class B Common Stock, the
shares of Class B Common Stock so converted will be cancelled and retired by the
corporation.
(b) The issuance of certificates for the shares of Class A Common
Stock upon conversion of shares of Class B Common Stock shall be made without
charge for any stamp or other similar tax in respect of such issuance. However,
if any such certificate is to be issued in a name other than that of the holder
of the share or shares of Class B Common Stock converted, the person or persons
requesting the issuance thereof shall pay to the corporation the amount of any
tax which may be payable in respect of any transfer involved in such issuance or
shall establish to the satisfaction of the corporation that such tax has been
paid or that no such tax is due.
(c) The corporation shall not be required to convert Class B Common
Stock, and no surrender of Class B Common Stock shall be effective for that
purpose, while the stock transfer books of the corporation are closed for any
purpose; but the surrender of Class B Common Stock for conversion during any
period while such books are so closed shall be deemed effective for conversion
immediately upon the reopening of such books, as if the conversion had been made
on the date such Class B Common Stock was surrendered.
(d) The corporation will at all times reserve and keep available,
solely for the purpose of issue upon conversion of the outstanding shares of
Class B Common Stock, such number of shares of Class A Common Stock as shall be
issuable upon the conversion of all such outstanding shares, provided that
nothing contained herein shall be construed to preclude the corporation from
satisfying its obligations in respect of the conversion of the outstanding
shares of Class B Common Stock by delivery of shares of Class A Common Stock
which are held in the treasury of the corporation. The corporation covenants
that if any shares of Class A Common Stock, required to be reserved for purposes
of conversion
-5-
<PAGE>
hereunder, require registration with or approval of any governmental authority
under any federal or state law before such shares of Class A Common Stock may be
issued upon conversion, the corporation will use its best efforts to cause such
shares to be duly registered or approved, as the case may be. The corporation
will endeavor to list the shares of Class A Common Stock required to be
delivered upon conversion prior to such delivery upon each national securities
exchange, if any, upon which the outstanding Class A Common Stock is listed at
the time of such delivery. The corporation covenants that all shares of Class A
Common Stock which shall be issued upon conversion of the shares of Class B
Common Stock, will, upon issue, be fully paid and nonassessable and not entitled
to any preemptive rights.
IV. Liquidation Rights.
In the event of any dissolution, liquidation or winding up of the
affairs of the corporation, whether voluntary or involuntary, after payment or
provision for payment of the debts and other liabilities of the corporation, the
holders of each series of Preferred Stock shall be entitled to receive, out of
the net assets of the corporation, an amount for each share equal to the amount
fixed and determined by the Board of Directors in any resolution or resolutions
providing for the issuance of any particular series of Preferred Stock, plus an
amount equal to all dividends (whether or not earned or declared) accrued and
unpaid on shares of such series to the date fixed for distribution, and no more,
before any of the assets of the corporation shall be distributed or paid over to
the holders of Class A Common Stock or Class B Common Stock. After payment in
full of said amounts to the holders of Preferred Stock of all series, the
remaining assets and funds of the corporation shall be divided among and paid
ratably to the holders of Class A Common Stock and Class B Common Stock
(including those persons who shall become holders of Class A Common Stock by
reason of the conversion of their shares of Class B Common Stock) as a single
class. If, upon such dissolution, liquidation or winding up, the assets of the
corporation distributable as aforesaid among the holders of Preferred Stock of
all series shall be insufficient to permit full payment to them of said
preferential amounts, then such assets shall be distributed among such holders,
first in the order of their respective preferences, and second, as to such
holders who are next entitled to such assets and who rank equally with regard to
such assets, ratably in proportion to the respective total amounts which they
shall be entitled to receive. A merger or consolidation of the corporation with
or into any other corporation or a sale or conveyance of all or any part of the
assets of the corporation (which shall not in fact result in the liquidation of
the corporation and the distribution of assets to stockholders) shall not be
deemed to be a voluntary or involuntary liquidation or dissolution or winding up
of the corporation within the meaning of this Section IV.
V. Reclassifications, Etc.
-6-
<PAGE>
Neither the Class A Common Stock nor the Class B Common Stock may be
subdivided, consolidated, reclassified or otherwise changed unless
contemporaneously therewith the other class of shares is subdivided,
consolidated, reclassified or otherwise changed in the same proportion and in
the same manner.
VI. Mergers, Consolidations, Etc.
In any merger, consolidation or business combination of the
corporation with or into another corporation, whether or not the corporation is
the surviving corporation, the consideration per share to be received by holders
of either Class A Common Stock or Class B Common Stock in such merger,
consolidation or business combination must be identical to that received by
holders of the other class of common stock, except that in any such transaction
in which shares of capital stock are distributed, such shares may differ as to
voting rights to the extent and only to the extent that the voting rights of the
Class A Common Stock and Class B Common Stock differ as provided herein.
VII. Rights or Warrants.
In case the corporation shall issue rights or warrants to purchase
shares of capital stock of the corporation, the terms of the rights and
warrants, and the number of rights or warrants per share, to be received by
holders of either Class A Common Stock or Class B Common Stock must be identical
to that received by holders of the other class of common stock, except that the
shares of capital stock into which such rights or warrants are exercisable may
differ as to voting rights to the extent and only to the extent that the voting
rights of the Class A Common Stock and Class B Common Stock differ as provided
herein.
B. Preferred Stock.
I. Authority is hereby expressly vested in the Board of Directors to
adopt from time to time a resolution or resolutions providing for the issuance
of Preferred Stock. Preferred Stock may be issued in one or more series and may
be with such voting powers, full or limited, or without voting powers, and with
such designations, preferences and relative, participating, optional or other
special rights, and the qualifications, limitations or restrictions thereof, as
shall be stated and expressed in the resolution or resolutions providing for the
issue of such stock adopted by the Board of Directors pursuant to authority
expressly vested in it by these provisions.
II. Any Preferred Stock or series thereof may be made subject to
redemption at such time or times and at such price or prices as shall be stated
and expressed in the resolution or resolutions providing for the issue of such
stock adopted by the Board of Directors as hereinabove provided.
-7-
<PAGE>
III. The holders of Preferred Stock or of any series thereof shall be
entitled to receive dividends at such rates, on such conditions and at such
times as shall be stated and expressed in the resolution or resolutions
providing for the issue of such stock adopted by the Board of Directors as
hereinabove provided, payable in preference to, or in such relation to, the
dividends payable on any other class or classes or of any other series of stock,
and cumulative or noncumulative as shall be so stated and expressed.
IV. The holders of Preferred Stock or of any class or of any series
thereof shall be entitled to such rights upon the dissolution of, or upon any
distribution of the assets of, the corporation as shall be stated and expressed
in the resolution or resolutions providing for the issue of such stock adopted
by the Board of Directors as hereinabove provided.
V. Any Preferred Stock of any class or of any series thereof may be
made convertible into, or exchangeable for, shares of any other class or classes
or of any other series of the same or of any other class or classes of stock of
the corporation, or shares of any class or series of stock of any other
corporation, at such price or prices or at such rates of exchange and with such
adjustments as shall be stated and expressed in the resolution or resolutions
providing for the issue of such stock adopted by the Board of Directors as
hereinabove provided.
FIFTH: The management of the business and the conduct of the affairs of the
corporation, including the election of the Chairman, if any, the President, the
Treasurer, the Secretary, and other principal officers of the corporation, shall
be vested in its Board of Directors. The number of directors of the corporation
shall be fixed by the By-Laws of the corporation and may be altered from time to
time as provided therein. A director shall be elected to hold office until the
expiration of the term for which such person is elected, and until such person's
successor shall be duly elected and qualified.
SIXTH: The name and mailing address of the incorporator are as follows:
Frederic L. Lightman, Seven Hanover Square, New York, New York 10004.
SEVENTH: Whenever a compromise or arrangement is proposed between this
corporation and its creditors or any class of them and/or between this
corporation and its stockholders or any class of them, any court of equitable
jurisdiction within the State of Delaware may, on the application in a summary
way of this corporation or any creditor or stockholder thereof or on the
application of any receiver or receivers appointed for this corporation under
the provisions of Section 291 of Title 8 of the Delaware Code or on the
application of trustees in dissolution or of any receiver or receivers appointed
for this corporation under the provisions of Section 279 of Title 8 of the
Delaware Code order a meeting of the creditors or class of creditors, and/or of
the stockholders or class of stockholders of this corporation, as the case may
be, to be summoned in such manner as the said court directs. If a majority in
number representing three-fourths in value of the creditors
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<PAGE>
or class of creditors, and/or of the stockholders of class of stockholders of
this corporation, as the case may be, agree to any compromise or arrangement and
to any reorganization of this corporation as a consequence of such compromise or
arrangement, the said compromise or arrangement and the said reorganization
shall, if sanctioned by the court to which the said application has been made,
be binding on all the creditors or class of creditors, and/or on all the
stockholders or class of stockholders, of this corporation, as the case may be,
and also on this corporation.
EIGHTH: The original By-Laws of the corporation shall be adopted by the
incorporator. Thereafter, the power to make, alter, or repeal the By-Laws, and
to adopt any new By-Law, shall be vested in the Board of Directors and the
stockholders entitled to vote in the election of directors.
NINTH: The corporation shall, to the fullest extent permitted by Section
145 of the General Corporation Law of the State of Delaware, as the same may be
amended and supplemented, or by any successor thereto, indemnify any and all
persons whom it shall have power to indemnify under said section from and
against any and all of the expenses, liabilities or other matters referred to in
or covered by said section. Such right to indemnification shall continue as to a
person who has ceased to be a director, officer, employee or agent and shall
inure to the benefit of the heirs, executors and administrators of such a
person. The indemnification provided for herein shall not be deemed exclusive of
any other rights to which those seeking indemnification may be entitled under
any By-Law, agreement, vote of stockholders or disinterested directors or
otherwise.
TENTH: No contract or transaction between the corporation and one or more
of its directors or officers, or between the corporation and any other
corporation, partnership, association, or other organization in which one or
more of its directors or officers are directors or officers, or have a financial
interest, shall be void or voidable solely for this reason, or solely because
the director or officer is present at or participates in the meeting of the
Board of Directors or committee thereof which authorizes the contract or
transaction, or solely because his or their votes are counted for such purpose,
if:
(A) The material facts as to his relationship or interest and as to
the contract or transaction are disclosed or are known to the Board of
Directors or the committee, and the Board of Directors or committee in
good faith authorizes the contract or transaction by the affirmative
votes of a majority of the disinterested directors, even though the
disinterested directors be less than a quorum; or
(B) The material facts as to his relationship or interest and as to
the contract or transaction are disclosed or are known to the
stockholders entitled to vote
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<PAGE>
thereon, and the contract or transaction is specifically approved in
good faith by vote of the stockholders; or
(C) The contract or transaction is fair as to the corporation as of
the time it is authorized, approved or ratified, by the Board of
Directors, a committee thereof, or the stockholders.
Common or interested directors may be counted in the presence of a quorum
at a meeting of the Board of Directors or of a committee which authorizes the
contract or transaction.
Executed at New York, New York on December 2, 1985.
/s/ Fredric L. Lightman
Fredric L. Lightman
Incorporator
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[START HERE]
(Exhibit 4.1)
================================================================================
CSC HOLDINGS, INC.
8 1/8% Senior Notes due 2009
-----------------------------
Registration Rights Agreement
-----------------------------
Dated: July 13, 1999
================================================================================
<PAGE>
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT dated July 13, 1999, between CSC HOLDINGS,
INC., a Delaware corporation (the "Company"), and BEAR, STEARNS & CO. INC.,
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED, DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION, GOLDMAN, SACHS & CO., MORGAN STANLEY & CO. INCORPORATED
and SALOMON SMITH BARNEY INC., as the initial purchasers (the "Initial
Purchasers") of the Securities referred to below pursuant to the Purchase
Agreement dated July 8, 1999, between the Initial Purchasers and the Company, in
connection with the issuance of $500,000,000 aggregate principal amount of the
Company's 8 1/8% Senior Notes due 2009 (the "Securities") pursuant to the
Indenture, dated as of July 1, 1999, between the Company and The Bank of New
York, as trustee (the "Indenture").
In consideration of the foregoing, the parties hereto agree as follows:
1. Certain Definitions.
As used in this Agreement, the following defined terms shall have the
following meanings:
"best efforts" with respect to the Company shall mean the Company's
best efforts except that such term shall mean reasonable best efforts in
the event and to the extent that the Company could satisfy the standard for
the issuance of a Suspension Notice pursuant to the third paragraph of
Section 5 hereof.
"Business Day" shall mean any day except (i) a Saturday, Sunday or
other day in The City of New York on which banks are required or authorized
to close or (ii) any other day on which the SEC is closed.
"Closing Time" shall mean the Closing Time as defined in the Purchase
Agreement.
"Company" shall have the meaning set forth in the preamble and shall
also include a company which succeeds to all or substantially all of the
Company's cable television business.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time.
"Exchange Offer" shall mean the exchange offer by the Company of
Exchange Securities for Registrable Securities pursuant to Section 2(a)
hereof.
<PAGE>
2
"Exchange Offer Registration" shall mean a registration under the
Securities Act effected pursuant to Section 2(a) hereof.
"Exchange Offer Registration Statement" shall mean an exchange offer
registration statement of the Company pursuant to the provisions of Section
2(a) hereof on Form S-4 (or, if applicable, on another appropriate form),
and all amendments and supplements to such registration statement, in each
case including the Prospectus contained therein, all exhibits thereto and
all material incorporated by reference therein.
"Exchange Securities" shall mean the 8 1/8% Series B Senior Notes due 2009
issued by the Company under the Indenture as Exchange Securities (as defined
therein), to be offered to Holders of Securities pursuant to the Exchange Offer.
"Holder" shall mean, individually, each of the Initial Purchasers, for
so long as they own any Registrable Securities, and any of the Initial
Purchasers' successors, assigns and direct and indirect transferees who
become registered owners of Registrable Securities.
"Indenture" shall have the meaning set forth in the preamble.
"Initial Purchasers" shall have the meaning set forth in the preamble.
"Majority Holders" shall mean the Holders of a majority of the
aggregate principal amount of outstanding Registrable Securities.
"Person" shall mean an individual, partnership, corporation, trust or
unincorporated organization, or a government or agency or political
subdivision thereof.
"Prospectus" shall mean the prospectus included in a Registration
Statement, including any preliminary prospectus, and any such prospectus as
amended or supplemented by any prospectus supplement, including a
prospectus supplement with respect to the terms of the offering of any
portion of the Registrable Securities covered by a Shelf Registration
Statement, and by all other amendments and supplements to a prospectus,
including post-effective amendments, and in each case including all
material incorporated by reference therein.
"Purchase Agreement" shall mean the Purchase Agreement dated July 8,
1999 between the Company and the Initial Purchasers, providing for the
initial purchase and sale of the Securities.
"Registrable Securities" shall mean the Securities; provided, however,
that any such Securities shall cease to be Registrable Securities upon the
earlier to occur of the
<PAGE>
3
date on which (i) the Exchange Offer has been consummated, (ii) a
Registration Statement with respect to such Securities shall have been
declared effective under the Securities Act and such Securities shall have
been disposed of pursuant to such Registration Statement, provided, that
Securities not disposed of pursuant to an effective Shelf Registration
Statement shall cease to be Registrable Securities two years from the date
such Shelf Registration Statement is declared effective by the SEC, or such
longer period as the Company's obligation to keep such Shelf Registration
Statement effective is extended in accordance with Section 5 hereof, (iii)
such Registrable Securities have been sold to the public pursuant to Rule
144(k) (or any similar provision then in force, but not Rule 144A) under
the Securities Act, or (iv) such Registrable Securities shall have ceased
to be outstanding.
"Registration Expenses" shall mean any and all expenses incident to
the performance of or compliance by the Company with this Agreement,
including without limitation: (i) all SEC or National Association of
Securities Dealers, Inc. registration and filing fees, (ii) all fees and
expenses incurred in connection with compliance with state securities or
blue sky laws, (iii) all expenses of any Persons acting on behalf of the
Company in preparing or assisting in preparing, word processing, printing
and distributing any Registration Statement, any Prospectus, any amendments
or supplements thereto and other documents reasonably relating to the
performance of and compliance with this Agreement by the Company, (iv) all
rating agency fees, (v) the fees and disbursements of counsel for the
Company and, in connection with a Shelf Registration Statement, the fees
and disbursements of one counsel for the Holders (which counsel shall be
selected by the Majority Holders and shall be reasonably acceptable to the
Company), and (vi) any fees and expenses of the independent public
accountants of the Company, including the expenses of any special audits or
"cold comfort" letters (in connection with a Shelf Registration) required
by or necessary to such performance and compliance, but excluding
underwriting discounts and commissions, fees and expenses and transfer
taxes, if any, relating to the sale or disposition of Registrable
Securities by a Holder.
"Registration Statement" shall mean any Exchange Offer Registration
Statement or Shelf Registration Statement.
"SEC" shall mean the Securities and Exchange Commission.
"Securities" shall have the meaning set forth in the preamble.
"Securities Act" shall mean the Securities Act of 1933, as amended
from time to time.
"Shelf Registration" shall mean a registration effected pursuant to
Section 2(b) hereof.
<PAGE>
4
"Shelf Registration Statement" shall mean a "shelf" registration
statement of the Company pursuant to the provisions of Section 2(b) hereof
which covers all of the Registrable Securities on an appropriate form under
Rule 4l5 under the Securities Act, or any similar rule that may be adopted
by the SEC and all amendments and supplements to such registration
statement, including post-effective amendments, in each case including the
Prospectus contained therein, all exhibits thereto and all material
incorporated by reference therein.
"Trustee" shall mean the trustee with respect to the Securities and
the Exchange Securities under the Indenture.
"Underwritten Registration or Underwritten Offering" shall mean a
registration in which Registrable Securities are sold to one or more
Underwriters (as hereinafter defined) for reoffering to the public.
2. Registration Under the Securities Act.
(a) Exchange Offer Registration. The Company shall, for the benefit of the
Holders of the Securities, file an Exchange Offer Registration Statement with
respect to Exchange Securities within 60 days after the Closing Time and use its
best efforts to cause such Exchange Offer Registration Statement to be declared
effective under the Securities Act within 180 days after the Closing Time. Upon
such Exchange Offer Registration Statement becoming effective under the
Securities Act, the Company shall offer the Exchange Securities in return for
surrender of the Securities. The Exchange Offer shall remain open for not less
than 30 days (or longer if required by applicable law) after the date notice of
the Exchange Offer is mailed to Holders of the Securities. For the Securities
surrendered to the Company under the Exchange Offer, the Holder will receive
Exchange Securities having an aggregate principal amount equal to that of the
surrendered Securities. Interest on the Exchange Securities shall accrue from
the last maturity date of any interest installment on which interest was paid on
the Security so surrendered (or the Exchange Securities, as the case may be or,
if no interest has been paid on the Securities, from July 13, 1999). The Company
shall commence the Exchange Offer by mailing the related Exchange Offer
Prospectus and accompanying documents to each Holder stating, in addition to
such other disclosures as are required by applicable law:
(i) that the Exchange Offer is being made pursuant to this
Registration Rights Agreement and that all Registrable Securities validly
tendered will be accepted for exchange;
(ii) the date of acceptance for exchange (which shall be a Business
Day no earlier than 30 days nor later than 40 days (unless otherwise
required by applicable law) from the date such notice is mailed) (the
"Exchange Date");
<PAGE>
5
(iii) that any Registrable Security not tendered will remain
outstanding and shall accrue interest at the initial rate borne by the
Securities and, other than Registrable Securities referred to in Section
2(b)(iii) below, will not retain any rights under this Registration Rights
Agreement;
(iv) that Holders electing to have a Registrable Security exchanged
pursuant to the Exchange Offer will be required to surrender such
Registrable Security, together with letters of transmittal, to the
institution and at the address (located in the Borough of Manhattan, City
of New York) specified in the notice prior to the close of business on the
Business Day immediately preceding the Exchange Date; and
(v) that Holders will be entitled to withdraw the election, not later
than the close of business on the Business Day immediately preceding the
Exchange Date, by sending to the institution and at the address (located in
the Borough of Manhattan, City of New York) specified in the notice, a
telegram, telex, facsimile transmission or letter setting forth the name of
such Holder, the number of shares of Registrable Securities delivered for
exchange, and a statement that such Holder is withdrawing its election to
have such Registrable Securities exchanged.
On the Exchange Date, the Company shall:
(i) accept for exchange Registrable Securities tendered and not
validly withdrawn pursuant to the Exchange Offer; and
(ii) deliver, or cause to be delivered, to the Trustee for
cancellation all Registrable Securities so accepted for exchange by the
Company, and issue and mail to each Holder or such Holder's nominee, for
the Registrable Securities so surrendered, new Exchange Securities having
an aggregate liquidation preference equal to that of the Registrable
Securities surrendered by such Holder.
The Company shall use its best efforts to complete the Exchange Offer as
provided above, and in accordance with the applicable requirements of the
Securities Act, the Exchange Act and other applicable laws in connection with
the Exchange Offer. Consummation of the Exchange Offer shall not be subject to
any conditions, other than that the Exchange Offer does not, and consummation of
the Exchange Offer will not, violate applicable law or any applicable
interpretation of the staff of the SEC. The Company shall inform the Initial
Purchasers of the names and addresses of the Holders to whom the Exchange Offer
is made, and the Initial Purchasers shall have the right to contact such Holders
and otherwise facilitate the tender of Registrable Securities in the Exchange
Offer.
(b) Shelf Registration. In the event that (i) the Company determines that
the Exchange Offer Registration provided in Section 2(a) above is not available
or may not be consummated because it would violate applicable law or the
applicable interpretations of the
<PAGE>
6
SEC staff, (ii) the Exchange Offer is not for any other reason consummated
within 180 days after the Closing Time, or (iii) following the consummation of
the Exchange Offer a Registration Statement must be filed and a Prospectus must
be delivered by the Initial Purchasers in connection with any offering or sale
of Registrable Securities because such Registrable Securities represent an
unsold allotment of the Registrable Securities purchased by the Initial
Purchasers from the Company, unless the Company has previously done so, the
Company will (a) file as soon as practicable after such determination or date,
as the case may be, a Shelf Registration Statement providing for the sale by the
Holders of all of the Registrable Securities, (b) use its best efforts to have
such Shelf Registration Statement declared effective by the SEC and (c) keep the
Shelf Registration Statement continuously effective until the second anniversary
of the Closing Time or such shorter period which will terminate when all of the
Registrable Securities covered by the Shelf Registration Statement have been
sold pursuant to the Shelf Registration Statement. In the event the Company is
required to file a Shelf Registration Statement solely as a result of the
matters referred to in clause (iii) of the preceding sentence, the Company shall
file and have declared effective by the SEC both an Exchange Offer Registration
Statement pursuant to Section 2(a) with respect to all Registrable Securities
and a Shelf Registration Statement (which may be a combined Registration
Statement with the Exchange Offer Registration Statement) with respect to offers
and sales of Registrable Securities held by the Initial Purchasers after
completion of the Exchange Offer. The Company further agrees, if necessary, to
supplement or amend the Shelf Registration Statement, if required by the rules,
regulations or instructions applicable to the registration form used by the
Company for such Shelf Registration Statement or by the 1933 Act or by any other
rules and regulations thereunder for shelf registration, and the Company agrees
to furnish to the Holders of Registrable Securities copies of any such
supplement or amendment promptly after its being used or filed with the SEC.
(c) Expenses. The Company shall pay all Registration Expenses in connection
with any registration pursuant to Section 2(a) or 2(b) hereof.
(d) Effective Registration Statement. An Exchange Offer Registration
Statement pursuant to Section 2(a) hereof or a Shelf Registration Statement
pursuant to Section 2(b) hereof will not be deemed to have become effective
unless it has been declared effective by the SEC; provided, however, that if,
after it has been declared effective, the offering of Registrable Securities
pursuant to a Shelf Registration Statement is interfered with by any stop order,
injunction or other order or requirement of the SEC or any other governmental
agency or court, such Registration Statement will be deemed not to have been
effective during the period of such interference, until the offering of
Registrable Securities pursuant to such Registration Statement may legally
resume.
<PAGE>
7
3. Participation of Broker-Dealers in Exchange Offer.
(a) The SEC staff has taken the position that any broker-dealer that
receives Exchange Securities for its own account in the Exchange Offer in
exchange for Securities that were acquired by such broker-dealer as a result of
market-making or other trading activities (a "Participating Broker-Dealer") may
be deemed to be an "underwriter" within the meaning of the Securities Act and
must deliver a prospectus meeting the requirements of the Securities Act in
connection with any resale of such Exchange Securities.
The Company understands that it is the SEC staff's position that if the
Prospectus contained in the Exchange Offer Registration Statement includes a
plan of distribution containing a statement to the above effect and the means by
which Participating Broker-Dealers may resell the Exchange Securities, without
naming the Participating Broker-Dealers or specifying the amount of Exchange
Securities owned by them, such Prospectus may be delivered by Participating
Broker-Dealers and other Persons, if any, subject to similar prospectus delivery
requirements to satisfy their prospectus delivery obligation under the
Securities Act in connection with resales of Exchange Securities for their own
accounts, so long as the Prospectus otherwise meets the requirements of the
Securities Act.
(b) In light of the above, notwithstanding the other provisions of this
Agreement, the Company agrees that the provisions of this Agreement as they
relate to a Shelf Registration shall also apply to an Exchange Offer
Registration to the extent, and with such reasonable modifications thereto as
may be, reasonably requested by the Initial Purchasers or by one or more
Participating Broker-Dealers, in each case as provided in clause (ii) below, in
order to expedite or facilitate the disposition of any Exchange Securities by
Participating Broker-Dealers consistent with the positions of the SEC staff
recited in Section 3(a) above; provided that:
(i) the Company shall not be required to amend or supplement the
Prospectus contained in the Exchange Offer Registration Statement, as would
otherwise be contemplated by Section 5(i), for a period exceeding 90 days
after the last Exchange Date (as such period may be extended pursuant to
the penultimate paragraph of Section 5 of this Agreement) and Participating
Broker-Dealers shall not be authorized by the Company to deliver and shall
not deliver such Prospectus after such period in connection with the
resales contemplated by this Section 3; and
(ii) the application of the Shelf Registration procedures set forth in
Section 5 of this Agreement to an Exchange Offer Registration, to the
extent not required by the positions of the SEC staff or the Securities Act
and the rules and regulations thereunder, will be in conformity with the
reasonable request to the Company by the Initial Purchasers or with the
reasonable request in writing to the Company by one or more broker-dealers
who certify to the Initial Purchasers and the Company in writing that they
anticipate that they will be Participating Broker-Dealers; and provided
further
<PAGE>
8
that, in connection with such application of the Shelf Registration
procedures set forth in Section 5 to an Exchange Offer Registration, the
Company shall be obligated (x) to deal only with one entity representing
the Participating Broker-Dealers, which shall be one of the Initial
Purchasers unless they collectively elect not to act as such
representative, (y) to pay the fees and expenses of only one counsel
representing the Participating Broker-Dealers, which shall be counsel to
the Initial Purchasers unless such counsel elects not to so act and (z) to
cause to be delivered only one, if any, "cold comfort" letter with respect
to the Prospectus in the form existing on the last Exchange Date and with
respect to each subsequent amendment or supplement, if any, effected during
the period specified in clause (i) above; provided, that the provisions of
clauses (y) and (z) of this Section 3(b)(ii) shall apply only if one or
more Participating Broker-Dealers holding at least $10,000,000 principal
amount of Registrable Securities shall request that the provisions of this
Agreement as they relate to a Shelf Registration also apply to an Exchange
Offer Registration Statement for the disposition of Exchange Securities by
Participating Broker-Dealers.
4. Liquidated Damages.
In the event that, for any reason, either (a) the Exchange Offer
Registration Statement is not filed with the SEC on or prior to the 60th
calendar day following the Closing Time or (b) the Exchange Offer is not
consummated or a Shelf Registration Statement is not declared effective on or
prior to the 180th calendar day following the Closing Time, the interest rate
borne by the Securities shall be increased by one-quarter of one percent per
annum for the first 30 days following such 60-day period in the case of (a)
above, or the first 90 days following such 180-day period in the case of (b)
above. Such interest rate will increase by an additional one-quarter of one
percent per annum at the beginning of each subsequent 30-day period in the case
of (a) above, or 90-day period in the case of (b) above, up to a maximum
aggregate increase of one percent per annum. Upon (i) the filing of the Exchange
Offer Registration Statement or (ii) the consummation of the Exchange Offer or
the effectiveness of a Shelf Registration Statement, as the case may be, the
interest rate borne by the Securities will be reduced to the original interest
rate.
5. Registration Procedures.
In connection with the obligations of the Company with respect to the
Registration Statement pursuant to Sections 2(a) and 2(b) hereof, the Company
shall:
(a) prepare and file with the SEC a Registration Statement on the
appropriate form under the Securities Act, which form (i) shall be selected
by the Company and (ii) shall, in the case of a Shelf Registration, be
available for the sale of the Registrable Securities in accordance with the
intended method or methods of distribution as the Company is so advised of
by the selling Holders thereof and (iii) shall comply as to form in all
material respects with the requirements of the applicable
<PAGE>
9
form and include (including through incorporation by reference) all
financial statements required by the SEC to be filed therewith, and the
Company shall use its best efforts to cause such Registration Statement to
become effective and remain effective in accordance with Section 2 hereof;
(b) prepare and file with the SEC such amendments and post-effective
amendments to such Registration Statement as may be necessary to keep such
Registration Statement in compliance with the Securities Act; and cause the
Prospectus to be supplemented by any required prospectus supplement, and as
so supplemented to be filed pursuant to Rule 424 under the Securities Act;
(c) in the case of a Shelf Registration, furnish to each Holder of
Registrable Securities and to each underwriter of Registrable Securities,
if any, without charge, as many copies of the Prospectus, including each
preliminary prospectus, and any amendment or supplement thereto and such
other documents as such Holder or Underwriter may reasonably request, in
order to facilitate the public sale or other disposition of the Registrable
Securities;
(d) in the case of a Shelf Registration, use its best efforts to
register or qualify the Registrable Securities under all applicable state
securities or "blue sky" laws of such jurisdictions as any Holder of
Registrable Securities covered by such Shelf Registration Statement and or
any Underwriter shall reasonably request in writing by the time the
applicable Shelf Registration Statement is declared effective by the SEC,
and do any and all other acts and things which may be reasonably necessary
or advisable to enable such Holder or Underwriter to consummate the
disposition in each such designated jurisdiction, provided, however, that
the Company shall not be required to (i) qualify generally to do business
as a foreign corporation or as a broker-dealer in any jurisdiction where it
would not otherwise be required to qualify but for this Section 5(d), (ii)
consent to general service of process in any such jurisdiction or (iii)
subject itself to taxation in any such jurisdiction;
(e) in the case of a Shelf Registration, promptly notify each Holder
and, if requested by such Holder, confirm such advice in writing (i) when
such Shelf Registration Statement has become effective and when any
post-effective amendments and supplements thereto become effective, (ii) of
the issuance by the SEC or any state securities authority of any stop order
suspending the effectiveness of such Shelf Registration Statement or the
initiation of any proceedings for that purpose, (iii) if, between the
effective date of such Shelf Registration Statement and the closing of any
sale of Registrable Securities covered thereby, the Company receives any
notification with respect to the suspension of the qualification of the
Registrable Securities for sale in any jurisdiction or the initiation of
any proceeding for such purpose, and (iv) of the happening of any event
during the period such Shelf Registration Statement is effective which
makes any statement made in such Shelf Registration Statement or the
related
<PAGE>
10
Prospectus untrue in any material respect or which requires the making of
any changes in such Shelf Registration Statement or Prospectus in order to
make the statements therein not misleading;
(f) make every reasonable effort to obtain the withdrawal of any order
suspending the effectiveness of a Registration Statement promptly and shall
provide notice to each Holder of the withdrawal of any such order as
promptly as practicable;
(g) in the case of a Shelf Registration, furnish to each Holder of
Registrable Securities, without charge, at least one conformed copy of such
Shelf Registration Statement and any post-effective amendment thereto
(without documents incorporated therein by reference or exhibits thereto,
unless requested);
(h) in the case of a Shelf Registration, cooperate with the selling
Holders of Registrable Securities to facilitate the timely preparation and
delivery of certificates representing Registrable Securities to be sold and
not bearing any restrictive legends; and enable such Registrable Securities
to be in such denominations and registered in such names as the selling
Holders may reasonably request at least two business days prior to the
closing of any sale of Registrable Securities;
(i) in the case of a Shelf Registration, upon the occurrence of any
event contemplated by Section 5(e)(iv) hereof, use its best efforts to
prepare a supplement or post-effective amendment to such Shelf Registration
Statement or the related Prospectus or any document incorporated therein by
reference or file any other required document so that, as thereafter
delivered to the purchasers of the Registrable Securities, such Prospectus
will not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(j) in the case of a Shelf Registration Statement, enter into and
deliver all such customary agreements, documents and take such other
actions (including causing the delivery of opinions of counsel and
"comfort" letters of independent certified public accountants) as are
reasonably required to expedite or facilitate the disposition of
Registrable Securities;
(k) in the case of a Shelf Registration, upon reasonable notice make
available for inspection by a representative of the Holders of the
Registrable Securities, any Underwriter participating in any disposition
pursuant to such Shelf Registration Statement, and any attorney or
accountant designated by the Selling Holders, at reasonable times and in a
reasonable manner, all financial and other records, pertinent documents and
properties of the Company, and cause the respective officers, directors and
employees of the Company to supply all information reasonably requested by
any such representative, Underwriter, attorney or accountant in connection
with a Shelf
<PAGE>
11
Registration Statement; provided, however, that such representatives,
attorneys or accountants shall be acceptable to the Company in its judgment
reasonably exercised and shall agree to enter into a written
confidentiality agreement mutually acceptable to the Company and the
Underwriters regarding any records, information or documents that are
designated by the Company as confidential unless such records, information
or documents are available to the public or disclosure of such records,
information or documents is required by court or administrative order after
the exhaustion of appeals therefrom and to use such information obtained
pursuant to this provision only in connection with the transaction for
which such information was obtained, and not for any other purpose;
(1) in the case of a Shelf Registration, provide copies of any
Prospectus, any amendment to any applicable Shelf Registration Statement or
amendment or supplement to any Prospectus or any document which is to be
incorporated by reference into such Shelf Registration Statement or any
Prospectus after initial filing of such Shelf Registration Statement, a
reasonable time prior to the filing of any such Prospectus, amendment,
supplement or document, to the Initial Purchasers on behalf of the Holders
and Underwriters, if any, and except with respect to a Shelf Registration
filed pursuant to Section 2(b)(iii) not file any such document in a form to
which the Initial Purchasers on behalf of the Holders or Underwriters, if
any, shall reasonably object; and make the representatives of the Company
as shall be reasonably requested by the Holders or the Initial Purchasers
on behalf of such Holders available for discussion of such document;
provided that the requirements of this paragraph shall not apply to the
Company's annual report on Form 10-K, its Quarterly Reports on Form 10-Q,
its current reports on Form 8-K or any other documents filed pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act (the "Exchange Act
Documents"); and further provided that the Company shall promptly notify
Holders of the filing of any Exchange Act Documents except for such
Exchange Act Documents specifically related to the offering of other
securities and not to the Registrable Securities;
(m) obtain a CUSIP number for all Exchange Securities or Registrable
Securities, as the case may be, not later than the effective date of any
Registration Statement; and
(n) cause the Indenture to be qualified under the Trust Indenture Act
of 1939, as amended (the "TIA"), in connection with the registration of the
Exchange Securities, cooperate with the Trustee and the Holders to effect
such changes to the Indenture as may be required for the Indenture to be so
qualified in accordance with the terms of the TIA and execute, and use its
best efforts to cause the Trustee to execute, all documents as may be
required to effect such changes, and all other forms and documents required
to be filed with the SEC to enable the Indenture to be so qualified in a
timely manner.
<PAGE>
12
In the case of a Shelf Registration Statement, the Company may (as a
condition to such Holder's participation in a Shelf Registration) require each
Holder to furnish to the Company information regarding the Holder and the
proposed distribution by such Holder of any Registrable Securities as the
Company may from time to time reasonably request in writing.
In the case of a Shelf Registration Statement, each Holder agrees that,
upon receipt of any (i) notice from the Company of the happening of any event of
the kind described in Section 5(e)(ii) or (iv) hereof, (ii) notice from the
Company that it is in possession of material information that has not been
disclosed to the public and the Company reasonably deems it to be advisable not
to disclose such information in a registration statement or (iii) notice from
the Company that it is in the process of a registered offering of securities and
the Company reasonably deems it to be advisable to temporarily discontinue
disposition of Registrable Securities pursuant to the Shelf Registration
Statement (in each case, such notice being hereinafter referred to as a
"Suspension Notice"), such Holder will forthwith discontinue disposition of
Registrable Securities pursuant to any Shelf Registration Statement and shall
not be entitled to the benefits provided under Section 6 hereof with respect to
any sales made by it in contravention of this paragraph, until such Holder's
receipt of the copies of the supplemented or amended Prospectus contemplated by
Section 5(i) or a notice in accordance with Section 5(f) hereof that any order
suspending the effectiveness of the Shelf Registration Statement has been
withdrawn, or, in the case of (ii) or (iii) above, until further notice from the
Company that disposition of Registrable Securities may resume, provided that
(except with respect to a Shelf Registration filed pursuant to Section
2(b)(iii)) such further notice will be given within 90 days of the Suspension
Notice in the case of (ii) above and within 120 days of the Suspension Notice in
the case of (iii) above, and provided further that in the case of (ii) and (iii)
above that any Suspension Notice must be based upon a good faith determination
of the Board of Directors of the Company or the Executive Committee thereof that
such Notice is necessary; and, if so directed by the Company, such Holder will
deliver to the Company (at the expense of the Company) all copies in its
possession, other than permanent file copies then in such Holder's possession,
of the Prospectus covering such Registrable Securities current at the time of
receipt of such notice. If the Company shall give any such notice to suspend the
disposition of Registrable Securities pursuant to any Shelf Registration
Statement, the Company shall extend the period during which such Shelf
Registration Statement shall be maintained effective pursuant to this Agreement
by the number of days during the period from and including the date of the
giving of such notice to and including the date when the Holders shall have
received copies of the supplemented or amended Prospectus necessary to resume
such dispositions or received notice that any order suspending dispositions of
the Securities has been withdrawn.
Each Holder will furnish to the Company such information regarding such
Holder and the distribution of such Registrable Securities as the Company may
from time to time reasonably request in writing, but only to the extent that
such information is required in order to comply with the Securities Act or any
relevant state securities or Blue Sky law or
<PAGE>
13
obligation. Each Holder of Registrable Securities as to which any registration
is being effected agrees to notify the Company as promptly as practicable of any
inaccuracy or change in information previously furnished by such Holder to the
Company or of the happening of any event, in either case as a result of which
any Prospectus relating to such registration contains an untrue statement of a
material fact regarding such Holder or the distribution of such Registrable
Securities or omits to state any material fact regarding such Holder or the
distribution of such Registrable Securities required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, and to furnish to the Company
promptly any additional information required to correct and update any
previously furnished information or required such that such prospectus shall not
contain, with respect to such holder or the distribution of such Registrable
Securities, an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading.
6. Indemnification; Contribution.
(a) The Company agrees to indemnify and hold harmless each Holder and each
Person, if any, who controls any Holder within the meaning of Section 15 of the
Securities Act as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in any Shelf Registration
Statement (or any amendment thereto) pursuant to which Registrable
Securities were registered under the Securities Act, including all
documents incorporated therein by reference, or the omission or alleged
omission therefrom of a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading or arising out of any untrue statement or alleged untrue
statement of a material fact contained in any preliminary prospectus or any
Prospectus (or any amendment or supplement thereto) or the omission or
alleged omission therefrom of a material fact necessary in order to make
the statements therein, in light of the circumstances under which they were
made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, if such settlement is effected with
the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred (including
fees and disbursements of counsel chosen by any Holder), reasonably
incurred in investigating,
<PAGE>
14
preparing or defending against any litigation, or investigation or
proceeding by any governmental agency or body, commenced or threatened, or
any claim whatsoever based upon any such untrue statement or omission, or
any such alleged untrue statement or omission, to the extent that any such
expense is not paid under subparagraph (i) or (ii) above;
provided, however, that this indemnity does not apply to any loss, claim,
damage, liability or expense to the extent it arises out of an untrue statement
or omission or alleged untrue statement or omission made in reliance upon and in
conformity with written information furnished to the Company by any Holder
expressly for use in a Registration Statement (or any amendment thereto) or any
Prospectus (or any amendment or supplement thereto).
The foregoing indemnity with respect to any untrue statement contained in
or any omission from a preliminary prospectus shall not inure to the benefit of
any Holder (or any Person controlling such Holder) from whom the Person
asserting any such loss, liability, claim, damage or expense purchased any of
the Securities that are the subject thereof if the Company shall sustain the
burden of proving that such Person was not sent or given a copy of the
Prospectus (or the Prospectus as amended or supplemented) (in each case
exclusive of the documents from which information is incorporated by reference)
at or prior to the written confirmation of the sale of such Securities to such
Person and the untrue statement contained in or the omission from such
preliminary prospectus was corrected in the Prospectus (or the Prospectus as
amended or supplemented).
(b) Each Holder severally agrees to indemnify and hold harmless the
Company, its directors, officers and each Person, if any, who controls the
Company within the meaning of Section 15 of the Securities Act, against any and
all loss, liability, claim, damage and expense described in the indemnity
contained in Section 6(a) hereof, as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions, made in the
Registration Statement (or any amendment thereto) or any Prospectus (or any
amendment or supplement thereto) in reliance upon and in conformity with written
information furnished to the Company by such Holder expressly for use in the
Registration Statement (or any amendment thereto) or such Prospectus (or any
amendment or supplement thereto).
(c) Each indemnified party shall give prompt notice to each indemnifying
party of any action commenced against it in respect of which indemnity may be
sought hereunder, but failure to so notify an indemnifying party shall not
relieve it from any liability which it may have otherwise than under this
indemnity agreement. An indemnifying party may participate at its own expense in
the defense of such action; provided, however, that counsel to the indemnifying
party shall not (except with the consent of the indemnified party) also be
counsel to the indemnified party. In no event shall the indemnifying party or
parties be liable for the fees and expenses of more than one counsel for all
indemnified parties in connection with any one action or separate but similar or
related actions in the same jurisdiction, arising out of the same general
allegations or circumstances.
<PAGE>
15
(d) In order to provide for just and equitable contribution in
circumstances in which the indemnity agreement provided for in this Section 6 is
for any reason held to be unenforceable by the indemnified parties although
applicable in accordance with its terms, the Company and the Holders shall
contribute to the aggregate losses, liabilities, claims, damages and expenses of
the nature contemplated by such indemnity agreement incurred by the Company and
one or more of the Holders; provided, however, that no Person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any Person who was not
guilty of such fraudulent misrepresentation. As between the Company and the
Holders, such parties shall contribute to the aggregate losses, liabilities,
claims, damages and expenses of the nature contemplated by such indemnity
agreement in such proportion as shall be appropriate to reflect (i) the relative
benefits received by the Company on the one hand and the Holders on the other
hand, from the offering of the Exchange Securities or Registrable Securities
included in such offering, and (ii) the relative fault of the Company on the one
hand and the Holders on the other, with respect to the statements or omissions
which resulted in such loss, liability, claim, damage or expense, or action in
respect thereof, as well as any other relevant equitable considerations. The
Company and the Holders of the Registrable Securities agree that it would not be
just and equitable if contribution pursuant to this Section 6 were to be
determined by pro rata allocation or by any other method of allocation which
does not take into account the relevant equitable considerations. For purposes
of this Section 6, each Person, if any, who controls a Holder within the meaning
of Section 15 of the Securities Act shall have the same rights to contribution
as such Holder, and each director of the Company, each officer of the Company
who signed the Registration Statement, and each Person, if any, who controls the
Company within the meaning of Section 15 of the Securities Act shall have the
same rights to contribution as the Company.
7. Selection of Underwriters. The Holders of Registrable Securities covered
by the Shelf Registration Statement who desire to do so may sell such
Registrable Securities in an Underwritten Offering. In any such Underwritten
Offering, the investment banker or investment bankers and manager or managers
(the "Underwriters") that will administer the offering will be selected by the
Majority Holders of the Registrable Securities included in such offering;
provided that such Underwriters must be reasonably acceptable to the Company and
of a reputation comparable to that of the Initial Purchasers.
8. Miscellaneous.
(a) No Inconsistent Agreements. The Company has not entered into nor will
the Company on or after the date of this Agreement enter into any agreement
which is inconsistent with the rights granted to the Holders in this Agreement
or otherwise conflicts with the provisions hereof. The rights granted to the
Holders hereunder do not in any way conflict with and are not inconsistent with
the rights granted to the holders of the Company's other issued and outstanding
securities under any such agreements.
<PAGE>
16
(b) Amendments and Waivers. The provisions of this Agreement, including the
provisions of this sentence, may not be amended, modified or supplemented, and
waivers or consents to departures from the provisions hereof may not be given
unless the Company has obtained the written consent of Holders of at least a
majority of the issued and outstanding Registrable Securities affected by such
amendment, modification, supplement, waiver or departure; provided, however, no
amendment, modification or supplement, waiver or consent with respect to the
provisions of Section 6 hereof shall be effective as against any Holder of
Registrable Securities unless consented to in writing by such Holder.
(c) Notices. All notices and other communications provided for or permitted
hereunder shall be made in writing by hand delivery, registered first-class
mail, telex, telecopier, or any courier guaranteeing overnight delivery (i) if
to a Holder, at the most current address given by such Holder to the Company by
means of a notice given in accordance with the provisions of this Section 8(c);
(ii) if to the Company, initially at 1111 Stewart Avenue, Bethpage, New York
11714, Attention: General Counsel, and thereafter at such other address, notice
of which is given in accordance with the provisions of this Section 8(c).
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five business
days after being deposited in the mail, postage prepaid, if mailed; when
answered back, if telexed; when receipt is acknowledged, if telecopied; and on
the next business day if timely delivered to any courier guaranteeing overnight
delivery.
Copies of all such notices, demands, or other communications shall be
concurrently delivered by the Person giving the same to the Trustee at The Bank
of New York, Corporate Trust Department, 101 Barclay Street, 21st Floor, New
York, New York 10286, Attention: Iliana Arciprete.
(d) Successors and Assigns. This Agreement shall inure to the benefit of
and be binding upon the successors, assigns and transferees of each of the
parties, including, without limitation and without the need for an express
assignment, subsequent Holders; provided that nothing herein shall be deemed to
permit any assignment, transfer or other disposition of Registrable Securities
in violation of the terms of the Purchase Agreement. If any transferee of any
Holder shall acquire Registrable Securities, in any manner, whether by operation
of law or otherwise, such Registrable Securities shall be held subject to all of
the terms of this Agreement, and by taking and holding such Registrable
Securities such Person shall be conclusively deemed to have agreed to be bound
by and to perform all of the terms and provisions of this Agreement and such
Person shall be entitled to receive the benefits hereof.
(e) Enforcement by Initial Purchasers. The Initial Purchasers shall have
the right to directly enforce the agreements made hereunder between the Company,
on the one hand, and the Holders, on the other hand, to the extent they deem
such enforcement necessary
<PAGE>
17
or advisable to protect their rights or the rights of Holders hereunder,
provided, however, that such right of direct enforcement shall terminate upon
consummation of an Exchange Offer.
(f) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(g) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(h) Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
(i) Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
<PAGE>
18 IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
CSC HOLDINGS, INC.
By: /s/ William J. Bell
--------------------------
Name: William J. Bell
Title: Vice Chairman
Confirmed and accepted as of the date first above written:
BEAR, STEARNS & CO. INC.
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
DONALDSON, LUFKIN & JENRETTE SECURITIES CORPORATION
GOLDMAN, SACHS & CO.
MORGAN STANLEY & CO. INCORPORATED
SALOMON SMITH BARNEY INC.
c/o Merrill Lynch, Pierce, Fenner & Smith Incorporated
By: Merrill Lynch, Pierce, Fenner & Smith Incorporated
By: Eric Federman
-----------------------------
Name: Eric Federman
Title: Authorized Signatory
(Exhibit 4.2)
================================================================================
CSC HOLDINGS, INC.,
Issuer,
to
THE BANK OF NEW YORK,
Trustee
---------
Indenture
Dated as of July 1, 1999
---------
$500,000,000
8 1/8% Senior Notes due 2009
8 1/8% Series B Senior Notes due 2009
<PAGE>
Reconciliation and Tie Between Trust Indenture Act
of 1939 and Indenture, Dated as of July 1, 1999
Trust Indenture
Act Section Indenture Section
Section 310(a)(1) ................................. 608
(a)(2) ................................. 608
(b) ................................. 607, 609
Section 311(a) ................................. 612
(b) ................................. 612
Section 312(a) ................................. 607
(b) .................................. 607
(c) ................................. 701
Section 313 ................................. 702
Section 314(a) ................................. 703
(a)(4) ................................. 1013
(c)(1) ................................. 103
(c)(2) ................................. 103
(e) ................................. 103
Section 315(b) ................................. 601
Section 316(a)(last
sentence) ................................. 101 ("Outstanding")
(a)(1)(A) ................................. 502, 512
(a)(1)(B) ................................. 513
(b) ................................. 508
(c) ................................. 105(d)
Section 317(a)(1) ................................. 503
(a)(2) ................................. 504
(b) ................................. 1003
Section 318(a) ................................. 108
Note: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of this Indenture.
<PAGE>
TABLE OF CONTENTS
Page
RECITALS.......................................................................1
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
Section 101. Definitions.............................................1
Acquired Indebtedness........................................2
Affiliate....................................................2
Agent Members................................................2
Annualized Operating Cash Flow...............................2
Average Life.................................................2
Bank Credit Agreement........................................2
Banks........................................................3
Board of Directors...........................................3
Board Resolution.............................................3
Book-Entry Security..........................................3
Business Day.................................................3
Capital Stock................................................3
Capitalized Lease Obligation.................................3
Cash Flow Ratio..............................................4
Commission...................................................4
Common Stock.................................................4
Company ....................................................4
Company Request" or "Company Order...........................4
Consolidated Net Tangible Assets.............................4
Corporate Trust Office.......................................5
corporation..................................................5
Cumulative Cash Flow Credit..................................5
Cumulative Interest Expense..................................5
Debt.........................................................6
Default ....................................................6
Depository...................................................6
Disqualified Stock...........................................6
Event of Default.............................................6
Exchange Act.................................................6
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Page
Exchange Offer...............................................6
Exchange Offer Registration Statement........................7
Exchange Securities..........................................7
generally accepted accounting principles" or "...............7
Global Security..............................................7
guarantee....................................................7
Holder ....................................................7
Indebtedness.................................................7
Indenture....................................................8
Initial Purchasers...........................................8
Initial Securities...........................................8
Interest Payment Date........................................8
Interest Swap Obligations....................................8
Investment...................................................8
Lease ....................................................8
Lien ....................................................8
Mandatorily Redeemable Preferred Stock.......................9
Maturity ....................................................9
Officers' Certificate........................................9
Operating Cash Flow..........................................9
Opinion of Counsel..........................................10
Outstanding.................................................10
Paying Agent................................................10
Permitted Liens.............................................11
Person ...................................................13
Physical Security...........................................13
Predecessor Security........................................13
Preferred Stock.............................................13
Qualified Institutional Buyer" or "QIB......................13
Receivables and Related Assets..............................13
Refinancing Indebtedness....................................13
Registered Securities.......................................14
Registration Rights Agreement...............................14
Regular Record Date.........................................14
Regulation S Global Security................................14
Responsible Officer.........................................14
Restricted Payment..........................................14
Restricted Security.........................................15
<PAGE>
iii
Page
Restricted Subsidiary.......................................15
Rule 144A Global Security...................................16
Securities Act..............................................16
Securities Issue Date.......................................16
Securitization Subsidiary...................................16
Security" and "Securities...................................16
Security Register" and "Security Registrar..................16
Senior Indebtedness.........................................16
Shelf Registration Statement................................17
Special Record Date.........................................17
Stated Maturity.............................................17
Stock Payment...............................................17
subsidiary..................................................17
Subsidiary..................................................17
Trust Indenture Act.........................................17
Trustee ...................................................18
Unrestricted Subsidiary.....................................18
Voting Stock................................................18
Section 102. Other Definitions......................................18
Section 103. Compliance Certificates and Opinions...................18
Section 104. Form of Documents Delivered to Trustee.................19
Section 105. Acts of Holders........................................20
Section 106. Notices, Etc. to Trustee and Company...................21
Section 107. Notice to Holders; Waiver..............................21
Section 108. Conflict of Any Provision of Indenture
with Trust Indenture Act.............................22
Section 109. Effect of Headings and Table of Contents...............22
Section 110. Successors and Assigns.................................22
Section 111. Separability Clause....................................22
Section 112. Benefits of Indenture..................................23
Section 113. Governing Law..........................................23
Section 114. Legal Holidays.........................................23
Section 115. No Recourse Against Others.............................23
ARTICLE TWO
SECURITY FORMS
Section 201. Forms Generally; Incorporation of Form in Indenture....24
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Page
Section 202. Form of Face of Security...............................24
Section 203. Form of Reverse of Security............................27
Section 204. Form of Trustee's Certificate of Authentication........31
Section 205. Form of Legend on Restricted Securities................31
Section 206. Form of Legend for Book-Entry Securities...............33
ARTICLE THREE
THE SECURITIES
Section 301. Title and Terms........................................34
Section 302. Denominations..........................................35
Section 303. Execution, Authentication, Delivery and Dating.........35
Section 304. Temporary Securities...................................36
Section 305. Registration, Registration of Transfer and Exchange....37
Section 306. Mutilated, Destroyed, Lost and Stolen Securities.......38
Section 307. Payment of Interest; Interest Rights Preserved.........39
Section 308. Persons Deemed Owners..................................40
Section 309. Cancellation...........................................41
Section 310. Computation of Interest................................41
Section 311. Registration Rights of Holders of Initial Securities...41
Section 312. CUSIP Numbers..........................................41
Section 313. Book-Entry Provisions for Global Securities............41
Section 314. Special Transfer Provisions............................43
ARTICLE FOUR
SATISFACTION AND DISCHARGE
Section 401. Satisfaction and Discharge of Indenture................46
Section 402. Application of Trust Money.............................47
ARTICLE FIVE
REMEDIES
Section 501. Events of Default......................................47
Section 502. Acceleration of Maturity; Rescission...................49
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Page
Section 503. Collection of Indebtedness and Suits
for Enforcement by Trustee...........................50
Section 504. Trustee May File Proofs of Claim.......................51
Section 505. Trustee May Enforce Claims Without
Possession of Securities.............................52
Section 506. Application of Money Collected.........................52
Section 507. Limitation on Suits....................................52
Section 508. Unconditional Right of Holders to Receive
Principal and Interest...............................53
Section 509. Restoration of Rights and Remedies.....................53
Section 510. Rights and Remedies Cumulative.........................54
Section 511. Delay or Omission Not Waiver...........................54
Section 512. Control by Holders.....................................54
Section 513. Waiver of Past Defaults................................54
Section 514. Undertaking for Costs..................................55
Section 515. Waiver of Stay, Extension or Usury Laws................55
ARTICLE SIX
THE TRUSTEE
Section 601. Notice of Defaults.....................................56
Section 602. Certain Rights of Trustee..............................56
Section 603. Not Responsible for Recitals
or Issuance of Securities............................57
Section 604. May Hold Securities....................................58
Section 605. Money Held in Trust....................................58
Section 606. Compensation and Reimbursement.........................58
Section 607. Conflicting Interests..................................59
Section 608. Corporate Trustee Required; Eligibility................59
Section 609. Resignation and Removal; Appointment of Successor......60
Section 610. Acceptance of Appointment by Successor.................61
Section 611. Merger, Conversion, Consolidation
or Succession to Business............................62
Section 612. Preferential Collection of Claims Against Company......62
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
Section 701. Disclosure of Names and Addresses of Holders...........63
Section 702. Reports by Trustee.....................................63
Section 703. Reports by Company.....................................63
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vi
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
Section 801. Company May Consolidate, Etc.,
Only on Certain Terms................................64
Section 802. Successor Substituted..................................65
ARTICLE NINE
SUPPLEMENTAL INDENTURES
Section 901. Supplemental Indentures Without Consent of Holders.....65
Section 902. Supplemental Indentures with Consent of Holders........66
Section 903. Execution of Supplemental Indentures...................67
Section 904. Effect of Supplemental Indentures......................67
Section 905. Conformity with Trust Indenture Act....................68
Section 906. Reference in Securities to Supplemental Indentures.....68
ARTICLE TEN
COVENANTS
Section 1001. Payment of Principal and Interest.....................68
Section 1002. Maintenance of Office or Agency.......................68
Section 1003. Money for Security Payments to Be Held in Trust.......69
Section 1004. Corporate Existence...................................70
Section 1005. Payment of Taxes and Other Claims.....................70
Section 1006. Maintenance of Properties.............................71
Section 1007. Limitation on Indebtedness............................71
Section 1008. Limitation on Liens...................................71
Section 1009. Limitation on Restricted Payments.....................72
Section 1010. Limitation on Investments in
Unrestricted Subsidiaries and Affiliates............73
Section 1011. Transactions with Affiliates..........................73
Section 1012. Provision of Financial Statements.....................73
Section 1013. Statement as to Compliance............................74
Section 1014. Waiver of Certain Covenants...........................74
Section 1015. Statement by Officers as to Default...................75
<PAGE>
vii
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
Section 1101. No Right of Redemption................................75
ARTICLE TWELVE
DEFEASANCE AND COVENANT DEFEASANCE
Section 1201. Option to Effect Defeasance or Covenant Defeasance....75
Section 1202. Defeasance and Discharge..............................75
Section 1203. Covenant Defeasance...................................76
Section 1204. Conditions to Defeasance or Covenant Defeasance.......76
Section 1205. Deposited Money and U.S. Government
Obligations to Be Held in Trust;
Other Miscellaneous Provisions.......................78
Section 1206. Reinstatement.........................................79
TESTIMONIUM...................................................................73
SIGNATURES AND SEALS..........................................................73
ACKNOWLEDGMENTS...............................................................73
EXHIBIT A List of Restricted Subsidiaries
EXHIBIT B Form of Registration Rights Agreement
<PAGE>
INDENTURE dated as of July 1, 1999 between CSC Holdings, Inc., a Delaware
corporation (hereinafter called the "Company"), and The Bank of New York, a New
York banking corporation, trustee (hereinafter called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the creation of an issue of its 8 1/8%
Senior Notes due 2009 (hereinafter called the "Initial Securities") and its 8
1/8% Series B Senior Notes due 2009 (the "Exchange Securities," and together
with the Initial Securities, the "Securities"), of substantially the tenor and
amount hereinafter set forth, and to provide therefor the Company has duly
authorized the execution and delivery of this Indenture;
Upon the issuance of the Exchange Securities, if any, or the effectiveness
of the Exchange Offer Registration Statement (as defined herein) or, under
certain circumstances, the effectiveness of the Shelf Registration Statement (as
defined herein), this Indenture will be subject to, and shall be governed by,
the provisions of the Trust Indenture Act that are required to be part of this
Indenture and shall to the extent applicable be governed by such provisions.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Securities
by the Holders thereof, it is mutually covenanted and agreed, for the equal and
proportionate benefit of all Holders of the Securities, as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 101. DEFINITIONS.
For all purposes of this Indenture, except as otherwise expressly provided
or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to them in
this Article and include the plural as well as the singular;
<PAGE>
2
(b) all other terms used herein which are defined in the Trust Indenture
Act, either directly or by reference therein, have the meanings assigned to them
therein;
(c) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles and
except as otherwise herein expressly provided, the term "generally accepted
accounting principles" with respect to any computation required or permitted
hereunder shall mean such accounting principles as were generally accepted in
the United States as of August 21, 1997; and
(d) the words "herein", "hereof" and "hereunder" and other words of similar
import refer to this Indenture as a whole and not to any particular Article,
Section or other subdivision.
"Acquired Indebtedness" means Indebtedness of a Person (a) existing at the
time such Person is merged with or into the Company or a Subsidiary or becomes a
Subsidiary or (b) assumed in connection with the acquisition of assets from such
Person.
"Affiliate" means, with respect to any specified Person, any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Agent Members" shall have the meaning set forth in Section 313.
"Annualized Operating Cash Flow" means, for any period of three complete
consecutive calendar months, an amount equal to Operating Cash Flow for such
period multiplied by four.
"Average Life" means, at any date of determination with respect to any debt
security, the quotient obtained by dividing (a) the sum of the products of (i)
the number of years from such date of determination to the dates of each
successive scheduled principal payment of such debt security and (ii) the amount
of such principal payment by (b) the sum of all such principal payments.
<PAGE>
3
"Bank Credit Agreement" means the Sixth Amended and Restated Credit
Agreement, dated as of May 28, 1998, among the Company, the Restricted
Subsidiaries party thereto, the banks party thereto, Toronto Dominion (Texas),
Inc., as Arranging Agent and as Administrative Agent, The Bank of New York, The
Bank of Nova Scotia, The Canadian Imperial Bank of Commerce, NationsBank, N.A.
and The Chase Manhattan Bank, as Managing Agents, Bank of Montreal, Chicago
Branch, Barclays Bank plc, Fleet Bank, N.A. and Royal Bank of Canada, as Agents,
Banque Paribas, Credit Lyonnais, BankBoston N.A., The First National Bank of
Chicago, Mellon Bank, N.A. and Societe Generale, New York Branch, as Co-Agents,
and The Canadian Imperial Bank of Commerce, The Chase Manhattan Bank and
NationsBank, N.A., as Co-Syndication Agents and the First Amended and Restated
Credit Agreement, dated as of May 28, 1998, by and among Cablevision MFR, Inc.,
the Guarantors party thereto, the Lenders from time to time party thereto and
Toronto Dominion Bank (Texas), Inc., as Arranging Agent and as Administrative
Agent, The Bank of New York, The Bank of Nova Scotia, The Canadian Imperial Bank
of Commerce, NationsBank, N.A. and The Chase Manhattan Bank, as Managing Agents,
Bank of Montreal, Chicago Branch, Barclays Bank plc, Fleet Bank, N.A. and Royal
Bank of Canada, as Agents, Banque Paribas, Credit Lyonnais, BankBoston N.A., The
First National Bank of Chicago, Mellon Bank, N.A. and Societe Generale, New York
Branch, as Co-Agents, and the Bank of New York and the Bank of Nova Scotia, as
Co-Syndication Agents, both agreements as in effect on the date hereof and as
such agreements may be amended or replaced from time to time.
"Banks" means the lenders from time to time who are parties to the Bank
Credit Agreement.
"Board of Directors" means the board of directors of the Company or any
duly authorized committee of such board.
"Board Resolution" means a copy of a resolution certified by the Secretary
or an Assistant Secretary of the Company to have been duly adopted by the Board
of Directors and to be in full force and effect on the date of such
certification and delivered to the Trustee.
"Book-Entry Security" means a Security represented by a Global Security and
registered in the name of the nominee of the Depository.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and Friday
that is not a day on which banking institutions in The City of New York are
authorized or obligated by law, regulation or executive order to close.
<PAGE>
4
"Capital Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated) of such
Person's capital stock whether now outstanding or issued after the date of this
Indenture, including, without limitation, all Common Stock, Preferred Stock and
Disqualified Stock.
"Capitalized Lease Obligation" means any obligation of a Person to pay rent
or other amounts under a lease with respect to any property (whether real,
personal or mixed) acquired or leased by such Person and used in its business
that is required to be accounted for as a liability on the balance sheet of such
Person in accordance with generally accepted accounting principles and the
amount of such Capitalized Lease Obligation shall be the amount so required to
be accounted for as a liability.
"Cash Flow Ratio" means, as at any date, the ratio of (a) the sum of the
aggregate outstanding principal amount of all Indebtedness of the Company and
the Restricted Subsidiaries determined on a consolidated basis but excluding all
Interest Swap Obligations entered into by the Company or any Restricted
Subsidiary and one of the Banks outstanding on such date plus (but without
duplication of Indebtedness supported by letters of credit) the aggregate
undrawn face amount of all letters of credit outstanding on such date to (b)
Annualized Operating Cash Flow determined as at the last day of the most recent
month for which financial information is available.
"Commission" means the Securities and Exchange Commission, as from time to
time constituted, created under the Exchange Act or, if at any time after the
execution of this Indenture such Commission is not existing and performing the
duties now assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.
"Common Stock" means, with respect to any Person, any and all shares,
interests and participations (however designated and whether voting or
non-voting) in such Person's common equity, whether now Outstanding or issued
after the date of this Indenture, and includes, without limitation, all series
and classes of such common stock.
"Company" means the Person named as the "Company" in the first paragraph of
this instrument, until a successor Person shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Company" shall mean
such successor Person. To the extent necessary to comply with the requirements
of the provisions of Trust Indenture Act Sections 310 through 317 as they are
applicable to the Company, the term "Company" shall include any other obligor
with respect to the Securities for the purposes of complying with such
provisions.
<PAGE>
5
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company (a) by its Chairman, Chief Executive Officer,
a Vice Chairman, its President or a Vice President and (b) by its Treasurer, an
Assistant Treasurer, its Secretary or an Assistant Secretary and delivered to
the Trustee; provided, however, that such written request or order may be signed
by any two of the officers or directors listed in clause (a) above in lieu of
being signed by one of such officers or directors listed in such clause (a) and
one of the officers listed in clause (b) above.
"Consolidated Net Tangible Assets" of any Person means, as of any date, (a)
all amounts that would be shown as assets on a consolidated balance sheet of
such Person and its Restricted Subsidiaries prepared in accordance with
generally accepted accounting principles, less (b) the amount thereof
constituting goodwill and other intangible assets as calculated in accordance
with generally accepted accounting principles.
"Corporate Trust Office" means the office of the Trustee at which at any
particular time its corporate trust business shall be principally administered,
which office at the date of execution of this Indenture is located at 101
Barclay Street, 21st Floor, New York, New York 10286.
"corporation" includes corporations, associations, partnerships, limited
liability companies, companies and business trusts.
"Cumulative Cash Flow Credit" means the sum of:
(a) cumulative Operating Cash Flow during the period commencing on
July 1, 1988 and ending on the last day of the most recent month preceding
the date of the proposed Restricted Payment for which financial information
is available or, if cumulative Operating Cash Flow for such period is
negative, minus the amount by which cumulative Operating Cash Flow is less
than zero, plus
(b) the aggregate net proceeds received by the Company from the
issuance or sale (other than to a Restricted Subsidiary) of its Capital
Stock (other than Disqualified Stock) on or after January 1, 1992, plus
(c) the aggregate net proceeds received by the Company from the
issuance or sale (other than to a Restricted Subsidiary) of its Capital
Stock (other than Disqualified Stock) on or after January 1, 1992, upon the
conversion of, or exchange for, Indebtedness of the Company or any
Restricted Subsidiary or from the exercise of any options, warrants or
other rights to acquire Capital Stock of the Company.
<PAGE>
6
For purposes of this definition, the net proceeds in property other than cash
received by the Company as contemplated by clauses (b) and (c) above shall be
valued at the fair market value of such property (as determined by the Board of
Directors, whose good faith determination shall be conclusive) at the date of
receipt by the Company.
"Cumulative Interest Expense" means, for the period commencing on July 1,
1988 and ending on the last day of the most recent month preceding the proposed
Restricted Payment for which financial information is available, the aggregate
of the interest expense of the Company and its Restricted Subsidiaries for such
period, determined on a consolidated basis in accordance with generally accepted
accounting principles, including interest expense attributable to Capitalized
Lease Obligations.
"Debt" with respect to any Person means, without duplication, any
liability, whether or not contingent, (a) in respect of borrowed money or
evidenced by bonds, notes, debentures or similar instruments or letters of
credit (or reimbursement agreements in respect thereto), but excluding
reimbursement obligations under any surety bond, (b) representing the balance
deferred and unpaid of the purchase price of any property (including pursuant to
Capitalized Lease Obligations), except any such balance that constitutes a trade
payable, (c) under Interest Swap Agreements (as defined in the Bank Credit
Agreement) entered into pursuant to the Bank Credit Agreement, (d) under any
other agreement related to the fixing of interest rates on any Indebtedness,
such as an interest swap, cap or collar agreement (if and to the extent any of
the foregoing liabilities would appear as a liability upon a balance sheet of
such Person prepared on a consolidated basis in accordance with generally
accepted accounting principles) or (e) guarantees of items of other Persons
which would be included within this definition for such other Persons (whether
or not the guarantee would appear on such balance sheet). "Debt" does not
include (a) Disqualified Stock, (b) any liability for federal, state or other
taxes owed or owing by such person or (c) any accounts payable or other
liability to trade creditors arising in the ordinary course of business
(including guarantees thereof or instruments evidencing such liabilities).
"Default" means any event which is, or after notice or passage of time or
both would be, an Event of Default.
"Depository" means, with respect to the Securities issued in the form of
one or more Book-Entry Securities, The Depository Trust Company or another
Person designated as Depository by the Company, which must be a clearing agency
registered under the Exchange Act.
<PAGE>
7
"Disqualified Stock" means any Capital Stock of the Company or any
Restricted Subsidiary which, by its terms (or by the terms of any security into
which it is convertible or for which it is exchangeable), or upon the happening
of any event, matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or is redeemable at the option of the holder thereof,
in whole or in part, on or prior to the maturity date of the Securities.
"Event of Default" has the meaning specified in Article Five.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Offer" means the offer by the Company to the Holders of the
Initial Securities to exchange all of the Initial Securities for Exchange
Securities, as provided for in the Registration Rights Agreement.
"Exchange Offer Registration Statement" means the Exchange Offer
Registration Statement as defined in the Registration Rights Agreement.
"Exchange Securities" has the meaning stated in the first recital of this
Indenture and refers to any Exchange Securities containing terms substantially
identical to the Initial Securities (except that (a) such Exchange Securities
shall not contain terms with respect to transfer restrictions and shall be
registered under the Securities Act, and (b) certain provisions relating to an
increase in the stated rate of interest thereon shall be eliminated) that are
issued and exchanged for the Initial Securities in accordance with the Exchange
Offer, as provided for in the Registration Rights Agreement and this Indenture.
"generally accepted accounting principles" or "GAAP" means generally
accepted accounting principles in the United States, consistently applied, which
were in effect as of August 15, 1997.
"Global Security" means one or more Securities evidencing all or a part of
the Securities to be issued as Book-Entry Securities, issued to the Depository
in accordance with Section 303 and bearing the legend prescribed in Section 206
and, in the case of a Restricted Security, the legend prescribed in Section 205.
"guarantee" means, as applied to any obligation, (a) a guarantee (other
than by endorsement of negotiable instruments for collection in the ordinary
course of business), direct or indirect, in any manner, of any part or all of
such obligation or (b) an agreement, direct or indirect, contingent or
otherwise, providing assurance of the payment or performance (or payment of
damages in the event of non-performance) of any part or all of such obligation,
<PAGE>
8
including, without limiting the foregoing, the payment of amounts drawn down by
letters of credit. Notwithstanding anything herein to the contrary, a guarantee
shall not include any agreement solely because such agreement creates a Lien on
the assets of any Person. The amount of a guarantee shall be deemed to be the
maximum amount of the obligation guaranteed for which the guarantor could be
held liable under such guarantee.
"Holder" means a Person in whose name a Security is registered in the
Security Register.
"Indebtedness" with respect to any Person, means the Debt of such Person;
provided that, for purposes of the definition of "Indebtedness" (including the
term "Debt" to the extent incorporated in such definition) and for purposes of
the definition of Event of Default, the term "guarantee" shall not be
interpreted to extend to a guarantee under which recourse is limited to the
Capital Stock of an entity that is not a Restricted Subsidiary.
"Indenture" means this instrument as originally executed (including all
exhibits and schedules hereto) and as it may from time to time be supplemented
or amended by one or more indentures supplemental hereto entered into pursuant
to the applicable provisions hereof.
"Initial Purchasers" means Bear, Stearns & Co. Inc., Merrill Lynch, Pierce,
Fenner & Smith Incorporated, Donaldson, Lufkin & Jenrette Securities
Corporation, Goldman Sachs & Co., Morgan Stanley & Co. Incorporated and Salomon
Smith Barney Inc.
"Initial Securities" has the meaning specified in the recitals to this
Indenture.
"Interest Payment Date" means the Stated Maturity of an installment of
interest on the Securities.
"Interest Swap Obligations" means, with respect to any Person, the
obligations of such Person pursuant to any arrangement with any other Person
whereby, directly or indirectly, such Person is entitled to receive from time to
time periodic payments calculated by applying either a floating or a fixed rate
of interest on a stated notional amount in exchange for periodic payments made
by such Person calculated by applying a fixed or a floating rate of interest on
the same notional amount.
"Investment" means any advance, loan, account receivable (other than an
account receivable arising in the ordinary course of business) or other
extension of credit (excluding, however, accrued and unpaid interest in respect
of any advance, loan or other extension of credit) or any capital contribution
to (by means of transfers of property to others,
<PAGE>
9
or payments for property or services for the account or use of others, or
otherwise), any purchase or ownership of any stocks, bonds, notes, debentures or
other securities (including, without limitation, any interests in any
partnership, joint venture or joint adventure) of, or any bank accounts with or
guarantee of any Indebtedness or other obligations of, any Unrestricted
Subsidiary or Affiliate that is not a Subsidiary; provided that (a) the term
"Investment" shall not include any transaction that would otherwise constitute
an Investment of the Company or a Subsidiary to the extent that the
consideration provided by the Company or such Subsidiary in connection therewith
shall consist of Capital Stock of the Company (other than Disqualified Stock)
and (b) the term "guarantee" shall not be interpreted to extend to a guarantee
under which recourse is limited to the Capital Stock of an entity that is not a
Restricted Subsidiary.
"Lease" means any capital lease, operating lease, equipment lease, real
property lease or other lease.
"Lien" means any lien, security interest, charge or encumbrance of any kind
(including any conditional sale or other title retention agreement, any lease in
the nature of a security interest and any agreement to give any security
interest). A Person shall be deemed to own subject to a Lien any property which
such Person has acquired or holds subject to the interest of a vendor or lessor
under a conditional sale agreement, capital lease or other title retention
agreement.
"Mandatorily Redeemable Preferred Stock" means the Company's Series H
Redeemable Exchangeable Preferred Stock, Series M Redeemable Exchangeable
Preferred Stock and any series of preferred stock of the Company issued in
exchange for, or the proceeds of which are used to repurchase, redeem, defease
or otherwise acquire, all or any portion of the Series H Redeemable Exchangeable
Preferred Stock, Series M Redeemable Exchangeable Preferred Stock or any other
Mandatorily Redeemable Preferred Stock.
"Maturity" when used with respect to any Security means the date on which
the principal of such Security becomes due and payable as therein or herein
provided whether at the Stated Maturity, by declaration of acceleration or
otherwise.
"Officers' Certificate" means a certificate signed by (a) the Chairman,
Chief Executive Officer, a Vice Chairman, the President, a Vice President or the
Treasurer of the Company and (b) the Secretary or an Assistant Secretary of the
Company and delivered to the Trustee; provided, however, that such certificate
may be signed by two of the officers or directors listed in clause (a) above in
lieu of being signed by one of such officers or directors listed in such clause
(a) and one of the officers listed in clause (b) above.
<PAGE>
10
"Operating Cash Flow" means, for any period, the sum of the following for
the Company and the Restricted Subsidiaries for such period, determined on a
consolidated basis in accordance with generally accepted accounting principles
(except for the amortization of deferred installation income which shall be
excluded from the calculation of Operating Cash Flow for all purposes of this
Indenture): (a) aggregate operating revenues minus (b) aggregate operating
expenses (including technical, programming, sales, selling, general and
administrative expenses and salaries and other compensation, net of amounts
allocated to Affiliates, paid to any general partner, director, officer or
employee of the Company or any Restricted Subsidiary, but excluding interest,
depreciation and amortization and the amount of non-cash compensation in respect
of the Company's employee incentive stock programs for such period (not to
exceed in the aggregate for any calendar year 7% of the Operating Cash Flow for
the previous calendar year) and, to the extent otherwise included in operating
expenses, any losses resulting from a writeoff or writedown of Investments by
the Company or any Restricted Subsidiary in Affiliates). For purposes of
determining Operating Cash Flow, there shall be excluded all management fees
until actually paid to the Company or any Restricted Subsidiary in cash.
"Opinion of Counsel" means a written opinion of counsel, who may be counsel
for the Company. Each such opinion shall include the statements provided for in
Trust Indenture Act section 314 to the extent applicable.
"Outstanding" when used with respect to Securities means, as of the date of
determination, all Securities theretofore authenticated and delivered under this
Indenture, except:
(a) Securities theretofore canceled by the Trustee or delivered to the
Trustee for cancellation;
(b) Securities, or portions thereof, for whose payment or purchase
money in the necessary amount has been theretofore deposited with the
Trustee or any Paying Agent (other than the Company) in trust or set aside
and segregated in trust by the Company (if the Company shall act as its own
Paying Agent) for the Holders of such Securities;
(c) Securities, except to the extent provided in Sections 1202 and
1203, with respect to which the Company has effected defeasance and/or
covenant defeasance as provided in Article Twelve; and
<PAGE>
11
(d) Securities paid pursuant to Section 306, Securities in exchange
for or in lieu of which other Securities have been authenticated and
delivered pursuant to this Indenture, other than any such Securities in
respect of which there shall have been presented to the Trustee proof
satisfactory to it that such Securities are held by a bona fide purchaser
in whose hands the Securities are valid obligations of the Company;
provided, however, that, in determining whether the Holders of the requisite
principal amount of Outstanding Securities have given any request, demand,
direction, consent or waiver hereunder, Securities owned by the Company or any
other obligor upon the Securities, or any Affiliate of the Company, or such
other obligor, shall be disregarded and deemed not to be Outstanding, except
that, in determining whether the Trustee shall be protected in relying upon any
such request, demand, direction, consent or waiver, only Securities which a
Responsible Officer of the Trustee actually knows to be so owned shall be so
disregarded. Securities so owned which have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Securities and that
the pledgee is not the Company or any other obligor upon the Securities or any
Affiliate of the Company or such other obligor.
"Paying Agent" means any Person authorized by the Company to pay the
principal of or interest on any Securities on behalf of the Company.
"Permitted Liens" means the following types of Liens:
(a) Liens existing on the date of this Indenture;
(b) Liens on shares of the Capital Stock of an entity that is not a
Restricted Subsidiary, which Liens solely secure a guarantee by the Company
or a Restricted Subsidiary, or both, of Indebtedness of such entity;
(c) Liens on Receivables and Related Assets (and proceeds thereof)
securing only Indebtedness otherwise permitted to be incurred by a
Securitization Subsidiary;
(d) Liens on shares of the Capital Stock of a Subsidiary securing
Indebtedness under the Bank Credit Agreement or any renewal or replacement
of the Bank Credit Agreement;
(e) Liens granted in favor of the Company or any Restricted
Subsidiary;
(f) Liens securing the Securities;
<PAGE>
12
(g) Liens securing Acquired Indebtedness created prior to (and not in
connection with or in contemplation of) the incurrence of such Indebtedness
by the Company or a Restricted Subsidiary; provided that such Lien does not
extend to any property or assets of the Company or any Restricted
Subsidiary other than the assets acquired in connection with the incurrence
of such Acquired Indebtedness;
(h) Liens securing Interest Swap Obligations or "margin stock", as
defined in Regulations G and U of the Board of Governors of the Federal
Reserve System;
(i) statutory Liens of landlords and carriers, warehousemen,
mechanics, suppliers, materialmen, repairmen or other like Liens arising in
the ordinary course of business of the Company or any Restricted Subsidiary
and with respect to amounts not yet delinquent or being contested in good
faith by appropriate proceedings;
(j) Liens for taxes, assessments, government charges or claims not yet
due or that are being contested in good faith by appropriate proceedings;
(k) zoning restrictions, easements, rights-of-way, restrictions and
other similar charges or encumbrances or minor defects in title not
interfering in any material respect with the business of the Company or any
of its Restricted Subsidiaries;
(l) Liens arising by reason of any judgment, decree or order of any
court, arbitral tribunal or similar entity so long as any appropriate legal
proceedings that may have been initiated for the review of such judgment,
decree or order shall not have been finally terminated or the period within
which such proceedings may be initiated shall not have expired;
(m) Liens incurred or deposits made in the ordinary course of business
in connection with workers' compensation, unemployment insurance and other
types of social security or similar legislation;
(n) Liens securing the performance of bids, tenders, Leases,
contracts, franchises, public or statutory obligations, surety, stay or
appeal bonds, or other similar obligations arising in the ordinary course
of business;
(o) Leases under which the Company or any Restricted Subsidiary is the
lessee or the lessor;
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13
(p) purchase money mortgages or other purchase money liens (including
without limitation any Capitalized Lease Obligations) upon any fixed or
capital assets acquired after the date of this Indenture, or purchase money
mortgages (including without limitation Capitalized Lease Obligations) on
any such assets hereafter acquired or existing at the time of acquisition
of such assets, whether or not assumed, so long as (i) such mortgage or
lien does not extend to or cover any other asset of the Company or any
Restricted Subsidiary and (ii) such mortgage or lien secures the obligation
to pay the purchase price of such asset, interest thereon and other charges
incurred in connection therewith (or the obligation under such Capitalized
Lease Obligation) only;
(q) Liens securing reimbursement obligations with respect to
commercial letters of credit which encumber documents and other property
relating to such letters of credit and products and proceeds thereof;
(r) Liens encumbering deposits made to secure obligations arising from
statutory, regulatory, contractual, or warranty requirements of the Company
or any of its Restricted Subsidiaries, including rights of offset and
set-off;
(s) Liens to secure other Indebtedness; provided, however, that the
principal amount of any Indebtedness secured by such Liens, together with
the principal amount of any Indebtedness refinancing any Indebtedness
incurred under this clause (s) as permitted by clause (t) below (and
successive refinancings thereof), may not exceed 15% of the Company's
Consolidated Net Tangible Assets as of the last day of the Company's most
recently completed fiscal year for which financial information is
available; and
(t) any extension, renewal or replacement, in whole or in part, of any
Lien described in the foregoing clauses (a) through (s); provided that any
such extension, renewal or replacement shall be no more restrictive in any
material respect than the Lien so extended, renewed or replaced and shall
not extend to any additional property or assets.
"Person" means any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization or government or any agency or political subdivision thereof.
"Physical Security" shall have the meaning set forth in Section 303.
<PAGE>
14
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 306 in exchange for a mutilated
security or in lieu of a lost, destroyed or stolen Security shall be deemed to
evidence the same debt as the mutilated, lost, destroyed or stolen Security.
"Preferred Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated) of such
Person's preferred or preference stock, whether now Outstanding or issued after
the date of this Indenture, and includes, without limitation, all classes and
series of preferred or preference stock.
"Qualified Institutional Buyer" or "QIB" shall have the meaning specified
in Rule 144A under the Securities Act.
"Receivables and Related Assets" means (a) accounts receivable,
instruments, chattel paper, obligations, general intangibles, equipment and
other similar assets, including interests in merchandise or goods, the sale or
Lease of which gives rise to the foregoing, related contractual rights,
guarantees, insurance proceeds, collections and other related assets, (b)
equipment, (c) inventory and (d) proceeds of all of the foregoing.
"Refinancing Indebtedness" means, with respect to any series of Securities,
Indebtedness of the Company incurred to redeem, repurchase, defease or otherwise
acquire or retire for value other Indebtedness that is subordinate in right of
payment to such Securities, so long as any such new Indebtedness (a) is made
subordinate to such Securities at least to the same extent as the Indebtedness
being refinanced and (b) does not have (i) an Average Life less than the Average
Life of the Indebtedness being refinanced, (ii) a final scheduled maturity
earlier than the final scheduled maturity of the Indebtedness being refinanced,
or (iii) permit redemption at the option of the holder earlier than the earlier
of (A) the final scheduled maturity of the Indebtedness being refinanced or (B)
any date of redemption at the option of the holder of the Indebtedness being
refinanced.
"Registered Securities" means Securities issued or sold in a transaction
pursuant to an effective registration statement under the Securities Act of
1933, as amended, as contemplated in the Registration Rights Agreement, and any
Exchange Security subsequently issued in exchange for or upon transfer of any
such Security.
"Registration Rights Agreement" means the Registration Rights Agreement
dated July 13, 1999 among the Company and the Initial Purchasers, a form of
which Registration Rights Agreement is attached hereto as Exhibit B.
<PAGE>
15
"Regular Record Date" for the interest payable on any Interest Payment Date
means the January 1 or July 1 (whether or not a Business Day), as the case may
be, next preceding such Interest Payment Date.
"Regulation S Global Security" shall have the meaning set forth in Section
303.
"Responsible Officer", when used with respect to the Trustee, means any
vice president, any assistant secretary, any assistant treasurer, any trust
officer or assistant trust officer or any other officer of the Trustee
customarily performing functions similar to those performed by any of the above
designated officers or assigned by the Trustee to administer corporate trust
matters at its Corporate Trust Office and also means, with respect to a
particular corporate trust matter, any other officer to whom such matter is
referred because of his knowledge of and familiarity with the particular
subject.
"Restricted Payment" means
(a) any Stock Payment by the Company or a Restricted Subsidiary;
(b) any direct or indirect payment to redeem, purchase, defease or
otherwise acquire or retire for value, or permit any Restricted Subsidiary
to redeem, purchase, defease or otherwise acquire or retire for value,
prior to any scheduled maturity, scheduled repayment or scheduled sinking
fund payment, any Indebtedness of the Company that is subordinate in right
of payment to such Securities; provided, however, that any direct or
indirect payment to redeem, purchase, defease or otherwise acquire or
retire for value, or permit any Restricted Subsidiary to redeem, purchase,
defease or otherwise acquire or retire for value, prior to any scheduled
maturity, scheduled repayment or scheduled sinking fund payment, any
Indebtedness that is subordinate in right of payment to such Securities
shall not be a Restricted Payment if either (i) after giving effect
thereto, the ratio of the Senior Indebtedness of the Company and the
Restricted Subsidiaries to Annualized Operating Cash Flow determined as of
the last day of the most recent month for which financial information is
available is less than or equal to 5 to 1 or (ii) such subordinate
Indebtedness is redeemed, purchased, defeased or otherwise acquired or
retired in exchange for, or out of (x) the proceeds of a sale (within one
year before or 180 days after such redemption, purchase, defeasance,
acquisition or retirement) of, Refinancing Indebtedness, or Capital Stock
of the Company or warrants, rights or options to acquire Capital Stock of
the Company or (y) any source of funds other than the incurrence of
Indebtedness;
<PAGE>
16
(c) any direct or indirect payment to redeem, purchase, defease or
otherwise acquire or retire for value any Disqualified Stock at its
mandatory redemption date or other maturity date if and to the extent that
Indebtedness is incurred to finance such redemption, purchase, defeasance
or other acquisition or retirement; provided, however, that the redemption,
purchase, defeasance or other acquisition or retirement of Mandatorily
Redeemable Preferred Stock at its mandatory redemption or other maturity
date shall not be a Restricted Payment if and to the extent any
Indebtedness incurred to finance all or a portion of the purchase or
redemption price does not have a final scheduled maturity date, or permit
redemption at the option of the holder thereof, earlier than the final
scheduled maturity of such Securities.
Notwithstanding the foregoing, Restricted Payments shall not include (a)
payments by any Restricted Subsidiary to the Company or any other Restricted
Subsidiary or (b) any Investment or designation of a Restricted Subsidiary as an
Unrestricted Subsidiary permitted under Section 1010.
"Restricted Security" shall have the meaning set forth in Section 205.
"Restricted Subsidiary" means any Subsidiary, whether existing on the date
hereof or created subsequent hereto, designated from time to time by the Company
as a "Restricted Subsidiary" and the initial Restricted Subsidiaries designated
by the Company are set forth on Exhibit A; provided, however, that no Subsidiary
that is not a Securitization Subsidiary can be or remain so designated unless
(a) at least 67% of each of the total equity interest and the voting control of
such Subsidiary is owned, directly or indirectly, by the Company or another
Restricted Subsidiary and (b) such Subsidiary is not restricted, pursuant to the
terms of any loan agreement, note, indenture or other evidence of indebtedness,
from (i) paying dividends or making any distribution on such Subsidiary's
Capital Stock or other equity securities or paying any Indebtedness owed to the
Company or to any Restricted Subsidiary, (ii) making any loans or advances to
the Company or any Restricted Subsidiary or (iii) transferring any of its
properties or assets to the Company or any Restricted Subsidiary (it being
understood that a financial covenant any of the components of which are directly
impacted by the taking of the action (e.g., the payment of a dividend) itself
(such as a minimum net worth test) would be deemed to be a restriction on the
foregoing actions, while a financial covenant none of the components of which is
directly impacted by the taking of the action (e.g., the payment of a dividend)
itself (such as a debt to cash flow test) would not be deemed to be a
restriction on the foregoing actions); and provided further that the Company
may, from time to time, redesignate any Restricted Subsidiary as an Unrestricted
Subsidiary in accordance with Section 1010.
<PAGE>
17
"Rule 144A Global Security" shall have the meaning set forth in Section
303.
"Securities Act" means the Securities Act of 1933, as amended.
"Securities Issue Date" means July 13, 1999 with respect to the Initial
Securities and the date of original issuance of the Exchange Securities with
respect to the Exchange Securities.
"Securitization Subsidiary" means a Restricted Subsidiary that is
established for the limited purpose of acquiring and financing Receivables and
Related Assets and engaging in activities ancillary thereto; provided that (a)
no portion of the Indebtedness of a Securitization Subsidiary is guaranteed by
or is recourse to the Company or any other Restricted Subsidiary (other than
recourse for customary representations, warranties, covenants and indemnities,
none of which shall relate to the collectibility of the Receivables and Related
Assets) and (b) none of the Company or any other Restricted Subsidiary has any
obligation to maintain or preserve such Securitization Subsidiary's financial
condition.
"Security" and "Securities" have the meaning set forth in the second
paragraph of this Indenture, such terms to include both the Initial Securities
and the Exchange Securities.
"Security Register" and "Security Registrar" have the respective meanings
specified in Section 305.
"Senior Indebtedness" means, with respect to any Person, all principal of
(premium, if any) and interest (including interest accruing on or after the
filing of any petition in bankruptcy or for reorganization relating to such
Person whether or not a claim for post filing interest is allowed in such
proceedings) with respect to all Indebtedness of such Person; provided that
Senior Indebtedness shall not include (a) any Indebtedness of such Person that,
by its terms or the terms of the instrument creating or evidencing such
Indebtedness, is expressly subordinate in right of payment to the Securities,
(b) any guarantee of Indebtedness of any subsidiary of such Person if recourse
against such guarantee is limited to the Capital Stock or other equity interests
of such subsidiary, (c) any obligation of such Person to any subsidiary of such
Person or, in the case of a Restricted Subsidiary, to the Company or any other
Subsidiary or (d) any Indebtedness of such Person (and any accrued and unpaid
interest in respect thereof) which is subordinate or junior in any respect to
any other Indebtedness or other obligation of such Person.
"Shelf Registration Statement" means the Shelf Registration Statement as
defined in the Registration Rights Agreement.
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18
"Special Record Date" means a date fixed by the Trustee for the payment of
any Defaulted Interest pursuant to Section 307.
"Stated Maturity", when used with respect to any Security or any
installment of interest thereon, means the date specified in such Security as
the fixed date on which the principal of such Security or such installment of
interest is due and payable.
"Stock Payment" means, with respect to any Person, the payment or
declaration of any dividend, either in cash or in property (except dividends
payable in Common Stock or common shares of Capital Stock of such Person), or
the making by such Person of any other distribution, on account of any shares of
any class of its Capital Stock, now or hereafter outstanding, or the redemption,
purchase, retirement or other acquisition or retirement for value by such
Person, directly or indirectly, of any shares of any class of its Capital Stock,
now or hereafter outstanding, other than the redemption, purchase, defeasance or
other acquisition or retirement for value of any Disqualified Stock at its
mandatory redemption date or other maturity date.
"subsidiary" means, as to a particular parent entity at any time, any
entity of which more than 50% of the outstanding Voting Stock or other equity
interest entitled ordinarily to vote in the election of the directors or other
governing body (however designated) of such entity is at the time beneficially
owned or controlled directly or indirectly by such parent corporation, by one or
more such entities or by such parent corporation and one or more such entities.
"Subsidiary" means any subsidiary of the Company.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended,
and as in force at the date as of which this instrument was executed, except as
provided in Section 905; provided, however, that, in the event that the Trust
Indenture Act of 1939 is amended after such date, "Trust Indenture Act" means,
to the extent required by any such amendment, the Trust Indenture Act of 1939 as
so amended.
"Trustee" means the Person named as the "Trustee" in the first paragraph of
this Indenture, until a successor Trustee shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Trustee" shall mean
such successor Trustee.
"Unrestricted Subsidiary" means any Subsidiary which is not a Restricted
Subsidiary.
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19
"Voting Stock" means any Capital Stock having voting power under ordinary
circumstances to vote in the election of a majority of the directors of a
corporation (irrespective of whether or not at the time stock of any other class
or classes shall have or might have voting power by reason of the happening of
any contingency).
SECTION 102. OTHER DEFINITIONS.
Defined
Term in Section
"Act"...................................................... 105
"Bankruptcy Law"........................................... 501
"covenant defeasance"...................................... 1203
"Custodian"................................................ 501
"defeasance"............................................... 1202
"Defaulted Interest"....................................... 307
"incorporated provision"................................... 108
"redesignation of a Restricted Subsidiary"................. 1010
"Restricted Security"...................................... 205
"Security Register"........................................ 305
"Security Registrar"....................................... 305
"successor"................................................ 801
"U.S. Government Obligations".............................. 1204
SECTION 103. COMPLIANCE CERTIFICATES AND OPINIONS.
Upon any application or request by the Company to the Trustee to take any
action under any provision of this Indenture, the Company shall furnish to the
Trustee an Officers' Certificate stating that all conditions precedent, if any,
provided for in this Indenture (including any covenant compliance with which
constitutes a condition precedent) relating to the proposed action have been
complied with and an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent, if any, have been complied with, except
that, in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate or
opinion need be furnished.
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20
Every certificate or opinion (other than the certificates required by
Section 1013) with respect to compliance with a condition or covenant provided
for in this Indenture shall include:
(a) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of each such individual, he has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(d) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
SECTION 104. FORM OF DOCUMENTS DELIVERED TO TRUSTEE.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
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21
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
SECTION 105. ACTS OF HOLDERS.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Indenture to be given or taken by Holders may
be embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Holders in person or by agent duly appointed in writing;
and, except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to the Trustee and,
where it is hereby expressly required, to the Company. Such instrument or
instruments (and the action embodied therein and evidenced thereby) are herein
sometimes referred to as the "Act" of the Holders signing such instrument or
instruments. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this Indenture
and (subject to Trust Indenture Act Section 315) conclusive in favor of the
Trustee and the Company, if made in the manner provided in this Section 105.
(b) The fact and date of the execution by any Person of any such instrument
or writing may be proved in any reasonable manner which the Trustee deems
sufficient.
(c) The ownership of Securities shall be proved by the Security Register.
(d) If the Company shall solicit from the Holders any request, demand,
authorization, direction, notice, consent, waiver or other Act, the Company may,
at its option, by or pursuant to a Board Resolution, fix in advance a record
date for the determination of such Holders entitled to give such request,
demand, authorization, direction, notice, consent, waiver or other Act, but the
Company shall have no obligation to do so. Notwithstanding Trust Indenture Act
Section 316(c), any such record date shall be the record date specified in or
pursuant to such Board Resolution, which shall be a date not more than 30 days
prior to the first solicitation of Holders generally in connection therewith and
no later than the date such solicitation is completed.
If such a record date is fixed, such request, demand, authorization,
direction, notice, consent, waiver or other Act may be given before or after
such record date, but only the Holders of record at the close of business on
such record date shall be deemed to be Holders for the purposes of determining
whether Holders of the requisite proportion of Securities then Outstanding have
authorized or agreed or consented to such request, demand,
<PAGE>
22
authorization, direction, notice, consent, waiver or other Act, and for this
purpose the Securities then Outstanding shall be computed as of such record
date; provided that no such request, demand, authorization, direction, notice,
consent, waiver or other Act by the Holders on such record date shall be deemed
effective unless it shall become effective pursuant to the provisions of this
Indenture not later than six months after the record date.
(e) Any request, demand, authorization, direction, notice, consent, waiver
or other Act by the Holder of any Security shall bind every future Holder of the
same Security or the Holder of every Security issued upon the registration of
transfer thereof or in exchange therefor or in lieu thereof, in respect of
anything done, suffered or omitted to be done by the Trustee, any Paying Agent
or the Company in reliance thereon, whether or not notation of such action is
made upon such Security.
SECTION 106. NOTICES, ETC. TO TRUSTEE AND COMPANY.
Any request, demand, authorization, direction, notice, consent, waiver or
Act of Holders or other document provided or permitted by this Indenture to be
made upon, given or furnished to, or filed with,
(a) the Trustee by any Holder, the agents of the Banks or the Company
shall be sufficient for every purpose hereunder if made, given, furnished
or delivered, in writing (which may be via facsimile), to or with the
Trustee at its Corporate Trust Office, Attention: Corporate Trust Trustee
Administration; or
(b) the Company by the Trustee or by any Holder shall be sufficient
for every purpose hereunder (unless otherwise herein expressly provided) if
made, given, furnished or delivered in writing to the Company addressed to
it c/o CSC Holdings, Inc., 1111 Stewart Avenue, Bethpage, New York 11714,
Attention: Secretary, or at any other address previously furnished in
writing to the Trustee by the Company.
SECTION 107. NOTICE TO HOLDERS; WAIVER.
Where this Indenture provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event, at his address as it appears in the Security Register, not later
than the latest date, and not earlier than the earliest date, prescribed for the
giving of such notice. In any case where notice to Holders is given by mail,
neither the failure to mail such notice, nor any defect in any notice so mailed,
to any particular Holder shall affect the sufficiency of such notice with
respect to other Holders. Any
<PAGE>
23
notice when mailed to a Holder in the aforesaid manner shall be conclusively
deemed to have been received by such Holder whether or not actually received by
such Holder.
Where this Indenture provides for notice in any manner, such notice may be
waived in writing by the Person entitled to receive such notice, either before
or after the event, and such waiver shall be the equivalent of such notice.
Waivers of notice by Holders shall be filed with the Trustee, but such filing
shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
In case by reason of the suspension of regular mail service or by reason of
any other cause, it shall be impracticable to mail notice of any event as
required by any provision of this Indenture, then any method of giving such
notice as shall be satisfactory to the Trustee shall be deemed to be a
sufficient giving of such notice.
SECTION 108. CONFLICT OF ANY PROVISION OF INDENTURE WITH TRUST INDENTURE
ACT.
If and to the extent that any provision of this Indenture limits, qualifies
or conflicts with the duties imposed by Trust Indenture Act Sections 310 to 318,
inclusive, or conflicts with any provision (an "incorporated provision")
required by or deemed to be included in this Indenture by operation of such
Trust Indenture Act Sections, such imposed duties or incorporated provision
shall control. If any provision of this Indenture modifies or excludes any
provision of the Trust Indenture Act that may be so modified or excluded, the
latter provision shall be deemed to apply to this Indenture as so modified or
excluded, as the case may be.
SECTION 109. EFFECT OF HEADINGS AND TABLE OF CONTENTS.
The Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
SECTION 110. SUCCESSORS AND ASSIGNS.
All covenants and agreements in this Indenture by the Company shall bind
its respective successors and assigns, whether so expressed or not.
<PAGE>
24
SECTION 111. SEPARABILITY CLAUSE.
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
SECTION 112. BENEFITS OF INDENTURE.
Nothing in this Indenture or in the Securities, express or implied, shall
give to any Person (other than the parties hereto and their successors
hereunder, any Paying Agent and the Holders) any benefit or any legal or
equitable right, remedy or claim under this Indenture.
SECTION 113. GOVERNING LAW.
This Indenture and the Securities shall be governed by and construed in
accordance with the laws of the State of New York, without regard to conflicts
of laws principles.
This Indenture is subject to the provisions of the Trust Indenture Act that
are required to be part of this Indenture and shall, to the extent applicable,
be governed by such provisions.
SECTION 114. LEGAL HOLIDAYS.
In any case where any Interest Payment Date, any date established for
payment of Defaulted Interest pursuant to Section 307, or any Maturity with
respect to any Security shall not be a Business Day, then (notwithstanding any
other provision of this Indenture or of the Securities) payment of interest or
principal need not be made on such date, but may be made on the next succeeding
Business Day with the same force and effect as if made on the Interest Payment
Date, or date established for payment of Defaulted Interest pursuant to Section
307, or Maturity, and no interest shall accrue with respect to such payment for
the period from and after such Interest Payment Date, or date established for
payment of Defaulted Interest pursuant to Section 307, or Maturity, as the case
may be, to the next succeeding Business Day.
<PAGE>
25
SECTION 115. NO RECOURSE AGAINST OTHERS.
A director, officer, employee or stockholder, as such, of the Company shall
not have any liability for any obligations of the Company under the Securities
or this Indenture or for any claim based on, in respect of or by reason of such
obligations or their creation. Each Holder by accepting any of the Securities
waives and releases all such liability.
ARTICLE TWO
SECURITY FORMS
SECTION 201. FORMS GENERALLY; INCORPORATION OF FORM IN INDENTURE.
The Securities and the Trustee's certificate of authentication with respect
thereto shall be in substantially the forms set forth in this Article, with such
appropriate legends, insertions, omissions, substitutions and other variations
as are required or permitted by this Indenture and may have such letters,
numbers or other marks of identification and such legends or endorsements placed
thereon as may be required to comply with the rules of any securities exchange
or as may, consistently herewith, be determined by the officers executing such
Securities, as evidenced by their execution of the Securities. Any portion of
the text of any Security may be set forth on the reverse thereof, with an
appropriate reference thereto on the face of the Security. Each Security shall
be dated the date of its authentication.
The definitive Securities shall be typewritten, printed, lithographed,
engraved or otherwise produced or produced by any combination of these methods
or may be produced in any other manner permitted by the rules of any securities
exchange on which the Securities may be listed, all as determined by the
officers executing such Securities, as evidenced by their execution of such
Securities.
SECTION 202. FORM OF FACE OF SECURITY.
CSC HOLDINGS, INC.
8 1/8% [Series B]* Senior Notes due 2009
No. _____ $__________
- --------
* Include only for Exchange Securities.
reena
<PAGE>
26
CUSIP No. __________
CSC Holdings, Inc., a Delaware corporation (herein called the "Company",
which term includes any successor entity under this Indenture hereinafter
referred to), for value received, hereby promises to pay to _________________ or
registered assigns the principal sum of ______ Dollars on July 15, 2009, at the
office or agency of the Company referred to below, and to pay interest thereon
on January 15, 2000 and semiannually thereafter, on January 15 and July 15 in
each year from the Securities Issue Date or from the most recent Interest
Payment Date to which interest has been paid or duly provided for at the rate of
8 1/8% per annum until the principal hereof is paid or duly provided for, and
(to the extent lawful) to pay on demand interest on any overdue interest at the
rate borne by the Securities from the date of the Interest Payment Date on which
such overdue interest becomes payable to the date payment of such interest has
been made or duly provided for.
[The Holder of this Security is entitled to the benefits of the
Registration Rights Agreement, dated July 13, 1999 (the "Registration Rights
Agreement"), between the Company and the Initial Purchasers named therein. In
the event that either (i) a registration statement under the Securities Act (the
"Exchange Offer Registration Statement") with respect to an exchange offer (the
"Exchange Offer") for this Initial Security is not filed with the Securities and
Exchange Commission (the "Commission") on or prior to September 10, 1999 or (ii)
the Exchange Offer is not consummated or a registration statement under the
Securities Act with respect to resales of this Security (the "Shelf Registration
Statement") is not declared effective by the Commission on or prior to January
9, 2000, in either case in accordance with the Registration Rights Agreement,
the aforesaid interest rate borne by this Security shall be increased by
one-quarter of one percent per annum for the first 30 days following September
10, 1999 in the case of (i) above, or the first 90 days following January 9,
2000 in the case of (ii) above. Such interest rate will increase by an
additional one-quarter of one percent per annum at the beginning of each
subsequent 30-day period in the case of (i) above, or 90-day period in the case
of (ii) above, up to a maximum aggregate increase of one percent per annum. Upon
(x) the filing of a registration statement with respect to the Exchange Offer or
(y) the consummation of the Exchange Offer or the effectiveness of a Shelf
Registration Statement, as the case may be, the interest rate borne by this
Security will be reduced to 8 1/8 per annum.]*
If any interest has accrued on this Security in respect of any period prior
to the issuance of this Security, such interest will be payable in respect of
such period at the rate or rates borne by the Predecessor Security surrendered
in exchange for this Security from time to
- --------
* Include only for Initial Securities.
<PAGE>
27
time during such period. The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in such Indenture,
be paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest, which shall be the January 1 or July 1 (whether or not a
Business Day), as the case may be, next preceding such Interest Payment Date.
Any such interest not so punctually paid or duly provided for, and interest on
such defaulted interest at the interest rate borne by this Security, to the
extent lawful, shall forthwith cease to be payable to the Holder on such Regular
Record Date, and may be paid to the Person in whose name this Security (or one
or more Predecessor Securities) is registered at the close of business on a
Special Record Date for the payment of such Defaulted Interest to be fixed by
the Trustee, notice whereof shall be given to Holders of Securities not less
than 10 days prior to such Special Record Date, or may be paid at any time in
any other lawful manner not inconsistent with the requirements of any securities
exchange on which the Securities may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in the Indenture. Payment
of the principal of and interest on this Security will be made at the office or
agency of the Company maintained for that purpose in The City of New York, or at
such other office or agency of the Company as may be maintained for such
purpose, in such coin or currency of the United States of America as at the time
of payment is legal tender for payment of public and private debts; provided,
however, that payment of interest may be made at the option of the Company by
check mailed to the address of the Person entitled thereto as such address shall
appear on the Security Register.
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been duly executed by
the Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under this Indenture, or be valid or
obligatory for any purpose.
<PAGE>
28
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
CSC HOLDINGS, INC.
By _______________________
Attest:
By ____________________
<PAGE>
29
SECTION 203. FORM OF REVERSE OF SECURITY.
This Security is one of a duly authorized issue of securities of the
Company designated as its 8 1/8% [Series B]* Senior Notes due 2009 (herein
called the "Securities"), limited (except as otherwise provided in this
Indenture referred to below) in aggregate principal amount to $500,000,000,
which may be issued under an indenture (herein called the "Indenture") dated as
of July 1, 1999, between the Company and The Bank of New York, trustee (herein
called the "Trustee", which term includes any successor trustee under this
Indenture), to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights, limitations of rights,
duties, obligations and immunities thereunder of the Company, the Trustee, the
holders of the Senior Indebtedness and the Holders of the Securities, and of the
terms upon which the Securities are, and are to be, authenticated and delivered.
[This Security is exchangeable under certain circumstances as provided in
the Indenture for the Company's 8 1/8% Series B Senior Notes due 2009 (herein
called the "Exchange Securities", issued under the Indenture. Unless the context
otherwise requires, the Securities and Exchange Securities shall constitute one
series for all purposes under the Indenture, including without limitation
amendments and waivers.]**
This Security is not subject to redemption at the option of the Company
prior to Maturity.
If an Event of Default shall occur and be continuing, the principal of all
the Securities may be declared due and payable in the manner and with the effect
provided in this Indenture.
The Indenture contains provisions for defeasance at any time of (a) the
entire indebtedness of the Company on this Security and (b) certain restrictive
covenants and the related Defaults and Events of Default, upon compliance by the
Company with certain conditions set forth therein, which provisions apply to
this Security.
This Security does not have the benefit of any sinking fund obligations.
- --------
* Include only for Exchange Securities.
** Include only for Initial Securities.
<PAGE>
30
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders under the Indenture at any time by the
Company and the Trustee with the consent of the Holders of a majority in
aggregate principal amount of the Securities at the time Outstanding. The
Indenture also contains provisions permitting the Holders of specified
percentages in aggregate principal amount of the Securities at the time
Outstanding, on behalf of the Holders of all the Securities, to waive compliance
by the Company with certain provisions of the Indenture and certain past
defaults under the Indenture and their consequences. Any such consent or waiver
by or on behalf of the Holder of this Security shall be conclusive and binding
upon such Holder and upon all future Holders of this Security and of any
Security issued upon the registration of transfer hereof or in exchange herefor
or in lieu hereof whether or not notation of such consent or waiver is made upon
this Security.
No reference herein to the Indenture and no provision of this Security or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and interest on this
Security at the times, place, and rate, and in the coin or currency, herein
prescribed.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Security is registrable on the Security Register of
the Company, upon surrender of this Security for registration of transfer at the
office or agency of the Company maintained for such purpose in The City of New
York, duly endorsed by, or accompanied by a written instrument of transfer in
form satisfactory to the Company and the Security Registrar duly executed by,
the Holder hereof or his attorney duly authorized in writing, and thereupon one
or more new Securities, of authorized denominations and for the same aggregate
principal amount, will be issued to the designated transferee or transferees.
The Securities are issuable only in registered form without coupons in
denominations of $1,000 and any integral multiple thereof. As provided in the
Indenture and subject to certain limitations therein set forth, the Securities
are exchangeable for a like aggregate principal amount of Securities of a
different authorized denomination, as requested by the Holder surrendering the
same.
No service charge shall be made for any registration of transfer or
exchange of Securities, but the Company may require payment of a sum sufficient
to pay all documentary, stamp or similar issue or transfer taxes or other
governmental charges payable in connection with any registration of transfer or
exchange.
<PAGE>
31
Prior to the time of due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and neither
the Company, the Trustee nor any agent shall be affected by notice to the
contrary.
This Security shall be governed by and construed in accordance with the
laws of the State of New York, without regard to conflicts of laws principles
thereof.
All terms used in this Security which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
Certificate of Transfer**
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
this Security to
- --------------------------------------------------------------------------------
(Please typewrite or print name and taxpayer identification number)
- --------------------------------------------------------------------------------
(Please typewrite or print address)
and hereby irrevocably constitutes and appoints ________________________________
his attorney to transfer the same on the books of the Company, with full power
of substitution in the premises.
In connection with any transfer of all or any portion of the Security
evidenced by this certificate for as long as such Security is a Restricted
Security, the undersigned confirms that such Security is being transferred:
[ ] (a) Pursuant to and in compliance with Rule 144A under the Securities
Act of 1933, as amended (the "Securities Act");
or
- --------
** Include only for Initial Securities.
<PAGE>
32
[ ] (b) Pursuant to offers and sales to non-U.S. Persons that occur
outside the United States within the meaning of Regulation S under the
Securities Act;
Unless one of the boxes above is checked, the Trustee will refuse to
register all or any portion of the Security evidenced by this certificate in the
name of any person other than the registered holder thereof (or hereof);
provided, however, that the Trustee may, in its sole discretion, register the
transfer of such Security if it has received such certifications, legal opinions
and/or other information as it has reasonably requested to confirm that such
transfer is being made pursuant to an exemption from, or in a transaction not
subject to, the registration requirements of the Securities Act.
Dated:
Signature _____________________
NOTE: The signature to this assignment must correspond with the name as written
upon the face of this Security in every particular, without alteration or
enlargement, or any change whatever.
TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED:
The undersigned represents and warrants that it is purchasing this Security
for its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act
and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Company as the
undersigned has requested pursuant to Rule 144A (including the information
specified in Rule 144(d)(4)) or has determined not to request such information
and that it is aware that the transferor is relying upon the undersigned's
foregoing representations in order to claim the exemption from registration
provided by Rule 144A.
Dated:___________________ ____________________________________
To be signed by an executive officer
SCHEDULE OF EXCHANGES FOR DEFINITIVE SECURITIES
The following exchanges of a part of this Security in global form for
definitive Securities or of definitive Securities for a part of this Security in
global form have been made:
<PAGE>
33
Principal
Amount of Amount of Amount of Signature of
decrease in increase in this Security authorized
Principal Principal in global form signatory of
Amount of Amount of following such Trustee or
Date of this Security this Security decrease (or Securities
Exchange in global form in global form increase) Custodian
- -------- -------------- -------------- --------- ---------
SECTION 204. FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION.
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities referred to in the within-mentioned
Indenture.
THE BANK OF NEW YORK,
as Trustee
By _______________________
Authorized Signatory
Dated:
SECTION 205. FORM OF LEGEND ON RESTRICTED SECURITIES.
During the period beginning on July 13, 1999 and ending on the later of
July 13, 2001 and the date two years after the last date on which the Company or
any Affiliate of the Company was the owner of an Initial Security (or any
Predecessor Security), any such Initial Security issued or owned during the
period set forth above, as the case may be, and any Initial Security issued upon
registration of transfer of, or in exchange for, or in lieu of, such Initial
Security shall be deemed a "Restricted Security" and shall be subject to the
restrictions on transfer provided in the legend set forth below; provided,
however, that the term "Restricted Security" shall not include (a) any Initial
Security which is issued upon transfer of, or in exchange for, any Initial
Security which is not a Restricted Security or (b) any Initial Security as to
which such restrictions on transfer have been terminated in accordance with
Section 314 or (c) any Exchange Security issued pursuant to an Exchange Offer.
Any Restricted Security shall bear a legend in substantially the following form:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN
<PAGE>
34
THE NAME OF A DEPOSITORY OR A NOMINEE THEREOF. THIS SECURITY MAY NOT BE
EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO TRANSFER OF
THIS SECURITY IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY
PERSON OTHER THAN SUCH DEPOSITORY OR ITS NOMINEE EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK 10041) TO
THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT
AND SUCH CERTIFICATE ISSUED IN EXCHANGE FOR THIS CERTIFICATE IS REGISTERED
IN THE NAME OF CEDE & CO., OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL,
SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS.
NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE
REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION
IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION AS SET FORTH BELOW. BY ITS
ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A "QUALIFIED
INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT
("RULE 144A")), OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS NOTE
IN AN OFFSHORE TRANSACTION, (2) AGREES TO OFFER, SELL, PLEDGE OR OTHERWISE
TRANSFER SUCH SECURITY, PRIOR TO THE DATE WHICH IS TWO YEARS AFTER THE
ORIGINAL ISSUE HEREOF ONLY (A) TO THE COMPANY, (B) PURSUANT TO A
REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE
PURSUANT TO RULE 144A TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A, (D) OUTSIDE THE UNITED STATES
PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS IN AN OFFSHORE TRANSACTION
PURSUANT TO REGULATION S UNDER THE
<PAGE>
35
SECURITIES ACT IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 904 UNDER
THE SECURITIES ACT OR (E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY'S
AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT
TO CLAUSE (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM.
SECTION 206. FORM OF LEGEND FOR BOOK-ENTRY SECURITIES.
Any Global Security authenticated and delivered hereunder shall bear a
legend (which would be in addition to any other legends required in the case of
a Restricted Security) in substantially the following form:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A
NOMINEE THEREOF. THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR
A SECURITY REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART
MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITORY OR
ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK 10041) TO
THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT
AND SUCH CERTIFICATE ISSUED IN EXCHANGE FOR THIS CERTIFICATE IS REGISTERED
IN THE NAME OF CEDE & CO., OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL,
SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
<PAGE>
36
ARTICLE THREE
THE SECURITIES
SECTION 301. TITLE AND TERMS.
The aggregate principal amount of Securities which may be authenticated and
delivered under this Indenture is limited to $500,000,000, except for Securities
authenticated and delivered upon registration of transfer of, or in exchange
for, or in lieu of, other Securities pursuant to Section 303, 304, 305, 306 or
906.
The Initial Securities shall be known and designated as the "8 1/8% Senior
Notes due 2009" and the Exchange Securities shall be known and designated as the
"8 1/8% Series B Senior Notes due 2009" of the Company. Their Stated Maturity
shall be July 15, 2009, and they shall bear interest at the rate of 8 1/8% per
annum (except as otherwise provided for in the form of Security) from the
Security Issue Date, or the most recent Interest Payment Date to which interest
has been paid or duly provided for on a given Security or a Security surrendered
in exchange for such Security, as the case may be, payable on January 15, 2000
and semiannually thereafter on January 15 and July 15 in each year and at said
Stated Maturity, until the principal thereof is paid or duly provided for. The
initial Interest Payment Date for any Security shall be the first January 15 or
July 15 occurring after the Security Issue Date for such Security. The Initial
Securities and the Exchange Securities shall rank pari passu.
The principal of and interest on the Securities shall be payable at the
office or agency of the Company maintained for such purpose in The City of New
York, or at such other office or agency of the Company as may be maintained for
such purpose; provided, however, that, at the option of the Company, cash
interest may be paid by check mailed to addresses of the Persons entitled
thereto as such addresses shall appear on the Security Register.
The Securities are not subject to redemption at the option of the Company.
At the election of the Company, the entire indebtedness represented by the
Securities or certain of the Company's obligations and covenants and certain
Events of Default thereunder may be defeased as provided in Article Twelve.
The Securities will be senior unsecured obligations of the Company and will
rank pari passu in right of payment with all existing and future unsubordinated
indebtedness of the Company.
<PAGE>
37
SECTION 302. DENOMINATIONS.
The Securities shall be issuable only in registered form without coupons
and only in denominations of $1,000 and any integral multiple thereof.
SECTION 303. EXECUTION, AUTHENTICATION, DELIVERY AND DATING.
The Securities shall be executed on behalf of the Company by any one of the
following: its Chairman, Chief Executive Officer, one of its Vice Chairmen, its
President or one of its Vice Presidents and attested by one of its Vice
Presidents or its Secretary or one of its Assistant Secretaries. The signature
of any of these officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals who
were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.
The Trustee shall (upon Company Order) authenticate and deliver Securities
for original issue in an aggregate principal amount of up to $500,000,000.
Each Security shall be dated the date of its authentication.
No Security endorsed thereon shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose unless there appears on such
Security a certificate of authentication substantially in the form provided for
herein duly executed by the Trustee by manual signature of one of its duly
authorized signatories, and such certificate upon any Security shall be
conclusive evidence, and the only evidence, that such Security has been duly
authenticated and delivered hereunder and is entitled to the benefits of this
Indenture.
In case the Company, pursuant to Article Eight, shall be consolidated or
merged with or into any other Person or shall convey, transfer, lease or
otherwise dispose of substantially all of its properties and assets to any
Person, and the successor Person resulting from such consolidation, or surviving
such merger, or into which the Company shall have been merged, or the successor
Person which shall have received a conveyance, transfer, Lease or other
disposition as aforesaid, shall have executed an indenture supplemental hereto
with the Trustee pursuant to Article Eight, any of the Securities authenticated
or delivered prior to such consolidation, merger, conveyance, transfer, Lease or
other disposition may, from time to time, at the request of the successor
Person, be exchanged for other Securities executed in the
<PAGE>
38
name of the successor Person with such changes in phraseology and form as may be
appropriate, but otherwise in substance of like tenor as the Securities
surrendered for such exchange and of like principal amount; and the Trustee,
upon written order of the successor Person, shall authenticate and deliver
Securities as specified in such request for the purpose of such exchange. If
Securities shall at any time be authenticated and delivered in any new name of a
successor Person pursuant to this Section 303 in exchange or substitution for or
upon registration of transfer of any Securities, such successor Person, at the
option of any Holder but without expense to such Holder, shall provide for the
exchange of all Securities at the time Outstanding held by such Holder for
Securities authenticated and delivered in such new name.
Except as described below, the Securities will be deposited with, or on
behalf of, the Depository, and registered in the name of the Depository or the
nominee of the Depository in the form of one or more global note certificates
(each a "Rule 144A Global Security"), for credit to the respective accounts of
the beneficial owners of the Securities represented thereby. The Rule 144A
Global Securities shall bear the legend set forth in Section 206 and, in the
case of Restricted Securities, the legend set forth in Section 205.
Securities purchased by persons outside the United States pursuant to sales
in accordance with Regulation S under the Securities Act shall be deposited
with, or on behalf of, the Depository, and registered in the name of the
Depository or the nominee of the Depository in the form of one or more global
note certificates (each a "Regulation S Global Security"), for credit to the
respective accounts of the beneficial owners of the Securities represented
thereby (or such other accounts as they may direct), provided that upon such
deposit all such Securities shall be credited to or through accounts maintained
at the Depository by or on behalf of the Euroclear System or Cedel Bank, S.A.
Securities represented by a Regulation S Global Security will not be
exchangeable for Securities in registered definitive form (each a "Physical
Security") until the expiration of the "40-day restricted period" within the
meaning of Rule 903(c)(3) of Regulation S under the Securities Act. The
Regulation S Global Securities shall bear the legend set forth in Section 206
and, in the case of Restricted Securities, the legend set forth in Section 205.
SECTION 304. TEMPORARY SECURITIES.
Pending the preparation of definitive Securities, the Company may execute,
and upon Company Order the Trustee shall authenticate and deliver, temporary
Securities which are typewritten, printed, lithographed, engraved or otherwise
produced or produced by any combination of these methods, in any authorized
denomination, substantially of the tenor of the definitive Securities in lieu of
which they are issued and with such appropriate
<PAGE>
39
insertions, omissions, substitutions and other variations as the officers
executing such Securities may determine, as conclusively evidenced by their
execution of such Securities.
If temporary Securities are issued, the Company will cause definitive
Securities to be prepared without unreasonable delay. After the preparation of
definitive Securities, the temporary Securities shall be exchangeable for
definitive Securities upon surrender of the temporary Securities at the office
or agency of the Company designated for such purpose pursuant to Section 1002,
without charge to the Holder. Upon surrender for cancellation of any one or more
temporary Securities, the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a like principal amount of
definitive Securities of authorized denominations. Until so exchanged, the
temporary Securities shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities.
SECTION 305. REGISTRATION, REGISTRATION OF TRANSFER AND EXCHANGE.
The Company shall cause to be kept at the Corporate Trust Office of the
Trustee a register (the register maintained in such office and in any other
office or agency designated pursuant to Section 1002 being herein sometimes
referred to as the "Security Register") in which, subject to such reasonable
regulations as it may prescribe, the Company shall provide for the registration
of Securities and of transfers of Securities. The Trustee is hereby initially
appointed "Security Registrar" for the purpose of registering Securities and
transfers of Securities as herein provided. Such Security Register shall
distinguish between Initial Securities and Exchange Securities.
Except as otherwise described in this Article Three, upon surrender for
registration of transfer of any Security at the office or agency of the Company
designated pursuant to Section 1002 for such purpose, the Company shall execute,
and the Trustee shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Securities of any authorized
denomination or denominations and of a like aggregate principal amount.
At the option of the Holder, Securities may be exchanged for other
Securities of any authorized denomination or denominations and of a like
aggregate principal amount upon surrender of the Securities to be exchanged at
such office or agency. Whenever any Securities are so surrendered for exchange,
the Company shall execute, and the Trustee shall authenticate and deliver, the
Securities which the Holder making the exchange is entitled to receive; provided
that no exchange of Initial Securities for Exchange Securities shall occur until
an Exchange Offer Registration Statement shall have been declared effective by
the Commission, the Trustee shall have received an Officers' Certificate
confirming that the Exchange Offer
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40
Registration Statement has been declared effective by the Commission and the
Initial Securities to be exchanged for the Exchange Securities shall be canceled
by the Trustee.
All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
debt, and (subject to the provisions in the Initial Securities regarding the
payment of additional interest) entitled to the same benefits under this
Indenture, as the Securities surrendered upon such registration of transfer or
exchange.
Every Security presented or surrendered for registration of transfer, or
for exchange, shall (if so required by the Company or the Security Registrar) be
duly endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Security Registrar, duly executed by the
Holder thereof or his attorney duly authorized in writing.
Every Restricted Security shall be subject to, and no transfer shall be
made other than in accordance with, the restrictions on transfer provided in the
legend set forth on the form of the face of each Restricted Security and the
restrictions set forth in this Article Three, and the Holder of each Restricted
Security, by such Holder's acceptance thereof, agrees to be bound by such
restrictions on transfer.
The Security Registrar shall notify the Company of any proposed transfer of
a Restricted Security to any Person.
No service charge shall be made for any registration of transfer or
exchange of Securities, but the Company may require payment of a sum sufficient
to pay all documentary, stamp or similar issue or transfer taxes or other
governmental charges that may be imposed in connection with any registration of
transfer or exchange of Securities, other than exchanges pursuant to Section
303, 304 or 906 not involving any transfer.
The Company shall not be required to issue, register the transfer of or
exchange any Security during a period beginning at the opening of business 15
days before an Interest Payment Date and ending on the close of business on such
Interest Payment Date.
SECTION 306. MUTILATED, DESTROYED, LOST AND STOLEN SECURITIES.
If (a) any mutilated Security is surrendered to the Trustee, or (b) the
Company and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Security, and there is delivered to the
Company and the Trustee such security or indemnity as
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41
may be required by them to save each of them and any agent of them harmless,
then, in the absence of notice to the Company or the Trustee that such Security
has been acquired by a bona fide purchaser, the Company shall execute and upon
Company Order the Trustee shall authenticate and deliver, in exchange for any
such mutilated Security or in lieu of any such destroyed, lost or stolen
Security, a replacement Security of like tenor and principal amount, and bearing
a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has become
or is about to become due and payable, the Company in its discretion may,
instead of issuing a replacement Security, pay such Security.
Upon the issuance of any replacement Securities under this Section 306, the
Company may require the payment of a sum sufficient to pay all documentary,
stamp or similar issue or transfer taxes or other governmental charges that may
be imposed in relation thereto and any other expenses (including the fees and
expenses of the Trustee) connected therewith.
Every replacement Security issued pursuant to this Section 306 in lieu of
any destroyed, lost or stolen Security shall constitute a contractual obligation
of the Company, whether or not the destroyed, lost or stolen Security shall be
at any time enforceable by anyone, and shall be entitled to all benefits of this
Indenture equally and proportionately with any and all other Securities duly
issued hereunder.
The provisions of this Section 306 are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities.
SECTION 307. PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED.
Interest on any Security which is payable, and is punctually paid or duly
provided for, on any Interest Payment Date shall be paid to the Person in whose
name that Security (or one or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for such interest. The initial
Interest Payment Date for any Security shall be the first January 15 or July 15
occurring after the Securities Issue Date for such Security.
Any interest on any Security which is payable, but is not punctually paid
or duly provided for, on any Interest Payment Date and interest on such
defaulted interest at the interest rate borne by the Securities, to the extent
lawful (such defaulted interest and interest thereon herein collectively called
"Defaulted Interest"), shall forthwith cease to be payable to
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42
the Holder on the relevant Regular Record Date by virtue of having been such
Holder; and such Defaulted Interest may be paid by the Company, at its election
in each case, as provided in Subsection (a) or (b) below:
(a) The Company may elect to make payment of any Defaulted Interest to
the Persons in whose names the Securities (or their respective Predecessor
Securities) are registered at the close of business on a Special Record
Date for the payment of such Defaulted Interest, which shall be fixed in
the following manner. The Company shall notify the Trustee in writing of
the amount of Defaulted Interest proposed to be paid on each Security and
the date of the proposed payment, and at the same time the Company shall
deposit with the Trustee an amount of money equal to the aggregate amount
proposed to be paid in respect of such Defaulted Interest or shall make
arrangements satisfactory to the Trustee for such deposit prior to the date
of the proposed payment, such money when deposited to be held in trust for
the benefit of the Persons entitled to such Defaulted Interest as in this
Subsection provided. Thereupon the Trustee shall fix a Special Record Date
for the payment of such Defaulted Interest which shall be not more than 15
days and not less than 10 days prior to the date of the proposed payment
and not less than 10 days after the receipt by the Trustee of the notice of
the proposed payment. The Trustee shall promptly notify the Company of such
Special Record Date. In the name and at the expense of the Company, the
Trustee shall cause notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor to be mailed, first-class
postage prepaid, to each Holder at his address as it appears in the
Security Register, not less than 10 days prior to such Special Record Date.
Notice of the proposed payment of such Defaulted Interest and the Special
Record Date therefor having been so mailed, such Defaulted Interest shall
be paid to the Persons in whose names the Securities (or their respective
Predecessor Securities) are registered at the close of business on such
Special Record Date and shall no longer be payable pursuant to the
following Subsection (b).
(b) The Company may make payment of any Defaulted Interest in any other
lawful manner not inconsistent with the requirements of any securities
exchange on which the Securities may be listed, and upon such notice as may
be required by such exchange, if, after notice given by the Company to the
Trustee of the proposed payment pursuant to this Subsection, such payment
shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section 307, each Security
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Security shall carry the rights to interest accrued
and unpaid, and to accrue, which were carried by such other Security.
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43
SECTION 308. PERSONS DEEMED OWNERS.
Prior to the time of due presentment for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name any Security is registered as the owner of such Security
for the purpose of receiving payment of principal of and (subject to Section
307) interest on such Security and for all other purposes whatsoever, whether or
not such Security be overdue, and neither the Company, the Trustee nor any agent
of the Company or the Trustee shall be affected by notice to the contrary.
SECTION 309. CANCELLATION.
All Securities surrendered for payment, registration of transfer or
exchange shall, if surrendered to any Person other than the Trustee, be
delivered to the Trustee and shall be promptly canceled by it. The Company may
at any time deliver to the Trustee for cancellation any Securities previously
authenticated and delivered hereunder which the Company may have acquired in any
manner whatsoever, and all Securities so delivered shall be promptly canceled by
the Trustee. No Securities shall be authenticated in lieu of or in exchange for
any Securities canceled as provided in this Section 309, except as expressly
permitted by this Indenture. All canceled Securities held by the Trustee shall
be disposed of as directed by the Company pursuant to a Company Order, provided,
however, that the Trustee shall not be required to destroy such canceled
Securities.
SECTION 310. COMPUTATION OF INTEREST.
Interest on the Securities shall be computed on the basis of a 360-day year
of twelve 30-day months.
SECTION 311. REGISTRATION RIGHTS OF HOLDERS OF INITIAL SECURITIES.
Pursuant to the terms of the Registration Rights Agreement, holders of
Initial Securities, if any, shall be entitled to the benefits of the
Registration Rights Agreement.
SECTION 312. CUSIP NUMBERS.
The Company in issuing the Securities may use "CUSIP" numbers (if then
generally in use) in addition to serial numbers, and, if so, the Trustee shall
use such "CUSIP" numbers in addition to serial numbers in notices of repurchase
as a convenience to Holders; provided that any such notice may state that no
representation is made as to the correctness of such numbers either as printed
on the Securities or as contained in any notice of a repurchase
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44
and that reliance may be placed only on the serial or other identification
numbers printed on the Securities, and any such repurchase shall not be affected
by any defect in or omission of such "CUSIP" numbers. The Company will promptly
notify the Trustee of any change in the "CUSIP" numbers.
SECTION 313. BOOK-ENTRY PROVISIONS FOR GLOBAL SECURITIES.
(a) The Global Securities initially shall (i) be registered in the name of
the Depository or the nominee of such Depository, (ii) be delivered to the
Trustee as custodian for such Depository and (iii) bear legends as set forth in
Section 206 and, in the case of Restricted Securities in the form of Global
Securities, Section 205.
Members of, or participants in, the Depository ("Agent Members") shall have
no rights under this Indenture with respect to any Global Security held on their
behalf by the Depository, or the Trustee as its custodian, or under the Global
Security, and the Depository may be treated by the Company, the Trustee and any
agent of the Company or the Trustee as the absolute owner of the Global Security
for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall
prevent the Company, the Trustee or any agent of the Company or the Trustee from
giving effect to any written certification, proxy or other authorization
furnished by the Depository or impair, as between the Depository and its Agent
Members, the operation of customary practices governing the exercise of the
rights of a Holder of any Security.
(b) Transfers of Global Securities shall be limited to transfers in whole,
but not in part, to the Depository, its successors or their respective nominees.
Interests of beneficial owners in a Rule 144A Global Security may be transferred
or exchanged for interests in a Regulation S Global Security, and interests of
beneficial owners in a Regulation S Global Security may be transferred or
exchanged for interests in a Rule 144A Global Security, in each case in
accordance with the rules and procedures of the Depository and the provisions of
Section 314. Interests of beneficial owners in the Global Securities may be
transferred or exchanged for Physical Securities in accordance with the rules
and procedures of the Depository and the provisions of Section 314.
In addition, Physical Securities shall be transferred to all beneficial
owners in exchange for their beneficial interests in a Global Security if (i)
the Depository notifies the Company that it is unwilling or unable to continue
as a depository for such Global Security or if at any time the Depository ceases
to be a clearing agency registered under the Exchange Act, and a successor
depository is not appointed by the Company within 90 days, (ii) there shall have
occurred and be continuing an Event of Default with respect to the Securities
represented
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45
by such Global Security or (iii) the Company at any time determines not to have
Securities represented by a Global Security.
Except as provided above, any Security authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, any Global
Security, whether pursuant to this Section 313, Section 304, 305, 306 or 906 or
otherwise, shall also be a Global Security and bear the legend specified in
Section 206.
(c) In connection with any transfer or exchange of a portion of the
beneficial interest in any Global Security to beneficial owners pursuant to
paragraph (b), the Security Registrar shall (if one or more Physical Securities
are to be issued) reflect on its books and records the date and a decrease in
the principal amount of the Global Security in an amount equal to the principal
amount of the beneficial interest in the Global Security to be transferred, and
the Company shall execute, and the Trustee shall authenticate and deliver, one
or more Physical Securities of like tenor and principal amount of authorized
denominations.
(d) In connection with the transfer of Global Securities as an entirety to
beneficial owners pursuant to paragraph (b), the Global Securities shall be
deemed to be surrendered to the Trustee for cancellation, and the Company shall
execute, and the Trustee shall authenticate and deliver, to each beneficial
owner identified by the Depository in exchange for its beneficial interest in
the Global Securities, an equal aggregate principal amount of Physical
Securities of like tenor of authorized denominations.
(e) Any Physical Security delivered in exchange for an interest in a Global
Security pursuant to paragraph (b) or (c) of this Section 313 shall, except as
otherwise provided by clause (1)(x) of paragraph (a) and by paragraph (d) of
Section 314, bear the legend set forth in Section 205.
(f) The Holder of any Global Security may grant proxies and otherwise
authorize any person, including Agent Members and persons that may hold
interests through Agent Members, to take any action which a Holder is entitled
to take under this Indenture or the Securities.
SECTION 314. SPECIAL TRANSFER PROVISIONS.
(a) Transfers to Non-U.S. Persons. The following provisions shall apply
with respect to the registration of any proposed transfer of a Restricted
Security to any non- U.S. person:
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46
(i) the Security Registrar shall register the transfer of any
Restricted Security if (x) the requested transfer is not prior to the date
which is two years (or such other period as may be prescribed by Rule
144(k) under the Securities Act or any successor provision thereunder)
after the later of the original issue date of such Security (or of any
Predecessor Security) or the last day on which the Company or any Affiliate
of the Company was the owner of such Security or any Predecessor Security
or (y) the proposed transferee has checked the box provided for on the form
of Security stating, and has provided to the Security Registrar such
certifications, opinions and other information as the Security Registrar
may (and, if so directed by the Company, shall) require, stating that such
Security is being transferred pursuant to offers and sales to non-U.S.
persons that occur outside the United States within the meaning of
Regulation S under the Securities Act; and
(ii) the Security Registrar shall register the transfer of any
Restricted Security if the proposed transferor is an Agent Member holding a
beneficial interest in a Rule 144A Global Security, upon receipt by the
Security Registrar of (x) the certificate, if any, required by paragraph
(i) above and (y) instructions given in accordance with the Depository's
and the Security Registrar's procedures;
whereupon the Security Registrar shall reflect on its books and records the date
of such transfer and (A) (if the transfer involves a transfer of a beneficial
interest in a Rule 144A Global Security) a decrease in the principal amount of
such Rule 144A Global Security in an amount equal to the principal amount to be
transferred and (B) an increase in the principal amount of a Regulation S Global
Security in an amount equal to the principal amount to be transferred.
(b) Transfers to QIBs. The following provisions shall apply with respect to
the registration of any proposed transfer of a Restricted Security to a person
purporting to be a QIB (excluding transfers to non-U.S. persons):
(i) the Security Registrar shall register the transfer of any
Restricted Security if such transfer is being made by a proposed transferor
who has checked the box provided for on the form of Security stating, or
who has otherwise advised the Company and the Security Registrar in
writing, that the transfer has been made in compliance with the exemption
from registration under the Securities Act provided under Rule 144A to a
transferee who has signed the certification provided for on the form of
Security stating, or has otherwise advised the Company and the Security
Registrar in writing, that such transferee represents and warrants that it
is purchasing the Security for its own account or an account with respect
to which it exercises sole
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47
investment discretion and that each of it and any such account is a QIB
within the meaning of Rule 144A and is aware that the sale to it is being
made in reliance on Rule 144A and acknowledges that it has received such
information regarding the Company as it has requested pursuant to Rule 144A
or has determined not to request such information and that it is aware that
the transferor is relying upon the foregoing representations in order to
claim the exemption from registration provided by Rule 144A; and
(ii) the Security Registrar shall register the transfer of any
Restricted Security if the proposed transferee is an Agent Member, and the
Securities to be transferred consist of Physical Securities which after
transfer are to be evidenced by an interest in the Rule 144A Global
Security, upon receipt by the Security Registrar of instructions given in
accordance with the Depository's and the Security Registrar's procedures,
the Security Registrar shall reflect on the Security Register the date and
an increase in the principal amount of the Rule 144A Global Security in an
amount equal to the principal amount of the Physical Securities to be
transferred, and the Trustee shall cancel the Physical Securities so
transferred.
(c) Other Transfers. If a Holder proposes to transfer a Security pursuant
to any exemption from the registration requirements of the Securities Act other
than as provided for by Sections 314(a) and 314(b), the Security Registrar shall
only register such transfer or exchange if such transferor delivers to the
Security Registrar and the Trustee an Opinion of Counsel satisfactory to the
Company and the Security Registrar that such transfer is in compliance with the
Securities Act and the terms of this Indenture; provided that the Company may,
based upon the opinion of its counsel, instruct the Security Registrar by a
Company Order not to register such transfer in any case where the proposed
transferee is not a QIB or a non-U.S. person.
(d) Private Placement Legend. Upon the registration of transfer, exchange
or replacement of Restricted Securities, the Security Registrar shall deliver
only Securities that bear the legend set forth in Section 205 unless the
circumstances contemplated by clause (a)(1)(x) of this Section 314 exist. By its
acceptance of any Security bearing the legend set forth in Section 205, each
Holder of such a Security acknowledges the restrictions on transfer of such
Security set forth in this Indenture and in such legend and agrees that it will
transfer such Security only as provided in this Indenture.
The Security Registrar shall retain copies of all letters, notices and
other written communications received pursuant to Section 313 or this Section
314 for a period of two years, after which time such letters, notices and other
written communications shall at the written
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48
request of the Company be delivered to the Company. The Company shall have the
right to inspect and make copies of all such letters, notices or other written
communications at any reasonable time upon the giving of reasonable prior
written notice to the Security Registrar.
(e) Termination of Restrictions. The restrictions imposed by this Section
314 upon the transferability of any particular Restricted Security shall cease
and terminate (i) on the later of July 13, 2001 and two years after the last
date on which the Company or any Affiliate of the Company was the owner of such
Restricted Security (or any predecessor of such Restricted Security) or (ii) (if
earlier) if and when such Restricted Security has been sold pursuant to an
effective registration statement under the Securities Act. Any Restricted
Security as to which such restrictions on transfer shall have expired in
accordance with their terms or shall have terminated may, upon surrender of such
Restricted Security for exchange to the Trustee or any transfer agent in
accordance with the provisions of Section 305, be exchanged for a new Initial
Security, of like tenor and aggregate principal amount, which shall not bear the
restrictive legend required by Section 205. The Company shall inform the Trustee
in writing of (i) the effective date of any registration statement registering
the Initial Securities under the Securities Act and (ii) at the request of the
Trustee, the date which is two years after the last date on which the Company or
any Affiliate of the Company was the owner of a Restricted Security in the event
that an Exchange Offer has not been consummated.
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. SATISFACTION AND DISCHARGE OF INDENTURE.
This Indenture shall, upon Company Request, cease to be of further effect
(except as to surviving rights of registration of transfer or exchange of
Securities herein expressly provided for) and the Trustee, on demand of and at
the expense of the Company, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture, when
(a) either
(i) all Securities theretofore authenticated and delivered (other than
(A) Securities which have been destroyed, lost or stolen and which have
been replaced or paid as provided in Section 306 and (B) Securities for
whose payment money has theretofore been deposited in trust or segregated
and held in
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49
trust by the Company and thereafter repaid to the Company or discharged
from such trust, as provided in Section 1003) have been delivered to the
Trustee for cancellation; or
(ii) all such Securities not theretofore delivered to the Trustee for
cancellation
(A) have become due and payable, or
(B) will become due and payable within one year,
and the Company, in the case of (A) or (B) above, has irrevocably deposited
or caused to be deposited with the Trustee as trust funds in trust for the
purpose an amount sufficient to pay and discharge the entire indebtedness
on such Securities not theretofore delivered to the Trustee for
cancellation, for principal and interest to the date of such deposit (in
the case of Securities which have become due and payable) or to the Stated
Maturity;
(b) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(c) the Company has delivered to the Trustee an Officers' Certificate and
an Opinion of Counsel each stating that all conditions precedent herein provided
for relating to the satisfaction and discharge of this Indenture have been
complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 606 and, if money shall
have been deposited with the Trustee pursuant to subclause (2) of Subsection (a)
of this Section 401, the obligations of the Trustee under Section 402 and the
last paragraph of Section 1003 shall survive such satisfaction and discharge.
SECTION 402. APPLICATION OF TRUST MONEY.
Subject to the provisions of the last paragraph of Section 1003, all money
deposited with the Trustee pursuant to Section 401 shall be held in trust and
applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as Paying Agent) as the Trustee may determine, to
the Persons entitled thereto, of the principal and interest for whose payment
such money has been deposited with the Trustee.
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ARTICLE FIVE
REMEDIES
SECTION 501. EVENTS OF DEFAULT.
An "Event of Default" occurs if:
(a) the Company defaults in the payment of interest on any Security when
the same becomes due and payable and such default continues for a period of 30
days;
(b) the Company defaults in the payment of the principal of any Security
when the same becomes due and payable at maturity, upon acceleration or
otherwise;
(c) the Company fails to comply with any of its other agreements or
covenants in, or provisions of, the Securities or this Indenture, and the
Default continues for the period and after the notice, if any, specified below;
(d) a default occurs under any mortgage, indenture or instrument under
which there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by the Company or one of its Restricted
Subsidiaries (or the payment of which is guaranteed by the Company or one of its
Restricted Subsidiaries), whether such Indebtedness or guarantee now exists or
shall be created hereafter (but excluding any Indebtedness for the deferred
purchase price of property or services owed to the Person providing such
property or services as to which the Company or such Restricted Subsidiary is
contesting its obligation to pay the same in good faith and by proper
proceedings and for which the Company or such Restricted Subsidiary has
established appropriate reserves), and (i) either (A) such event of default
results from the failure to pay any such Indebtedness at final maturity or (B)
as a result of such event of default the maturity of such Indebtedness has been
accelerated prior to its expressed maturity and (ii) the principal amount of
such Indebtedness equals $10,000,000 or more or, together with the principal
amount of any such Indebtedness in default for failure to pay principal at
maturity or the maturity of which has been so accelerated, aggregates
$10,000,000 or more;
(e) a final judgment or final judgments for the payment of money are
entered by a court or courts of competent jurisdiction against the Company or
any Restricted Subsidiary and either (i) an enforcement proceeding shall have
been commenced by any
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creditor upon such judgment or (ii) such judgment remains undischarged and
unbonded for a period (during which execution shall not be effectively stayed)
of 60 days, provided that the aggregate of all such judgments exceeds
$10,000,000;
(f) the Company pursuant to or within the meaning of any Bankruptcy Law:
(i) commences a voluntary case or proceeding,
(ii) consents to the entry of an order for relief against it in an
involuntary case or proceeding,
(iii) consents to the appointment of a Custodian of it or for all or
substantially all of its property,
(iv) makes a general assignment for the benefit of its creditors, or
(v) admits in writing that it generally is unable to pay its debts
as the same become due; or
(g) a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:
(i) is for relief against the Company in an involuntary case or
proceeding,
(ii) appoints a Custodian of the Company or for all or substantially
all of its property, or
(iii) orders the liquidation of the Company;
and in each case the order or decree remains unstayed and in effect for 60
days.
The term "Bankruptcy Law" means Title 11, U.S. Code or any similar Federal
or state law for the relief of debtors. The term "Custodian" means any receiver,
trustee, assignee, liquidator, sequestrator or similar official under any
Bankruptcy Law.
A Default under Section 501(c) is not an Event of Default until the Trustee
notifies the Company in writing, or the Holders of at least 25% in principal
amount of the Securities then Outstanding notify the Company and the Trustee in
writing, of the Default, and
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52
the Company does not cure the Default within 60 days (30 days in the case of a
Default under Section 801 or 1004) after receipt of the notice. The notice must
specify the Default, demand that it be remedied and state that the notice is a
"Notice of Default." Such notice to the Company shall be given by the Trustee if
so requested in writing by the Holders of 25% of the principal amount of the
Securities then Outstanding.
SECTION 502. ACCELERATION OF MATURITY; RESCISSION.
If an Event of Default (other than an Event of Default specified in Section
501(f) or 501(g)) occurs and is continuing, the Trustee or the Holders of at
least 25% of the principal amount of the Initial Securities and the Exchange
Securities then Outstanding, voting together as a single class, by written
notice to the Company and the agents, if any, under the Bank Credit Agreement
(and to the Trustee if such notice is given by the Holders), may, and the
Trustee at the request of such Holders shall, declare all unpaid principal of
and accrued interest on all the Securities to be due and payable, as specified
below. Upon a declaration of acceleration, such principal and accrued interest
shall be due and payable 10 days after receipt by the Company of such written
notice given hereunder. If an Event of Default specified in Section 501(f) or
501(g) with respect to the Company occurs, the amounts described above shall
ipso facto become and be immediately due and payable without any declaration or
other act on the part of the Trustee or any Holder. Upon payment of such
principal and interest all of the Company's obligations under the Securities and
this Indenture, other than obligations under Section 606, shall terminate.
The Holders of at least a majority in principal amount of the Initial
Securities and the Exchange Securities then Outstanding, voting together as a
single class, by written notice to the Trustee, may rescind an acceleration and
its consequences if (i) all existing Events of Default, other than the
non-payment of principal of or interest on the Securities which have become due
solely because of the acceleration, have been cured or waived and (ii) the
rescission would not conflict with any judgment or decree of a court of
competent jurisdiction.
Notwithstanding the preceding paragraph, in the event of a declaration of
acceleration in respect of the Securities because an Event of Default specified
in Section 501(d) shall have occurred and be continuing, such declaration of
acceleration shall be automatically annulled if the Indebtedness that is the
subject of such Event of Default has been discharged or the holders thereof have
rescinded their declaration of acceleration in respect of such Indebtedness, and
written notice of such discharge or rescission, as the case may be, shall have
been given to the Trustee by the Company and countersigned by the holders of
such Indebtedness or a trustee, fiduciary or agent for such holders, within 30
days after such
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53
declaration of acceleration in respect of the Securities, and no other Event of
Default has occurred during such 30-day period which has not been cured or
waived during such period.
Notices by the Trustee to the agents under the Bank Credit Agreement
provided for herein shall be delivered or mailed to Toronto Dominion (Texas),
Inc., 909 Fannin Street, Suite 1700, Houston, Texas 77010, Attention: Agency
Department; and to any other person who hereafter becomes an agent under the
Bank Credit Agreement, provided the Trustee has been notified by the Company or
the Banks of the names and mailing addresses of such persons.
SECTION 503. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY
TRUSTEE.
The Company covenants that if
(a) default is made in the payment of any interest on any Security
when such interest becomes due and payable and such default continues for a
period of 30 days, or
(b) default is made in the payment of the principal of any Security at
the Maturity thereof,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the whole amount then due and payable on such
Securities for principal and interest, with interest upon the overdue principal
and, to the extent that payment of such interest shall be legally enforceable,
upon overdue installments of interest, at the rate borne by the Securities; and,
in addition thereto, such further amount as shall be sufficient to cover the
costs and expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel.
If the Company fails to pay such amounts forthwith upon such demand, the
Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid and may
prosecute such proceeding to judgment or final decree, and may enforce the same
against the Company or any other obligor upon the Securities and collect the
moneys adjudged or decreed to be payable in the manner provided by law out of
the property of the Company or any other obligor upon the Securities, wherever
situated.
If an Event of Default occurs and is continuing, the Trustee may in its
discretion proceed to protect and enforce its rights and the rights of the
Holders under this Indenture by
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such appropriate private or judicial proceedings as the Trustee shall deem most
effectual to protect and enforce such rights.
SECTION 504. TRUSTEE MAY FILE PROOFS OF CLAIM.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or their
creditors, the Trustee (irrespective of whether the principal of the Securities
shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on
the Company for the payment of overdue principal or interest) shall be entitled
and empowered, by intervention in such proceeding or otherwise,
(a) to file and prove a claim for the whole amount of principal and
interest owing and unpaid in respect of the Securities and to file such
other papers or documents as may be necessary or advisable in order to have
the claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its
agents and counsel) and of the Holders allowed in such judicial proceeding,
and
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same; and any
custodian, receiver, assignee, trustee, liquidator, sequestrator or similar
official in any such judicial proceeding is hereby authorized by each
Holder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the
Holders, to pay the Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its
agents and counsel, and any other amounts due the Trustee under Section
606.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any proposal,
plan of reorganization, arrangement, adjustment or composition or other similar
arrangement affecting the Securities or the rights of any Holder thereof, or to
authorize the Trustee to vote in respect of the claim of any Holder in any such
proceeding.
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SECTION 505. TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF SECURITIES.
All rights of action and claims under this Indenture or the Securities may
be prosecuted and enforced by the Trustee without the possession of any of the
Securities or the production thereof in any proceeding relating thereto, and any
such proceeding instituted by the Trustee shall be brought in its own name and
as trustee of an express trust, and any recovery of judgment shall, after
provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Securities in respect of which such
judgment has been recovered.
SECTION 506. APPLICATION OF MONEY COLLECTED.
Any money collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of principal or interest,
upon presentation of the Securities and the notation thereon of the payment if
only partially paid and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under Section 606;
SECOND: To the payment of the amounts then due and unpaid upon the
Securities for principal and interest, in respect of which or for the
benefit of which such money has been collected, ratably, without preference
or priority of any kind, according to the amounts due and payable on such
Securities for principal and interest; and
THIRD: The balance, if any, to the Company.
SECTION 507. LIMITATION ON SUITS.
No Holder of any Securities shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Indenture or the
Securities, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless
(a) such Holder has previously given written notice to the Trustee of
a continuing Event of Default;
(b) the Holders of not less than 25% in principal amount of the
Initial Securities and the Exchange Securities then Outstanding, voting
together as a single
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class, shall have made written request to the Trustee to institute
proceedings in respect of such Event of Default in its own name as Trustee
hereunder;
(c) such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;
(d) the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity has failed to institute any such proceeding; and
(e) no direction inconsistent with such written request has been given
to the Trustee during such 60-day period by the Holders of a majority in
principal amount of the Outstanding Securities;
it being understood and intended that no one or more Holders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture to affect, disturb or prejudice the rights of any other Holders,
or to obtain or to seek to obtain priority or preference over any other Holders
or to enforce any right under this Indenture except in the manner provided in
this Indenture and for the equal and ratable benefit of all the Holders.
SECTION 508. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL AND
INTEREST.
Notwithstanding any other provision in this Indenture, the Holder of any
Security shall have the right, which is absolute and unconditional, to receive
payment of the principal of and (subject to Section 307) interest on such
Security on the respective due dates expressed in such Security and to institute
suit for the enforcement of any such payment, and such rights shall not be
impaired without the consent of such Holder.
SECTION 509. RESTORATION OF RIGHTS AND REMEDIES.
If the Trustee or any Holder has instituted any proceeding to enforce any
right or remedy under this Indenture and such proceeding has been discontinued
or abandoned for any reason, or has been determined adversely to the Trustee or
to such Holder, then and in every such case the Company, the Trustee and the
Holders shall, subject to any determination in such proceeding, be restored
severally and respectively to their former positions hereunder, and thereafter
all rights and remedies of the Trustee and the Holders shall continue as though
no such proceeding had been instituted.
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SECTION 510. RIGHTS AND REMEDIES CUMULATIVE.
Except as provided in Section 306, no right or remedy herein conferred upon
or reserved to the Trustee or to the Holders is intended to be exclusive of any
other right or remedy, and every right and remedy shall, to the extent permitted
by law, be cumulative and in addition to every other right and remedy given
hereunder or now or hereafter existing at law or in equity or otherwise. The
assertion or employment of any right or remedy hereunder, or otherwise, shall
not prevent the concurrent assertion or employment of any other appropriate
right or remedy.
SECTION 511. DELAY OR OMISSION NOT WAIVER.
No delay or omission of the Trustee or of any Holder of any Security to
exercise any right or remedy accruing upon any Event of Default shall impair any
such right or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given by this Article or by law to
the Trustee or to the Holders may be exercised from time to time, and as often
as may be deemed expedient, by the Trustee or by the Holders, as the case may
be.
SECTION 512. CONTROL BY HOLDERS.
The Holders of a majority in principal amount of the Initial Securities and
the Exchange Securities then Outstanding, voting together as a single class,
shall have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any trust or
power conferred on the Trustee, provided that
(a) such direction shall not be in conflict with any rule of law or
with this Indenture or expose the Trustee to personal liability, and
(b) subject to the provisions of Trust Indenture Act Section 315, the
Trustee may take any other action deemed proper by the Trustee which is not
inconsistent with such direction.
Section 513. Waiver of Past Defaults.
The Holders of a majority in principal amount of the Initial Securities and
the Exchange Securities then Outstanding, voting together as a single class, may
on behalf of the Holders of all the Securities waive any past Default or Event
of Default hereunder and its consequences, except a Default or Event of Default
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(a) in the payment of the principal of or interest on any Security, or
(b) in respect of a covenant or provision hereof which under Article
Nine cannot be modified or amended without the consent of the Holder of
each Outstanding Security affected.
Upon any such waiver, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
default or impair any right consequent thereon.
SECTION 514. UNDERTAKING FOR COSTS.
All parties to this Indenture agree, and each Holder of any Security by his
acceptance thereof shall be deemed to have agreed, that any court may in its
discretion require, in any suit for the enforcement of any right or remedy under
this Indenture, or in any suit against the Trustee for any action taken,
suffered or omitted by it as Trustee, the filing by any party litigant in such
suit of an undertaking to pay the costs of such suit, and that such court may in
its discretion assess reasonable costs, including reasonable attorneys' fees and
expenses, against any party litigant in such suit, having due regard to the
merits and good faith of the claims or defenses made by such party litigant; but
the provisions of this Section 514 shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Holder, or group of Holders, holding in
the aggregate more than 10% in principal amount of the Initial Securities and
the Exchange Securities then Outstanding, voting together as a single class, or
to any suit instituted by any Holder for the enforcement of the payment of the
principal of or interest on any Security on or after the respective Stated
Maturities expressed in such Security; provided that neither this Section 514
nor the Trust Indenture Act shall be deemed to authorize any court to require
such an undertaking or to make such an assessment in any suit instituted by the
Company.
SECTION 515. WAIVER OF STAY, EXTENSION OR USURY LAWS.
The Company covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, or plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay, extension or usury law wherever
enacted, now or at any time hereafter in force, which may affect the covenants
or the performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it will not hinder, delay or impede the execution
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59
of any power herein granted to the Trustee, but will suffer and permit the
execution of every such power as though no such law had been enacted.
ARTICLE SIX
THE TRUSTEE
SECTION 601. NOTICE OF DEFAULTS.
Within 90 days after the occurrence of any Default, the Trustee shall
transmit by mail to all Holders, as their names and addresses appear in the
Security Register, notice of such Default hereunder actually known to a
Responsible Officer of the Trustee, unless such default shall have been cured or
waived; provided, however, that, except in the case of a default in the payment
of the principal of or interest on any Security, the Trustee shall be protected
in withholding such notice if and so long as the board of directors, the
executive committee or a trust committee of directors and/or Responsible
Officers of the Trustee in good faith determines that the withholding of such
notice is in the interest of the Holders; and provided further that, in the case
of any default or breach of the character specified in Section 501(d), no such
notice to Holders shall be given until at least 30 days after the occurrence
thereof.
SECTION 602. CERTAIN RIGHTS OF TRUSTEE.
Subject to the provisions of Trust Indenture Act Sections 315(a) through
315(d):
(a) the Trustee may conclusively rely and shall be fully protected in
acting or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of indebtedness or
other paper or document (whether in its original or facsimile form)
believed by it to be genuine and to have been signed or presented by the
proper party or parties;
(b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any
resolution of the Board of Directors may be sufficiently evidenced by a
Board Resolution;
(c) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting
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any action hereunder, the Trustee (unless other evidence be herein
specifically prescribed) may, in the absence of bad faith on its part, rely
upon an Officers' Certificate;
(d) the Trustee may consult with counsel of its selection and the
advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction
of any of the Holders pursuant to this Indenture, unless such Holders shall
have offered to the Trustee reasonable security or indemnity satisfactory
to it against the costs, expenses and liabilities which might be incurred
by it in compliance with such request or direction;
(f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Trustee, in its discretion, may make such further inquiry
or investigation into such facts or matters as it may see fit, and, if the
Trustee shall determine to make such further inquiry or investigation, it
shall be entitled to examine the books, records and premises of the
Company, personally or by agent or attorney at the expense of the Company
and shall incur no liability or additional liability of any kind by reason
of such inquiry or investigation;
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by
it hereunder; and
(h) no provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder, or in the exercise of any of
its rights or powers, if it shall have reasonable grounds for believing
that repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it.
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SECTION 603. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.
The recitals contained herein and in the Securities, except the Trustee's
certificates of authentication, shall be taken as the statements of the Company,
and the Trustee assumes no responsibility for their correctness. The Trustee
makes no representations as to the validity or sufficiency of this Indenture or
of the Securities. The Trustee shall not be accountable for the use or
application by the Company of Securities or the proceeds thereof, except that
the Trustee represents that it is duly authorized to execute and deliver this
Indenture, authenticate the Securities and perform its obligations hereunder and
that the statements to be made by it in a Statement of Eligibility on Form T-1
supplied to the Company are true and accurate, subject to the qualifications set
forth therein.
SECTION 604. MAY HOLD SECURITIES.
The Trustee, any Paying Agent, Security Registrar or any other agent of the
Company, in its individual or any other capacity, may become the owner or
pledgee of Securities and, subject to Trust Indenture Act Sections 310(b) and
311, may otherwise deal with the Company with the same rights it would have if
it were not Trustee, Paying Agent, Security Registrar or such other agent.
SECTION 605. MONEY HELD IN TRUST.
Money held by the Trustee in trust hereunder need not be segregated from
other funds except to the extent required by law. The Trustee shall be under no
liability for interest on any money received by it hereunder except as otherwise
agreed in writing with the Company.
SECTION 606. COMPENSATION AND REIMBURSEMENT.
The Company agrees:
(a) to pay to the Trustee from time to time such compensation as shall
be agreed to in writing between the Company and the Trustee for all
services rendered by it hereunder (which compensation shall not be limited
by any provision of law in regard to the compensation of a trustee of an
express trust);
(b) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any provision
of this Indenture (including the
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reasonable compensation and the expenses and disbursements of its agents
and counsel), except any such expense, disbursement or advance as may be
attributable to its negligence or willful misconduct; and
(c) to indemnify each of the Trustee or any predecessor Trustee for,
and to hold it harmless against, any and all loss, damage, claim, liability
or expense including taxes (other than taxes based on the income of the
Trustee) incurred without negligence or willful misconduct on its part,
arising out of or in connection with the acceptance or administration of
this trust, including the costs and expenses of defending itself against
any claim or liability in connection with the exercise or performance of
any of its powers or duties hereunder.
As security for the performance of the obligations of the Company under
this Section 606, the Trustee shall have a Lien prior to the Securities upon all
property and funds held or collected by the Trustee as such, except funds held
in trust for the benefit of Holders of particular Securities.
When the Trustee incurs expenses or renders services in connection with an
Event of Default specified in Section 501(f) or 501(g), the expenses (including
the reasonable charges and expenses of its counsel) and the compensation for the
services will be intended to constitute expenses of administration under any
Bankruptcy Law.
The provisions of this Section 606 shall survive the termination of this
Indenture.
SECTION 607. CONFLICTING INTERESTS.
(a) The Trustee shall comply with the provisions of Section 310(b) of the
Trust Indenture Act.
(b) The indenture dated as of February 15, 1993, for the Company's 97/8%
Senior Subordinated Debentures due 2013, the indenture dated as of April 1,
1993, for the Company's 97/8% Senior Subordinated Debentures due 2023 the
indenture dated as of November 1, 1995, for the Company's 9 1/4% Senior
Subordinated Debentures due 2005, the Company's 97/8% Senior Subordinated
Debentures due 2006 and the Company's 10 1/2% Senior Subordinated Debentures due
2016, the indenture dated as of August 26, 1997 for the Company's 8 1/8% Senior
Debentures due 2009 and the indenture dated as of July 1, 1998 for the Company's
7 1/4 Senior Notes due 2008 and 75/8 Senior Debentures due 2018 shall be
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63
deemed to be specifically described herein for the purposes of clause (i) of the
first proviso contained in Section 310(b) of the Trust Indenture Act.
SECTION 608. CORPORATE TRUSTEE REQUIRED; ELIGIBILITY.
There shall at all times be a Trustee hereunder qualified or to be
qualified under Trust Indenture Act Section 310(a)(1) and which shall have a
combined capital and surplus of at least $50,000,000 to the extent there is such
an institution eligible and willing to serve. If the Trustee publishes reports
of condition at least annually, pursuant to law or to the requirements of
Federal, State, Territorial or District of Columbia supervising or examining
authority, then for the purposes of this Section 608, the combined capital and
surplus of the Trustee shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time
the Trustee shall cease to be eligible in accordance with the provisions of this
Section 608, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article.
SECTION 609. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 610.
(b) The Trustee may resign at any time by giving written notice thereof to
the Company. If an instrument of acceptance by a successor Trustee shall not
have been delivered to the Trustee within 30 days after the giving of such
notice of resignation, the resigning Trustee may petition at the expense of the
Company any court of competent jurisdiction for the appointment of a successor
Trustee.
(c) The Trustee may be removed at any time by an Act of the Holders of a
majority in principal amount of the Outstanding Securities, delivered to the
Trustee and the Company. If an instrument of acceptance by a successor Trustee
shall not have been delivered to the Trustee within 30 days after the giving of
such notice of removal, the removed Trustee may petition at the expense of the
Company any court of competent jurisdiction for the appointment of a successor
Trustee.
(d) If at any time:
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(i) the Trustee shall fail to comply with the provisions of Trust
Indenture Act Section 310(b) after written request therefor by the Company
or by any Holder who has been a bona fide Holder of a Security for at least
six months, or
(ii) the Trustee shall cease to be eligible under Section 608 and shall
fail to resign after written request therefor by the Company or by any
Holder who has been a bona fide Holder of a Security for at least six
months, or
(iii) the Trustee shall become incapable of acting or shall be adjudged
a bankrupt or insolvent, or a receiver of the Trustee or of its property
shall be appointed or any public officer shall take charge or control of
the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any case, (A) the Company by a Board Resolution may remove the Trustee,
or (B) subject to Section 514, the Holder of any Security who has been a bona
fide Holder of a Security for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction for
the removal of the Trustee and the appointment of a successor Trustee.
(e) If the Trustee shall resign, be removed or become incapable of acting,
or if a vacancy shall occur in the office of Trustee for any cause, the Company,
by a Board Resolution, shall promptly appoint a successor Trustee. If, within
one year after such resignation, removal or incapability, or the occurrence of
such vacancy, a successor Trustee shall be appointed by Act of the Holders of a
majority in principal amount of the Outstanding Securities delivered to the
Company and the retiring Trustee, the successor Trustee so appointed shall,
forthwith upon its acceptance of such appointment in accordance with Section
610, become the successor Trustee and supersede the successor Trustee appointed
by the Company. If no successor Trustee shall have been so appointed by the
Company or the Holders of the Securities and so accepted appointment, the Holder
of any Security who has been a bona fide Holder for at least six months may, on
behalf of himself and all others similarly situated, petition any court of
competent jurisdiction for the appointment of a successor Trustee.
(f) The Company shall give notice of each resignation and each removal of
the Trustee and each appointment of a successor Trustee by mailing written
notice of such event by first-class mail, postage prepaid, to the Holders of
Securities as their names and addresses appear in the Security Register. Each
notice shall include the name of the successor Trustee and the address of its
Corporate Trust Office.
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SECTION 610. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.
Every successor Trustee appointed hereunder shall execute, acknowledge and
deliver to the Company and to the retiring Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring Trustee
shall become effective and such successor Trustee, without any further act, deed
or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Trustee, provided, however, that the retiring Trustee
shall continue to be entitled to the benefit of Section 606(c); but, on request
of the Company or the successor Trustee, such retiring Trustee shall, upon
payment of its charges, execute and deliver an instrument transferring to such
successor Trustee all the rights, powers and trusts of the retiring Trustee, and
shall duly assign, transfer and deliver to such successor Trustee all property
and money held by such retiring Trustee hereunder. Upon request of any such
successor Trustee, the Company shall execute any and all instruments for more
fully and certainly vesting in and confirming to such successor Trustee all such
rights, powers and trusts.
No successor Trustee shall accept its appointment unless at the time of
such acceptance such successor Trustee shall be qualified and eligible under
this Article.
SECTION 611. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.
Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto. In case any Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.
SECTION 612. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
If and when the Trustee shall be or become a creditor of the Company (or
any other obligor under the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Company (or any such other obligor).
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SECTION 613. TRUSTEE'S APPLICATION FOR INSTRUCTIONS FROM THE COMPANY.
Any application by the Trustee for written instructions from the Company
may, at the option of the Trustee, set forth in writing any action proposed to
be taken or omitted by the Trustee under this Indenture and the date on and/or
after which such action shall be taken or such omission shall be effective. The
Trustee shall not be liable for any action taken by, or omission of, the Trustee
in accordance with a proposal included in such application on or after the date
specified in such application (which date shall not be less than three Business
Days after the date any officer of the Company actually received such
application, unless any such action (or the effective date in the case of an
omission), the Trustee shall have received written instructions in response to
such application specifying the action to be taken or omitted.
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. DISCLOSURE OF NAMES AND ADDRESSES OF HOLDERS.
Every Holder of Securities, by receiving and holding the same, agrees with
the Company and the Trustee that neither the Company nor the Trustee or any
agent of either of them shall be held accountable by reason of the disclosure of
any information as to the names and addresses of the Holders in accordance with
Trust Indenture Act Section 312, regardless of the source from which such
information was derived, and that the Trustee shall not be held accountable by
reason of mailing any material pursuant to a request made under Trust Indenture
Act Section 312.
SECTION 702. REPORTS BY TRUSTEE.
Within 60 days after April 30 of each year commencing with the first April
30 after the Security Issue Date, the Trustee shall transmit by mail to all
Holders, as their names and addresses appear in the Security Register, as
provided in Trust Indenture Act Section 313(c), a brief report dated as of such
April 30 if required by Trust Indenture Act Section 313(a).
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SECTION 703. REPORTS BY COMPANY.
The Company shall:
(a) file with the Trustee, within 30 days after the Company is required
to file the same with the Commission, copies of the annual reports and of
the information, documents and other reports (or copies of such portions of
any of the foregoing as the Commission may from time to time by rules and
regulations prescribe) which the Company may be required to file with the
Commission pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934; or, if the Company is not required to file
information, documents or reports pursuant to either of such Sections, then
it shall file with the Trustee and the Commission, in accordance with rules
and regulations prescribed from time to time by the Commission, such of the
supplementary and periodic information, documents and reports which may be
required pursuant to Section 13 of the Securities Exchange Act of 1934 in
respect of a security listed and registered on a national securities
exchange as may be prescribed from time to time in such rules and
regulations; delivery of such reports, information and documents to the
Trustee is for informational purposes only and the Trustee's receipt of
such shall not constitute constructive notice of any information contained
therein or determinable from information contained therein, including the
Company's compliance with any of its covenants hereunder (as to which the
Trustee is entitled to rely exclusively on Officers' Certificates);
(b) file with the Trustee and the Commission, in accordance with rules
and regulations prescribed from time to time by the Commission, such
additional information, documents and reports with respect to compliance by
the Company with the conditions and covenants of this Indenture as may be
required from time to time by such rules and regulations; delivery of such
reports, information and documents to the Trustee is for informational
purposes only and the Trustee's receipt of such shall not constitute
constructive notice of any information contained therein or determinable
from information contained therein, including the Company's compliance with
any of its covenants hereunder (as to which the Trustee is entitled to rely
exclusively on Officers' Certificates); and
(c) transmit by mail to all Holders, as their names and addresses
appear in the Security Register, within 30 days after the filing thereof
with the Trustee, in the manner and to the extent provided in Trust
Indenture Act Section 313(c), such summaries of any information, documents
and reports required to be filed by the
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Company pursuant to subsections (a) and (b) of this Section 703 as may
be required by rules and regulations prescribed from time to time by
the Commission.
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. COMPANY MAY CONSOLIDATE, ETC., ONLY ON CERTAIN TERMS.
The Company shall not consolidate or merge with or into, or sell, assign,
transfer, lease, convey, or otherwise dispose of all or substantially all of its
assets to, any Person, unless:
(a) the Person formed by or surviving any such consolidation or merger
(if other than the Company), or to which such sale, assignment, transfer,
lease, conveyance or disposition shall have been made, is a corporation
organized and existing under the laws of the United States, any state
thereof or the District of Columbia and shall assume by supplemental
indenture hereto all the obligations of the Company under the Securities
and this Indenture;
(b) immediately before and immediately after such transaction, and
after giving effect thereto, no Default or Event of Default shall have
occurred and be continuing;
(c) immediately after such transaction, and after giving effect
thereto, the Person formed by or surviving any such consolidation or
merger, or to which such sale, assignment, transfer, lease or conveyance or
disposition shall have been made (the "successor"), shall have a Cash Flow
Ratio not in excess of 9 to 1; and
(d) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that such consolidation, merger or
transfer and such supplemental indenture, if one is required by this
Section 801, comply with this Section 801 and that all conditions precedent
herein provided for relating to such transaction have been complied with.
Cash Flow Ratio for purposes of this Section 801 shall be computed as if
any such successor were the Company.
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SECTION 802. SUCCESSOR SUBSTITUTED.
Upon any consolidation or merger, or any sale, assignment, transfer, Lease
or conveyance or other disposition of all or substantially all of the assets, of
the Company in accordance with Section 801, the successor Person formed by such
consolidation or into which the Company is merged or to which such sale,
assignment, transfer, Lease, conveyance or other disposition is made shall
succeed to, and be substituted for, and may exercise every right and power of,
the Company under this Indenture with the same effect as if such successor
Person had been named as the Company herein. When a successor assumes all the
obligations of its predecessor under this Indenture and the Securities, the
predecessor will be released from those obligations, provided that in the case
of a transfer by lease, the predecessor corporation shall not be released from
the payment of principal and interest on the Securities.
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS.
Without the consent of any Holders, the Company, when authorized by a Board
Resolution, and the Trustee, at any time and from time to time, may enter into
one or more indentures supplemental hereto in form satisfactory to the Trustee,
for any of the following purposes:
(a) to evidence the succession of another Person to the Company and the
assumption by any such successor of the covenants of the Company herein and
in the Securities;
(b) to add to the covenants of the Company for the benefit of the
Holders, or to surrender any right or power herein or in the Securities
conferred upon the Company;
(c) to cure any ambiguity, to correct or supplement any provision
herein which may be defective or inconsistent with any other provision
herein, or to make any other provisions with respect to matters or
questions arising under this Indenture; provided that, in each case, such
provisions shall not adversely affect the interests of the Holders in any
material respect;
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(d) to secure the Securities, if the Company so elects;
(e) to supplement any provisions of this Indenture to such extent as
shall be necessary to permit or facilitate the defeasance and discharge of
the Securities pursuant to Sections 1201, 1202 and 1203.
(f) to make any changes necessary to qualify this Indenture under the
Trust Indenture Act in connection with the Exchange Offer or the Shelf
Registration Statement; or
(g) to make any other change that does not adversely affect the rights
of any Holder.
SECTION 902. SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS.
With the consent of the Holders of not less than a majority in aggregate
principal amount of the Initial Securities and the Exchange Securities then
Outstanding, voting together as a single class, by Act of such Holders delivered
to the Company and the Trustee and the Company, each when authorized by a Board
Resolution, and the Trustee may enter into one or more indentures supplemental
hereto for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Indenture or of waiving or modifying
in any manner the rights of the Holders under this Indenture; provided, however,
that no such supplemental indenture, amendment or waiver shall, without the
consent of the Holder of each Outstanding Security affected thereby:
(a) change the Stated Maturity of the principal of, or any installment
of interest on, any Security, or reduce the principal amount thereof or the
rate of interest thereon, or change the coin or currency in which the
principal of any Security or the interest thereon is payable, or impair the
right to institute suit for the enforcement of any such payment after the
Stated Maturity thereof; or
(b) reduce the percentage in principal amount of the Outstanding
Securities, the consent of whose Holders is required for any such
supplemental indenture, or the consent of whose Holders is required for any
waiver (of compliance with certain provisions of this Indenture or certain
defaults hereunder and their consequences) provided for in this Indenture;
or
(c) modify any of the provisions of this Section 902 or Section 513,
except to increase any such percentage or to provide that certain other
provisions of this
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Indenture cannot be modified or waived without the consent of the Holder of
each Outstanding Security affected thereby.
It shall not be necessary for any Act of Holders under this Section 902
to approve the particular form of any proposed supplemental indenture, but
it shall be sufficient if such Act shall approve the substance thereof.
SECTION 903. EXECUTION OF SUPPLEMENTAL INDENTURES.
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Trust Indenture Act Section 315(a) through 315(d) and Section
602 hereof) shall be fully protected in relying upon, an Opinion of Counsel
stating that the execution of such supplemental indenture is authorized or
permitted by this Indenture. The Trustee may, but shall not be obligated to,
enter into any such supplemental indenture which affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise.
SECTION 904. EFFECT OF SUPPLEMENTAL INDENTURES.
Upon the execution of any supplemental indenture under this Article, this
Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
SECTION 905. CONFORMITY WITH TRUST INDENTURE ACT.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act as then in effect.
SECTION 906. REFERENCE IN SECURITIES TO SUPPLEMENTAL INDENTURES.
Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article may, and shall if required by
the Trustee, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company shall so determine,
new Securities so modified as to conform, in the opinion of the Trustee and the
Company, to any such supplemental indenture may be prepared and executed by the
Company and authenticated and delivered by the Trustee in exchange for
Outstanding Securities.
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ARTICLE TEN
COVENANTS
SECTION 1001. PAYMENT OF PRINCIPAL AND INTEREST.
The Company will duly and punctually pay the principal of and interest on
the Securities in accordance with the terms of the Securities and this
Indenture.
SECTION 1002. MAINTENANCE OF OFFICE OR AGENCY.
The Company will maintain, in The City of New York, an office or agency
where Securities may be presented or surrendered for payment, where Securities
may be surrendered for registration of transfer or exchange and where notices
and demands to or upon the Company in respect of the Securities and this
Indenture may be served. If the Corporate Trust Office is located in New York
City, then it shall be such office or agency of the Company, unless the Company
shall designate and maintain some other office or agency for one or more of such
purposes. The Company will give prompt written notice to the Trustee of any
change in the location of any such office or agency. If at any time the Company
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office, and the
Company hereby appoints the Trustee as its agent to receive all such
presentations, surrenders, notices and demands.
The Company may from time to time designate one or more other offices or
agencies (in or outside of The City of New York) where the Securities may be
presented or surrendered for any or all such purposes, and may from time to time
rescind such designation; provided, however, that no such designation or
rescission shall in any manner relieve the Company of its obligation to maintain
an office or agency in The City of New York for such purposes. The Company will
give prompt written notice to the Trustee of any such designation or rescission
and any change in the location of any such office or agency.
SECTION 1003. MONEY FOR SECURITY PAYMENTS TO BE HELD IN TRUST.
If the Company shall at any time act as its own Paying Agent, it will, on
or before each due date of the principal of or interest on any of the
Securities, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum sufficient to pay the principal or
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interest so becoming due until such sums shall be paid to such Persons or
otherwise disposed of as herein provided, and will promptly notify the Trustee
of its action or failure so to act.
Whenever the Company shall have one or more Paying Agents for the
Securities, it will, on or before each due date of the principal of or interest
on any Securities, deposit with a Paying Agent a sum in same day funds (or New
York Clearing House funds if such deposit is made prior to the date on which
such deposit is required to be made) sufficient to pay the principal or interest
so becoming due, such sum to be held in trust for the benefit of the Persons
entitled to such principal or interest and (unless such Paying Agent is the
Trustee) the Company will promptly notify the Trustee of such action or any
failure so to act.
The Company will cause each Paying Agent other than the Trustee to execute
and deliver to the Trustee an instrument in which such Paying Agent shall agree
with the Trustee, subject to the provisions of this Section 1003, that such
Paying Agent will:
(a) hold all sums held by it for the payment of the principal of or
interest on Securities in trust for the benefit of the Persons entitled
thereto until such sums shall be paid to such Persons or otherwise disposed
of as herein provided;
(b) give the Trustee notice of any default by the Company (or any other
obligor upon the Securities) in the making of any payment of principal or
interest; and
(c) at any time during the continuance of any such default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so
held in trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, pay, or by Company
Order direct any Paying Agent to pay, to the Trustee all sums held in trust by
the Company or such Paying Agent, such sums to be held by the Trustee upon the
same trusts as those upon which such sums were held by the Company or such
Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such
Paying Agent shall be released from all further liability with respect to such
money.
Any money deposited with the Trustee or any Paying Agent, or then held by
the Company, in trust for the payment of the principal of or interest on any
Security and remaining unclaimed for two years after such principal or interest
has become due and payable shall be paid to the Company on Company Request or
(if then held by the Company) shall be discharged from such trust; and the
Holder of such Security shall thereafter, as an unsecured
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general creditor, look only to the Company for payment thereof, and all
liability of the Trustee or such Paying Agent with respect to such trust money,
and all liability of the Company as trustee thereof, shall thereupon cease.
SECTION 1004. CORPORATE EXISTENCE.
Subject to Article Eight, the Company shall do or cause to be done all
things necessary to preserve and keep in full force and effect its corporate
existence and that of each Restricted Subsidiary and the corporate rights
(charter and statutory), corporate licenses and corporate franchises of the
Company and its Restricted Subsidiaries, except where a failure to do so, singly
or in the aggregate, is not likely to have a materially adverse effect upon the
business, assets, financial condition or results of operations of the Company
and the Restricted Subsidiaries taken as a whole determined on a consolidated
basis in accordance with generally accepted accounting principles; provided that
the Company shall not be required to preserve any such existence (except of the
Company), right, license or franchise if the Board of Directors, or of the
Restricted Subsidiary concerned, shall determine that the preservation thereof
is no longer desirable in the conduct of the business of the Company or such
Restricted Subsidiary and that the loss thereof is not disadvantageous in any
material respect to the Holders.
SECTION 1005. PAYMENT OF TAXES AND OTHER CLAIMS.
The Company will pay or discharge or cause to be paid or discharged, before
the same shall become delinquent, (a) all material taxes, assessments and
governmental charges levied or imposed upon it or any Subsidiary or upon the
income, profits or property of the Company or any of its Subsidiaries and (b)
all material lawful claims for labor, materials and supplies, which, if unpaid,
might by law become a lien upon the property of the Company or any Restricted
Subsidiary; provided, however, that the Company shall not be required to pay or
discharge or cause to be paid or discharged any such tax, assessment, charge or
claim whose amount, applicability or validity is being contested in good faith
by appropriate proceedings.
SECTION 1006. MAINTENANCE OF PROPERTIES.
The Company shall cause all material properties owned by or leased to it or
any Restricted Subsidiary and necessary in the conduct of its business or the
business of such Restricted Subsidiary to be maintained and kept in normal
condition, repair and working order, ordinary wear and tear excepted; provided
that nothing in this Section 1006 shall prevent the Company or any Restricted
Subsidiary from discontinuing the use, operation or maintenance of
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any of such properties, or disposing of any of them, if such discontinuance or
disposal is, in the judgment of the Board of Directors or the Restricted
Subsidiary concerned, or of any officer (or other agent employed by the Company
or any Restricted Subsidiary) of the Company or such Restricted Subsidiary
having managerial responsibility for any such property, desirable in the conduct
of the business of the Company or any Restricted Subsidiary of the Company and
if such discontinuance or disposal is not adverse in any material respect to the
Holders.
The Company shall provide or cause to be provided, for itself and any
Restricted Subsidiaries, insurance (including appropriate self-insurance)
against loss or damage of the kinds customarily insured against by corporations
similarly situated and owning like properties in the same general areas in which
the Company or such Restricted Subsidiaries operate.
SECTION 1007. LIMITATION ON INDEBTEDNESS.
The Company shall not, and shall not permit any Restricted Subsidiary to,
directly or indirectly, incur, create, issue, assume, guarantee or otherwise
become liable for, contingently or otherwise, or become responsible for the
payment of, contingently or otherwise, any Indebtedness (other than Indebtedness
between or among any of the Company and Restricted Subsidiaries) unless, after
giving effect thereto, the Cash Flow Ratio shall be less than or equal to 9 to
1.
SECTION 1008. LIMITATION ON LIENS.
The Company shall not, and shall not permit any Restricted Subsidiary to,
directly or indirectly, create, incur, assume or suffer to exist any Lien of any
kind, except for Permitted Liens, on or with respect to any of its property or
assets, whether owned at the date of this Indenture or hereafter acquired, or
any income, profits or proceeds therefrom, or assign or otherwise convey any
right to receive income thereon, unless (x) in the case of any Lien securing
Indebtedness that is subordinated in right of payment to the Securities, the
Securities are secured by a Lien on such property, assets or proceeds that is
senior in priority to such Lien and (y) in the case of any other Lien, the
Securities are equally and ratably secured.
SECTION 1009. LIMITATION ON RESTRICTED PAYMENTS.
Except as otherwise provided in this Section 1009, the Company shall not,
and shall not permit any Restricted Subsidiary to, make any Restricted Payment
if (a) at the time of such proposed Restricted Payment, a Default or Event of
Default shall have occurred and be
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continuing or shall occur as a consequence of such Restricted Payment or (b)
immediately after giving effect to such Restricted Payment, the aggregate of all
Restricted Payments that shall have been made on or after July 1, 1988 would
exceed the sum of:
(a) $25,000,000, plus
(b) an amount equal to the difference between (i) the Cumulative Cash
Flow Credit and (ii) 1.2 multiplied by Cumulative Interest Expense.
For purposes of this Section 1009, the amount of any Restricted Payment, if
other than cash, shall be based upon fair market value as determined by the
Board of Directors, whose good faith determination shall be conclusive.
The foregoing provisions of this Section 1009 shall not prevent (i) the
payment of any dividend within 60 days after the date of declaration thereof, if
at such date of declaration such payment complied with the provisions or this
Section 1009; and (ii) the retirement, redemption, purchase, defeasance or other
acquisition of any shares of the Company's Capital Stock or warrants, rights or
options to acquire Capital Stock of the Company in exchange for, or out of the
proceeds of a sale (within one year before or 180 days after such retirement,
redemption, purchase, defeasance or other acquisition) of, other shares of the
Company's Capital Stock or warrants, rights or options to acquire Capital Stock
of the Company. For purposes of determining the aggregate permissible amount of
Restricted Payments in accordance with clause (b) of the first paragraph of this
Section 1009, all amounts expended pursuant to clause (i) of this paragraph
shall be included and all amounts expended or received pursuant to clause (ii)
of this paragraph shall be excluded; provided, however, that amounts paid
pursuant to clause (i) of this paragraph shall be included only to the extent
that such amounts were not previously included in calculating Restricted
Payments.
For the purposes of this Section 1009, the net proceeds from the issuance
of shares of Capital Stock of the Company upon conversion of Indebtedness shall
be deemed to be an amount equal to (i) the accreted value of such Indebtedness
on the date of such conversion and (ii) the additional consideration, if any,
received by the Company upon such conversion thereof, less any cash payment on
account of fractional shares (such consideration, if in property other than
cash, to be determined by the Board of Directors, whose good faith determination
shall be conclusive and evidenced by a Board Resolution). If the Company makes a
Restricted Payment which, at the time of the making of such Restricted Payment,
would in the good faith determination of the Company be permitted under the
requirements of this Section 1009, such Restricted Payment shall be deemed to
have been made in compliance with this Section 1009 notwithstanding any
subsequent adjustments made in good faith to the
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Company's financial statements affecting Cumulative Cash Flow Credit or
Cumulative Interest Expense for any period.
SECTION 1010. LIMITATION ON INVESTMENTS IN UNRESTRICTED SUBSIDIARIES AND
AFFILIATES.
The Company shall not, and shall not permit any Restricted Subsidiary to,
directly or indirectly, (a) make any Investment or (b) allow any Restricted
Subsidiary to become an Unrestricted Subsidiary (a "redesignation of a
Restricted Subsidiary"), in each case unless (i) no Default or Event of Default
shall have occurred and be continuing or shall occur as a consequence of such
Investment or such redesignation of a Restricted Subsidiary and (ii) after
giving effect thereto, the Cash Flow Ratio shall be less than or equal to 9 to
1.
The foregoing provisions of this Section 1010 shall not prohibit (a) any
renewal or reclassification of any Investment existing on the date hereof or (b)
trade credit extended on usual and customary terms in the ordinary course of
business.
SECTION 1011. TRANSACTIONS WITH AFFILIATES.
The Company shall not, and shall not permit any of its Subsidiaries to,
sell, lease, transfer or otherwise dispose of any of its properties or assets to
or purchase any property or assets from, or enter into any contract, agreement,
understanding, loan, advance or guarantee with, or for the benefit of, an
Affiliate of the Company that is not a Subsidiary, having a value, or for
consideration having a value, in excess of $10,000,000 individually or in the
aggregate unless the Board of Directors shall make a good faith determination
that the terms of such transaction are, taken as a whole, no less favorable to
the Company or such subsidiary, as the case may be, than those which might be
available in a comparable transaction with an unrelated Person. For purposes of
clarification, this Section 1011 shall not apply to any Restricted Payments
permitted by Section 1009.
SECTION 1012. PROVISION OF FINANCIAL STATEMENTS.
(a) The Company shall supply without cost to each Holder of the Securities,
and file with the Trustee (if not otherwise filed with the Trustee pursuant to
Section 703) within 30 days after the Company is required to file the same with
the Commission, copies of the annual reports and quarterly reports and of the
information, documents and other reports which the Company may be required to
file with the Commission pursuant to Section 13(a), 13(c) or 15(d) of the
Exchange.
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(b) If the Company is not required to file with the Commission such reports
and other information referred to in Section 1012(a), the Company shall furnish
without cost to each Holder of the Securities and file with the Trustee (i)
within 140 days after the end of each fiscal year, annual reports containing the
information required to be contained in Items 1, 2, 3, 6, 7, 8 and 9 of Form
10-K promulgated under the Exchange Act, or substantially the same information
required to be contained in comparable items of any successor form, and (ii)
within 75 days after the end of each of the first three fiscal quarters of each
fiscal year, quarterly reports containing the information required to be
contained in Form 10-Q promulgated under the Exchange Act, or substantially the
same information required to be contained in any successor form.
(c) At any time when the Company is not subject to Section 13 or 15(d) of
the Exchange Act, upon the request of a Holder of a Restricted Security, the
Company will promptly furnish or cause to be furnished such information as is
specified pursuant to Rule 144A(d)(4) under the Securities Act (or any successor
provision thereto) to such Holder or to a prospective purchaser of such Security
designated by such holder, as the case may be, in order to permit compliance by
such holder with Rule 144A under the Securities Act.
SECTION 1013. STATEMENT AS TO COMPLIANCE.
The Company will deliver to the Trustee, within 120 days after the end of
each fiscal year ending after July 13, 1999, a brief certificate of its
principal executive officer, principal financial officer or principal accounting
officer stating whether, to such officer's knowledge, the Company is in
compliance with all covenants and conditions under this Indenture. For purposes
of this Section 1013, such compliance shall be determined without regard to any
period of grace or requirement of notice under this Indenture.
SECTION 1014. WAIVER OF CERTAIN COVENANTS.
The Company may omit in any particular instance to comply with any covenant
or condition set forth in Sections 1007 through 1012 if, before or after the
time for such compliance, the Holders of a majority in aggregate principal
amount of the Outstanding Securities, by Act of such Holders, waive such
compliance in such instance or generally waive compliance with such covenant or
condition, but no such waiver shall extend to or affect such covenant or
condition except to the extent so expressly waived, and, until such waiver shall
become effective, the obligations of the Company and the duties of the Trustee
in respect of any such covenant or condition shall remain in full force and
effect.
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SECTION 1015. STATEMENT BY OFFICERS AS TO DEFAULT.
The Company shall deliver to the Trustee, as soon as possible and in any
event within five days after the Company becomes aware of the occurrence of any
Event of Default or an event which, with notice or the lapse of time or both,
would constitute an Event of Default, an Officers' Certificate setting forth the
details of such Event of Default or default and the action which the Company
proposes to take with respect thereto.
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
SECTION 1101. NO RIGHT OF REDEMPTION.
The Securities are not subject to redemption at the option of the Company.
ARTICLE TWELVE
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1201. OPTION TO EFFECT DEFEASANCE OR COVENANT DEFEASANCE.
The Company may, at its option by Board Resolution, at any time, with
respect to the Securities, elect to have either Section 1202 or Section 1203 be
applied to all Outstanding Securities upon compliance with the conditions set
forth below in this Article Twelve.
SECTION 1202. DEFEASANCE AND DISCHARGE.
Upon the Company's exercise under Section 1201 of the option applicable to
this Section 1202, the Company shall be deemed to have been discharged from its
obligations with respect to all Outstanding Securities on the date the
conditions set forth below are satisfied (hereinafter, "defeasance"). For this
purpose, such defeasance means that the Company shall be deemed to have paid and
discharged the entire indebtedness represented by the Outstanding Securities,
which shall thereafter be deemed to be "Outstanding" only for the purposes of
Section 1205 and the other Sections of this Indenture referred to in (A) and (B)
below, and to have satisfied all its other obligations under such Securities and
this Indenture (and the Trustee, on demand of and at the expense of the Company,
shall execute proper instruments
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acknowledging the same), except for the following which shall survive until
otherwise terminated or discharged hereunder: (A) the rights of Holders of
Outstanding Securities to receive solely from the trust fund described in
Section 1204 and as more fully set forth in such Section, payments in respect of
the principal of and interest on such Securities when such payments are due, (B)
the Company's obligations with respect to such Securities under Sections 304,
305, 306, 1002 and 1003, (C) the rights, powers, trusts, duties and immunities
of the Trustee hereunder and the Company's obligations in connection therewith
and (D) this Article Twelve. Subject to compliance with this Article Twelve, the
Company may exercise its option under this Section 1202 notwithstanding the
prior exercise of its option under Section 1203 with respect to the Securities.
SECTION 1203. COVENANT DEFEASANCE.
Upon the Company's exercise under Section 1201 of the option applicable to
this Section 1203, the Company shall be released from its obligations under any
covenant contained in Article Eight and in Sections 1004 through 1012 with
respect to the Outstanding Securities on and after the date the conditions set
forth below are satisfied (hereinafter, "covenant defeasance"), and the
Securities shall thereafter be deemed to be not "Outstanding" for the purposes
of any direction, waiver, consent or declaration or Act of Holders (and the
consequences of any thereof) in connection with such covenants, but shall
continue to be deemed "Outstanding" for all other purposes hereunder (it being
understood that such Securities shall not be deemed Outstanding for financial
accounting purposes). For this purpose, such covenant defeasance means that,
with respect to the Outstanding Securities, the Company may omit to comply with
and shall have no liability in respect of any term, condition or limitation set
forth in any such covenant, whether directly or indirectly, by reason of any
reference elsewhere herein to any such covenant or by reason of any reference in
any such covenant to any other provision herein or in any other document and
such omission to comply shall not constitute a default or an Event of Default
under Section 501(c), but, except as specified above, the remainder of this
Indenture and such Securities shall be unaffected thereby. In addition, upon the
Company's exercise under Section 1201 of the option applicable to Section 1203,
Sections 501(c) through 501(e) shall not constitute Events of Default.
SECTION 1204. CONDITIONS TO DEFEASANCE OR COVENANT DEFEASANCE.
The following shall be the conditions to application of either Section 1202
or Section 1203 to the Outstanding Securities:
(1) The Company shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee satisfying the requirements
of Section 608 who
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shall agree to comply with the provisions of this Article Twelve applicable
to it) as trust funds in trust for the purpose of making the following
payments, specifically pledged as security for, and dedicated solely to,
the benefit of the Holders of such Securities, (A) cash in U.S. Dollars in
an amount, or (B) U.S. Government Obligations which through the scheduled
payment of principal and interest in respect thereof in accordance with
their terms will provide, not later than one day before the due date of any
payment, cash in U.S. Dollars in an amount, or (C) a combination thereof,
sufficient, in the opinion of a nationally recognized firm of independent
public accountants expressed in a written certification thereof delivered
to the Trustee, to pay and discharge and which shall be applied by the
Trustee (or other qualifying trustee) to pay and discharge, (i) the
principal of and interest on the Outstanding Securities on the Stated
Maturity of such principal or installment of principal or interest and (ii)
any mandatory sinking fund payments or analogous payments applicable to the
Outstanding Securities on the day on which such payments are due and
payable in accordance with the terms of this Indenture and of such
Securities; provided that the Trustee shall have been irrevocably
instructed to apply such money or the proceeds of such U.S. Government
Obligations to said payments with respect to the Securities. For this
purpose, "U.S. Government Obligations" means securities that are (x) direct
obligations of the United States of America for the timely payment of which
its full faith and credit is pledged or (y) obligations of a Person
controlled or supervised by and acting as an agency or instrumentality of
the United States of America the timely payment of which is unconditionally
guaranteed as a full faith and credit obligation by the United States of
America, which, in either case, are not callable or redeemable at the
option of the issuer thereof, and shall also include a depository receipt
issued by a bank (as defined in Section 3(a)(2) of the Securities Act of
1933, as amended), as custodian with respect to any such U.S. Government
Obligation or a specific payment of principal of or interest on any such
U.S. Government Obligation held by such custodian for the account of the
holder of such depository receipt; provided that (except as required by
law) such custodian is not authorized to make any deduction from the amount
payable to the holder of such depository receipt from any amount received
by the custodian in respect of the U.S. Government Obligation or the
specific payment of principal of or interest on the U.S. Government
Obligation evidenced by such depository receipt.
(2) No Default or Event of Default with respect to the Securities shall
have occurred and be continuing on the date of such deposit or, insofar as
Subsection 501(f) or 501(g) is concerned, at any time during the period
ending on the 91st day after the date of such deposit (it being understood
that this condition shall not be deemed satisfied until the expiration of
such period).
<PAGE>
82
(3) Such defeasance or covenant defeasance shall not result in a breach
or violation of, or constitute a default under, this Indenture or any other
material agreement or instrument to which the Company is a party or by
which it is bound.
(4) In the case of an election under Section 1202, the Company shall
have delivered to the Trustee an Opinion of Counsel in the United States
stating that (x) the Company has received from, or there has been published
by, the Internal Revenue Service a ruling or (y) since August 26, 1997,
there has been a change in the applicable federal income tax law, in either
case to the effect that, and based thereon such opinion shall confirm that,
the Holders of the Outstanding Securities will not recognize income, gain
or loss for federal income tax purposes as a result of such defeasance and
will be subject to federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if such defeasance
had not occurred.
(5) In the case of an election under Section 1203, the Company shall
have delivered to the Trustee an Opinion of Counsel in the United States to
the effect that the Holders of the Outstanding Securities will not
recognize income, gain or loss for federal income tax purposes as a result
of such covenant defeasance and will be subject to federal income tax on
the same amounts, in the same manner and at the same times as would have
been the case if such covenant defeasance had not occurred.
(6) In the case of an election under either Section 1202 or 1203, the
Company shall represent to the Trustee that the deposit made by the Company
pursuant to its election under Section 1202 or 1203 was not made by the
Company with the intent of preferring the Holders over other creditors of
the Company or with the intent of defeating, hindering, delaying or
defrauding creditors of the Company or others.
(7) The Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel in the United States, each stating
that all conditions precedent provided for relating to either the
defeasance under Section 1202 or the covenant defeasance under Section 1203
(as the case may be) have been complied with.
Section 1205. Deposited Money and U.S. Government Obligations to Be Held in
Trust; Other Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section 1003, all money
and U.S. Government Obligations (including the proceeds thereof) deposited with
the Trustee (or other qualifying trustee, collectively for purposes of this
Section 1205, the "Trustee") pursuant to Section 1204 in respect of the
Outstanding Securities shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Securities and this Indenture, to the
<PAGE>
83
payment, either directly or through any Paying Agent (including the Company
acting as its own Paying Agent) as the Trustee may determine, to the Holders of
such Securities of all sums due and to become due thereon in respect of
principal and interest, but such money need not be segregated from other funds
except to the extent required by law. Money and U.S. Government Obligations so
held in trust are not subject to Article Twelve.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or U.S. Government
Obligations deposited pursuant to Section 1204 or the principal and interest
received in respect thereof other than any such tax, fee or other charge which
by law is for the account of the Holders of the Outstanding Securities.
Anything in this Article Twelve to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon Company
Request any money or U.S. Government Obligations held by it as provided in
Section 1204 which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee (which may be the opinion delivered under Section
1204(1)), are in excess of the amount thereof which would then be required to be
deposited to effect an equivalent defeasance or covenant defeasance.
SECTION 1206. REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any money in accordance
with Section 1202 or 1203, as the case may be, by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, then the Company's obligations under
this Indenture and the Securities shall be revived and reinstated as though no
deposit had occurred pursuant to Section 1202 or 1203, as the case may be, until
such time as the Trustee or Paying Agent is permitted to apply all such money in
accordance with Section 1202 or 1203, as the case may be; provided, however,
that, if the Company makes any payment of principal of or interest on any
Security following the reinstatement of its obligations, the Company shall be
subrogated to the rights of the Holders of such Securities to receive such
payment from the money held by the Trustee or Paying Agent.
* * * * *
<PAGE>
84
This Indenture may be signed in any number of counterparts with the same
effect as if the signatures to each counterpart were upon a single instrument,
and all such counterparts together shall be deemed an original of this
Indenture.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed as of the day and year first above written.
CSC HOLDINGS, INC.
By: /s/ William J. Bell
-----------------------
William J. Bell
Vice Chairman
Attest:
/s/Robert S. Lemle
Robert S. Lemle
Executive Vice President
General Counsel and Secretary
THE BANK OF NEW YORK
By: /s/ Iliana A. Arciprete
----------------------
Assistant Treasurer
<PAGE>
A-1
EXHIBIT A
RESTRICTED SUBSIDIARIES(1)
(* - material subsidiary)
3300 Lakeside Corporation
A-R Cable Investments, Inc.
A-R Cable Services - NY, Inc.
Arsenal MSub 2 Inc.
Arsenal MSub 7, Inc.
Cable Science Corporation
Cablevision Area 9 Corporation
Cablevision Fairfield Corporation
Cablevision Lightpath, Inc.
Cablevision MFR, Inc.
Cablevision of Boston, Inc.
Cablevision of Brookhaven, Inc.
Cablevision of Brookline Limited Partnership
Cablevision of Brookline, Inc.
Cablevision of Cleveland G.P., Inc.
Cablevision of Cleveland L.P., Inc.
Cablevision of Cleveland, L.P.
Cablevision of Connecticut Corporation
Cablevision of Connecticut Limited Partnership
Cablevision of Hudson County, Inc.
Cablevision of Massachusetts, Inc. (f/k/a Cablevision of Nashoba, Inc.)
Cablevision of Michigan, Inc.
Cablevision of Monmouth, Inc.
Cablevision of New Jersey, Inc.
*Cablevision of New York City - Master L.P.
Cablevision of New York City - Phase I L.P.
Cablevision of Newark
Cablevision of Oakland, Inc.
Cablevision of Paterson, Inc.
Cablevision of Rockland/Ramapo, Inc.
Cablevision of Southern Westchester, Inc.
Cablevision of the Midwest Holding, Inc.
Cablevision of the Midwest, Inc.
Cablevision of Warwick, Inc.
Cablevision Systems Brookline Corporation
Cablevision Systems Dutchess Corporation
<PAGE>
A-2
Cablevision Systems East Hampton Corporation
Cablevision Systems Great Neck Corporation
Cablevision Systems Huntington Corporation
Cablevision Systems Islip Corporation
Cablevision Systems Long Island Corporation
Cablevision Systems New York City Corporation
Cablevision Systems of Southern Connecticut Limited Partnership
Cablevision Systems Suffolk Corporation
Cablevision Systems Westchester Corporation
Communications Development Corporation
CSC Acquisition - MA, Inc.
CSC Acquisition - NY, Inc.
CSC Acquisition Corporation
CSC Gateway Corporation
CSC TKR, Inc.
CSC TKR I, Inc.
KRC/CCC Investment Partnership
NYC GP Corp.
NYC LP Corp.
Petra Cablevision Corporation
Sampson Cablevision Corp.
Suffolk Cable Corporation
Suffolk Cable of Shelter Island, Inc.
Suffolk Cable of Smithtown, Inc.
Telerama, Inc.
V Cable, Inc.
VC Holding, Inc.
<PAGE>
EXHIBIT B
Form of Registration Rights Agreement
(Exhibit 23.1)
CONSENT OF INDEPENDENT ACCOUNTANTS
----------------------------------
The Board of Directors
CSC Holdings, Inc.:
We consent to the incorporation by reference in the registration statement on
Form S-4 of CSC Holdings, Inc., that covers the exchange of 8 1/8% Series B
Senior Notes due 2009 for 8 1/8% Senior Notes due 2009 of our report dated March
12, 1999, relating to the consolidated financial statements and schedule of CSC
Holdings, Inc. and subsidiaries as of December 31, 1998 and 1997 and for each of
the years in the three-year period ended December 31, 1998 which report appears
in the December 31, 1998 combined annual report on Form 10-K of CSC Holdings,
Inc., and Cablevision Systems Corporation, and to the references to our firm
under the heading "Selected Financial Data" and "Experts" in the registration
statement.
/s/KPMG LLP
KPMG LLP
Melville, New York
August 4, 1999
LETTER OF TRANSMITTAL
for
8 1/8% Senior Notes
of
CSC Holdings, Inc.
Pursuant to the
Exchange Offer
in Respect of
All of its Outstanding
8 1/8% Senior Notes due 2009
for
8 1/8% Series B Senior Notes due 2009
---------------
Pursuant to the Prospectus Dated [Date], 1999
- --------------------------------------------------------------------------------
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON [Date],1999
UNLESS THE EXCHANGE OFFER IS EXTENDED (THE "EXPIRATION DATE"). TENDERS OF OLD
NOTES MAY BE WITHDRAWN AT ANY TIME PRIOR TO 5:00 P.M. ON THE BUSINESS DAY PRIOR
TO THE EXPIRATION DATE.
- --------------------------------------------------------------------------------
The Exchange Agent For The Exchange Offer Is:
The Bank Of New York
<TABLE>
<CAPTION>
By Hand Or Overnight Delivery: Facsimile Transmissions: By Registered Or Certified Mail:
(Eligible Institutions Only)
<S> <C> <C>
The Bank of New York The Bank of New York
101 Barclay Street (212) 571-3080 101 Barclay Street, 7E
Corporate Trust Services Window New York, New York 10286
Ground Level To Confirm by Telephone Attention: Reorganization Section,
Attention: Reorganization Section, or for Information Call: [Name]
[Name]
(212) 815-5920
</TABLE>
Delivery of this Letter of Transmittal to an address, or transmission via
telegram, telex or facsimile, other than as set forth above will not constitute
a valid delivery. The instructions contained herein should be read carefully
before this Letter of Transmittal is completed.
HOLDERS WHO WISH TO BE ELIGIBLE TO RECEIVE NEW NOTES FOR THEIR OLD
NOTES PURSUANT TO THE EXCHANGE OFFER MUST VALIDLY TENDER (AND NOT
<PAGE>
WITHDRAW) THEIR OLD NOTES TO THE EXCHANGE AGENT PRIOR TO THE EXPIRATION DATE.
By execution hereof, the undersigned acknowledges receipt of the Prospectus
(the "Prospectus"), dated [Date], 1999, of CSC Holdings, Inc., a Delaware
corporation (the "Company"), which, together with this Letter of Transmittal and
the instructions hereto (the "Letter of Transmittal"), constitute the Company's
offer (the "Exchange Offer") to exchange $1,000 principal amount of its 8 1/8%
Series B Senior Notes due 2009 (the "New Notes") that have been registered under
the Securities Act of 1933, as amended (the "Securities Act"), pursuant to a
Registration Statement of which the Prospectus constitutes a part, for each
$1,000 principal amount of its outstanding 8 1/8% Senior Notes due 2009 (the
"Old Notes"), upon the terms and subject to the conditions set forth in the
Prospectus.
This Letter of Transmittal is to be used by Holders if: (1) certificates
representing Old Notes are to be physically delivered to the Exchange Agent
herewith by Holders; (2) tender of Old Notes is to be made by book-entry
transfer to the Exchange Agent's account at The Depository Trust Company (the
"Book-Entry Transfer Facility" or "DTC") pursuant to the procedures set forth in
the Prospectus under "How to Tender Your Old Notes--Procedures for Tendering" by
any financial institution that is a participant in DTC and whose name appears on
a security position listing as the owner of Old Notes (such participants, acting
on behalf of Holders, are referred to herein, together with such Holders, as
"Acting Holders"); or (3) tender of Old Notes is to be made according to the
guaranteed delivery procedures set forth in the Prospectus under "How to Tender
Your Old Notes--Procedures for Tendering." Delivery of documents to the
Book-Entry Transfer Facility does not constitute delivery to the Exchange Agent.
The term "Holder" with respect to the Exchange Offer means any
person: (1) in whose name Old Notes are registered on the books of the Company
or any other person who has obtained a properly completed bond power from the
registered Holder; or (2) whose Old Notes are held of record by DTC who desires
to deliver such Old Notes by book-entry transfer at DTC.
NOTE: SIGNATURES MUST BE PROVIDED BELOW
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
The undersigned has completed, executed and delivered this Letter of
Transmittal to indicate the action the undersigned desires to take with respect
to the Exchange Offer. Holders who wish to tender their Old Notes must complete
this letter in its entirety.
All capitalized terms used herein and not defined herein shall have
the meaning ascribed to them in the Prospectus.
The instructions included with this Letter of Transmittal must be followed.
Questions and requests for assistance or for additional copies of the
Prospectus, this Letter of Transmittal and the Notice of Guaranteed Delivery may
be directed to the Exchange Agent. See Instruction 6 herein.
HOLDERS WHO WISH TO ACCEPT THE EXCHANGE OFFER AND TENDER THEIR OLD NOTES
MUST COMPLETE THIS LETTER OF TRANSMITTAL IN ITS ENTIRETY.
-2-
<PAGE>
List below the Old Notes to which this Letter of Transmittal relates. If
the space provided below is inadequate, list the certificate numbers and
principal amounts on a separately executed schedule and affix the schedule to
this Letter of Transmittal. Tenders of Old Notes will be accepted only in
principal amounts equal to $1,000 or integral multiples thereof.
<TABLE>
<CAPTION>
- --------------------------------------------- --------------------------------------------
DESCRIPTION OF OLD NOTES
- --------------------------------------------------------------------------------------------
Certificate Aggregate
Number(s)* Principal
(Attach signed Amount
Names and Address(es) of Holder(s) list if necessary) Tendered (if less than
Please fill in, if blank) all) **
- -------------------------------------------------------------------------------------------
<S> <C>
-------------------------------------------
-------------------------------------------
-------------------------------------------
-------------------------------------------
-------------------------------------------
-------------------------------------------
-------------------------------------------
-------------------------------------------
-------------------------------------------
-------------------------------------------
-------------------------------------------
-------------------------------------------
- ----------------------------------------------------------------------------------------
TOTAL PRINCIPAL AMOUNT OF OLD NOTES TENDERED
========================================================================================
- ----------------------------------------------------------------------------------------
<FN>
* Need not be completed by Holders tendering by book-entry transfer.
** Need not be completed by Holders who wish to tender with respect to all Old Notes listed. See Instruction 2.
</FN>
- ----------------------------------------------------------------------------------------
</TABLE>
-3-
<PAGE>
|_| CHECK HERE IF TENDERED OLD NOTES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
MADE TO THE ACCOUNT MAINTAINED BY THE EXCHANGE AGENT WITH THE BOOK-ENTRY
TRANSFER FACILITY AND COMPLETE THE FOLLOWING:
Name of Tendering Institution:
DTC Book-Entry Account No.:
Transaction Code No.:
If Holders desire to tender Old Notes pursuant to the Exchange Offer and (1)
certificates representing such Old Notes are not lost but are not immediately
available, (2) time will not permit this Letter of Transmittal, certificates
representing such Old Notes or other required documents to reach the Exchange
Agent prior to the Expiration Date or (3) the procedures for book-entry transfer
cannot be completed prior to the Expiration Date, such Holders may effect a
tender of such Old Notes in accordance with the guaranteed delivery procedures
set forth in the Prospectus under "How to Tender Your Old Notes--Guaranteed
Delivery Procedures."
|_| CHECK HERE AND ENCLOSE A PHOTOCOPY OF THE NOTICE OF GUARANTEED DELIVERY IF
TENDERED OLD NOTES ARE BEING DELIVERED PURSUANT TO A NOTICE OF GUARANTEED
DELIVERY PREVIOUSLY DELIVERED TO THE EXCHANGE AGENT AND COMPLETE THE
FOLLOWING:
Name(s) of Holder(s) of Old Notes:
Window Ticket No. (if any):
Date of Execution of Notice of Guaranteed Delivery:
Name of Eligible Institution that Guaranteed Delivery:
If Delivered by Book-Entry Transfer:
Name of Tendering Institution:
DTC Book-Entry Account No.:
Transaction Code No.:
|_| CHECK HERE IF TENDERED BY BOOK-ENTRY TRANSFER AND NON-EXCHANGED OLD NOTES
ARE TO BE RETURNED BY CREDITING THE BOOK-ENTRY TRANSFER FACILITY ACCOUNT
NUMBER SET FORTH ABOVE.
-4-
<PAGE>
|_| CHECK HERE IF YOU ARE A BROKER-DEALER WHO ACQUIRED THE OLD NOTES FOR ITS
OWN ACCOUNT AS A RESULT OF MARKET MAKING OR OTHER TRADING ACTIVITIES (A
"PARTICIPATING BROKER-DEALER") AND WISH TO RECEIVE 10 ADDITIONAL COPIES OF
THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS THERETO.
Name:
Address:
-5-
<PAGE>
Ladies and Gentlemen:
Upon the terms and subject to the conditions of the Exchange Offer, the
undersigned hereby tenders to the Company, the above described aggregate
principal amount of the Company's 8 1/8% Senior Notes due 2009 (the "Old Notes")
in exchange for a like aggregate principal amount of the Company's 8 1/8% Series
B Senior Notes due 2009 (the "New Notes") which have been registered under the
Securities Act upon the terms and subject to the conditions set forth in the
Prospectus dated [Date], 1999 (as the same may be amended or supplemented from
time to time, the "Prospectus"), receipt of which is acknowledged, and in this
Letter of Transmittal (which, together with the Prospectus, constitute the
"Exchange Offer").
Subject to and effective upon the acceptance for exchange of the
principal amount of Old Notes tendered in accordance with this Letter of
Transmittal, the undersigned sells, assigns and transfers to, or upon the order
of, the Company all right, title and interest in and to the Old Notes tendered
hereby. The undersigned hereby irrevocably constitutes and appoints the Exchange
Agent its agent and attorney-in-fact (with full knowledge that the Exchange
Agent also acts as the agent of the Company and as Trustee under the Indenture
for the Old Notes and the New Notes) with respect to the tendered Old Notes with
full power of substitution to (1) deliver certificates for such Old Notes to the
Company, or transfer ownership of such Old Notes on the account books maintained
by DTC, together in either such case, with all accompanying evidences of
transfer and authenticity to, or upon the order of, the Company and (2) present
such Old Notes for transfer on the books of the Company and receive all benefits
and otherwise exercise all rights of beneficial ownership of such Old Notes, all
in accordance with the terms of the Exchange Offer. The power of attorney
granted in this paragraph shall be deemed irrevocable and coupled with an
interest.
The undersigned hereby represents and warrants that he or she has full
power and authority to tender, sell, assign and transfer the Old Notes tendered
hereby and that the Company will acquire good and unencumbered title thereto,
free and clear of all liens, restrictions, charges and encumbrances and not
subject to any adverse claim, when the same are acquired by the Company. The
undersigned also acknowledges that this Exchange Offer is being made in reliance
upon an interpretation by the staff of the Securities and Exchange Commission
that the New Notes issued in exchange for the Old Notes pursuant to the Exchange
Offer may be offered for sale, resold and otherwise transferred by holders
thereof (other than any such holder that is an "affiliate" of the Company within
the meaning of Rule 405 under the Securities Act) without compliance with the
registration and prospectus delivery provisions of the Securities Act provided
that such New Notes are acquired in the ordinary course of such holder's
business and such holders have no arrangement with any person to participate in
the distribution of such New Notes. If the undersigned is not a broker-dealer,
the undersigned represents that it is not engaged in, and does not intend to
engage in, a distribution of the New Notes.
The undersigned will upon request, execute and deliver any additional
documents deemed by the Exchange Agent or the Company to be necessary or
desirable to complete the assignment and transfer of the Old Notes tendered
hereby.
For purposes of the Exchange Offer, the Company shall be deemed to have
accepted validly tendered Old Notes when, and as if the Company has given oral
or written notice thereof to the Exchange Agent. If any tendered Old Notes are
not accepted for exchange pursuant to the Exchange Offer for any reason,
certificates for any such unaccepted Old Notes will be returned (except as noted
below with respect to tenders through DTC), without expense, to the undersigned
at the address shown below or at a different address shown below or at a
different address as may be indicated under "Special Issuance Instructions" as
promptly as practicable after the Expiration Date.
-6-
<PAGE>
All authority conferred or agreed to be conferred by this Letter of
Transmittal shall survive the death, incapacity or dissolution of the
undersigned and every obligation under this Letter of Transmittal shall be
binding upon the undersigned's heirs, personal representatives, successors and
assigns.
The undersigned understands that tenders of Old Notes pursuant to the
procedures described under the caption "How to Tender Your Old Notes--Procedures
for Tendering" in the Prospectus and in the instructions hereto will constitute
a binding agreement between the undersigned and the Company upon the terms and
subject to the conditions of the Exchange Offer.
Unless otherwise indicated under "Special Issuance Instructions,"
please issue the certificates representing the New Notes issued in exchange for
the Old Notes accepted for exchange and return any Old Notes not tendered or not
exchanged, in the name(s) of the undersigned (or in either such event in the
case of Old Notes tendered by DTC, by credit to the account at DTC). Similarly,
unless otherwise indicated under "Special Delivery Instructions," please send
the certificates representing the New Notes issued in exchange for the Old Notes
accepted for exchange and any certificates for Old Notes not tendered or not
exchanged (and accompanying documents, as appropriate) to the undersigned at the
address shown below the undersigned's signatures, unless, in either event,
tender is being made through DTC. In the event that both "Special Issuance
Instructions" and "Special Delivery Instructions" are completed, please issue
the certificates representing the New Notes issued in exchange for the Old Notes
accepted for exchange and return any Old Notes not tendered or not exchanged in
the name(s) of, and send said certificates to, the person(s) so indicated. The
undersigned recognizes that the Company has no obligation pursuant to the
"Special Issuance Instructions" and "Special Delivery Instructions" to transfer
any Old Notes from the name of the registered holder(s) thereof if the Company
does not accept for exchange any of the Old Notes so tendered.
By tendering Old Notes and executing this letter of transmittal, the
undersigned hereby represents and agrees that (1) the undersigned is not an
"affiliate" of CSC Holdings, Inc., (2) any New Notes to be received by the
undersigned are being acquired in the ordinary course of its business, (3) the
undersigned has no arrangement or understanding with any person to participate
in a distribution (within the meaning of the securities act) of New Notes to be
received in the exchange offer, and (4) if the undersigned is not a
broker-dealer, the undersigned is not engaged in, and does not intend to engage
in, a distribution (within the meaning of the securities act) of such New Notes.
By tendering Old Notes pursuant to the exchange offer and executing this letter
of transmittal, a holder of Old Notes which a broker-dealer represents and
agrees, consistent with certain interpretive letters issued by the staff of the
division of corporation finance of the securities and exchange commission to
third parties, that (a) such Old Notes held by the broker-dealer are held only
as a nominee, or (b) such Old Notes were acquired by such broker-dealer for its
own account as a result of market-making activities or other trading activities
and it will deliver the prospectus (as amended or supplemented from time to
time) meeting the requirements of the securities act in connection with any
resale of such New Notes (provided that, by so acknowledging and by delivering a
prospectus, such broker-dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the securities act).
The company has agreed that, subject to the provisions of the
registration rights agreement, the prospectus, as it may be amended or
supplemented from time to time, may be used by a participating broker-dealer (as
defined below) in connection with resales of New Notes received in exchange for
Old Notes, where such Old Notes were acquired by such participating
broker-dealer for its own account as a result of market-making activities or
other trading activities, for a period ending 90 days after the expiration date
(subject to extension under certain limited circumstances described in the
prospectus) or, if earlier, when all such New Notes have been disposed of by
such participating broker-dealer. In that regard, each broker-dealer who
acquired
-7-
<PAGE>
Old Notes for its own account as a result of market-making or other trading
activities (a "participating broker-dealer"), by tendering such Old Notes and
executing this letter of transmittal, agrees that, upon receipt of notice from
the company of the occurrence of any event or the discovery of any fact which
makes any statement contained or incorporated by reference in the prospectus
untrue in any material respect or which causes the prospectus to omit to state a
material fact necessary in order to make the statements contained or
incorporated by reference therein, in light of the circumstances under which
they were made, not misleading or of the occurrence of certain other events
specified in the registration rights agreement, such participating broker-dealer
will suspend the sale of New Notes pursuant to the prospectus until the company
has amended or supplemented the prospectus to correct such misstatement or
omission and has furnished copies of the amended or supplemented prospectus to
the participating broker-dealer or the company has given notice that the sale of
the New Notes may be resumed, as the case may be. If the company gives such
notice to suspend the sale of the New Notes, it shall extend the 90-day period
referred to above during which participating broker-dealers are entitled to use
the prospectus in connection with the resale of New Notes by the number of days
during the period from and including the date of the giving of such notice to
and including the date when participating broker-dealers shall have received
copies of the supplemented or amended prospectus necessary to permit resales of
the New Notes or to and including the date on which the company has given notice
that the sale of New Notes may be resumed, as the case may be.
The undersigned, by completing the box entitled "description of Old
Notes" above and signing this letter, will be deemed to have tendered the Old
Notes as set forth in such box.
-8-
<PAGE>
- --------------------------------------------------------------------------------
PLEASE SIGN HERE
(To Be Completed by All Tendering Holders of
Old Notes Regardless of Whether Old Notes Are Being Physically
Delivered Herewith)
This Letter of Transmittal must be signed by the Holder(s) of Old Notes
exactly as their name(s) appear(s) on certificate(s) for Old Notes or, if
tendered by a participant in DTC, exactly as such participant's name appears on
a security position listing as the owner of Old Notes, or by person(s)
authorized to become registered Holder(s) by endorsements and documents
transmitted with this Letter of Transmittal. If signature is by a trustee,
executor, administrator, guardian, attorney-in-fact, officer or other person
acting in a fiduciary or representative capacity, such person must set forth his
or her full title below under "Capacity" and submit evidence satisfactory to the
Company of such person's authority to so act. See Instruction 3 herein.
If the signature appearing below is not of the registered Holder(s) of
the Old Notes, then the registered Holder(s) must sign a valid proxy.
X . . . . . . . . . . . . . . . . . Date: . . . . . . . . . . . . . . . . . .
X . . . . . . . . . . . . . . . . . Date: . . . . . . . . . . . . . . . . . .
Signature(s) of Holder(s) or Authorized Signatory
Name(s): . . . . . . . . . . . . . Address: . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . .
(Please Print) (Including Zip Code)
Capacity: . . . . . . . . . . . . . Area Code and Telephone No.: . . . . . .
Social Security No.: . . . . . . .
SIGNATURE GUARANTEE (See Instruction 3 herein)
Certain Signatures Must Be Guaranteed by an Eligible Institution
................................................................................
(Name of Eligible Institution Guaranteeing Signatures)
................................................................................
(Address (including zip code) and Telephone Number
(including area code) of Firm)
................................................................................
(Authorized Signature)
................................................................................
(Printed Name)
................................................................................
(Title)
Date: . . . . . . . . . . . . .
- --------------------------------------------------------------------------------
-9-
<PAGE>
<TABLE>
<CAPTION>
- --------------------------------------------------- ---------------------------------------------------------
SPECIAL ISSUANCE INSTRUCTIONS SPECIAL DELIVERY INSTRUCTIONS
(See Instruction 4 herein) (See Instruction 4 herein)
<S> <C>
To be completed ONLY if certificates for To be completed ONLY if certificates for
Old Notes in a principal amount not Old Notes in a principal amount not
tendered are to be issued in the name tendered or not accepted for purchase or
of, or the New Notes issued pursuant to the New Notes issued pursuant to the
the Exchange Offer are to be issued to Exchange Offer are to be sent to someone
the order of, someone other than the other than the person or persons whose
person or persons whose signature(s) signature(s) appear(s) within this
appear(s) within this Letter of Letter of Transmittal or to an address
Transmittal or issued to an address different from that shown in the box
different from that shown in the box entitled "Description of Old Notes"
entitled "Description of Old Notes" within this Letter of Transmittal.
within this Letter of Transmittal, or if
Old Notes tendered by book-entry
transfer that are not accepted for
purchase are to be credited to an
account maintained at DTC.
Name: ........................................... Name: ..............................................
(Please Print) (Please Print)
Address: ........................................... Address: ...........................................
(Please Print) (Please Print)
.................................................... ....................................................
Zip Code Zip Code
.................................................... ....................................................
Taxpayer Identification or Social Security Number Taxpayer Identification or Social Security Number
- ---------------------------------------------------- ----------------------------------------------------
</TABLE>
-10-
<PAGE>
INSTRUCTIONS
Forming Part of the Terms and Conditions
of the Exchange Offer and the Solicitation
1. Delivery of this Letter of Transmittal and Old Notes. The certificates
for the tendered Old Notes (or a confirmation of a book-entry transfer into the
Exchange Agent's account at DTC of all Old Notes delivered electronically), as
well as a properly completed and duly executed copy of this Letter of
Transmittal or facsimile hereof and any other documents required by this Letter
of Transmittal must be received by the Exchange Agent at its address set forth
herein prior to 5:00 P.M., New York City time, on the Expiration Date. The
method of delivery of the tendered Old Notes, this Letter of Transmittal and all
other required documents to the Exchange Agent is at the election and risk of
the Holder and, except as otherwise provided below, the delivery will be deemed
made only when actually received by the Exchange Agent. Instead of delivery by
mail, it is recommended that the Holder use an overnight or hand delivery
service. In all cases, sufficient time should be allowed to assure timely
delivery. No Letter of Transmittal or Old Notes should be sent to the Company.
Holders who wish to tender their Old Notes and (1) whose Old Notes are
not immediately available or (2) who cannot deliver their Old Notes, this Letter
of Transmittal or any other documents required hereby to the Exchange Agent
prior to the Expiration Date must tender their Old Notes and follow the
guaranteed delivery procedures set forth in the Prospectus. Pursuant to such
procedures: (1) such tender must be made by or through an Eligible Institution;
(2) prior to the Expiration Date, the Exchange Agent must have received from the
Eligible Institution a properly completed and duly executed Notice of Guaranteed
Delivery (by facsimile transmission, mail or hand delivery) setting forth the
name and address of the Holder of the Old Notes, the certificate number or
numbers of such Old Notes and the principal amount of Old Notes tendered,
stating that the tender is being made thereby and guaranteeing that, within five
business days after the Expiration Date, this Letter of Transmittal (or
facsimile thereof) together with the certificate(s) representing the Old Notes
(or a confirmation of electronic delivery of book-entry delivery into the
Exchange Agent's account at DTC) and any of the required documents will be
deposited by the Eligible Institution with the Exchange Agent; and (3) such
properly completed and executed Letter of Transmittal (or facsimile hereof), as
well as all other documents required by this Letter of Transmittal and the
certificate(s) representing all tendered Old Notes in proper form for transfer
(or a confirmation of electronic mail delivery of book-entry delivery into the
Exchange Agent's account at DTC), must be received by the Exchange Agent within
five business days after the Expiration Date, all as provided in the Prospectus
under the caption "How to Tender Your Old Notes--Guaranteed Delivery
Procedures." Any Holder of Old Notes who wishes to tender his Old Notes pursuant
to the guaranteed delivery procedures described above must ensure that the
Exchange Agent receives the Notice of Guaranteed Delivery prior to 5:00 P.M.,
New York City time, on the Expiration Date.
The Notice of Guaranteed Delivery may be delivered by hand or
transmitted by facsimile or mail to the Exchange Agent, and must include a
guarantee by an Eligible Institution in the form set forth in such Notice. For
Old Notes to be properly tendered pursuant to the guaranteed delivery procedure,
the Exchange Agent must receive a Notice of Guaranteed Delivery on or prior to
the Expiration Date. As used herein and in the Prospectus, "Eligible
Institution" means a firm or other entity identified in Rule 17Ad-15 under the
Exchange Act as "an eligible guarantor institution," including (as such terms
are defined therein) (1) a bank; (2) a broker, dealer, municipal securities
broker or dealer or government securities broker or dealer; (3) a credit union;
(4) a national securities exchange, registered securities association or
clearing agency; or (5) a savings association that is a participant in a
Securities Transfer Association.
-11-
<PAGE>
THE METHOD OF DELIVERY OF CERTIFICATES, THIS LETTER OF TRANSMITTAL AND
ALL OTHER REQUIRED DOCUMENTS ARE AT THE OPTION AND SOLE RISK OF THE TENDERING
HOLDER AND THE DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE
EXCHANGE AGENT. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT
REQUESTED, PROPERLY INSURED, OR OVERNIGHT DELIVERY SERVICE IS RECOMMENDED. IN
ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.
All questions as to the validity, form, eligibility (including time of
receipt), acceptance and withdrawal of tendered Old Notes will be determined by
the Company in its sole discretion, which determination will be final and
binding. The Company reserves the absolute right to reject any and all Old Notes
not properly tendered or any Old Notes the Company's acceptance of which would,
in the opinion of counsel for the Company, be unlawful. The Company also
reserves the right to waive any irregularities or conditions of tender as to
particular Old Notes. The Company's interpretation of the terms and conditions
of the Exchange Offer (including the instructions in this Letter of Transmittal)
will be final and binding on all parties. Unless waived, any defects or
irregularities in connection with tenders of Old Notes must be cured within such
time as the Company shall determine. Neither the Company, the Exchange Agent nor
any other person shall be under any duty to give notification of defects or
irregularities with respect to tenders of Old Notes, nor shall any of them incur
any liability for failure to give such notification. Tenders of Old Notes will
not be deemed to have been made until such defects or irregularities have been
cured or waived. Any Old Notes received by the Exchange Agent that are not
properly tendered and as to which the defects or irregularities have not been
cured or waived will be returned without cost by the Exchange Agent to the
tendering Holders of Old Notes, unless otherwise provided in this Letter of
Transmittal, as soon as practicable following the Expiration Date.
2. Partial Tenders; Withdrawal Rights. Tenders of Old Notes will be
accepted in all denominations of $1,000 and integral multiples in excess
thereof. If less than the entire principal amount of any Old Notes is tendered,
the tendering Holder should fill in the principal amount tendered in the third
column of the chart entitled "Description of Old Notes." The entire principal
amount of Old Notes delivered to the Exchange Agent will be deemed to have been
tendered unless otherwise indicated. If the entire principal amount of all Old
Notes is not tendered, Old Notes for the principal amount of Old Notes delivered
to the Exchange Agent will be deemed to have been tendered unless otherwise
indicated. If the entire principal amount of all Old Notes is not tendered, Old
Notes for the principal amount of Old Notes not tendered and a certificate or
certificates representing New Notes issued in exchange of any Old Notes accepted
will be sent to the Holder at his or her registered address, unless a different
address is provided in the appropriate box on this Letter of Transmittal or
unless tender is made through DTC, promptly after the Old Notes are accepted for
exchange.
Except as otherwise provided herein, tenders of Old Notes may be
withdrawn at any time on or prior to the Expiration Date. In order for a
withdrawal to be effective on or prior to that time, a written, telegraphic,
telex or facsimile transmission of such notice of withdrawal must be timely
received by the Exchange Agent at one of its addresses set forth above or in the
Prospectus on or prior to the Expiration Date. Any such notice of withdrawal
must specify the name of the person who tendered the Old Notes to be withdrawn,
the aggregate principal amount of Old Notes to be withdrawn, and (if
Certificates for Old Notes have been tendered) the name of the registered holder
of the Old Notes as set forth on the certificate for the Old Notes, if different
from that of the person who tendered such Old Notes. If certificates for the Old
Notes have been delivered or otherwise identified to the Exchange Agent, then
prior to the physical release of such certificates for the Old Notes, the
tendering holder must submit the serial numbers shown on the particular
certificates for the Old Notes to be withdrawn and the signature on the notice
of withdrawal must be guaranteed by an Eligible Institution, except in the case
of Old Notes tendered for the
-12-
<PAGE>
account of an Eligible Institution. If Old Notes have been tendered pursuant to
the procedures for book-entry transfer set forth in the Prospectus under "How to
Tender Your Old Notes--Procedures for Tendering," the notice of withdrawal must
specify the name and number of the account at DTC to be credited with the
withdrawal of Old Notes, in which case a notice of withdrawal will be effective
if delivered to the Exchange Agent by written, telegraphic, telex or facsimile
transmission. Withdrawals of tenders of Old Notes may not be rescinded. Old
Notes properly withdrawn will not be deemed validly tendered for purposes of the
Exchange Offer, but may be retendered at any subsequent time on or prior to the
Expiration Date by following any of the procedures described in the Prospectus
under "How to Tender Your Old Notes--Procedures for Tendering."
Signatures on the Letter of Transmittal; Bond Powers and Endorsements;
Guarantee of Signatures. If this Letter of Transmittal (or facsimile hereof) is
signed by the registered Holder(s) of the Old Notes tendered hereby, the
signature must correspond with the name(s) as written on the face of the Old
Notes without alternation, enlargement or any change whatsoever.
If this Letter of Transmittal (or facsimile hereof) is signed by the
registered Holder(s) of Old Notes tendered and the certificate(s) for New Notes
issued in exchange therefor is to be issued (or any untendered principal amount
of Old Notes is to be reissued) to the registered Holder, such Holder need not
and should not endorse any tendered Old Debenture, nor provide a separate bond
power. In any other case, such holder must either properly endorse the Old Notes
tendered or transmit a properly completed separate bond power with this Letter
of Transmittal, with the signatures on the endorsement or bond power guaranteed
by an Eligible Institution.
If this Letter of Transmittal (or facsimile hereof) is signed by a
person other than the registered Holder(s) of any Old Notes listed, such Old
Notes must be endorsed or accompanied by appropriate bond powers signed as the
name of the registered Holder(s) appears on the Old Notes.
If this Letter of Transmittal (or facsimile hereof) or any Old Notes
or bond powers are signed by trustees, executors, administrators, guardians,
attorneys-in-fact, or officers of corporations or others acting in a fiduciary
or representative capacity, such persons should so indicate when signing, and
unless waived by the Company, evidence satisfactory to the Company of their
authority so to act must be submitted with this Letter of Transmittal.
Endorsements on Old Notes or signatures on bond powers required by
this Instruction 3 must be guaranteed by an Eligible Institution.
Signatures on this Letter of Transmittal (or facsimile hereof) must be
guaranteed by an Eligible Institution unless the Old Notes tendered pursuant
thereto are tendered (1) by a registered Holder (including any participant in
DTC whose name appears on a security position listing as the owner of Old Notes)
who has not completed the box set forth herein entitled "Special Issuance
Instructions" or the box entitled "Special Delivery Instructions" or (2) for the
account of an Eligible Institution.
4. Special Issuance and Delivery Instructions. Tendering Holders should
indicate, in the applicable spaces, the name and address to which New Notes or
substitute Old Notes for principal amounts not tendered or not accepted for
exchange are to be issued or sent, if different from the name and address of the
person signing this Letter of Transmittal (or in the case of tender of the Old
Notes through DTC, if different from DTC). In the case of issuance in a
different name, the taxpayer identification or social security number of the
person named must also be indicated.
-13-
<PAGE>
5. Irregularities. The Company will determine, in its sole discretion,
all questions as to the form of documents, validity, eligibility (including time
of receipt) and acceptance for exchange of any tender of Old Notes, which
determination shall be final and binding on all parties. The Company reserves
the absolute right to reject any and all tenders determined by it not to be in
proper form or the acceptance of which, or exchange for which, may, in the view
of counsel to the Company, be unlawful. The Company also reserves the absolute
right, subject to applicable law, to waive any of the conditions of the Exchange
Offer set forth in the Prospectus under "The Exchange Offer--Terms of the
Exchange Offer" or any conditions or irregularity in any tender of Old Notes of
any particular holder whether or not similar conditions or irregularities are
waived in the case of other holders. The Company's interpretation of the terms
and conditions of the Exchange Offer (including this Letter of Transmittal and
the instructions hereto) will be final and binding. No tender of Old Notes will
be deemed to have been validly made until all irregularities with respect to
such tender have been cured or waived. The Company, any affiliates or assigns of
the Company, the Exchange Agent, or any other person shall not be under any duty
to give notification of any irregularities in tenders or incur any liability for
failure to give such notification.
6. Questions, Requests for Assistance and Additional Copies. Questions
and requests for assistance may be directed to the Exchange Agent at its address
and telephone number set forth on the front of this Letter of Transmittal.
Additional copies of the Prospectus, the Notice of Guaranteed Delivery and the
Letter of Transmittal may be obtained from the Exchange Agent or from your
broker, dealer, commercial bank, trust company or other nominee.
7. Waiver of Conditions. The Company reserves the absolute right to
amend, waive or modify specified conditions in the Exchange Offer in the case of
any Old Notes tendered.
8. Mutilated, Lost, Stolen or Destroyed Old Notes. Any tendering Holder
whose Old Notes have been mutilated, lost, stolen or destroyed should contact
the Exchange Agent at the address indicated herein for further instruction.
9. Security Transfer Taxes. Holders who tender their Old Notes for
exchange will not be obligated to pay any transfer taxes in connection
therewith. If, however, New Notes are to be delivered to, or are to be issued in
the name of, any person other than the registered holder of the Old Notes
tendered, or if a transfer tax is imposed for any reason other than the exchange
of Old Notes in connection with the Exchange Offer, then the amount of any such
transfer tax (whether imposed on the registered holder or any other persons)
will be payable by the tendering holder. If satisfactory evidence of payment of
such taxes or exemption therefrom is not submitted with the Letter of
Transmittal, the amount of such transfer taxes will be billed directly to such
tendering holder.
(DO NOT WRITE IN SPACE BELOW)
==============================================================================
Certificate Surrendered Old Notes Tendered Old Notes Accepted
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
Delivery Prepared by _______ Checked by ________ Date ___________
==============================================================================
-15-
<PAGE>
The Exchange Agent for the Exchange Offer is:
The Bank of New York
<TABLE>
<CAPTION>
By Hand Or Overnight Delivery: Facsimile Transmissions: By Registered Or Certified Mail:
(Eligible Institutions Only)
<S> <C> <C>
The Bank of New York The Bank of New York
101 Barclay Street (212) 571-3080 101 Barclay Street, 7E
Corporate Trust Services Window New York, New York 10286
Ground Level To Confirm by Telephone Attention: Reorganization Section,
Attention: Reorganization Section, or for Information Call: [Name]
[Name]
(212) 815-5920
</TABLE>
-15-
(EXHIBIT 99.2)
NOTICE OF GUARANTEED DELIVERY
FOR TENDER OF ANY AND ALL OUTSTANDING
8 1/8% SENIOR NOTES DUE 2009
OF
CSC HOLDINGS, INC.
As set forth in the Prospectus, dated [DATE], 1999 (the "Prospectus"), of
CSC Holdings, Inc. (the "Company"), in the accompanying Letter of Transmittal
and instructions thereto (the "Letter of Transmittal"), this form or one
substantially equivalent hereto must be used to accept the Company's exchange
offer (the "Exchange Offer") to purchase all of its outstanding 8 1/8% Senior
Notes due 2009 (the "Old Notes") if (1) certificates representing the Old Notes
to be tendered for purchase and payment are not lost but are not immediately
available, (2) time will not permit the Letter of Transmittal, certificates
representing such Old Notes or other required documents to reach the Exchange
Agent prior to the Expiration Date or (3) the procedures for book-entry transfer
cannot be completed prior to the Expiration Date. This form may be delivered by
an Eligible Institution by mail or hand delivery or transmitted, via telegram,
telex or facsimile, to the Exchange Agent as set forth below. This Notice of
Guaranteed Delivery may be delivered by hand, overnight courier or mail, or
transmitted by facsimile transmission, to the Exchange Agent. See "How to Tender
Your Old Notes--Guaranteed Delivery Procedures" in the Prospectus. In addition,
in order to utilize the guaranteed delivery procedure to tender Old Notes
pursuant to the Exchange Offer, a completed, signed and dated Letter of
Transmittal relating to the Old Notes (or facsimile thereof) must also be
received by the Exchange Agent prior to 5:00 P.M., New York City time, on the
Expiration Date. All capitalized terms used herein but not defined herein shall
have the meanings ascribed to them in the Prospectus.
- --------------------------------------------------------------------------------
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON [DATE],
1999 UNLESS THE OFFER IS EXTENDED (THE "EXPIRATION DATE"). TENDERS OF OLD NOTES
MAY BE WITHDRAWN AT ANY TIME PRIOR TO 5:00 P.M. ON THE BUSINESS DAY PRIOR TO THE
EXPIRATION DATE.
- --------------------------------------------------------------------------------
The Exchange Agent:
THE BANK OF NEW YORK
<TABLE>
<S> <C> <C>
By Registered or Certified Mail: Facsimile Transmissions: By Hand or Overnight Delivery:
(Eligible Institutions Only)
The Bank of New York (212) 571-3080 The Bank of New York
101 Barclay Street, 7E 101 Barclay Street
New York, New York 10286 Confirm by Telephone Corporate Trust Services Window
Attn: Reorganization Section, or for Information Call: Ground Level
[NAME] (212) 815-5920 New York, New York 10286
Attention: Reorganization Section,
[NAME]
</TABLE>
DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS OTHER THAN AS
SET FORTH ABOVE OR TRANSMISSIONS OF THIS NOTICE OF GUARANTEED DELIVERY VIA
FACSIMILE TO A NUMBER OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID
DELIVERY.
THIS NOTICE OF GUARANTEED DELIVERY IS NOT TO BE USED TO GUARANTEE
SIGNATURES. IF A SIGNATURE ON A LETTER OF TRANSMITTAL IS REQUIRED TO BE
GUARANTEED BY AN "ELIGIBLE INSTITUTION" UNDER THE INSTRUCTIONS THERETO, SUCH
SIGNATURE GUARANTEE MUST APPEAR IN THE APPLICABLE SPACE PROVIDED IN THE
SIGNATURE BOX ON THE LETTER OF TRANSMITTAL.
<PAGE>
Ladies and Gentlemen:
The undersigned hereby tender(s) to the Company, upon the terms and subject
to the conditions set forth in the Exchange Offer and the Letter of Transmittal,
receipt of which is hereby acknowledged, the aggregate principal amount of Old
Notes set forth below pursuant to the guaranteed delivery procedures set forth
in the Prospectus.
The undersigned understands that tenders of Old Notes will be accepted only
in principal amounts equal to $1,000 or integral multiples thereof. The
undersigned understands that tenders of Old Notes pursuant to the Exchange Offer
may not be withdrawn after 5:00 P.M., New York City time on the Business Day
prior to the Expiration Date. Tenders of Old Notes may also be withdrawn if the
Exchange Offer is terminated without any such Old Notes being purchased
thereunder or as otherwise provided in the Prospectus.
All authority herein conferred or agreed to be conferred by this Notice of
Guaranteed Delivery shall survive the death or incapacity of the undersigned and
every obligation of the undersigned under this Notice of Guaranteed Delivery
shall be binding upon the heirs, personal representatives, executors,
administrators, successors, assigns, trustees in bankruptcy and other legal
representatives of the undersigned.
PLEASE SIGN AND COMPLETE
<TABLE>
<S> <C>
Signature(s) of Registered Owner(s) or Authorized Signatory: Name(s) of Registered Holder(s):
-------
- ------------------------------------------------------------------- --------------------------------------------------------------
- ------------------------------------------------------------------- --------------------------------------------------------------
--------------------------------------------------------------
Principal Amount of Old Notes Tendered: Address:
----------------------------
- ------------------------------------------------------------------- --------------------------------------------------------------
Certificate No(s). of Old Notes (if available): Area Code and Telephone No.:
-------------------- ----------------------------------
- ------------------------------------------------------------------- If Old Notes will be delivered by book-entry transfer at The
Depository Trust Company, insert, Depository Account No.:
- ------------------------------------------------------------------- --------------------------------------------------------------
Date:
--------------------------------------------------------------
</TABLE>
- --------------------------------------------------------------------------------
This Notice of Guaranteed Delivery must be signed by the registered holder(s) of
Old Notes exactly as its (their) name(s) appear on certificates for Old Notes or
on a security position listing as the owner of Old Notes, or by person(s)
authorized to become registered Holder(s) by endorsements and documents
transmitted with this Notice of Guaranteed Delivery. If signature is by a
trustee, executor, administrator, guardian, attorney-in-fact, officer or other
person acting in a fiduciary or representative capacity, such person must
provide the following information.
Please print name(s) and address(es)
Name(s):
----------------------------------------------------------------------
------------------------------------------------------------------
Capacity:
----------------------------------------------------------------------
Address(es):
------------------------------------------------------------------
------------------------------------------------------------------
------------------------------------------------------------------
DO NOT SEND OLD NOTES WITH THIS FORM. NOTES SHOULD BE SENT TO THE EXCHANGE AGENT
TOGETHER WITH A PROPERLY COMPLETED AND DULY EXECUTED LETTER OF TRANSMITTAL.
- --------------------------------------------------------------------------------
-2-
<PAGE>
- --------------------------------------------------------------------------------
GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a firm or other entity identified in Rule 17Ad-15 under
the Securities Exchange Act of 1934, as amended, as an "eligible guarantor
institution," including (as such terms are defined therein): (1) a bank; (2) a
broker, dealer, municipal securities broker, municipal securities dealer,
government securities broker, government securities dealer; (3) a credit union;
(4) a national securities exchange, registered securities association or
learning agency; or (5) a savings association that is a participant in a
Securities Transfer Association recognized program (each of the foregoing being
referred to as an "Eligible Institution"), hereby guarantees to deliver to the
Exchange Agent, at one of its addresses set forth above, either the Old Notes
tendered hereby in proper form for transfer, or confirmation of the book-entry
transfer of such Old Notes to the Exchange Agent's account at The Depository
Trust Company, pursuant to the procedures for book-entry transfer set forth in
the Prospectus, in either case together with one or more properly completed and
duly executed Letter(s) of Transmittal (or facsimile thereof) and any other
required documents within five business days after the date of execution of this
Notice of Guaranteed Delivery.
THE UNDERSIGNED ACKNOWLEDGES THAT IT MUST DELIVER THE LETTER OF TRANSMITTAL
AND OLD NOTES TENDERED HEREBY TO THE EXCHANGE AGENT WITHIN THE TIME PERIOD SET
FORTH ABOVE AND THAT FAILURE TO DO SO COULD RESULT IN FINANCIAL LOSS TO THE
UNDERSIGNED.
<TABLE>
<S> <C>
Name of Firm:
------------------------------------------------------ --------------------------------------------------------------
Authorized Signature
Address: Name:
---------------------------------------------------------- --------------------------------------------------------
Title:
---------------------------------------------------------- --------------------------------------------------------
Area Code and Telephone No.: Date:
--------------------------------------- --------------------------------------------------------
</TABLE>
NOTE: DO NOT SEND CERTIFICATES FOR OLD Notes WITH THIS FORM. CERTIFICATES FOR
OLD Notes SHOULD ONLY BE SENT WITH YOUR LETTER OF TRANSMITTAL.
- --------------------------------------------------------------------------------
-3-
(EXHIBIT 99.3)
EXCHANGE AGENT AGREEMENT
[DATE], 1999
The Bank of New York
Corporate Trust Trustee Administration
101 Barclay Street - 21st Floor
New York, New York 10286
Ladies and Gentlemen:
CSC Holdings, Inc., a Delaware corporation (the "Company"), has made an
offer (the "Exchange Offer") to exchange its 8 1/8% Senior Notes due 2009 (the
"Existing Notes") for 8 1/8% Series B Senior Notes due 2009 (the "New Notes").
The terms and conditions of the Exchange Offer as currently contemplated are set
forth in a prospectus, dated [DATE], 1999 (the "Prospectus"), proposed to be
distributed to all record holders of the Existing Notes. The Existing Notes and
the New Notes are collectively referred to herein as the "Notes."
The Company hereby appoints The Bank of New York to act as exchange
agent (the "Exchange Agent") in connection with the Exchange Offer. References
hereinafter to "you" shall refer to The Bank of New York.
The Exchange Offer is expected to be commenced by the Company on or
about [DATE], 1999. The Letter of Transmittal accompanying the Prospectus (or in
the case of book entry securities, the ATOP system) is to be used by the holders
of the Existing Notes to accept the Exchange Offer and contains instructions
with respect to the delivery of certificates for Existing Notes tendered in
connection therewith.
The Exchange Offer shall expire at 5:00 P.M., New York City time, on
the 30th day following its commencement or on such later date or time to which
the Company may extend the Exchange Offer (the "Expiration Date"). Subject to
the terms and conditions set forth in the Prospectus, the Company expressly
reserves the right to extend the Exchange Offer from time to time and may extend
the Exchange Offer by giving oral (confirmed in writing) or written notice to
you before 9:00 A.M., New York City time, on the business day following the
previously scheduled Expiration Date.
The Company expressly reserves the right to amend or terminate the
Exchange Offer, and not to accept for exchange any Existing Notes not
theretofore accepted for exchange, upon the occurrence of any of the conditions
of the Exchange Offer specified in the Prospectus under the caption "The
Exchange Offer -- Expiration Date" and "The Exchange Offer--We Can Amend or
Extend the Exchange Offer." The Company shall give oral (confirmed in writing)
or written notice of any amendment, termination or nonacceptance to you as
promptly as practicable.
In carrying out your duties as Exchange Agent, you are to act in
accordance with the following instructions:
<PAGE>
1. You will perform such duties and only such duties as are
specifically set forth in the section of the Prospectus captioned "The Exchange
Offer" and "How to Tender Your Old Notes," in the Letter of Transmittal
accompanying the Prospectus or as specifically set forth herein; provided,
however, that in no way will your general duty to act in good faith be
discharged by the foregoing.
2. You will establish an account with respect to the Existing Notes at
The Depository Trust Company ("DTC" or the "Book-Entry Transfer Facility") for
purposes of the Exchange Offer within two business days after the date of the
Prospectus, and any financial institution that is a participant in the
Book-Entry Transfer Facility's systems may make book-entry delivery of the
Existing Notes by causing the Book-Entry Transfer Facility to transfer such
Existing Notes into your account in accordance with the Book-Entry Transfer
Facility's procedure for such transfer.
3. You are to examine each of the Letters of Transmittal and
certificates for Existing Notes (or confirmation of book-entry transfer into
your account at the Book-Entry Transfer Facility) and any other documents
delivered or mailed to you by or for holders of the Existing Notes to ascertain
whether: (a) the Letters of Transmittal and any such other documents are duly
executed and properly completed in accordance with instructions set forth
therein and (b) the Existing Notes have otherwise been properly tendered. In
each case where the Letter of Transmittal or any other document has been
improperly completed or executed or any of the certificates for Existing Notes
are not in proper form for transfer or some other irregularity in connection
with the acceptance of the Exchange Offer exists, you will endeavor to inform
the presenters of the need for fulfillment of all requirements and to take any
other action as may be necessary or advisable to cause such irregularity to be
corrected.
4. With the approval of the President, Vice Chairman, Senior Vice
President, Executive Vice President or any Vice President of the Company, or of
counsel to the Company or any other party designated by any officer named in
this Paragraph 4 (such approval, if given orally, to be confirmed in writing),
you are authorized to waive any irregularities in connection with any tender of
Existing Notes pursuant to the Exchange Offer.
5. Tenders of Existing Notes may be made only as set forth in the
Letter of Transmittal and in the section of the Prospectus captioned "The
Exchange Offer--Procedures for Tendering," and Existing Notes shall be
considered properly tendered to you only when tendered in accordance with the
procedures set forth therein.
Notwithstanding the provisions of this paragraph 5, Existing Notes that
the President, Vice Chairman, Senior Vice President, Executive Vice President or
any Vice President of the Company shall approve as having been properly tendered
shall be considered to be properly tendered (such approval, if given orally,
shall be confirmed in writing).
6. You shall advise the Company with respect to any Existing Notes
received subsequent to the Expiration Date and accept its instructions with
respect to disposition of such Existing Notes.
7. You shall accept tenders:
-2-
<PAGE>
(a) in cases where the Existing Notes are registered in two or
more names only if signed by all named holders;
(b) in cases where the signing person (as indicated on the Letter of
Transmittal) is acting in a fiduciary or a representative capacity only
when proper evidence of his or her authority so to act is submitted; and
(c) from persons other than the registered holder of Existing Notes
provided that customary transfer requirements, including any applicable
transfer taxes, are fulfilled.
You shall accept partial tenders of Existing Notes where so indicated
and as permitted in the Letter of Transmittal and deliver certificates for
Existing Notes to the transfer agent for split-up and return any untendered
Existing Notes to the holder (or such other person as may be designated in the
Letter of Transmittal) as promptly as practicable after expiration or
termination of the Exchange Offer.
8. Upon satisfaction or waiver of all of the conditions to the Exchange
Offer, the Company will notify you (such notice if given orally, to be confirmed
in writing) of its acceptance, promptly after the Expiration Date, of all
Existing Notes properly tendered and you, on behalf of the Company, will
exchange Existing Notes duly tendered for New Notes on the terms and subject to
the conditions set forth in the Prospectus and the Letter of Transmittal.
Delivery of New Notes will be made on behalf of the Company by you at the rate
of $1,000 principal amount of New Notes for each $1,000 principal amount of
Existing Notes tendered as soon as practicable after notice (such notice if
given orally, to be confirmed in writing) of acceptance of said Existing Notes
by the Company; provided, however, that in all cases, Existing Notes tendered
pursuant to the Exchange Offer will be exchanged only after timely receipt by
you of certificates for such Existing Notes (or confirmation of book-entry
transfer into your account at the Book-Entry Transfer Facility), a properly
completed and duly executed Letter of Transmittal (or facsimile thereof) with
any required signature guarantees and any other required documents. Unless
otherwise instructed by the Company, you shall issue New Notes only in
denominations of $1,000 or any integral multiple thereof.
9. Tenders pursuant to the Exchange Offer are irrevocable, except that,
subject to the terms and upon the conditions set forth in the Prospectus and the
Letter of Transmittal, Existing Notes tendered pursuant to the Exchange Offer
may be withdrawn at any time prior to the Expiration Date.
10. The Company shall not be required to exchange any Existing Notes
tendered if any of the conditions set forth in the Exchange Offer are not met.
Notice of any decision by the Company not to exchange any Existing Notes
tendered shall be given (and confirmed in writing) by the Company to you.
11. If, pursuant to the Exchange Offer, the Company does not accept for
exchange all or part of the Existing Notes tendered because of an invalid
tender, the occurrence of certain other events set forth in the Prospectus under
the caption "The Exchange Offer--Termination" or otherwise, you shall as soon as
practicable after the expiration or termination of the Exchange Offer return
those certificates for unaccepted Existing Notes (or effect appropriate
book-entry transfer), together with any related required documents and the
Letters of Transmittal relating thereto that are in your possession, to the
persons who deposited them.
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12. All certificates for reissued Existing Notes, unaccepted Existing
Notes or for New Notes shall be forwarded by first-class certified mail, return
receipt requested under a blanket surety bond protecting you and the Company
from loss or liability arising out of the non-receipt or non-delivery of such
certificates.
13. You are not authorized to pay or offer to pay any concessions,
commissions or solicitation fees to any broker, dealer, bank or other persons or
to engage or utilize any person to solicit tenders.
14. As Exchange Agent hereunder you:
(a) shall have no duties or obligations other than those specifically
set forth in the section of the Prospectus captioned "The Exchange Offer"
and "How to Tender Your Old Notes," in the "Letter of Transmittal"
accompanying the Prospectus or herein or as may be subsequently agreed to
in writing by you and the Company;
(b) will be regarded as making no representations and having no
responsibilities as to the validity, sufficiency, value or genuineness of
any of the certificates or the Existing Notes represented thereby deposited
with you pursuant to the Exchange Offer, and will not be required to and
will make no representation as to the validity, value or genuineness of the
Exchange Offer; provided, however, that in no way will your general duty to
act in good faith be discharged by the foregoing;
(c) shall not be obligated to take any legal action hereunder that
might in your reasonable judgment involve any expense or liability, unless
you shall have been furnished with reasonable indemnity;
(d) may reasonably rely on and shall be protected in acting in reliance
upon any certificate, instrument, opinion, notice, letter, telegram or
other document or security delivered to you and reasonably believed by you
to be genuine and to have been signed by the proper party or parties;
(e) may reasonably act upon any tender, statement, request, comment,
agreement or other instrument whatsoever not only as to its due execution
and validity and effectiveness of its provisions, but also as to the truth
and accuracy of any information contained therein, which you shall in good
faith believe to be genuine or to have been signed or represented by a
proper person or persons;
(f) may rely on and shall be protected in acting upon written or oral
instructions from any officer of the Company;
(g) may consult with your counsel with respect to any questions
relating to your duties and responsibilities and the written opinion of
such counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted to be taken by you
hereunder in good faith and in accordance with the written opinion of such
counsel; and
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(h) shall not advise any person tendering Existing Notes pursuant to
the Exchange Offer as to the wisdom of making such tender or as to the
market value or decline or appreciation in market value of any Existing
Notes.
15. You shall take such action as may from time to time be requested by
the Company or its counsel (and such other action as you may reasonably deem
appropriate) to furnish copies of the Prospectus, Letter of Transmittal and the
Notice of Guaranteed Delivery (as defined in the Prospectus) or such other forms
as may be approved from time to time by the Company, to all persons requesting
such documents and to accept and comply with telephone requests for information
relating to the Exchange Offer, provided that such information shall relate only
to the procedures for accepting (or withdrawing from) the Exchange Offer. The
Company will furnish you with copies of such documents at your request. All
other requests for information relating to the Exchange Offer shall be directed
to the Company, Attention: Secretary.
16. You shall advise by facsimile transmission or telephone, and
promptly thereafter confirm in writing to the Company and such other person or
persons as it may request, daily (and more frequently during the week
immediately preceding the Expiration Date and if otherwise requested) up to and
including the Expiration Date, as to the amount of Existing Notes that have been
tendered pursuant to the Exchange Offer and the items received by you pursuant
to this Agreement, separately reporting and giving cumulative totals as to items
properly received and items improperly received. In addition, you will also
inform, and cooperate in making available to, the Company or any such other
person or persons upon oral request made from time to time prior to the
Expiration Date of such other information as it or he reasonably requests. Such
cooperation shall include, without limitation, the granting by you to the
Company and such person as the Company may request of access to those persons on
your staff who are responsible for receiving tenders, in order to ensure that
immediately prior to the Expiration Date the Company shall have received
information in sufficient detail to enable it to decide whether to extend the
Exchange Offer. You shall prepare a final list of all persons whose tenders were
accepted, the aggregate principal amount of Existing Notes tendered, the
aggregate principal amount of Existing Notes accepted and deliver said list to
the Company.
17. Letters of Transmittal and Notices of Guaranteed Delivery shall be
stamped by you as to the date and the time of receipt thereof and shall be
preserved by you for a period of time at least equal to the period of time you
preserve other records pertaining to the transfer of securities. You shall
dispose of unused Letters of Transmittal and other surplus materials as
instructed by the Company.
18. You hereby expressly waive any lien, encumbrance or right of
set-off whatsoever that you may have with respect to funds deposited with you
for the payment of transfer taxes by reasons of amounts, if any, borrowed by the
Company, or any of its subsidiaries or affiliates pursuant to any loan or credit
agreement with you or for compensation owed to you hereunder.
19. For services rendered as Exchange Agent hereunder, you shall be
entitled to such compensation as set forth in Schedule I attached hereto.
20. You hereby acknowledge receipt of the Prospectus and the Letter of
Transmittal and further acknowledge that you have examined each of them. Any
inconsistency between this Agreement,
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on the one hand, and the Prospectus and the Letter of Transmittal (as they may
be amended from time to time), on the other hand, shall be resolved in favor of
the latter two documents, except with respect to the duties, liabilities and
indemnification of you as Exchange Agent which shall be controlled by this
Agreement.
21. The Company covenants and agrees to indemnify and hold you in your
capacity as Exchange Agent hereunder harmless against any loss, liability, cost
or expense, including reasonable attorneys' fees arising out of or in connection
with any act, omission, delay or refusal made by you in reasonable reliance upon
any signature, endorsement, assignment, certificate, order, request, notice,
instruction or other instrument or document reasonably believed by you to be
valid, genuine and sufficient and in accepting any tender or effecting any
transfer of Existing Notes reasonably believed by you in good faith to be
authorized, and in delaying or refusing in good faith to accept any tenders or
effect any transfer of Existing Notes; provided, however, that the Company shall
not be liable for indemnification or otherwise for any loss, liability, cost or
expense to the extent arising out of your gross negligence, willful misconduct
or bad faith. In no case shall the Company be liable under this indemnity with
respect to any claim against you unless the Company shall be notified by you, by
letter or facsimile confirmed by letter, of the written assertion of a claim
against you or of any other action commenced against you, promptly after you
shall have received any such written assertion or notice of connection of
action. The Company shall be entitled to participate at its own expense in the
defense of any such claim or other action, and, if the Company so elects, the
Company shall assume the defense of any suit brought to enforce any such claim.
In the event that the Company shall assume the defense of any such suit, the
Company shall not be liable for the fees and expenses of any additional counsel
thereafter retained by you, so long as the Company shall retain counsel
reasonably satisfactory to you to defend such suit.
22. You shall comply with all requirements under the tax laws of the
United States.
23. You shall deliver or cause to be delivered, in a timely manner to
each governmental authority to which any transfer taxes are payable in respect
of the exchange of Existing Notes, your check in the amount of all transfer
taxes so payable, and the Company shall reimburse you for the amount of any and
all transfer taxes payable by the Company in respect of the exchange of Existing
Notes in accordance with the Section of the Prospectus captioned "How to Tender
Your Old Notes--Fees and Expenses"; provided, however, that you shall reimburse
the Company for amounts refunded to you in respect of your payment of any such
transfer taxes, at such time as such refund is received by you.
24. This Agreement and your appointment as Exchange Agent hereunder
shall be construed and enforced in accordance with the laws of the State of New
York applicable to agreements made and to be performed entirely within such
state, and without regard to conflicts of law principles, and shall inure to the
benefit of, and the obligations created hereby shall be binding upon, the
successors and assigns of each of the parties hereto.
25. This Agreement may be executed in two or more counterparts, each of
which shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.
26. In case any provision of this Agreement shall be invalid, illegal
or unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
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27. This Agreement shall not be deemed or construed to be modified,
amended, rescinded, cancelled or waived, in whole or in part, except by a
written instrument signed by a duly authorized representative of the party to be
charged. This Agreement may not be modified orally.
28. Unless otherwise provided herein, all notices, requests and other
communications to any party hereunder shall be in writing (including facsimile
or similar writing) and shall be given to such party, addressed to it, at its
address or telecopy number set forth below:
If to the Company:
CSC Holdings, Inc.
1111 Stewart Avenue
Bethpage, New York 11714
Facsimile: (516) 803-2577
Attention: Legal Department
with a copy to:
John P. Mead
Sullivan & Cromwell
125 Broad Street
New York, New York 10004
Facsimile: (212) 558-3588
If to the Exchange Agent:
The Bank of New York
101 Barclay Street
Floor 21 West
New York, New York 10286
Facsimile: (212) 815-5915
Attention: Corporate Trust Administration
29. Unless terminated earlier by the parties hereto, this Agreement
shall terminate 90 days following the Expiration Date. Notwithstanding the
foregoing, Paragraphs 19, 21 and 23 shall survive the termination of this
Agreement. Upon any termination of this Agreement, you shall promptly deliver to
the Company any certificates, funds or property then held by you as Exchange
Agent under this Agreement.
30. This Agreement shall be binding and effective as of the date
hereof.
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Please acknowledge receipt of this Agreement and confirm the
arrangements herein provided by signing and returning the enclosed copy.
CSC HOLDINGS, INC.
By:
--------------------------
Name:
Title:
Accepted as of the date
first above written.
THE BANK OF NEW YORK, as Exchange Agent
By:
----------------------------
Name:
Title:
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