SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (date of earliest event reported) July 2, 1998
ADELPHIA COMMUNICATIONS CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 0-16014 23-2417713
(State or other (Commission File Number) (IRS Employer
jurisdiction of Identification No.)
incorporation)
Main at Water Street - Coudersport, PA 16915-1141
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (814) 274-9830
<PAGE>
Item 5. Other Events
The Registrant is filing certain exhibits herewith under Item 7 hereof regarding
the issuance of the Registrants 8-1/8% Senior Notes due 2003 on July 2, 1998 and
the announcement of the proposed public offering by the Regristrant of Class A
Common Stock by press release on July 20, 1998.
Item 7. Financial Statements and Exhibits
Exhibit No. Description
4.01 Indenture, dated as of July 2, 1998, with respect to the Registrant's
8-1/8% Senior Notes due 2003, between the Registrant and the Bank of
Montreal Trust Company (Filed herewith)
4.02 Registration Rights Agreement between Adelphia Communications
Corporation and the Initial Purchaser, dated July 2, 1998, regarding
the Registrant's 8-1/8% Senior Notes due 2003 (Filed herewith)
4.03 Form of 8-1/8% Senior Note due 2003 (contained in Exhibit 4.01)
10.01 Purchase Agreement among Adelphia Communications Corporation and
Barclays Capital, Inc. (the "Initial Purchaser") dated June 29, 1998
(Filed herewith)
99.01 Press Release dated July 20, 1998 regarding the Registrant's proposed
public offering of Class A Common Stock (Filed herewith)
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date:July 21, 1998 ADELPHIA COMMUNICATIONS CORPORATION
(Registrant)
By: /s/Timothy J. Rigas
Timothy J. Rigas
Executive Vice President,
Treasurer and Chief
Financial Officer
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
4.01 Indenture, dated as of July 2, 1998, with respect to the Registrant's
8-1/8% Senior Notes due 2003, between the Registrant and the Bank of
Montreal Trust Company (Filed herewith)
4.02 Registration Rights Agreement between Adelphia Communications
Corporation and the Initial Purchaser, dated July 2, 1998, regarding
the Registrant's 8-1/8% Senior Notes due 2003 (Filed herewith)
4.03 Form of 8-1/8% Senior Note due 2003 (contained in Exhibit 4.01)
10.01 Purchase Agreement among Adelphia Communications Corporation and
Barclays Capital, Inc. (the "Initial Purchaser") dated June 29, 1998
(Filed herewith)
99.01 Press Release dated July 20, 1998 regarding the Registrant's proposed
public offering of Class A Common Stock (Filed herewith)
EXHIBIT 4.01
ADELPHIA COMMUNICATIONS CORPORATION
Up to $300,000,000
8-1/8% Senior Notes Due 2003
INDENTURE
Dated as of July 2, 1998
BANK OF MONTREAL TRUST COMPANY,
Trustee
<PAGE>
<TABLE>
<CAPTION>
CROSS-REFERENCE TABLE
TIA Indenture
Section Section
<S> <C>
310(a)(1)-----------------------------------------------------------------------------------7.10
(a)(2---------------------------------------------------------------------------------7.10
(a)(3)--------------------------------------------------------------------------------N.A.
(a)(4)--------------------------------------------------------------------------------N.A.
(b)-----------------------------------------------------------------------------------7.08;7.10;11.02
(b)(1)--------------------------------------------------------------------------------7.10
(b)(9)--------------------------------------------------------------------------------7.10
(c)-----------------------------------------------------------------------------------N.A.
311(a)--------------------------------------------------------------------------------------7.11
(b)-----------------------------------------------------------------------------------7.11
(c)-----------------------------------------------------------------------------------N.A.
312(a)--------------------------------------------------------------------------------------2.05
(b)----------------------------------------------------------------------------------11.03
(c)----------------------------------------------------------------------------------11.03
313(a)--------------------------------------------------------------------------------------7.06
(b)(1)--------------------------------------------------------------------------------7.06
(b)(2)--------------------------------------------------------------------------------7.06
(c)-----------------------------------------------------------------------------------7.06, 11.02
(d)-----------------------------------------------------------------------------------7.06
314(a)--------------------------------------------------------------------------------------4.02;11.02
(b)-----------------------------------------------------------------------------------N.A.
(c)(1)-------------------------------------------------------------------------------11.04;11.05
(c)(2)-------------------------------------------------------------------------------11.04;11.05
(c)(3)--------------------------------------------------------------------------------N.A.
(d)-----------------------------------------------------------------------------------N.A.
(e)----------------------------------------------------------------------------------11.05
(f)-----------------------------------------------------------------------------------N.A.
315(a)--------------------------------------------------------------------------------------7.01;7.02
(b)-----------------------------------------------------------------------------------7.05;11.02
(c)-----------------------------------------------------------------------------------7.01
(d)-----------------------------------------------------------------------------------6.05;7.01;7.02
(e)-----------------------------------------------------------------------------------6.11
316(a) (last sentence)---------------------------------------------------------------------11.06
(a)(1)(A)-----------------------------------------------------------------------------6.05
(a)(1)(B)-----------------------------------------------------------------------------6.04
(a)(2)--------------------------------------------------------------------------------8.02
(b)-----------------------------------------------------------------------------------6.07
317(a)(1)-----------------------------------------------------------------------------------6.08
(a)(2)--------------------------------------------------------------------------------6.09
(b)-----------------------------------------------------------------------------------2.04
318(a)-------------------------------------------------------------------------------------11.01
N.A. means Not Applicable
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be a part of the Indenture.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
Page
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
<S> <C>
Section 1.01. Definitions................................................................................1
Section 1.02. Other Definitions.........................................................................12
Section 1.03. Incorporation by Reference of Trust Indenture.............................................12
Section 1.04. Rules of Construction.....................................................................13
Section 1.05. Acts of Holders...........................................................................13
ARTICLE 2
THE NOTES
Section 2.01. Form And Dating...........................................................................14
Section 2.02. Execution and Authentication..............................................................15
Section 2.03. Registrar and Paying Agent................................................................16
Section 2.04. Paying Agent to Hold Money in Trust.......................................................16
Section 2.05. Holder Lists..............................................................................17
Section 2.06. Transfer and Exchange.....................................................................17
Section 2.07. Replacement Notes.........................................................................22
Section 2.08. Outstanding Notes.........................................................................23
Section 2.09. Treasury Notes............................................................................23
Section 2.10. Temporary Notes...........................................................................23
Section 2.11. Cancellation..............................................................................24
Section 2.12. Defaulted Interest........................................................................24
ARTICLE 3
CHANGE OF CONTROL OFFER
ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes..........................................................................27
Section 4.02. SEC Reports...............................................................................27
Section 4.03. Waiver of Stay, Extension or Usury Laws...................................................27
Section 4.04. Limitation on Transactions with Affiliates................................................27
<PAGE>
Section 4.05. Limitation on Indebtedness................................................................28
Section 4.06. Limitation on Restricted Payments.........................................................28
Section 4.07. Reports to Holders........................................................................29
Section 4.08. Notice of Defaults Or Events of Default...................................................29
Section 4.09. Compliance Certificates...................................................................29
Section 4.10. Covenant to Secure Notes Equally..........................................................30
Section 4.11. Limitation on Investment in Affiliates and Unrestricted Subsidiaries......................30
Section 4.12. Limitation on Sale of Assets..............................................................30
ARTICLE 5
SUCCESSOR CORPORATION
Section 5.01. Mergers and Consolidations................................................................31
Section 5.02. Successor Person Substituted..............................................................32
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default.........................................................................32
Section 6.02. Acceleration..............................................................................34
Section 6.03. Other Remedies............................................................................34
Section 6.04. Waiver of Past Defaults and Events of Default.............................................35
Section 6.05. Control by Majority.......................................................................35
Section 6.06. Limitation on Suits.......................................................................35
Section 6.07. Rights of Holders to Receive Payment......................................................36
Section 6.08. Collection Suit by Trustee................................................................36
Section 6.09. Trustee May File Proofs of Claim..........................................................36
Section 6.10. Priorities................................................................................37
Section 6.11. Undertaking for Costs.....................................................................37
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee.........................................................................38
Section 7.02. Rights of Trustee.........................................................................39
Section 7.03. Individual Rights of Trustee..............................................................39
Section 7.04. Trustee's Disclaimer......................................................................40
Section 7.05. Notice of Defaults........................................................................40
Section 7.06. Reports by Trustee to Holders.............................................................40
Section 7.07. Compensation and Indemnity................................................................40
Section 7.08. Replacement of Trustee....................................................................41
<PAGE>
Section 7.09. Successor Trustee by Consolidation, Merger or Conversion..................................42
Section 7.10. Eligibility; Disqualification............................................................42
Section 7.11. Preferential Collection of Claims Against Company.........................................43
Section 7.12. Paying Agents.............................................................................43
ARTICLE 8
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 8.01. Without Consent of Holders................................................................43
Section 8.02. With Consent of Holders...................................................................44
Section 8.03. Compliance with Trust Indenture Act.......................................................45
Section 8.04. Revocation and Effect of Consents.........................................................45
Section 8.05. Notation on or Exchange of Notes..........................................................46
Section 8.06. Trustee to Sign Amendments, etc...........................................................46
ARTICLE 9
SATISFACTION AND DISCHARGE OF INDENTURE: UNCLAIMED MONEYS
Section 9.01. Satisfaction and Discharge of Indenture...................................................46
Section 9.02. Funds Deposited for Payment of Notes......................................................47
Section 9.03. Moneys Held by Paying Agent...............................................................47
Section 9.04. Moneys Held by Trustee....................................................................48
Section 9.05. Reinstatement.............................................................................48
ARTICLE 10
DEFEASANCE AND COVENANT DEFEASANCE
Section 10.01. Applicability of Article; Company Option to Effect Defeasance............................49
Section 10.02. Defeasance and Discharge.................................................................49
Section 10.03. Covenant Defeasance......................................................................49
Section 10.04. Conditions to Defeasance or Covenant Defeasance..........................................50
Section 10.05. Deposited Money and U.S. Government Obligations to be Held in Trust; Other
Miscellaneous Provisions..............................................................51
Section 10.06. Reinstatement............................................................................52
ARTICLE 11
MISCELLANEOUS
Section 11.01. Trust Indenture Act Controls.............................................................52
Section 11.02. Notices..................................................................................52
Section 11.03. Communications by Holders with Other Holders.............................................53
<PAGE>
Section 11.04. Certificate and Opinion as to Conditions.................................................54
Section 11.05. Statements Required in Certificate and Opinion...........................................54
Section 11.06. When Treasury Notes Disregarded..........................................................54
Section 11.07. Rules by Trustee and Agents..............................................................55
Section 11.08. Business Days; Legal Holidays............................................................55
Section 11.09. Governing Law............................................................................55
Section 11.10. No Adverse Interpretation of Other Agreements............................................55
Section 11.11. No Recourse against Others...............................................................55
Section 11.12. Successors...............................................................................56
Section 11.13. Multiple Counterparts....................................................................56
Section 11.14. Table of Contents, Headings, etc.........................................................56
Section 11.15. Separability.............................................................................56
</TABLE>
<PAGE>
EXHIBITS
Exhibit A FORM OF NOTE
Exhibit B-1 FORM OF CERTIFICATE FOR EXCHANGE
<PAGE>
THIS INDENTURE, dated as of July 2, 1998, is by and between
ADELPHIA COMMUNICATIONS CORPORATION, a Delaware corporation (the "Company"), and
BANK OF MONTREAL TRUST COMPANY, a trust company organized under the laws of the
State of New York (the "Trustee").
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions
"Act", when used with respect to any Holder, has the meaning
specified in Section 1.05 hereof.
"Affiliate" means a Person (i) which directly or indirectly
through one or more intermediaries controls, or is controlled by, or is under
common control with, the Company, (ii) which beneficially owns or holds 10% or
more of any class of the voting Capital Stock of the Company, or (iii) of which
10% or more of the voting Capital Stock is beneficially owned or held by the
Company, a Restricted Subsidiary or an Unrestricted Subsidiary of the Company.
Without a limitation, an Affiliate also includes any director or executive
officer of the Company. As used herein, "Affiliate" shall not include a
Restricted Subsidiary.
"Agent" means any Registrar, Paying Agent, co-registrar or
agent for service of notices and demands. See Section 2.03 hereof.
"Agent Members" means members of, or participants in, the
Depository.
"Aggregate Excess Restricted Investments" means for any fiscal
quarter the aggregate of Excess Restricted Investments with respect to the
Restricted Investments in all of the Unrestricted Subsidiaries and Affiliates of
the Company.
"Allowable Securities" means (i) cash equivalents, (ii) common
or preferred Capital Stock in a Person which (x) has Investment Grade Senior
Debt or (y) whose ratio of Indebtedness plus Preferred Stock to Annualized Pro
Forma EBITDA is less than 7.75:1, or (iii) debt securities issued by a Person
which (x) has Investment Grade Senior Debt or (y) whose Leverage Ratio is less
than 7.75:1, provided that the securities in (ii)(y) and (iii)(y) above shall
only be deemed to be Allowable Securities if the principal business of the
Person is owning and operating cable television systems.
"Annualized Pro Forma EBITDA" means, with respect to any
Person, (i) such Person's Pro Forma EBITDA for the latest fiscal quarter
multiplied by four, minus (ii) in the case of the Company only, the Company's
Aggregate Excess Restricted Investments for such fiscal quarter.
<PAGE>
"Asset Sale" means the sale, transfer or other disposition
(other than to the Company or any of its Restricted Subsidiaries) in any single
transaction or series of related transactions of (a) any Capital Stock of or
other equity interest in any Restricted Subsidiary, (b) all or substantially all
of the assets of the Company or of any Restricted Subsidiary or (c) all or
substantially all of the assets of a Company System or part thereof serving at
least 5,000 basic subscribers, a division, line of business or comparable
business segment of the Company or any Restricted Subsidiary.
"Applicable Procedures" means the procedures of the
Depository.
"Board of Directors" means the Board of Directors of the
Company or any committee authorized to act therefor.
"Board Resolution" means a copy of a resolution certified
pursuant to an Officers' Certificate to have been duly adopted by the Board of
Directors and to be in full force and effect, and delivered to the Trustee.
"Capital Stock" means, with respect to any Person, any and all
shares or other equivalents (however designated) of corporate stock, partnership
interests or any other participation, right or other interest in the nature of
any equity interest in such Person or any option, warrant or other security
convertible into any of the foregoing.
"Capital Stock Sale Proceeds" means the aggregate net sale
proceeds (including the fair market value of property, other than cash, as
determined by an independent appraisal firm) received by the Company from the
issue or sale (other than to a Subsidiary) by the Company of any class of its
Capital Stock on or after January 1, 1993 (including Capital Stock of the
Company issued after January 1, 1993 upon conversion of or in exchange for other
securities of the Company).
"Capitalized Lease Obligations" means Indebtedness represented
by obligations under a lease that is required to be capitalized for financial
reporting purposes in accordance with GAAP and the amount of such Indebtedness
shall be the capitalized amount of such obligations determined in accordance
with GAAP.
"Change of Control" means such time as (i) (a) a "person" or
"group" (within the meaning of Sections 13(d) and 14(d)(2) of the Exchange Act),
other than the Rigas Family and its Affiliates, becomes the "beneficial owner"
(as defined in Rule 13d-3 under the Exchange Act) of more than 35% of the total
voting power required to elect or designate for election a majority of the
Company's Board of Directors and attaching to the then outstanding voting
Capital Stock of the Company and (b) the Rigas Family, together with its
Affiliates, is not at such time the "beneficial owner" (as defined in Rule 13d-3
under the Exchange Act) of more than 35% of the total voting power required to
elect or designate for election a majority of the Company's Board of Directors
and attaching to the then outstanding voting Capital Stock of the Company, or
<PAGE>
(ii) during any period of two consecutive calendar years, individuals who at the
beginning of such period constituted the Company's Board of Directors (together
with any new directors whose election by the Company's Board of Directors or
whose nomination for election by the Company's stockholders was approved by a
vote of at least two-thirds of the directors then still in office who either
were directors at the beginning of such period or whose election or nomination
for election was previously so approved or approved by the Rigas Family and its
Affiliates at a time when they had the right or ability by voting right,
contract or otherwise to elect or designate for election a majority of the
Company's Board of Directors) cease for any reason to constitute a majority of
the directors then in office.
"Change of Control Triggering Event" means the occurrence of
both a Change of Control and a Rating Decline.
"Company" means the party named as such in the first paragraph
of this Indenture until a successor replaces such party pursuant to Article 5 of
this Indenture and thereafter means the successor and any other obligor on the
Notes.
"Company Request" means any written request signed in the name
of the Company by the Chairman, the President or a Vice President of the Company
and attested to by a Secretary or an Assistant Secretary or the Treasurer or an
Assistant Treasurer of the Company.
"Consolidated Fixed Charge Ratio" means, for any Person, for
any period, the ratio of (i) Annualized Pro Forma EBITDA to (ii) Consolidated
Interest Expense for such period multiplied by four.
"Consolidated Interest Expense" means, for any Person, for any
period, the amount of interest in respect of Indebtedness (including
amortization of original issue discount, amortization of debt issuance costs,
and non-cash interest payments on any Indebtedness and the interest portion of
any deferred payment obligation and after taking into account the effect of
elections made under any Interest Rate Agreement, however denominated, with
respect to such Indebtedness), the amount of Redeemable Dividends and the
interest component of rentals in respect of any Capitalized Lease Obligation
paid, accrued or scheduled to be paid or accrued by such Person during such
period, determined on a consolidated basis in accordance with GAAP. For purposes
of this definition, interest on a Capitalized Lease Obligation shall be deemed
to accrue at an interest rate reasonably determined by such Person to be the
rate of interest implicit in such Capitalized Lease Obligation in accordance
with GAAP consistently applied.
"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 88 Pine Street, New York, New York 10005.
<PAGE>
"Cumulative Credit" means the sum of (i) Capital Stock Sale
Proceeds plus (ii) cumulative EBITDA of the Company from and after January 1,
1993 to the end of the fiscal quarter immediately preceding the date of a
proposed Restricted Payment, or, if such cumulative EBITDA for such period is
negative, minus the amount by which such cumulative EBITDA is less than zero.
"Cumulative Interest Expense" means the aggregate amount of
Consolidated Interest Expense paid, accrued or scheduled to be paid or accrued
by the Company from January 1, 1993 to the end of the fiscal quarter immediately
preceding a proposed Restricted Payment, determined on a consolidated basis in
accordance with GAAP.
"Default" means any event which is, or after notice or passage
of time or both would be, an Event of Default.
"Definitive Notes" means Notes that are in the form of the
Notes attached hereto as Exhibit A, that do not include the information called
for by footnotes 1 and 2 thereof.
"Depository" means The Depository Trust Company and its
successors.
"EBITDA" means, for any Person, for any period, an amount
equal to (A) the sum of (i) consolidated net income for such period (exclusive
of any gain or loss realized in such period upon an Asset Sale), plus (ii) the
provision for taxes for such period based on income or profits to the extent
such income or profits were included in computing consolidated net income and
any provision for taxes utilized in computing net loss under clause (i) hereof,
plus (iii) Consolidated Interest Expense for such period, plus (iv) depreciation
for such period on a consolidated basis, plus (v) amortization of intangibles
for such period on a consolidated basis, plus (vi) any other non-cash items
reducing consolidated net income for such period, minus (B) all non-cash items
increasing consolidated net income for such period, all for such Person and its
Subsidiaries determined in accordance with GAAP consistently applied, except
that with respect to the Company, each of the foregoing items shall be
determined on a consolidated basis with respect to the Company and its
Restricted Subsidiaries only.
"Excess Restricted Investment" means, with respect to any
particular Unrestricted Subsidiary or Affiliate of the Company for a fiscal
quarter, the lesser of the amounts described in the following clauses (i) and
(ii), or if such amounts are equal, such amount:
(i) the aggregate amount of any Restricted
Investments (other than the Initial
Investment) made by the Company or any
Restricted Subsidiary with respect to such
Unrestricted Subsidiary or Affiliate and
during the twelve-month period ending on the
last day of such fiscal quarter;
<PAGE>
(ii) cash income received during such quarter by
the Company with respect to its Restricted
Investments in such Unrestricted Subsidiary
or Affiliate multiplied by four;
and provided that cash income from a particular Restricted Investment shall be
included only (x) if cash income has been received by the Company with respect
to such Restricted Investment during each of the previous two fiscal quarters,
or (y) if the cash income derived from such Restricted Investment is
attributable to Allowable Securities.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Offer" means the Exchange Offer as defined in the
Registration Rights Agreement.
"GAAP" means generally accepted accounting principles as in
effect in the United States from time to time.
"Global Note" means a permanent global note that contains the
paragraph referred to in footnote 1 and the additional schedule referred to in
footnote 2 to the form of the Note attached hereto as Exhibit A, and that is
deposited with and registered in the name of the Depository.
"Holder" or "Noteholder" means the Person in whose name a
Note is registered on the Registrar's books.
"Indebtedness" is defined to mean (without duplication), with
respect to any Person, any indebtedness, secured or unsecured, contingent or
otherwise, which is for borrowed money (whether or not the recourse of the
lender is to the whole of the assets of such Person or only to a portion
thereof), or evidenced by bonds, notes, debentures or similar instruments or
representing the balance deferred and unpaid of the purchase price of any
property (excluding, without limitation, any balances that constitute subscriber
advance payments and deposits, accounts payable or trade payables, and other
accrued liabilities arising in the ordinary course of business) if and to the
extent any of the foregoing indebtedness would appear as a liability upon a
balance sheet of such Person prepared in accordance with GAAP, and shall also
include, to the extent not otherwise included, (i) any Capitalized Lease
Obligations, (ii) obligations secured by a lien to which the property or assets
owned or held by such Person is subject, whether or not the obligation or
obligations secured thereby shall have been assumed, (iii) guaranties of items
of other Persons which would be included within this definition for such other
Persons (whether or not such items would appear upon the balance sheet of the
guarantor), (iv) in the case of the Company, Preferred Stock of its Restricted
Subsidiaries and (v) obligations of any such Person under any Interest Rate
Agreement applicable to any of the foregoing. Notwithstanding the foregoing,
Indebtedness shall not include any interest or accrued interest until due and
payable.
<PAGE>
"Indenture" means this Indenture as amended, restated or
supplemented from time to time.
"Initial Investment" means the Restricted Investment in a
Person made by the Company or a Restricted Subsidiary that first results in such
Person becoming an Unrestricted Subsidiary or Affiliate of the Company, except
that in the case of Olympus, "Initial Investment" shall mean any Restricted
Investment made in Olympus since February 22, 1994, but only to the extent that
such Restricted Investment when aggregated with the other Restricted Investments
made in Olympus since such date does not exceed $25,000,000.
"Interest Payment Date" means the stated maturity of an
installment of interest on the Notes.
"Interest Rate Agreement" means, for any Person, any interest
rate swap agreement, interest rate cap agreement, interest rate collar agreement
or other similar agreement designed to protect the party indicated therein
against fluctuations in interest rates.
"Investment Grade Senior Debt" means, with respect to any
Person, Indebtedness of such Person which has been rated with an investment
grade rating by Moody's or Standard & Poor's Corporation.
"Leverage Ratio" is defined as the ratio of (i) the
outstanding Indebtedness of a Person and its Subsidiaries (or in the case of the
Company, its Restricted Subsidiaries) divided by (ii) the Annualized Pro Forma
EBITDA of such Person.
"Lien" means with respect to any property or assets of the
Company (it being understood that for the purposes of this definition property
or assets of the Company do not include property or assets of any Subsidiary of
the Company) any mortgage or deed of trust, pledge, hypothecation, assignment,
deposit arrangement, security interest, lien, charge, easement (other than any
easement not materially impairing usefulness or marketability), encumbrance,
preference, priority, or other security agreement or preferential arrangement of
any kind or nature whatsoever on or with respect to such property or assets
(including without limitation, any Capitalized Lease Obligation, conditional
sale, or other title retention agreement having substantially the same economic
effect as any of the foregoing) except for (i) liens for taxes, assessments or
governmental charges or levies on property if the same shall not at the time be
delinquent or thereafter can be paid without penalty, or are being contested in
good faith and by appropriate proceedings; (ii) liens imposed by law such as
carriers', warehousemen's and mechanics' liens and other similar liens arising
in the ordinary course of business which secure payment of obligations not more
than sixty (60) days past due or are being contested in good faith and by
appropriate proceedings; (iii) other liens incidental to the conduct of its
business or the ownership of its property and assets which were not incurred in
connection with the borrowing of money or the obtaining of advances or credit
and which do not in the aggregate materially detract from the value of its
property or assets or materially impair the use thereof in the operation of its
<PAGE>
business; (iv) utility easements, building restrictions and such other
encumbrances or charges against real property as are of a nature generally
existing with respect to properties of a similar character; or (v) liens arising
upon entry of a confession of judgment in Pennsylvania courts in connection with
borrowings not in excess of $1,000,000 in the aggregate.
"Notes" means the securities that are issued under this
Indenture, as amended or supplemented from time to time pursuant to this
Indenture.
"Officer" means the Chairman of the Board, the President, any
Vice President, the Chief Financial Officer, the Treasurer, the Secretary or any
Assistant Secretary of the Company.
"Officers' Certificate" means a certificate signed by two
Officers. See Sections 11.04 and 11.05 hereof.
"Olympus" means Olympus Communications, L.P., a Delaware
limited partnership.
"Opinion of Counsel" means a written opinion from legal
counsel who is acceptable to the Trustee. The counsel may be an employee of or
counsel to the Company or the Trustee. See Sections 11.04 and 11.05 hereof.
"Permitted Investments" means, for any Person, Restricted
Investments made on or after February 22, 1994 consisting of (i) advances for
less than one year issued in the ordinary course of business for working capital
purposes or for the purchase of property, plant and equipment in an amount not
to exceed $5,000,000 in the aggregate outstanding, (ii) with respect to a
Restricted Investment in Olympus, $25,000,000 plus the aggregate amount of cash
income received by the Company from Olympus, minus the aggregate amount of all
Restricted Investments made since February 22, 1994 with respect to Olympus,
(iii) $20,000,000 plus the cash proceeds from the sale or redemption of, or
income from, any Restricted Investments made on or after January 1, 1993, minus
the aggregate amount of all Restricted Investments (excluding Restricted
Investments made with respect to Olympus) since January 1, 1993, (iv) non-cash
Restricted Investments made with the non-cash proceeds from the sale or
redemption of, or income from, any Restricted Investments, or (v) an amount
which, at the time of such Restricted Investment, does not exceed the amount of
Restricted Payments that could then be made by the Company and its Restricted
Subsidiaries under Section 4.06; provided further that no Restricted Investments
may be made under (ii), (iii), (iv) or (v) unless pro forma for such Restricted
Investment the Company could incur $1 of debt under the first paragraph of
Section 4.05.
"Permitted Refinancing Indebtedness" means any renewals,
extensions, substitutions, refinancings or replacements of any Indebtedness,
including any successive extensions, renewals, substitutions, refinancings or
replacements so long as (i) the aggregate amount of Indebtedness represented
thereby is not increased by such renewal, extension, substitution, refinancing
<PAGE>
or replacement, (ii) in the case of Indebtedness of the Company, the average
life and the date such Indebtedness is scheduled to mature is not shortened and
(iii) in the case of Indebtedness of the Company, the new Indebtedness shall not
be senior in right of payment to the Indebtedness that is being extended,
renewed, substituted, refinanced or replaced.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization or
government (including any agency or political subdivision thereof).
"Preferred Stock" means any Capital Stock of a Person, however
designated, which entitles the holder thereof to a preference with respect to
dividends, distributions or liquidation proceeds of such Person over the holders
of other Capital Stock issued by such Person.
"Pro Forma EBITDA" means for any Person, for any period, the
EBITDA of such Person, as determined on a consolidated basis in accordance with
GAAP consistently applied after giving effect to the following: (i) if, during
or after such period, such Person or any of its Subsidiaries shall have made any
Asset Sale, Pro Forma EBITDA of such Person and its Subsidiaries for such period
shall be reduced by an amount equal to the Pro Forma EBITDA (if positive)
directly attributable to the assets which are the subject of such Asset Sale for
the period or increased by an amount equal to the Pro Forma EBITDA (if negative)
directly attributable thereto for such period and (ii) if, during or after such
period, such Person or any of its Subsidiaries completes an acquisition of any
Person or business which immediately after such acquisition is a Subsidiary of
such Person or whose assets are held directly by such Person or a Subsidiary of
such Person, Pro Forma EBITDA shall be computed so as to give pro forma effect
to the acquisition of such Person or business; and provided further that with
respect to the Company, all of the foregoing references to "Subsidiary" or
"Subsidiaries" shall be deemed to refer only to a "Restricted Subsidiary" or
"Restricted Subsidiaries" of the Company.
"QIB" means a "qualified institutional buyer" as defined in
Rule 144A.
"Rating Date" means the date which is 90 days prior to the
earlier of (i) a Change of Control and (ii) public notice of the occurrence of a
Change of Control or of the intention of the Company to effect a Change of
Control.
"Rating Decline" means the occurrence of the following on, or
within 90 days after, the date of public notice of the occurrence of a Change of
Control or of the intention by the Company to effect a Change of Control (which
period shall be extended so long as the rating of the Notes is under publicly
announced consideration for possible downgrade by Moody's or Standard & Poor's
Corporation): (a) in the event the Notes are rated by either Moody's or Standard
& Poor's on the Rating Date as Investment Grade Senior Debt, the rating of the
Notes by both Moody's and Standard & Poor's shall be below Investment Grade
Senior Debt; or (b) in the event the Notes are rated below Investment Grade
Senior Debt by both Moody's and Standard & Poor's on the Rating Date, the rating
<PAGE>
of the Notes by either Moody's or Standard & Poor's shall be decreased by one or
more gradations (including gradations within rating categories as well as
between rating categories).
"Redeemable Dividend" means, for any dividend with regard to
Redeemable Stock, the quotient of the dividend divided by the difference between
one and the maximum statutory federal income tax rate (expressed as a decimal
number between 1 and 0) then applicable to the issuer of such Redeemable Stock.
"Redeemable Stock" means with respect to any Person, any
Capital Stock that by its terms or otherwise is required to be redeemed or is
redeemable at the option of the holder at any time prior to the maturity of the
Notes.
"Registration Rights Agreement" means the Note Registration
Rights Agreement, dated as of July 2, 1998, by and between the Company and
Barclays Capital Inc.
"Restricted 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 stocks, 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 of the Company.
"Restricted Payment" means (i) any dividend or distribution
(whether made in cash, property or securities), on or with respect to any shares
of Capital Stock of the Company or Capital Stock of any Subsidiary which is
consolidated with the Company in accordance with GAAP consistently applied,
except for any dividend or distribution which is made solely to the Company or
another Subsidiary or dividends or distributions payable solely in shares of
Common Stock of the Company, or (ii) any redemption, repurchase, retirement or
other direct or indirect acquisition of (a) Indebtedness of the Company which is
subordinate in right of payment to the Notes, except by exchange for or out of
the proceeds of the substantially concurrent issuance of Permitted Refinancing
Indebtedness or from proceeds of a sale of Capital Stock by the Company, or (b)
shares of Capital Stock of the Company or any warrants, rights or options to
directly or indirectly purchase or acquire any such Capital Stock of the Company
or any securities exchangeable for or convertible into any such shares, other
than options issued or shares purchased or granted under the Company's Stock
Option Plan of 1986 or the Company's Restricted Stock Bonus Plan, from any
employee of the Company or any of its Subsidiaries who, together with any Person
that, directly or indirectly, controls (other than by virtue of being directly
or indirectly the employer of such employee), is controlled by or is under
common control with such employee, owns less than 1% of the outstanding Capital
Stock of the Company, except for the purchase, redemption, retirement or other
<PAGE>
acquisition of any shares of the Company's Capital Stock by exchange for, or out
of the proceeds of the substantially concurrent sale of, other shares of its
Capital Stock other than any capital stock 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 redeemable at the option
of the holder thereof, in whole or in part, on or prior to July 15, 2003.
"Restricted Subsidiary" means (a) any Subsidiary of the
Company, whether existing on or after the date of this Indenture, unless such
Subsidiary is an Unrestricted Subsidiary or shall have been classified as an
Unrestricted Subsidiary by a resolution adopted by the Board of Directors of the
Company and (b) an Unrestricted Subsidiary which is reclassified as a Restricted
Subsidiary by a resolution adopted by the Board of Directors of the Company,
provided that on and after the date of such reclassification such Unrestricted
Subsidiary shall not incur Indebtedness other than that permitted to be incurred
by a Restricted Subsidiary under the provisions of this Indenture.
"Rigas Family" means collectively John J. Rigas and members of
his immediate family, any of their respective spouses, estates, lineal
descendants, heirs, executors, personal representatives, administrators, trusts
for any of their benefit and charitable foundations to which shares of the
Company's Capital Stock beneficially owned by any of the foregoing have been
transferred.
"Rule 144A" means Rule 144A promulgated under the Securities
Act.
"SEC" means the United States Securities and Exchange
Commission as constituted from time to time or any successor performing
substantially the same functions.
"Securities Act" means the Securities Act of 1933, as amended.
"Series A Notes" and "Series B Notes" mean the Notes as
described and in the forms contemplated herein, and as authenticated and issued
under this Indenture.
"Subsidiary" of any specified Person means any corporation,
partnership, joint venture, association or other business entity, whether now
existing or hereafter organized or acquired, (i) in the case of a corporation,
of which more than 50% of the total voting power of the Capital Stock entitled
(without regard to the occurrence of any contingency) to vote in the election of
directors, officers or trustees thereof is held by such first-named Person or
any of its Subsidiaries; or (ii) in the case of a partnership, joint venture,
association or other business entity, with respect to which such Person or any
of its Subsidiaries has the power to direct or cause the direction of the
management and policies of such entity by contract or otherwise if in accordance
with GAAP such entity is consolidated with the first-named Person for financial
statement purposes.
<PAGE>
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code
ss.ss. 77aaa-77bbbb) as in effect on the date of this Indenture (except as
provided in Section 8.03 hereof).
"Trustee" means the party named as such in this Indenture
until a successor replaces it pursuant to this Indenture and thereafter means
the successor.
"Trust Officer" means any officer or assistant officer of the
Trustee.
"U.S. Government Obligations" means (a) securities that are
direct obligations of the United States of America for the payment of which its
full faith and credit are pledged or (b) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America, the 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 a specific payment of
principal or interest on any such U.S. Government Obligation held by such
custodian for the account of the holder of such depository receipt.
"Unrestricted Subsidiary" means (a) any Subsidiary of an
Unrestricted Subsidiary, (b) any Subsidiary of the Company which is classified
after the date of this Indenture as an Unrestricted Subsidiary by a resolution
adopted by the Board of Directors of the Company and (c) any subsidiary which as
of the date of the Indenture has been declared an Unrestricted Subsidiary by a
resolution adopted by the Board of Directors of the Company (such Unrestricted
Subsidiaries being Hyperion Telecommunications, Inc., Global Cablevision, Inc.,
Orchard Park Cablevision, Inc. and Global Acquisition Partners, L.P. on the date
hereof); provided that a Subsidiary organized or acquired after the date of this
Indenture may be so classified as an Unrestricted Subsidiary only if immediately
after the date of such classification, any investment by the Company and its
Restricted Subsidiaries in any such Subsidiary made at the time of the
organization or acquisition of such Subsidiary would be a Restricted Investment
permissible under this Indenture. The Trustee shall be given prompt notice by
the Company of each resolution adopted by its Board of Directors under this
provision, together with a copy of each such resolution adopted.
<PAGE>
Section 1.02. Other Definitions.
The definitions of the following terms may be found in the
sections indicated as follows:
Term Defined in Section
"Act".................................................................1.05
"Bankruptcy Law"......................................................6.01
"Business Day"........................................................11.08
"Certificated Notes"..................................................2.01
"Change of Control Offer".............................................3.00
"Change of Control Purchase Price"....................................3.00
"Covenant Defeasance".................................................10.03
"Custodian"...........................................................6.01
"Defeasance"..........................................................10.02
"DTC".................................................................2.03
"Event of Default"....................................................6.01
"Legal Holiday".......................................................11.08
"Paying Agent"........................................................2.03
"Proposed Change of Control Response Date"............................3.00
"Reclassification"....................................................4.12
"Registrar"...........................................................2.03
Section 1.03. Incorporation by Reference of Trust Indenture
Whenever this Indenture refers to a provision of the TIA, the
portion of such provision required to be incorporated herein in order for this
Indenture to be qualified under the TIA is incorporated by reference in and made
a part of this Indenture. The following TIA terms used in this Indenture have
the following meanings:
"Commission" means the SEC.
"indenture securities" means the Notes.
"indenture noteholder" means a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the
Trustee.
"obligor" means the Company or any other obligor on the
indenture securities.
All other terms used in this Indenture that are defined by the
TIA, defined in the TIA by reference to another statute or defined by SEC rule
have the meanings therein assigned to them.
Section 1.04. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it herein,
whether defined expressly or by reference;
(2) an accounting term not otherwise defined has the
meaning assigned to it in accordance with GAAP;
<PAGE>
(3) "or" is not exclusive;
(4) words in the singular include the plural,
and in the plural include the singular; and
(5) words used herein implying any gender shall apply
to every gender.
Section 1.05. 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 an 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 an agent therefor shall be sufficient for any purpose of
this Indenture and (subject to Section 7.01 hereof) conclusive in favor of the
Trustee and the Company, if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any
such instrument may be proved by the affidavit of a witness of such execution or
by a certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged to him the execution thereof. Where such execution is by
<PAGE>
a signer acting in a capacity other than his individual capacity, such
certificate or affidavit shall also constitute sufficient proof of his
authority. The fact and date of the execution of any such instrument or writing,
or the authority of the Person executing the same, may also be proved in any
other manner which the Trustee deems sufficient.
(c) The ownership of Notes shall be proved by the register of
Notes maintained by the Registrar pursuant to Section 2.03 hereof.
(d) Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Note shall bind every future
Holder of the same Note and the Holder of every Note issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof in
respect of anything done, omitted or suffered to be done by the Trustee or the
Company in reliance thereon, whether or not notation of such action is made upon
such Note.
ARTICLE 2
THE NOTES
Section 2.01. Form and Dating.
The Notes and the Trustee's certificate of authentication
shall be substantially in the form of Exhibit A attached hereto. The Notes may
have notations, legends or endorsements required by law, stock exchange rule or
usage. Each Note shall be dated the date of its authentication. The Notes shall
be in denominations of $1,000 and integral multiples thereof.
The terms and provisions contained in the Notes shall
constitute, and are hereby expressly made, a part of this Indenture and the
Company and the Trustee, by their execution and delivery of this Indenture,
expressly agree to such terms and provisions and to be bound thereby.
(a) Global Note. Notes shall be issued initially in the form
of the Global Note, which shall be deposited on behalf of the purchasers of the
Notes represented thereby with the Depository at its New York office, and
registered in the name of the Depository or a nominee of the Depository, duly
executed by the Company and authenticated by the Trustee as hereinafter
provided. The aggregate principal amount of the Global Note may from time to
time be increased or decreased by adjustments made on the records of the Trustee
and the Depository or its nominee as hereinafter provided.
The Global Note shall represent such of the outstanding Notes
as shall be specified therein and shall provide that it shall represent the
aggregate amount of outstanding Notes from time to time endorsed thereon and
that the aggregate amount of outstanding Notes represented thereby may from time
to time be reduced or increased, as appropriate, to reflect exchanges and
redemptions. Any endorsement of the Global Note to reflect the amount of any
increase or decrease in the amount of outstanding Notes represented thereby
shall be made by the Trustee or the Note Custodian (as hereinafter defined), at
<PAGE>
the direction of the Trustee, in accordance with instructions given by the
Holder thereof as required by Section 2.06 hereof.
Except as set forth in Section 2.06 hereof, the Global Note
may be transferred, in whole and not in part, only to another nominee of the
Depository or to a successor of the Depository or its nominee.
(b) Book-Entry Provisions. This Section 2.01(b) shall apply
only to the Global Note deposited with or on behalf of the Depository.
The Company shall execute and the Trustee shall, in accordance
with this Section 2.01(b), authenticate and deliver the Global Note that (i)
shall be registered in the name of the Depository or the nominee of the
Depository and (ii) shall be delivered by the Trustee to the Depository or
pursuant to the Depository's instructions or held by the Note Custodian.
Agent Members shall have no rights either under this Indenture
with respect to any Global Note held on their behalf by the Depository or by the
Note Custodian or under such Global Note, 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 such Global Note 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 of such Depository governing the exercise of the rights of
an owner of a beneficial interest in the Global Note.
(c) Definitive Notes. Notes issued in certificated form shall
be substantially in the form of Exhibit A attached hereto (but without including
the text referred to in footnotes 1 and 2 thereto). Except as provided in
Section 2.06, owners of beneficial interests in the Global Note will not be
entitled to receive physical delivery of certificated Securities.
Section 2.02. Execution and Authentication.
An Officer shall sign the Notes for the Company by manual or
facsimile signature. If an Officer whose signature is on a Note no longer holds
that office at the time a Note is authenticated, the Note shall nevertheless be
valid. A Note shall not be valid until authenticated by the manual signature of
the Trustee. The signature shall be conclusive evidence that the Note has been
authenticated under this Indenture.
The Trustee shall, upon a written order of the Company signed
by an Officer, authenticate Series A Notes for original issue up to the
aggregate principal amount stated in paragraph 4 of the Notes. The Trustee
shall, upon a written order of the Company signed by an Officer, authenticate
<PAGE>
Series B Notes for original issue up to the aggregate principal amount of Series
A Notes exchanged in the Exchange Offer or otherwise exchanged for Series A
Notes pursuant to the terms of the Registration Rights Agreement. The aggregate
principal amount of Notes outstanding at any time may not exceed such amounts
except as provided in Section 2.07 hereof.
The Trustee may appoint an authenticating agent acceptable to
the Company to authenticate Notes. An authenticating agent may authenticate
Notes whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with the Company or
an Affiliate of the Company.
Section 2.03. Registrar and Paying Agent.
The Company shall maintain an office or agency where Notes may
be presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Notes may be presented for payment ("Paying Agent"). The
Registrar shall keep a register of the Notes and of their transfer and exchange.
The Company may appoint one or more co-registrars and one or more additional
paying agents. The term "Registrar" includes any co-registrar and the term
"Paying Agent" includes any additional paying agent. The Company may change any
Paying Agent or Registrar without notice to any Holder. The Company shall notify
the Trustee in writing of the name and address of any Agent not a party to this
Indenture. If the Company fails to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Company or any of
its Subsidiaries may act as Paying Agent or Registrar.
The Company initially appoints The Depository Trust Company
("DTC") to act as Depository with respect to the Global Note.
The Company initially appoints the Trustee to act as the
Registrar and Paying Agent respect to the Global Note.
Section 2.04. Paying Agent to Hold Money in Trust.
The Company shall require each Paying Agent other than the
Trustee to agree in writing that the Paying Agent will hold in trust for the
benefit of Holders or the Trustee all money held by the Paying Agent for the
payment of principal, premium or Liquidated Damages, if any, or interest on the
Notes, and will notify the Trustee of any default by the Company in making any
such payment. While any such default continues, the Trustee may require a Paying
Agent to pay all money held by it to the Trustee. The Company at any time may
require a Paying Agent to pay all money held by it to the Trustee. Upon payment
over to the Trustee, the Paying Agent (if other than the Company or a
Subsidiary) shall have no further liability for the money. If the Company or a
<PAGE>
Subsidiary acts as Paying Agent, it shall segregate and hold in a separate trust
fund for the benefit of the Holders all money held by it as Paying Agent. Upon
any bankruptcy or reorganization proceedings relating to the Company, the
Trustee shall serve as Paying Agent for the Notes.
Section 2.05. Holder Lists.
The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and
addresses of all Holders and shall otherwise comply with TIA ss. 312(a). If the
Trustee is not the Registrar, the Company shall furnish to the Trustee at least
seven Business Days before each interest payment date and at such other times as
the Trustee may request in writing, a list in such form and as of such date as
the Trustee may reasonably require of the names and addresses of the Holders of
Notes and the Company shall otherwise comply with TIA ss. 312(a).
Section 2.06. Transfer and Exchange.
(a) Transfer and Exchange of Global Note. The transfer and
exchange of beneficial interests in the Global Note shall be effected through
the Depository, in accordance with this Indenture and the procedures of the
Depository therefor, which shall include restrictions on transfer comparable to
those set forth herein to the extent required by the Securities Act. Beneficial
interests in the Global Note may be transferred to Persons who take delivery
thereof in the form of a beneficial interest in the Global Note in accordance
with the transfer restrictions set forth in the legend in subsection (g) of this
Section 2.06.
(b) Transfer and Exchange of Definitive Notes. When
Definitive Notes are presented by a Holder to the Registrar with a request:
(x) to register the transfer of the Definitive
Notes; or
(y) to exchange such Definitive Notes for an
equal principal amount of Definitive Notes
of other authorized denominations, the
Registrar shall register the transfer or
make the exchange as requested if its
requirements for such transactions are met;
provided, however, that the Definitive Notes
presented or surrendered for register of
transfer or exchange:
(i) shall be duly endorsed or
accompanied by a written instruction
of transfer in form satisfactory to
the Registrar duly executed by such
Holder or by his attorney, duly
authorized in writing; and
(ii) in the case of a Definitive Note
that is a Transfer Restricted
Security, such request shall be
accompanied by the following
additional information and
documents, as applicable:
<PAGE>
(A) if such Transfer Restricted
Security is being delivered
to the Registrar by a
Holder for registration in
the name of such Holder,
without transfer, a
certification to that
effect from such Holder (in
substantially the form of
Exhibit B-1 hereto);
(B) if such Transfer Restricted
Security is being
transferred to a QIB in
accordance with Rule 144A
under the Securities Act or
pursuant to an exemption
from registration in
accordance with Rule 144
under the Securities Act or
pursuant to an effective
registration statement
under the Securities Act, a
certification to that
effect from such Holder (in
substantially the form of
Exhibit B-1 hereto); or
(C) if such Transfer Restricted
Security is being
transferred in reliance on
another exemption from the
registration requirements
of the Securities Act, a
certification to that
effect from such Holder (in
substantially the form of
Exhibit B-1 hereto) and an
Opinion of Counsel from
such Holder or the
transferee reasonably
acceptable to the Company
and to the Registrar to the
effect that such transfer
is in compliance with the
Securities Act.
(c) Intentionally omitted.
(d) Restrictions on Transfer and Exchange of Global Note.
Notwithstanding any other provision of this Indenture (other than the provisions
set forth in subsection (f) of this Section 2.06), the Global Note may not be
transferred as a whole except by the Depository to a nominee of the Depository
or by a nominee of the Depository to the Depository or another nominee of the
Depository or by the Depository or any such nominee to a successor Depository or
a nominee of such successor Depository.
(e) Intentionally omitted.
(f) Authentication of Definitive Notes in Absence of
Depository. If at any time:
(i) the Depository for the Notes
notifies the Company that the
Depository is unwilling or unable to
continue as Depository for the
Global Note and a successor
Depository for the Global Note is
<PAGE>
not appointed by the Company within
90 days after delivery of such
notice; or
(ii) the Company at its sole discretion,
notifies the Trustee in writing that
it elects to cause the issuance of
Definitive Notes under this
Indenture,
then the Company shall execute, and the Trustee shall, upon receipt of an
authentication order in accordance with Section 2.02 hereof, authenticate and
deliver, Definitive Notes in an aggregate principal amount equal to the
principal amount of the Global Note in exchange for such Global Note.
(g) Legends.
(i) Except as permitted by the following
paragraphs (ii) and (iii), each Note
certificate evidencing the Global
Note and Definitive Notes (and all
Notes issued in exchange therefor or
substitution thereof) shall bear
legends in substantially the
following form:
THE NOTES EVIDENCED HEREBY HAVE NOT
BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT") AND
MAY NOT BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED EXCEPT (1) TO
A PERSON WHOM THE SELLER REASONABLY
BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE
MEANING OF RULE 144A UNDER THE
SECURITIES ACT PURCHASING FOR ITS
OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER IN A
TRANSACTION MEETING THE REQUIREMENTS
OF RULE 144A, (2) PURSUANT TO AN
EXEMPTION FROM REGISTRATION UNDER
THE SECURITIES ACT PROVIDED BY RULE
144 THEREUNDER (IF AVAILABLE), (3)
PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OR (4) TO
INSTITUTIONAL ACCREDITED INVESTORS
IN A TRANSACTION EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, IN EACH CASE IN
ACCORDANCE WITH ALL APPLICABLE
SECURITIES LAWS OF THE STATES OF THE
UNITED STATES AND OTHER
JURISDICTIONS.
<PAGE>
(ii) Upon any sale or transfer of a
Transfer Restricted Security
(including any Transfer Restricted
Security represented by the Global
Note) pursuant to Rule 144 under the
Securities Act or pursuant to an
effective registration statement
under the Securities Act:
(A) in the case of any Transfer
Restricted Security that is
a Definitive Note, the
Registrar shall permit the
Holder thereof to exchange
such Transfer Restricted
Security for a Definitive
Note that does not bear the
legend set forth in (i)
above and rescind any
restriction on the transfer
of such Transfer Restricted
Security upon receipt of a
certification from the
transferring holder
substantially in the form
of Exhibit B-1 hereto, and;
(B) in the case of any Transfer
Restricted Security
represented by the Global
Note, such Transfer
Restricted Security shall
not be required to bear the
legend set forth in (i)
above, but shall continue
to be subject to the
provisions of Section
2.06(a) and (b) hereof.
(iii) Upon any sale or transfer of a
Transfer Restricted Security
(including any Transfer Restricted
Security represented by the Global
Note) in reliance on any exemption
from the registration requirements
of the Securities Act (other than
exemptions pursuant to Rule 144A or
Rule 144 under the Securities Act)
in which the Holder or the
transferee provides an Opinion of
Counsel to the Company and the
Registrar in form and substance
reasonably acceptable to the Company
and the Registrar (which Opinion of
Counsel shall also state that the
transfer restrictions contained in
the legend are no longer
applicable):
(A) in the case of any Transfer
Restricted Security that is
a Definitive Note, the
Registrar shall permit the
Holder thereof to exchange
such Transfer Restricted
Security for a Definitive
Note that does not bear the
legend set forth in (i)
above and rescind any
restriction on the transfer
of such Transfer Restricted
Security; and
<PAGE>
(B) in the case of any Transfer
Restricted Security
represented by the Global
Note, such Transfer
Restricted Security shall
not be required to bear the
legend set forth in (i)
above, but shall continue
to be subject to the
provisions of Section
2.06(a) and (b) hereof.
(iv) Notwithstanding the foregoing, upon
consummation of the Exchange Offer
in accordance with the Registration
Rights Agreement, the Company shall
issue and, upon receipt of an
authentication order in accordance
with Section 2.02 hereof, the
Trustee shall authenticate Series B
Notes in exchange for Series A Notes
accepted for exchange in the
Exchange Offer, which Series B Notes
shall not bear the legend set forth
in (i) above, and the Registrar
shall rescind any restriction on the
transfer of such Series B Notes, in
each case unless the Holder of such
Series A Notes is either (A) a
broker-dealer, (B) a Person
participating in the distribution of
the Series A Notes or (C) a Person
who is an affiliate (as defined in
Rule 144A) of the Company.
(h) Cancellation and/or Adjustment of the Global Note. At such
time as all beneficial interests in the Global Note have been exchanged for
Definitive Notes, redeemed, repurchased or canceled, the Global Note shall be
returned to or retained and canceled by the Trustee in accordance with Section
2.11 hereof. At any time prior to such cancellation, if any beneficial interest
in the Global Note is exchanged for Definitive Notes, redeemed, repurchased or
canceled, the principal amount of Notes represented by the Global Note shall be
reduced accordingly and an endorsement shall be made on the Global Note, by the
Trustee or the Note Custodian, at the direction of the Trustee, to reflect such
reduction.
(i) General Provisions Relating to Transfers and
Exchanges.
(i) To permit registrations of transfers
and exchanges, the Company shall
execute and the Trustee shall
authenticate Definitive Notes and
the Global Note at the Registrar's
request.
(ii) No service charge shall be made to a
Holder for any registration of
transfer or exchange, but the
Company may require payment of a sum
sufficient to cover any transfer tax
or similar governmental charge
payable in connection therewith
(other than any such transfer taxes
or similar governmental charge
payable upon exchange or transfer
pursuant to Sections 2.10 and 8.05
hereto).
<PAGE>
(iii) All Definitive Notes and the Global
Note issued upon any registration of
transfer or exchange of Definitive
Notes or the Global Note shall be
the valid obligations of the
Company, evidencing the same debt,
and entitled to the same benefits
under this Indenture, as the
Definitive Notes or the Global Note
surrendered upon such registration
of transfer or exchange.
(iv) Prior to due presentment for the
registration of a transfer of any
Note, the Trustee, any Agent and the
Company may deem and treat the
Person in whose name any Note is
registered as the absolute owner of
such Note for the purpose of
receiving payment of principal of
and interest on such Notes, and
neither the Trustee, any Agent nor
the Company shall be affected by
notice to the contrary.
(v) The Trustee shall authenticate
Definitive Notes and the Global Note
in accordance with the provisions of
Section 2.02 hereof.
Section 2.07. Replacement Notes.
If any mutilated Note is surrendered to the Trustee, or the
Company and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Note, the Company shall issue and the Trustee
shall authenticate a replacement if the Trustee's requirements are met. If
required by the Trustee or the Company, an indemnity bond must be supplied by
the Holder that is sufficient in the judgment of the Trustee and the Company to
protect the Company, the Trustee, any Agent and any authenticating agent from
any loss that any of them may suffer if a Note is replaced. The Company may
charge for any expenses in replacing a Note.
Every replacement Note is an additional obligation of the
Company and shall be entitled to all of the benefits of this Indenture equally
and proportionately with all other Notes duly issued hereunder.
Section 2.08. Outstanding Notes.
The Notes outstanding at any time are all the Notes
authenticated by the Trustee except for those cancelled by it, those delivered
to it for cancellation, and those described in this Section as not outstanding.
Except as set forth in Section 2.09 hereof, a Note does not cease to be
outstanding because the Company or an Affiliate of the Company holds the Note.
<PAGE>
If a Note is replaced pursuant to Section 2.07 hereof, it
ceases to be outstanding unless the Trustee receives proof satisfactory to it
that the replaced Note is held by a bona fide purchaser.
If the principal amount of any Note is considered paid under
Section 4.01 hereof, it ceases to be outstanding and interest on it ceases to
accrue.
If the Paying Agent (other than the Company, a Subsidiary or
an Affiliate of any thereof) holds, on a redemption date or maturity date, money
sufficient to pay Notes payable on that date, then on and after that date such
Notes shall be deemed to be no longer outstanding and shall cease to accrue
interest.
Section 2.09. Treasury Notes.
In determining whether the Holders of the required principal
amount of Notes have concurred in any direction, waiver or consent, Notes owned
by the Company or by any Person directly or indirectly controlling or controlled
by or under direct or indirect common control with the Company, shall be
considered as though not outstanding, except that for the purposes of
determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent, only Notes that a Trustee knows are so owned shall
be so disregarded.
Section 2.10. Temporary Notes.
Until definitive Notes are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Notes upon a written order
of the Company signed by an Officer. Temporary Notes shall be substantially in
the form of definitive Notes but may have variations that the Company considers
appropriate for temporary Notes and as shall be reasonably acceptable to the
Trustee. Without unreasonable delay, the Company shall prepare and the Trustee
shall authenticate definitive Notes in exchange for temporary Notes.
Holders of temporary Notes shall be entitled to all of the
benefits of this Indenture.
Section 2.11. Cancellation.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else shall cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and shall dispose of
cancelled Notes (subject to the record retention requirement of the Exchange Act
in accordance with its standard disposition policies in effect from time to
<PAGE>
time). Certification of the destruction of all cancelled Notes shall be
delivered to the Company. The Company may not issue new Notes to replace Notes
that it has paid or that have been delivered to the Trustee for cancellation.
Section 2.12. Defaulted Interest.
If the Company defaults in a payment of interest on the Notes,
it shall pay the defaulted interest in any lawful manner plus, to the extent
lawful, interest payable on the defaulted interest, to the Persons who are
Holders on a subsequent special record date, in each case at the rate provided
in the Notes and in Section 4.01 hereof. The Company shall notify the Trustee in
writing of the amount of defaulted interest proposed to be paid on each Note and
the date of the proposed payment. The Company shall fix or cause to be fixed
each such special record date and payment date, provided that no such special
record date shall be less than 10 days prior to the related payment date for
such defaulted interest. At least 15 days before the special record date, the
Company (or, upon the written request of the Company, the Trustee in the name
and at the expense of the Company) shall mail or cause to be mailed to Holders a
notice that states the special record date, the related payment date and the
amount of such interest to be paid.
ARTICLE 3
CHANGE OF CONTROL OFFER
Within 50 days of (i) the proposed occurrence of a Change of
Control or (ii) the occurrence of a Change of Control Triggering Event, the
Company shall notify the Trustee in writing of such proposed occurrence or
occurrence, as the case may be, and shall make an offer to purchase (the "Change
of Control Offer") the Notes at a purchase price equal to 100% of the principal
amount thereof plus any accrued and unpaid interest thereon to the Change of
Control Payment Date (as hereinafter defined) (the "Change of Control Purchase
Price") in accordance with the procedures set forth in this covenant.
Within 50 days of (i) the proposed occurrence of a Change of
Control or (ii) the occurrence of a Change of Control Triggering Event, the
Company also shall (a) cause a notice of the Change of Control Offer to be sent
at least once to the Dow Jones News Service or similar business news service in
the United States and (b) send by first-class mail, postage prepaid, to the
Trustee and to each holder of the Notes, at his address appearing in the
register of the Notes maintained by the Registrar, a notice stating:
(1) that the Change of Control Offer is being made
pursuant to this covenant and that all Notes tendered will be
accepted for payment, provided that a Change of Control
Triggering Event has occurred and otherwise subject to the
terms and conditions set forth herein;
<PAGE>
(2) the Change of Control Purchase Price and the
purchase date (which shall be a Business Day no earlier than
50 days from the date such notice is mailed and no later than
15 days after the date of the corresponding Change of Control
Triggering Event) (the "Change of Control Payment Date");
(3) that any Note not tendered will continue to
accrue interest;
(4) that, unless the Company defaults in the payment
of the Change of Control Purchase Price, any Notes accepted
for payment pursuant to the Change of Control Offer shall
cease to accrue interest after the Change of Control Payment
Date;
(5) that holders accepting the offer to have their
Notes purchased pursuant to a Change of Control Offer will be
required to surrender the Notes to the Paying Agent at the
address specified in the notice prior to the close of business
on the Business Day preceding the Change of Control Payment
Date;
(6) that holders will be entitled to withdraw their
acceptance if the Paying Agent receives, not later than the
close of business on the third Business Day preceding the
Change of Control Payment Date, a telegram, telex, facsimile
transmission or letter setting forth the name of the holder,
the principal amount of the Notes delivered for purchase, and
a statement that such holder is withdrawing his election to
have such Notes purchased;
(7) that holders whose Notes are being purchased only
in part will be issued new Notes equal in principal amount to
the unpurchased portion of the Notes surrendered, provided
that each Note purchased and each such new Note issued shall
be in an original principal amount in denominations of $1,000
and integral multiples thereof; and
(8) any other procedures that a holder must follow to
accept a Change of Control Offer or effect withdrawal of such
acceptance.
Notwithstanding any other provision of this Article 3, in the
case of a notice of a Change of Control Offer that is being furnished by the
Company with respect to a proposed Change of Control that has not yet actually
occurred, the Company may specify in such notice that holders of the Notes shall
be required to notify the Company, by a date not earlier than the date (the
"Proposed Change of Control Response Date") which is 30 days from the date of
such notice, as to whether such holders will tender their Notes for payment
pursuant to the Change of Control Offer and to notify the Company of the
principal amount of such Notes to be so tendered (with the failure of any holder
to so notify the Company within such 30-day period to be deemed an election of
such holder not to accept such Change of Control Offer). In such event, the
Company shall have the option, to be exercised by a subsequent written notice to
be sent, no later than 15 days after the Proposed Change of Control Response
Date, to the same Persons to whom the original notice of the Change of Control
<PAGE>
Offer was sent, to cancel or otherwise effect the termination of the proposed
Change of Control and to rescind the related Change of Control Offer, in which
case the then outstanding Change of Control Offer shall be deemed to be null and
void and of no further effect.
On the Change of Control Payment Date, the Company shall (a)
accept for payment Notes or portions thereof tendered pursuant to the Change of
Control Offer, (b) deposit with the Paying Agent money sufficient to pay the
purchase price of all Notes or portions thereof so tendered and (c) deliver or
cause to be delivered to the Trustee Notes so accepted together with an
Officers' Certificate stating the Notes or portions thereof tendered to the
Company. The Paying Agent shall promptly mail to each holder of Notes so
accepted payment in an amount equal to the purchase price for such Notes, and
the Trustee shall promptly authenticate and mail to such holder a new Note equal
in principal amount to any unpurchased portion of the Notes surrendered;
provided that each such new Note shall be issued in an original principal amount
in denominations of $1,000 and integral multiples thereof.
There shall be no purchase of any Notes pursuant to this
covenant if there has occurred (prior to, on or after, as the case may be, the
tender of such Notes pursuant to the Change of Control Offer, by the holders of
such Notes) and is continuing an Event of Default. The Paying Agent will
promptly return to the respective holders thereof any Notes (a) the tender of
which has been withdrawn in compliance with this Indenture or (b) held by it
during the continuance of an Event of Default (other than a default in the
payment of the Change of Control Purchase Price with respect to such Notes).
In the event that the Company is required to make a Change of
Control Offer, the Company will comply with all applicable tender offer rules
including Rule 14e-1 under the Exchange Act, to the extent applicable.
ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes.
The Company shall pay the principal of and all interest on the
Notes on the dates and in the manner provided in the Notes and this Indenture.
An installment of principal or interest shall be considered paid on the date it
is due if the Trustee or Paying Agent holds on that date money designated for
and sufficient to pay such installment.
The Company will pay interest on overdue principal (including
post-petition interest in a proceeding under any Bankruptcy Law) and on overdue
interest, to the extent lawful, at the rate borne by the Notes.
Section 4.02. SEC Reports.
<PAGE>
The Company shall file with the Trustee, within 15 days after
it files with the SEC, copies of the annual reports and of the other
information, documents and reports (or copies of such portions of any of the
foregoing as the SEC may by rules and regulations prescribe), if any, which the
Company is required to file with the SEC pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934, as amended. The Company shall also comply with
the other provisions of TIA ss. 314(a).
Section 4.03. 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 (as a defense or
otherwise) or in any manner whatsoever claim or take the benefit or advantage
of, any stay or extension law or any usury law or other law which would prohibit
or forgive the Company from paying all or any portion of the principal of and/or
interest on the Notes as contemplated herein, wherever enacted, now or at any
time hereafter in force, or which may affect the covenants or the performance of
this Indenture; and (to the extent that it may lawfully do so) the Company
hereby expressly waives all benefit or advantage of any such law, and covenants
that it will not hinder, delay or impede the execution 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.
Section 4.04. Limitation on Transactions with Affiliates.
The Company shall not, and shall not permit any Restricted
Subsidiary to, engage in any transaction with any Affiliate upon terms which
would be any less favorable than those obtainable by the Company or a Restricted
Subsidiary in a comparable arm's-length transaction with a Person which is not
an Affiliate. The Company shall not, and shall not permit any Restricted
Subsidiary to, engage in any transaction (or series of related transactions)
involving in the aggregate $1,000,000 or more with any Affiliate except for (i)
the making of any Restricted Payment, (ii) any transaction or series of
transactions between the Company and one or more of its Restricted Subsidiaries
or between two or more of its Restricted Subsidiaries (provided that no more
than 5% of the equity interest in any of its Restricted Subsidiaries is owned by
an Affiliate), and (iii) the payment of compensation (including, without
limitation, amounts paid pursuant to employee benefit plans) for the personal
services of officers, directors and employees of the Company or any of its
Restricted Subsidiaries, so long as the Board of Directors of the Company in
good faith shall have approved the terms thereof and deemed the services
theretofore or thereafter to be performed for such compensation or fees to be
fair consideration therefor; and provided further that for any Asset Sale, or a
sale, transfer or other disposition (other than to the Company or any of its
Restricted Subsidiaries) of an interest in a Restricted Investment, involving an
amount greater than $25,000,000, such Asset Sale or transfer of interest in a
Restricted Investment is for fair value as determined by an opinion of a
nationally recognized investment banking firm filed with the Trustee.
Notwithstanding the foregoing, this provision shall not prohibit any such
transaction which is determined by the independent members of the Board of
Directors of the Company, in their reasonable, good faith judgment (as evidenced
<PAGE>
by a Board Resolution filed with the Trustee) to be (a) in the best interests of
the Company or such Restricted Subsidiary, and (b) upon terms which would be
obtainable by the Company or a Restricted Subsidiary in a comparable
arm's-length transaction with a Person which is not an Affiliate.
Section 4.05. Limitation on Indebtedness.
The Company shall not, and shall not permit any Restricted
Subsidiary to, directly or indirectly, create, incur, issue, assume or become
liable for, contingently or otherwise (collectively an "incurrence"), any
Indebtedness (other than the $150,000,000 of the Notes originally issued under
the Indenture) unless, after giving effect to such incurrence on a pro forma
basis, Indebtedness of the Company and its Restricted Subsidiaries, on a
consolidated basis, shall not be more than the product of the Annualized Pro
Forma EBITDA for the latest fiscal quarter preceding such incurrence for which
financial statements are available, multiplied by 8.75.
Notwithstanding the above, this provision will not limit the
incurrence of Indebtedness which is incurred by the Company or its Restricted
Subsidiaries for working capital purposes or capital expenditures with respect
to plant, property and equipment of the Company and its Restricted Subsidiaries
in an aggregate amount not to exceed $50,000,000. Further, this provision will
not limit Permitted Refinancing Indebtedness, subject to the provisions of
Section 4.06.
Section 4.06. Limitation on Restricted Payments.
So long as any of the Notes remain outstanding, the Company
shall not make, 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 continuing or shall occur
as a consequence of such Restricted Payment, or (b) immediately after giving
effect to any such Restricted Payment, the aggregate of all Restricted Payments
which shall have been made on or after January 1, 1993 (the amount of any
Restricted Payment, if other than cash, to be based upon fair market value as
determined in good faith by the Company's Board of Directors whose determination
shall be conclusive) would exceed an amount equal to the greater of (i) the sum
of $5,000,000 or (ii) the difference between (a) the Cumulative Credit and (b)
the sum of the aggregate amount of all Restricted Payments, and all Permitted
Investments made pursuant to clause (v) of the definition of "Permitted
Investments," made on or after January 1, 1993 plus 1.2 times Cumulative
Interest Expense.
Section 4.07. Reports to Holders.
The Company will send to the Trustee and to Noteholders,
within 15 days after the filing thereof with the SEC, copies of its annual
reports on Form 10-K, its Quarterly Reports on Form 10-Q and its Current Reports
on Form 8-K; provided, however, that notwithstanding any event which results in
the Company being relieved of its obligation to file information, documents and
<PAGE>
reports with the SEC pursuant to Sections 13 or 15(d) of the Exchange Act, the
Company shall nevertheless continue, so long as any Note remains outstanding and
unpaid, (i) to file with the SEC (at such time as it would be required to file
such reports under the Exchange Act), and to send to the Trustee and Noteholders
(within 15 days thereafter), quarterly and annual reports and information,
documents and other reports substantially equivalent to those it would have been
obligated to file if it had remained subject to such sections of the Exchange
Act, and (ii) so long as the Notes have not been registered pursuant to the
Registration Rights Agreement, upon the request of a Noteholder, to provide
information required to be delivered under Rule 144A(d)(4) under the Securities
Act to such Noteholder and its prospective purchasers designated by such
Noteholder.
Section 4.08. Notice of Defaults Or Events of Default.
In the event that any Default or Event of Default shall occur
and be continuing, the Company will, within 10 days of the occurrence thereof,
give written notice of such Default or Event of Default to the Trustee.
Section 4.09. Compliance Certificates.
The Company shall deliver to the Trustee on or before 105 days
after the end of its fiscal year and on or before 50 days after the end of its
second fiscal quarter in each year an Officers' Certificate stating whether or
not the signers know of any Default or Event of Default. If they do know of such
a Default or Event of Default, the certificate shall describe such Default or
Event of Default and the efforts to remedy or obtain a waiver of the same. The
certificate must comply with Section 11.05 hereof.
Section 4.10. Covenant to Secure Notes Equally.
Except for Liens created or assumed by the Company
in connection with the acquisition of real property or equipment to be used by
the Company in the operation of its business which do not secure Indebtedness in
excess of the purchase price of such real property or equipment, the Company
covenants that, if it shall create or assume any Lien upon any of its property
or assets, whether now owned or hereafter acquired, it will make or cause to be
made effective provisions whereby the Notes will be secured by such Lien equally
and ratably with all other Indebtedness of the Company secured by such Lien as
long as any such other Indebtedness of the Company shall be so secured. The
restriction imposed by this Section 4.10 shall not apply with respect to a Lien,
including a pledge of Capital Stock of a Subsidiary or an Affiliate, to secure
Indebtedness which is an obligation of such Subsidiary or Affiliate and not an
obligation of the Company.
Section 4.11. Limitation on Investment in Affiliates and Unrestricted
Subsidiaries.
After the date of this Indenture, the Company may not, nor
will the Company allow any Restricted Subsidiary to, make a Restricted
Investment other than by way of Permitted Investments unless pro forma for such
Restricted Investment the Leverage Ratio of the Company does not exceed 7.75:1.
<PAGE>
Section 4.12. Limitation on Sale of Assets.
Neither the Company nor any Restricted Subsidiary of the
Company shall sell an asset (including Capital Stock of Restricted Subsidiaries)
or reclassify a Restricted Subsidiary existing on the date of this Indenture as
an Unrestricted Subsidiary (a "Reclassification") unless (a) in the case of an
asset sale, (i) at least 75% of the net proceeds received by the Company or such
Restricted Subsidiary is in cash, cash equivalents or common or preferred
Capital Stock or debt securities issued by a Person which has Investment Grade
Senior Debt and (ii) cash proceeds from the asset sale are used to reduce debt
and such debt reduction results in the Company's Leverage Ratio being lower pro
forma after such asset sale than prior to such asset sale, or (b) in the case of
an asset sale or Reclassification, pro forma for such asset sale or
Reclassification the Indebtedness of the Company and its Restricted
Subsidiaries, on a consolidated basis, shall not be more than 7.75 multiplied by
Annualized Pro Forma EBITDA, provided that in no case under either clause (a) or
(b) shall the Company undertake an asset sale or Reclassification, if pro forma
for such an asset sale or Reclassification the Company and its Restricted
Subsidiaries would be the owners of fewer than 75% of the cable systems
(measured on the basis of basis subscribers as of February 22, 1994) owned by
the Company and its Restricted Subsidiaries as of February 22, 1994, provided
however, that the Company and its Restricted Subsidiaries may sell additional
assets of up to 10% of assets held as of February 22, 1994 if the consideration
received from such sale is (i) cash which is used within 12 months to purchase
additional systems of equivalent value or (ii) other cable systems of equivalent
value.
ARTICLE 5
SUCCESSOR CORPORATION
Section 5.01. Mergers and Consolidations.
The Company may not consolidate with, merge with or into, or
transfer all or substantially all of its assets (as an entirety or substantially
as an entirety in one transaction or a series of related transactions), to any
Person unless: (i) the Company shall be the continuing Person, or the Person (if
other than the Company) formed by such consolidation or into which the Company
is merged or to which the properties and assets of the Company are transferred
shall be a corporation organized and existing under the laws of the United
States or any State thereof or the District of Columbia and shall expressly
assume, by a supplemental indenture, executed and delivered to the Trustee, in
form satisfactory to the Trustee, all of the obligations of the Company under
the Notes and this Indenture, and the obligations under this Indenture shall
remain in full force and effect; (ii) immediately before and immediately after
giving effect to such transaction, no Default or Event of Default shall have
occurred and be continuing; and (iii) immediately after giving effect to such
transaction on a pro forma basis for the most recent quarter, the pro forma
Consolidated Fixed Charge Ratio of the surviving entity shall be at least 1:1;
provided that, if the Consolidated Fixed Charge Ratio of the Company for the
most recent quarter preceding such transaction is within the range set forth in
Column A below, then the pro forma Consolidated Fixed Charge Ratio of the
surviving entity after giving effect to such transaction shall be at least equal
<PAGE>
to the greater of the percentage of the Consolidated Fixed Charge Ratio of the
Company for the most recent quarter preceding such transaction set forth in
Column B below or the ratio set forth in Column C below:
A B C
1.1111:1 to 1.4999:1 90% 1.00:1
1.5 and higher 80% 1.35:1
and provided, further, that if the pro forma Consolidated Fixed Charge Ratio of
the surviving entity is 2:1 or more, the calculation in the preceding proviso
shall be inapplicable and such transaction shall be deemed to have complied with
the requirements of such proviso.
In connection with any consolidation, merger or
transfer contemplated by this Section 5.01, the Company shall deliver, or cause
to be delivered, to the Trustee, in form and substance reasonably satisfactory
to the Trustee, an Officers' Certificate and an Opinion of Counsel, each stating
that such consolidation, merger or transfer and the supplemental indenture in
respect thereto comply with this Section 5.01 and that all conditions precedent
herein provided for relating to such transaction or transactions have been
complied with.
Section 5.02. Successor Person Substituted.
Upon any consolidation or merger, or any transfer of all or
substantially all of the assets of the Company in accordance with Section 5.01
above, the successor corporation formed by such consolidation or into which the
Company is merged or to which such transfer 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 corporation had been
named as the Company herein, and thereafter the predecessor corporation shall be
relieved of all obligations and covenants under this Indenture and the Notes.
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default.
An "Event of Default" occurs if:
(1) the Company defaults in the payment of any
principal of any Note when the same becomes due and payable at
maturity, upon acceleration or otherwise;
<PAGE>
(2) the Company defaults in the payment of any
interest on any Note when the same becomes due and payable and
the default continues for a period of 30 days;
(3) the Company defaults in the observance or
performance of any other covenant in the Notes or this
Indenture for 60 days after written notice from the Trustee or
the Holders of not less than 25% in aggregate principal amount
of the Notes then outstanding;
(4) the Company fails to pay when due principal,
interest or premium aggregating $10,000,000 or more with
respect to any Indebtedness of the Company or any Restricted
Subsidiary, or the acceleration of any such Indebtedness which
default shall not be cured or waived, or such acceleration
shall not be rescinded or annulled, within ten days after
written notice as provided in this Indenture;
(5) a court of competent jurisdiction enters a final
judgment or judgments for the payment of money in excess of
$10,000,000 against the Company or any Restricted Subsidiary
and such judgment remains undischarged for a period of 60
consecutive days during which a stay of enforcement of such
judgment shall not be in effect;
(6) the Company, or any Restricted Subsidiary with
liabilities of greater than $10,000,000 under GAAP as of the
date of the event described in this clause (6), pursuant to or
within the meaning of any Bankruptcy Law:
(A) commences a voluntary case,
(B) consents to the entry of an
order for relief against it
in an involuntary case,
(C) consents to the appointment
of a Custodian of it or for
all or substantially all of
its property, or
(D) makes a general assignment
for the benefit of its
creditors;
(7) a court of competent jurisdiction enters an order
or decree under any Bankruptcy Law that:
(A) is for relief against the
Company, or any Restricted
Subsidiary with liabilities
of greater than $10,000,000
<PAGE>
under GAAP as of the
effective date of such
order or decree, in an
involuntary case,
(B) appoints a Custodian of the
Company, or any Restricted
Subsidiary with liabilities
of greater than $10,000,000
under GAAP as of the
effective date of such
order or decree, or for all
or substantially all of its
property, or
(C) orders the liquidation of
the Company, or any
Restricted Subsidiary with
liabilities of greater than
$10,000,000 under GAAP as
of the effective date of
such order or decree, and
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 or similar official under any
Bankruptcy Law.
A Default under clauses (3) and (4) is not an Event of Default
until the Trustee notifies the Company, or the Holders of at least 25% in
aggregate principal amount of the Securities notify the Company and the Trustee,
of the Default and the Company does not cure the Default within (a) 60 days
after receipt of such notice in the case of a Default under clause (3) and (b)
10 days after receipt of such notice in the case of a Default under clause (4).
The notice must specify the Default, demand that it be remedied and state that
the notice is a "Notice of Default." If the Holders of at least 25% in principal
amount of the outstanding Notes request the Trustee to give such notice on their
behalf, the Trustee shall do so.
Subject to Section 7.05 hereof, the Trustee may withhold
notice to the Holders of the Notes of any default (except in payment of
principal or interest on the Notes) if the Trustee considers it to be in the
best interest of the Holders of the Notes to do so.
Section 6.02. Acceleration.
If an Event of Default (other than an Event of Default
resulting from certain events of bankruptcy, insolvency or reorganization)
occurs and is continuing, the Trustee by notice to the Company, or the Holders
of not less than 25% in aggregate principal amount of the Notes then outstanding
may declare to be immediately due and payable the principal amount of all the
Notes then outstanding plus accrued but unpaid interest to the date of
acceleration; provided, however, that after such acceleration but before a
judgment or decree based on such acceleration is obtained by the Trustee, the
Holders of a majority in aggregate principal amount of outstanding Notes by
written notice to the Trustee and the Company may rescind and annul such
<PAGE>
acceleration and its consequences if all existing Events of Default, other than
the nonpayment of accelerated principal or interest, have been cured or waived.
In case an Event of Default specified in Section 6.01(6) or (7) occurs, such
amount with respect to all of the Notes shall be due and payable immediately
without any declaration or other act on the part of the Trustee or the Holders
of the Notes.
Section 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee
may pursue any available remedy by proceeding at law or in equity to collect the
payment of principal of and interest on the Notes or to enforce the performance
of any provision of the Notes or this Indenture and may take any necessary
action requested of it as Trustee to settle, compromise, adjust or otherwise
conclude any proceedings to which it is a party.
The Trustee may maintain a proceeding even if it does not
possess any of the Notes or does not produce any of them in the proceeding. A
delay or omission by the Trustee or any Noteholder in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative.
Section 6.04. Waiver of Past Defaults and Events of Default.
Subject to Sections 6.02, 6.07 and 8.02 hereof, the Holders of
a majority in principal amount of the Notes then outstanding have the right to
waive any existing default or compliance with any provision of this Indenture or
the Notes and to direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee, subject to certain limitations
specified in this Indenture.
Section 6.05. Control by Majority.
The Holders of a majority in principal amount of the Notes
then outstanding may 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 by this Indenture. The Trustee, however, may
refuse to follow any direction that conflicts with law or this Indenture or that
the Trustee determines may be unduly prejudicial to the rights of another
Noteholder not taking part in such direction, and the Trustee shall have the
right to decline to follow any such direction if the Trustee, being advised by
counsel, determines that the action so directed may not lawfully be taken or if
the Trustee in good faith shall, by a Trust Officer, determine that the
proceedings so directed would involve it in personal liability; provided that
the Trustee may take any other action deemed proper by the Trustee which is not
inconsistent with such direction.
Section 6.06. Limitation on Suits.
<PAGE>
Subject to Section 6.07 below, a Noteholder may not institute
any proceeding or pursue any remedy with respect to this Indenture or the Notes
unless:
(1) the Holder gives to the Trustee written
notice of a continuing Event of Default;
(2) the Holders of at least 25% in aggregate
principal amount of the Notes then outstanding make a written
request to the Trustee to pursue the remedy;
(3) such Holder or Holders offer to the Trustee
indemnity reasonably satisfactory to the Trustee against any
loss, liability or expense;
(4) the Trustee does not comply with the request
within 60 days after receipt of the request and the offer of
indemnity; and
(5) 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 aggregate principal
amount of the Notes then outstanding.
A Noteholder may not use this Indenture to prejudice the
rights of another Noteholder or to obtain a preference or priority over another
Noteholder.
Section 6.07. Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the
right of any Holder of a Note to receive payment of principal of and interest on
the Note on or after the respective due dates expressed in the Note, or to bring
suit for the enforcement of any such payment on or after such respective dates,
is absolute and unconditional and shall not be impaired or affected without the
consent of the Holder.
Section 6.08. Collection Suit by Trustee.
If an Event of Default in payment of principal or interest
specified in Section 6.01(1) or (2) hereof occurs and is continuing, the Trustee
may recover judgment in its own name and as trustee of an express trust against
the Company or any other obligor on the Notes for the whole amount of unpaid
principal and accrued interest remaining unpaid, together with interest on
overdue principal and, to the extent that payment of such interest is lawful,
interest on overdue installments of interest, in each case at the rate then
borne by the Notes, and such further amounts 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.
Section 6.09. Trustee May File Proofs of Claim.
<PAGE>
The Trustee may file such proofs of claim and 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 the
Noteholders allowed in any judicial proceedings relative to the Company (or any
other obligor upon the Notes), its creditors or its property and shall be
entitled and empowered to collect and receive any monies or other property
payable or deliverable on any such claims and to distribute the same after
deduction of its charges and expenses to the extent that any such charges and
expenses are not paid out of the estate in any such proceedings and any
Custodian in any such judicial proceeding is hereby authorized by each
Noteholder 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
Noteholders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee or any predecessor trustee
under Section 7.07 hereof.
To the extent that the payment of any such compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, and
any other amounts due the Trustee or any predecessor Trustee under Section 7.07
hereof out of the estate in any such proceeding shall be denied for any reason,
payment of the same shall be secured by a lien on, and shall be paid out of, any
and all distributions, dividends, monies, securities and other properties which
the Holders of the Notes may be entitled to receive in such proceeding whether
in liquidation or under any plan of reorganization or arrangement or otherwise.
Nothing herein contained shall be deemed to authorize the Trustee to authorize
or consent to or accept or adopt on behalf of any Noteholder any plan of
reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any Holder thereof, or to authorize the Trustee to vote in respect
of the claim of any Noteholder in any such proceedings.
Section 6.10. Priorities.
If the Trustee collects any money pursuant to this Article 6,
it shall pay out the money in the following order:
FIRST: to the Trustee or any predecessor trustee for
amounts due under Sections 6.09 and 7.07 hereof;
SECOND: to Noteholders for amounts due and unpaid on
the Notes for principal and interest as to each, ratably, without
preference or priority of any kind, according to the amounts due
and payable on the Notes; and
THIRD: to the Company.
The Trustee may fix a record date and payment date for any
payment to Noteholders pursuant to this Section 6.10.
<PAGE>
Section 6.11. Undertaking for Costs.
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 or
omitted by it as Trustee, a court in its discretion may require the filing by
any party litigant in the suit of an undertaking to pay the costs of the suit,
and the court in its discretion may assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section 6.11 does not apply to a suit by the Trustee, a suit by a
Holder pursuant to Section 6.07 hereof or a suit by Holders of more than 10% in
principal amount of the Notes then outstanding.
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee.
(a) If an Event of Default has occurred and is
continuing, the Trustee shall exercise such of the rights and powers vested in
it by this Indenture and use the same degree of care and skill in their exercise
as a prudent man would exercise or use under the same circumstances in the
conduct of his own affairs.
(b) Except during the continuance of an Event of
Default:
(1) The Trustee need perform only those duties that
are specifically set forth in this Indenture and no others.
(2) In the absence of bad faith on its part, the
Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the
Trustee and conforming to the requirements of this Indenture.
The Trustee, however, shall examine the certificates and
opinions to determine whether or not they conform to the
requirements of this Indenture.
(c) The Trustee may not be relieved from
liability for its own negligent action, its own negligent failure to act, or its
own willful misconduct, except that:
(1) This paragraph does not limit the effect of
paragraph (b) of this Section 7.01.
(2) The Trustee shall not be liable for any error of
judgment made in good faith by a Trust Officer, unless it is
proved that the Trustee was negligent in ascertaining the
pertinent facts.
<PAGE>
(3) The Trustee shall not be liable with respect to
any action it takes or omits to take in good faith in
accordance with a direction received by it pursuant to Section
6.05 hereof.
(4) 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.
(d) Whether or not therein expressly so
provided, paragraphs (a), (b) and (c) of this Section 7.01 shall govern every
provision of this Indenture that in any way relates to the Trustee.
(e) The Trustee may refuse to perform any duty
or exercise any right or power unless it receives indemnity reasonably
satisfactory to it against any loss, liability, expense or fee.
(f) The Trustee shall not be liable for interest
on any money received by it except as the Trustee may agree with the Company.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by law.
Section 7.02. Rights of Trustee.
Subject to Section 7.01 hereof:
(1) The Trustee may rely on any document reasonably
believed by it to be genuine and to have been signed or
presented by the proper person. The Trustee need not
investigate any fact or matter stated in the document.
(2) Before the Trustee acts or refrains from acting,
it may require an Officers' Certificate or an Opinion of
Counsel, or both, which shall conform to the provisions of
Section 11.05 hereof. The Trustee shall not be liable for any
action it takes or omits to take in good faith in reliance on
such Certificate or Opinion.
(3) The Trustee may act through agents and shall not
be responsible for the misconduct or negligence of any agent
appointed with due care.
(4) The Trustee shall not be liable for any action it
takes or omits to take in good faith which it reasonably
believes to be authorized or within its rights or powers.
(5) The Trustee may consult with counsel, and the
advice or opinion of such counsel as to matters of law shall
be full and complete authorization and protection in respect
<PAGE>
of any action taken, omitted or suffered by it hereunder in
good faith and in accordance with the advice or opinion of
such counsel.
Section 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become
the owner or pledgee of Notes and may otherwise deal with the Company or its
Affiliates with the same rights it would have if it were not Trustee. Any Agent
may do the same with like rights. The Trustee, however, shall be subject to
Sections 7.10 and 7.11 hereof.
Section 7.04. Trustee's Disclaimer.
The Trustee makes no representation as to the validity or adequacy of this
Indenture or the Notes, it shall not be accountable for the Company's use of the
proceeds from the sale of Notes and it shall not be responsible for any
statement in the Notes other than its certificate of authentication.
Section 7.05. Notice of Defaults.
If a Default occurs and is continuing and if it is known to
the Trustee, the Trustee shall mail to each Noteholder notice of the Default
within 90 days after it occurs. Except in the case of a Default in payment of
the principal of or interest on any Note the Trustee may withhold the notice if
and so long as the board of directors of the Trustee, the executive committee or
any trust committee of such board and/or its Trust Officers in good faith
determine(s) that withholding the notice is in the interests of the Noteholders.
Section 7.06. Reports by Trustee to Holders.
Within 60 days after May 15 of any year, commencing the May 15
following the date of this Indenture, the Trustee shall mail to each Noteholder
a brief report dated as of such May 15 that complies with TIA ss. 313(a) (but if
no event described in TIA ss. 313(a) has occurred within the twelve months
preceding the reporting date, no report need be transmitted). The Trustee also
shall comply with TIA ss. 313(b)(2).
Reports pursuant to this Section shall be transmitted by mail:
(1) to all registered Holders of Notes, as the names
and addresses of such Holders appear on the Registrar's books;
(2) to such Holders of Notes as have, within the two
years preceding such transmission, filed their names and
addresses with the Trustee for that purpose; and
<PAGE>
(3) except in the case of reports pursuant to TIA ss.
313(b), to each Noteholder whose name and address is preserved
at the time by the Trustee, as provided in Section 2.05.
A copy of each report at the time of its mailing to
Noteholders shall be filed with the SEC and each stock exchange on which the
Notes are listed. The Company shall notify the Trustee when the Notes are listed
on any stock exchange.
Section 7.07. Compensation and Indemnity.
The Company shall pay to the Trustee from time to time
reasonable compensation for its services hereunder (which compensation shall not
be limited by any provision of law in regard to the compensation of a trustee of
an express trust). The Company shall reimburse the Trustee upon request for all
reasonable disbursements, expenses and advances incurred or made by it in
connection with its duties under this Indenture, including the reasonable
compensation, disbursements and expenses of the Trustee's agents and counsel.
The Company shall indemnify the Trustee for, and hold it
harmless against, any loss, liability or reasonable expense incurred by it in
connection with the performance of its duties under this Indenture including the
reasonable 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 (including, without limitation, settlement costs). The Trustee shall
notify the Company promptly of any claim asserted against the Trustee for which
it may seek indemnity.
The Company need not reimburse the Trustee for any expense or
indemnify it against any loss or liability incurred by the Trustee through its
negligence or bad faith. To secure the Company's payment obligations in Sections
6.09 and 7.07, the Trustee shall have a lien prior to the Notes on all money or
property held or collected by the Trustee except such money or property held in
trust to pay principal of and interest on particular Notes.
When the Trustee incurs expenses or renders services after an
Event of Default specified in Section 6.01(6) or (7) hereof occurs, the expenses
and the compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law. However, in the event that such
expenses of administration are disallowed by a final judgment of a court of
competent jurisdiction, the expenses thereby, and all other unreimbursed
expenses of the Trustee, shall constitute a general unsecured claim of the
Trustee against the estate.
For purposes of this Section 7.07, the term "Trustee" shall
include any trustee appointed pursuant to Article 10.
<PAGE>
Section 7.08. Replacement of Trustee.
The Trustee may resign by so notifying the Company. The
Holders of a majority in principal amount of the outstanding Notes may remove
the Trustee by notifying the removed Trustee and may appoint a successor Trustee
with the Company's written consent. Subject to the provisions of Section 6.11,
any Noteholder who has been a bona fide holder of Notes 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, if the Trustee fails, after written notice therefor by such Holder,
to comply with the provisions of clause (i) of TIA 310(b). The Company may
remove the Trustee at its election if:
(1) the Trustee fails to comply with Section
7.10 hereof;
(2) the Trustee is adjudged a bankrupt or an
insolvent;
(3) a receiver or other public officer takes charge
of the Trustee or its property;
(4) the Trustee otherwise becomes incapable of
acting; or
(5) a successor corporation becomes successor
Trustee pursuant to Section 7.09 below.
If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason, the Company shall promptly appoint a
successor Trustee.
If a successor Trustee does not take office within 45 days
after the retiring Trustee resigns or is removed, the retiring Trustee, the
Company or the Holders of a majority in principal amount of the outstanding
Notes may petition any court of competent jurisdiction for the appointment of a
successor Trustee.
If the Trustee fails to comply with Section 7.10, any
Noteholder may petition any court of competent jurisdiction for the removal of
the Trustee and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately following
such delivery, the retiring Trustee shall transfer all property held by it as
Trustee to the successor Trustee, the resignation or removal of the retiring
Trustee shall become effective, and the successor Trustee shall have all the
rights, powers and duties of the Trustee under this Indenture. A successor
Trustee shall mail notice of its succession to each Noteholder.
Section 7.09. Successor Trustee by Consolidation, Merger or Conversion.
<PAGE>
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust assets to, another
corporation, subject to Section 7.10 hereof, the successor corporation without
any further act shall be the successor Trustee.
Section 7.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA ss. 310(a)(1) and (2) in every respect. The Trustee shall
have a combined capital and surplus of at least $5,000,000 as set forth in its
most recent published annual report of condition. The Trustee shall comply with
TIA ss. 310(b), including the provision in SS 310(b)(1). Section 7.11.
Preferential Collection of Claims Against Company.
The Trustee shall comply with TIA 311(a), excluding
any creditor relationship listed in TIA 311(b). A Trustee who has resigned or
been removed shall be subject to TIA 311(a) to the extent indicated therein.
Section 7.12. Paying Agents.
The Company shall cause each Paying Agent other than the
Trustee to execute and deliver to it and the Trustee an instrument in which such
agent shall agree with the Trustee, subject to the provisions of this Section
7.12:
(A) that it will hold all sums
held by it as agent for the
payment of principal of or
interest on, the Notes
(whether such sums have
been paid to it by the
Company or by any obligor
on the Notes) in trust for
the benefit of Holders of
the Notes;
(B) that it will at any time
during the continuance of
any Event of Default, upon
written request from the
Trustee, deliver to the
Trustee all sums so held in
trust by it; and
(C) that it will give the
Trustee written notice
within three (3) Business
Days of any failure of the
Company (or by any obligor
on the Notes) in the
payment of any installment
of the principal of or
interest on, the Notes when
the same shall be due and
payable.
<PAGE>
ARTICLE 8
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 8.01. Without Consent of Holders.
The Company and the Trustee may amend or supplement this
Indenture or the Notes without notice to or consent of any Noteholder:
(1) to comply with Section 5.01 hereof;
(2) to convey, transfer, assign, mortgage or pledge
any property to the Trustee and otherwise to comply with
Section 4.10 hereof;
(3) to provide for uncertificated Notes in addition
to or in place of certificated Notes;
(4) to issue up to $150,000,000 in aggregate
principal amount of additional Notes pursuant to this
Indenture; or
(5) to cure any ambiguity, defect or inconsistency,
or to make any other change that does not materially and
adversely affect the rights of any Noteholder.
The Trustee is hereby authorized to join with the Company in
the execution of any supplemental indenture authorized or permitted by the terms
of this Indenture and to make any further appropriate agreements and
stipulations which may be therein contained, but the Trustee shall not be
obligated to enter into any such supplemental indenture which adversely affects
its own rights, duties or immunities under this Indenture.
Section 8.02. With Consent of Holders.
The Company and the Trustee may modify or supplement this
Indenture or the Notes with the written consent of the Holders of at least
one-half in principal amount of the outstanding Notes without notice to any
Noteholder. The Holders of a majority in aggregate principal amount of the
outstanding Notes may waive compliance in a particular instance by the Company
with any provision of this Indenture or the Notes without notice to any
Noteholder. Subject to Section 8.04, without the consent of each Noteholder
affected, however, an amendment, supplement or waiver, including a waiver
pursuant to Section 6.04, may not:
(1) reduce the amount of Notes whose Holders must
consent to an amendment, supplement or waiver to this
Indenture or the Notes;
(2) reduce the rate of or change the time for payment
of interest on any Note;
<PAGE>
(3) reduce the principal of or change the stated
maturity of any Note;
(4) change the amount or time of any payment required
by the Notes or provide for the redemption of the Notes prior
to maturity;
(5) waive a default in the payment of the principal
of, interest on, or redemption payment with respect to, any
Note;
(6) make any Note payable in money other than that
stated in the Note or change the place of payment from New
York, New York; or
(7) make any changes in Sections 6.04, 6.07
hereof or this sentence of Section 8.02.
After an amendment, supplement or waiver under this Section
8.02 becomes effective, the Company shall mail to the Holders a notice briefly
describing the amendment, supplement or waiver.
Upon the request of the Company, accompanied by a Board
Resolution authorizing the execution of any such supplemental indenture, and
upon the filing with the Trustee of evidence of the consent of the Noteholders
as aforesaid, the Trustee shall join with the Company in the execution of such
supplemental indenture unless such supplemental indenture affects the Trustee's
own rights, duties or immunities under this Indenture, in which case the Trustee
may in its discretion, but shall not be obligated to, enter into such
supplemental indenture.
It shall not be necessary for the consent of the Holders under
this Section to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
Section 8.03. Compliance with Trust Indenture Act.
Every amendment to or supplement of this Indenture or the
Notes shall comply with the TIA as then in effect.
Section 8.04. Revocation and Effect of Consents.
Until an amendment, supplement, waiver or other action becomes
effective, a consent to it by a Holder of a Note is a continuing consent
conclusive and binding upon such Holder and every subsequent Holder of the same
Note or portion thereof, and of any Note issued upon the transfer thereof or in
exchange therefor or in place thereof, even if notation of the consent is not
made on any such Note. Any such Holder or subsequent Holder, however, may revoke
the consent as to his Note or portion of a Note, if the Trustee receives the
<PAGE>
notice of revocation before the date the amendment, supplement, waiver or other
action becomes effective.
The Company may, but shall not be obligated to, fix a record
date for the purpose of determining the Holders entitled to consent to any
amendment, supplement, or waiver. If a record date is fixed, then,
notwithstanding the preceding paragraph, those Persons who were Holders at such
record date (or their duly designated proxies), and only such Persons, shall be
entitled to consent to such amendment, supplement, or waiver or to revoke any
consent previously given, whether or not such Persons continue to be Holders
after such record date. No such consent shall be valid or effective for more
than 90 days after such record date unless the consent of the requisite number
of Holders has been obtained.
After an amendment, supplement, waiver or other action becomes
effective, it shall bind every Noteholder, unless it makes a change described in
any of clauses (1) through (7) of Section 8.02 hereof. In that case the
amendment, supplement, waiver or other action shall bind each Holder of a Note
who has consented to it and every subsequent Holder of a Note or portion of a
Note that evidences the same debt as the consenting Holder's Note.
Section 8.05. Notation on or Exchange of Notes.
If an amendment, supplement, or waiver changes the terms of a
Note, the Trustee may request the Holder of the Note to deliver it to the
Trustee. In such case, the Trustee shall place an appropriate notation on the
Note about the changed terms and return it to the Holder. Alternatively, if the
Company or the Trustee so determines, the Company in exchange for the Note shall
issue and the Trustee shall authenticate a new security that reflects the
changed terms.
Section 8.06. Trustee to Sign Amendments, etc.
The Trustee shall sign any amendment, supplement or waiver
authorized pursuant to this Article 8 if the amendment, supplement or waiver
does not adversely affect the rights, duties, liabilities or immunities of the
Trustee. If it does, the Trustee may, but need not, sign it. In signing or
refusing to sign such amendment, supplement or waiver the Trustee shall be
entitled to receive and, subject to Section 7.01 hereof, shall be fully
protected in relying upon an Officers' Certificate and an Opinion of Counsel
stating that such amendment, supplement or waiver is authorized or permitted by
this Indenture. The Company may not sign an amendment or supplement until the
Board of Directors approves it.
ARTICLE 9
SATISFACTION AND DISCHARGE OF INDENTURE: UNCLAIMED MONEYS
Section 9.01. Satisfaction and Discharge of Indenture.
<PAGE>
If at any time
(a) either
(i) there shall have been canceled by the
Trustee or delivered to the Trustee for
cancellation all Notes theretofore
authenticated and delivered (other than any
Notes that are asserted to have been
destroyed, lost or stolen and that shall
have been replaced as provided in Section
2.07 hereof, or paid, or Notes for whose
payment money has theretofore been deposited
in trust with the Trustee); or
(ii) all such Notes not theretofore canceled by
the Trustee or delivered to the Trustee for
cancellation shall have become due and
payable, or are by their terms to become due
and payable within one (1) year, and the
Company has deposited or caused to be
deposited with the Trustee as trust funds
the entire amount sufficient to pay at
maturity the principal of and accrued
interest on all such Notes not theretofore
canceled by the Trustee or delivered to the
Trustee for cancellation; and
(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 stating that all conditions precedent provided for
herein relating to the satisfaction and discharge of this Indenture have been
complied with; and
(d) the Company has delivered to the Trustee an
Opinion of Counsel stating that the documents and other items that have been or
are therewith delivered to the Trustee conform to the requirements of this
Indenture, and that, upon the basis of a Company Request and the accompanying
documents and items specified in this Section 9.01, all conditions precedent
provided for herein relating to the satisfaction and discharge of this Indenture
have been complied with, then, upon Company Request, this Indenture and the
rights and interests hereby created shall cease to be of further effect (except
as to any surviving rights of registration of transfer or exchange of Notes),
and the Trustee, at the cost and expense of the Company, shall, subject to
Section 9.05 hereof, execute and deliver proper instruments acknowledging
satisfaction and discharge of this Indenture.
Notwithstanding the satisfaction and discharge of this
Indenture, the obligations of the Company in Sections 2.03, 2.04, 2.05, 2.06,
2.07, 4.01, 6.09, 7.07, 7.08, 9.04 and 9.05 shall survive until the Notes are no
longer outstanding. Thereafter, the Company's obligations to the Trustee under
Sections 7.07, 9.04 and 9.05 hereof shall survive.
<PAGE>
Section 9.02. Funds Deposited for Payment of Notes.
All moneys deposited with the Trustee pursuant to Section 9.01
hereof shall be held in trust and shall be available for payment when the Notes
become due and payable in accordance with their terms, either directly or
through any Paying Agent, to the Holders of the particular Notes for the payment
of which such moneys have been deposited with the Trustee.
Section 9.03. Moneys Held by Paying Agent.
In connection with the satisfaction and discharge of this
Indenture, all moneys then held by any Paying Agent under the provisions of this
Indenture shall, upon demand of the Company, be paid to the Trustee, or if
sufficient moneys have been deposited pursuant to Section 9.01 hereof, to the
Company, and thereupon such Paying Agent shall be released from all further
liability with respect to such moneys.
Section 9.04. Moneys Held by Trustee.
Any moneys 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 Note that are not applied but remain unclaimed by the Holder of
such Note for two (2) years after the date upon which the principal of or
interest on such Note shall have respectively become due and payable shall be
repaid to the Company upon Company Request, or (if then held by the Company)
shall be discharged from such trust; and the Holder of such Note entitled to
receive such payment shall thereafter, as an unsecured general creditor, look
only to the Company for the 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; provided, however, that the
Trustee or any such Paying Agent, before being required to make any such
repayment, may, at the expense of the Company, either mail to each Noteholder
affected, at the address shown in the register of the Notes maintained by the
Registrar pursuant to Section 2.03 hereof, or cause to be published once a week
for two successive weeks, in a newspaper published in the English language,
customarily published each Business Day and of general circulation in the City
of New York, New York, a notice that such money remains unclaimed and that,
after a date specified therein, which shall not be less than 30 days from the
date of such mailing or publication, any unclaimed balance of such moneys then
remaining will be repaid to the Company. After payment to the Company,
Noteholders entitled to the money must look only to the Company for payment as
general creditors unless applicable abandoned property law designates another
person.
Section 9.05. Reinstatement.
If the Trustee or Paying Agent is unable to apply any
money in accordance with Section 9.01 hereof by reason of any legal proceeding
or by reason of any order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such application, the Company's
<PAGE>
obligations under this Indenture and the Notes shall be revived and reinstated
as though no deposit had occurred pursuant to this Article 9 until such time as
the Trustee or Paying Agent is permitted to apply all such money in accordance
with Section 9.01; provided, however, that if the Company has made any payment
of principal of or interest on any Notes because of the reinstatement of its
obligations, the Company shall be subrogated to the rights of the holders of
such Notes to receive such payment from the money held by the Trustee or Paying
Agent.
ARTICLE 10
DEFEASANCE AND COVENANT DEFEASANCE
Section 10.01. Applicability of Article; Company Option to Effect Defeasance
The Company may at its option by a Board Resolution at any
time, with respect to the Notes elect to have Section 10.02 or Section 10.03
hereof be applied to the outstanding Notes upon compliance with the conditions
set forth below in this Article 10.
Section 10.02. Defeasance and Discharge
Upon the Company's exercise of the option described in Section
10.01 above applicable to this Section with respect to the Notes, the Company
shall be deemed to have been discharged from its obligations with respect to the
Notes on the date the conditions set forth in Section 10.04 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 Notes and to have satisfied all its other obligations under
such Notes and this Indenture insofar as such Notes are concerned (and the
Trustee, at the expense of the Company, shall, subject to Section 10.06 hereof,
execute proper instruments acknowledging the same), except for the following
which shall survive until otherwise terminated or discharged hereunder: (A) the
rights of Holders of outstanding Notes to receive solely from the trust funds
described in Section 10.04 hereof and as more fully set forth in such Section,
payments in respect of the principal of and interest on such Notes when such
payments are due, (B) the Company's obligations with respect to such Notes under
Sections 2.03, 2.04, 2.05, 2.06, 2.07 and 2.08 hereof, (C) the rights, powers,
trusts, duties, and immunities of the Trustee hereunder (including claims of, or
payments to, the Trustee under or pursuant to Section 7.07 hereof) and (D) this
Article 10. Subject to compliance with this Article 10, the Company may exercise
its option under this Section 10.02 with respect to the Notes notwithstanding
the prior exercise of its option under Section 10.03 below with respect to the
Notes.
Section 10.03. Covenant Defeasance
Upon the Company's exercise of the option in Section 10.01
above applicable to this Section with respect to the Notes, the Company shall be
released from its obligations under Article III, Sections 4.04, 4.05, 4.06,
4.10, 4.11 and 4.12, and clause (iii) of Section 5.01 hereof with respect to the
<PAGE>
outstanding Notes on and after the date the conditions set forth in Section
10.04 below are satisfied (hereinafter, "Covenant Defeasance"). For this
purpose, such Covenant Defeasance means that 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 specified Section or portion thereof, whether directly or
indirectly by reason of any reference elsewhere herein to any such specified
Section or portion thereof or by reason of any reference in any such specified
Section or portion thereof to any other provision herein or in any other
document, but the remainder of this Indenture and the Notes shall be unaffected
thereby.
Section 10.04. Conditions to Defeasance or Covenant Defeasance
The following shall be the conditions to application of
Section 10.02 or Section 10.03 above to the outstanding Notes:
(1) the Company shall irrevocably have deposited or
caused to be deposited with the Trustee (or another trustee
satisfying the requirements of Section 7.10 hereof who shall
agree to comply with the provisions of this Article 10
applicable to it) as 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 the
Notes, (A) money 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 the due date of any payment,
money 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, the principal of and accrued
interest on the outstanding Notes at the maturity date of such
principal or interest;
(2) no Event of Default or Default with respect to
the Notes shall have occurred and be continuing on the date of
such deposit, or shall have occurred and be continuing at any
time during the period ending on the 91st day after the date
of such deposit or, if longer, ending on the day following the
expiration of the longest preference period under any
Bankruptcy Law applicable to the Company in respect of such
deposit (it being understood that this condition shall not be
deemed satisfied until the expiration of such period);
(3) such Defeasance or Covenant Defeasance shall not
cause the Trustee to have a conflicting interest for purposes
of the TIA with respect to any securities of the Company;
<PAGE>
(4) such Defeasance or Covenant Defeasance shall not
result in a breach or violation of, or constitute default
under, this Indenture or any other agreement or instrument to
which the Company is a party or by which it is bound;
(5) in the case of an election under Section 10.02
above, the Company shall have delivered to the Trustee an
Opinion of Counsel stating that the Company has received from,
or there has been published by, the Internal Revenue Service a
ruling to the effect that, and such opinion shall confirm
that, the Holders of the outstanding Notes or persons in their
positions 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;
(6) in the case of an election under Section 10.03
hereof, the Company shall have delivered to the Trustee an
Opinion of Counsel to the effect that the Holders of the
outstanding Notes 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 amount, in the same manner and at the same times as would
have been the case if such Covenant Defeasance had not
occurred;
(7) the Company shall have delivered to the Trustee
an Officers' Certificate and an Opinion of Counsel, each
stating that all conditions precedent provided for relating to
either the Defeasance under Section 10.02 above or the
Covenant Defeasance under Section 10.03 above (as the case may
be) have been complied with; and
(8) the Company shall have delivered to the Trustee
an Officers' Certificate stating its intention to effect a
Defeasance pursuant to the provisions of this Article 10 at
least sixty (60) days prior to such Defeasance.
Section 10.05. Deposited Money and U.S. Government Obligations to be Held
in Trust; Other Miscellaneous Provisions
All money and U.S. Government Obligations (including the
proceeds thereof) deposited with the Trustee pursuant to Section 10.04 in
respect of the outstanding Notes shall be held in trust and applied by the
Trustee, in accordance with the provisions of such Notes and this Indenture, to
the payment, either directly or through any Paying Agent as the Trustee may
determine, to the Holders of such Notes, of all sums due and to become due
thereon in respect of principal and accrued interest, but such money need not be
segregated from other funds except to the extent required by law.
<PAGE>
The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the U.S. Government
Obligations deposited pursuant to Section 10.04 above 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 Notes.
Anything in this Article 10 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 10.04 above which, in the opinion of a nationally-recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, are in excess of the amount thereof which would then
be required to be deposited to effect an equivalent Defeasance or Covenant
Defeasance.
Section 10.06. Reinstatement.
If the Trustee or Paying Agent is unable to apply any money or
U.S. Government Obligations in accordance with Section 10.01 by reason of any
legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, the Company's obligations under this Indenture and the Notes shall
be revived and reinstated as though no deposit had occurred pursuant to this
Article 10 until such time as the Trustee or Paying Agent is permitted to apply
all such money or U.S. Government Obligations in accordance with Section 10.01;
provided, however, that if the Company has made any payment of principal of or
accrued interest on any Notes because of the reinstatement of its obligations,
the Company shall be subrogated to the rights of the Holders of such Notes to
receive such payment from the money or U.S. Government Obligations held by the
Trustee or Paying Agent.
ARTICLE 11
MISCELLANEOUS
Section 11.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or
conflicts with another provision which is required to be included in this
Indenture by the TIA, the required provision shall control.
Section 11.02. Notices
Any notice or communication shall be given in writing
and delivered in person, sent by telex or telephone facsimile, delivered by
commercial courier service or mailed by first-class mail, postage prepaid,
addressed as follows:
If to the Company:
<PAGE>
Adelphia Communications Corporation
Main at Water Street
Coudersport, Pennsylvania 16195
Attention: Colin Higgin, Esq.
Copy to:
Buchanan Ingersoll Professional Corporation
1 Oxford Center
301 Grant Street, 20th Floor
Pittsburgh, Pennsylvania 15219
Attention: Carl E. Rothenberger, Jr., Esq.
If to the Trustee:
Bank of Montreal Trust Company
Wall Street Plaza
88 Pine Street, 19th Floor
New York, New York 10005
Attention: Corporate Trust Department
Such notices or communications shall be effective when
received and shall be sufficiently given if so given within the time prescribed
in this Indenture.
The Company or the Trustee by notice to the other may
designate additional or different addresses for subsequent notices or
communications.
Any notice or communication mailed to a Noteholder shall be
mailed to him by first class mail, postage prepaid, at his address shown on the
register kept by the Registrar. Any notice or communication shall also be so
mailed to any Person described in TIA ss. 313(c), to the extent required by the
TIA.
Failure to mail a notice or communication to a Noteholder or
any defect in it shall not affect its sufficiency with respect to other
Noteholders. If a notice or communication to a Noteholder is mailed in the
manner provided above, it shall be deemed duly given, whether or not the
addressee receives it.
In case by reason of the suspension of regular mail service,
<PAGE>
or by reason of any other cause, it shall be impossible to mail any notice as
required by this Indenture, then such method of notification as shall be made
with the approval of the Trustee shall constitute a sufficient mailing of such
notice.
Section 11.03. Communications by Holders with Other Holders
Noteholders may communicate pursuant to TIA ss. 312(b) with
other Noteholders with respect to their rights under this Indenture or the
Notes. The Company, the Trustee, the Registrar and anyone else shall have the
protection of TIA ss. 312(c).
Section 11.04. Certificate and Opinion as to Conditions.
Upon any request or application by the Company to
the Trustee to take any action under this Indenture, the Company shall furnish
to the Trustee:
(1) an Officers' Certificate (which shall include the
statements set forth in Section 11.05 below) stating that, in
the opinion of the signers, all conditions precedent, if any,
provided for in this Indenture relating to the proposed action
have been complied with; and
(2) an Opinion of Counsel (which shall include the
statements set forth in Section 11.05 below) stating that, in
the opinion of such counsel, all such conditions precedent
have been complied with.
Section 11.05. Statements Required in Certificate and Opinion
Each certificate and opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA ss. 314(a)(4)) shall include:
(1) a statement that the Person making such
certificate or opinion has read such covenant or condition;
(2) 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;
(3) a statement that, in the opinion of such Person,
it or he has made such examination or investigation as is
necessary to enable it or him to express an informed opinion
as to whether or not such covenant or condition has been
complied with; and
(4) a statement as to whether or not, in the opinion
<PAGE>
of such Person, such covenant or condition has been complied
with.
Section 11.06. When Treasury Notes Disregarded
In determining whether the Holders of the required aggregate
principal amount of Notes have concurred in any direction, waiver or consent,
Notes owned by the Company or any other obligor on the Notes or by any person
directly or indirectly controlling or controlled by or under direct or indirect
common control with the Company or such obligor shall be disregarded, except
that for the purposes of determining whether the Trustee shall be protected in
relying on any such direction, waiver or consent, only Notes which the Trustee
knows are so owned shall be so disregarded. Notes so owned which have been
pledged in good faith shall not be disregarded if the pledgee establishes to the
satisfaction of the Trustee the pledgee's right so to act with respect to the
Notes and that the pledgee is not the Company or any other obligor upon the
Notes or any person directly or indirectly controlling or controlled by or under
direct or indirect common control with the Company or such obligor.
Section 11.07. Rules by Trustee and Agents
The Trustee may make reasonable rules for action by or
meetings of Noteholders. The Registrar and Paying Agent may make reasonable
rules for their functions.
Section 11.08. Business Days; Legal Holidays
A "Business Day" is a day that is not a Legal Holiday. A
"Legal Holiday" is a Saturday, a Sunday, a federally-recognized holiday or a day
on which banking institutions are not required to be open in the State of New
York. If a payment date is a Legal Holiday at a place of payment, payment may be
made at that place on the next succeeding day that is not a Legal Holiday, and
no interest shall accrue for the intervening period.
Section 11.09. Governing Law
The laws of the State of New York shall govern this Indenture
and the Notes without regard to principles of conflicts of law.
Section 11.10. No Adverse Interpretation of Other Agreements
This Indenture may not be used to interpret another indenture,
loan, security or debt agreement of the Company or any Subsidiary. No such
indenture, loan, security or debt agreement may be used to interpret this
Indenture.
Section 11.11. No Recourse against Others
<PAGE>
No recourse for the payment of the principal of or accrued
interest on any of the Notes, or for any claim based thereon or otherwise in
respect thereof, and no recourse under or upon any obligation, covenant or
agreement of the Company in this Indenture or in any supplemental indenture, or
in any of the Notes, or because of the creation of any Indebtedness represented
thereby, shall be had against any stockholder, officer, director or employee, as
such, past, present or future, of the Company or of any successor corporation or
against the property or assets of any such stockholder, officer, employee or
director, either directly or through the Company or any successor corporation,
whether by virtue of any constitution, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise; it being expressly
understood that this Indenture and the Notes are solely obligations of the
Company, and that no such personal liability whatever shall attach to, or is or
shall be incurred by, any stockholder, officer, employee or director of the
Company or any successor corporation because of the creation of the indebtedness
hereby authorized, or under or by reason of the obligations, covenants or
agreements contained in this Indenture or the Notes or implied therefrom, and
that any and all such personal liability of, and any and all claims against
every stockholder, officer, employee and director, are hereby expressly waived
and released as a condition of, and as a consideration for, the execution of
this Indenture and the issuance of the Notes. It is understood that this
limitation on recourse is made expressly for the benefit of any such
shareholder, employee, officer or director and may be enforced by any of them.
Section 11.12. Successors
All agreements of the Company in this Indenture and the Notes
shall bind its successor. All agreements of the Trustee, any additional trustee
and any Paying Agents in this Indenture shall bind its successor.
Section 11.13. Multiple Counterparts
The parties may sign multiple counterparts of this Indenture.
Each signed counterpart shall be deemed an original, but all of them together
represent one and the same agreement.
Section 11.14. Table of Contents, Headings, etc.
The table of contents, cross-reference sheet and headings of
the Articles and Sections of this Indenture have been inserted for convenience
of reference only, are not to be considered a part hereof, and shall in no way
modify or restrict any of the terms or provisions hereof.
Section 11.15. Separability
Each provision of this Indenture shall be considered
separable and, if for any reason any provision which is not essential to the
<PAGE>
effectuation of the basic purpose of this Indenture or the Notes 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.
[The rest of this page has been intentionally left blank.]
<PAGE>
IN WITNESS WHEREOF, the parties have caused this Indenture to
be duly executed, and attested, all as of the date and year first written above.
ADELPHIA COMMUNICATIONS CORPORATION
By: /s/ James R. Brown
Name: James R. Brown
Title: Vice President
WITNESS:
_/s/ Colin H. Higgin_______
Name: Colin H. Higgin
BANK OF MONTREAL TRUST COMPANY, as Trustee
By: _/s/ Peter Morse__
Name: Peter Morse
Title:
WITNESS:
- ---------------------------
Name:
<PAGE>
Exhibit A
(Face of Note)
8 1/8% Senior Notes due 2003
No. $__________
ADELPHIA COMMUNICATIONS CORPORATION
promises to pay to or registered assigns, the principal sum of
_____________________ Dollars on July 15, 2003.
Interest Payment Dates: January 15, and July 15
Record Dates: January 1, and July 1
Dated:
ADELPHIA COMMUNICATIONS CORPORATION
By
Name:
Title:
(SEAL)
This is one of the Notes referred to in the within-mentioned Indenture:
BANK OF MONTREAL TRUST COMPANY,
as Trustee
By:
Authorized Signature
<PAGE>
A-11
(Back of Note)
8 1/8% Senior Notes due 2003
[Unless and until it is exchanged in whole or in part for
Notes in definitive form, this Note may not be transferred except as a whole by
the Depository to a nominee of the Depository or by a nominee of the Depository
to the Depository or another nominee of the Depository or by the Depository or
any such nominee to a successor Depository or a nominee of such successor
Depository. Unless this certificate is presented by an authorized representative
of The Depository Trust Company (55 Water Street, New York, New York) ("DTC"),
to the issuer or its agent for registration of transfer, exchange or payment,
and any certificate issued is registered in the name of Cede & Co. or such other
name as may be requested by an authorized representative of DTC (and any payment
is made to Cede & Co. or such other entity as may be requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]1/
THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT") AND MAY NOT BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED EXCEPT (1) TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN
THE MEANING OF RULE 144A UNDER THE SECURITIES ACT PURCHASING
FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS
OF RULE 144A, (2) PURSUANT TO AN EXEMPTION FROM REGISTRATION
UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF
AVAILABLE), (3) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OR (4) TO INSTITUTIONAL
ACCREDITED INVESTORS IN A TRANSACTION EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, IN EACH CASE
IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE
STATES OF THE UNITED STATES AND OTHER JURISDICTIONS.
1. This paragraph should be included only if the Note is issued in global form.
<PAGE>
Capitalized terms used herein shall have the meanings assigned to them
in the Indenture referred to below unless otherwise indicated.
1. Interest. Adelphia Communications Corporation, a Delaware
corporation (the "Company") promises to pay interest on the principal amount of
this Note at 8 1/8% per annum from July 2, 1998 until July 15, 2003 and shall
pay the Liquidated Damages, if any, payable pursuant to Section 5 of the
Registration Rights Agreement referred to below. The Company shall pay interest
and Liquidated Damages, if any, semi-annually in arrears on January 15 and July
15 of each year, or if any such day is not a Business Day, on the next
succeeding Business Day (each an "Interest Payment Date"). Interest on the Notes
will accrue from the most recent date to which interest has been paid or, if no
interest has been paid, from the date of issuance; provided that if there is no
existing Default in the payment of interest, and if this Note is authenticated
between a record date referred to on the face hereof and the next succeeding
Interest Payment Date, interest shall accrue from such next succeeding Interest
Payment Date; provided, further, that the first Interest Payment Date shall be
January 15, 1999. The Company shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue principal from
time to time on demand at a rate equal to the per annum rate on the Notes then
in effect; it shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest and
Liquidated Damages, if any, (without regard to any applicable grace periods)
from time to time on demand at the same rate to the extent lawful. Interest will
be computed on the basis of a 360-day year of twelve 30-day months.
2. Method of Payment. The Company shall make payments in
respect of the Notes represented by the Global Note (including principal,
interest and Liquidated Damages, if any) by wire transfer of immediately
available funds to the accounts specified by the Note Custodian. With respect to
Notes issued in definitive form, the Company shall make all payments of
principal, interest and Liquidated Damages, if any, by mailing a check to each
such Holder's registered address, provided that all payments with respect to
Notes having an aggregate principal amount of $100,000 or more, the Holders of
which have given wire transfer instructions to the Company at least ten business
days prior to the applicable payment date, will be required to be made by wire
transfer of immediately available funds to the accounts specified by the Holders
thereof. The Notes represented by the Global Note are expected to be eligible to
trade in DTC's Same-Day Funds Settlement System, and any permitted secondary
market trading activity in such notes will, therefore, be required by DTC to be
settled in immediately available funds. The Company expects that secondary
trading in the Definitive Notes also will be settled in immediately available
funds.
3. Paying Agent and Registrar. Initially, Bank of Montreal
Trust Company, the Trustee under the Indenture, will act as Paying Agent and
Registrar. The Notes may be presented for registration of transfer and exchange
<PAGE>
at the offices of the Registrar. The Company may change any Paying Agent or
Registrar without notice to any Holder. The Company or any of its Subsidiaries
may act in any such capacity.
4. Indenture. The Company issued the Notes under an Indenture
dated as of July 2, 1998 ("Indenture") between the Company and the Trustee. The
terms of the Notes include those stated in the Indenture and those made part of
the Indenture by reference to the Trust Indenture Act of 1939, as amended (15
U.S. Code ss.ss. 77aaa-77bbbb). The Notes are subject to all such terms, and
Holders are referred to the Indenture and such Act for a statement of such
terms. The Notes issued under the Indenture are senior unsecured obligations of
the Company limited to $300 million in aggregate principal amount.
5. Mandatory Redemption. Except as set forth in paragraph 6
below, the Company shall not be required to make mandatory redemption payments
with respect to the Notes.
6. Repurchase at Option of Holder. Within 50 days of (i) the
proposed occurrence of a Change of Control or (ii) the occurrence of Change of
Control Triggering Event, the Company shall be required to make an offer (a
"Change of Control Offer") to repurchase all or any part (equal to $1,000 or an
integral multiple thereof) of each Holder's Notes at a purchase price equal to
100% of the principal amount thereof plus accrued and unpaid interest and
Liquidated Damages thereon, if any, to the date of purchase, which date shall be
no later than 50 days from the date such notice is mailed (the "Change of
Control Payment Date"). Within 50 days of (i) the proposed occurrence of a
Change of Control or (ii) the occurrence of Change of Control Triggering Event,
the Company shall mail a notice to each Holder setting forth the procedures
governing the Change of Control Offer as required by the Indenture. Such right
to require the repurchase of Notes shall not continue after discharge of the
Company from its obligations with respect to the Notes. The board of directors
of the Company may not waive this provision.
7. Denominations, Transfer, Exchange. The Notes are in
registered form without coupons in minimum denominations of $1,000 and integral
multiples of $1,000 in excess thereof. The transfer of Notes may be registered
and Notes may be exchanged as provided in the Indenture.
8. Persons Deemed Owners. The registered Holder of a Note
may be treated as its owner for all purposes.
9. Amendment, Supplement and Waiver. Subject to certain
exceptions, the Indenture or the Notes may be amended or supplemented with the
consent of the Holders of at least a majority in principal amount of the then
outstanding Notes, and any existing default or compliance with any provision of
the Indenture or the Notes may be waived with the consent of the Holders of a
majority in principal amount of the then outstanding Notes. Without the consent
<PAGE>
of any Holder of a Note, the Indenture or the Notes may be amended or
supplemented to cure any ambiguity, defect or inconsistency, to provide for
uncertificated Notes in addition to or in place of certificated Notes, to
provide for the assumption of the Company's obligations to Holders of the Notes
in case of a merger or consolidation, to issue up to $150,000,000 in aggregate
principal amount of additional Notes, to transfer, assign, mortgage or pledge
any property to the Trustee and otherwise comply with the covenant to secure
Notes equally, to make any change that would provide any additional rights or
benefits to the Holders of the Notes or that does not adversely affect the legal
rights under the Indenture of any such Holder, or to comply with the
requirements of the SEC in order to effect or maintain the qualification of the
Indenture under the Trust Indenture Act.
10. Defaults and Remedies. An Event of Default occurs if: (i)
the Company defaults in the payment when due of any interest on, or Liquidated
Damages with respect to, any Note and such default continues for a period of 30
days; (ii) the Company defaults in the payment of the principal of any Note at
its maturity; (iii) the Company fails to observe or perform any other covenant,
representation, warranty or other agreement in the Indenture or the Notes for 60
days after written notice to the Company by the Trustee or the Holders of at
least 25% in principal amount of the Notes then outstanding; (iv) the Company
fails to pay when due principal, interest or premium aggregating $10,000,000 or
more with respect to any Indebtedness of the Company or any Restricted
Subsidiary, or the acceleration of any such Indebtedness which default shall not
be cured or waived, or such acceleration shall not be rescinded or annulled,
within 10 days after written notice; (v) 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 of its Restricted Subsidiaries and such judgment or
judgments remain undischarged for a period (during which execution shall not be
effectively stayed) of 60 days, provided that the aggregate of all such
judgments exceeds $10 million; or (vi) the Company or any Restricted Subsidiary
with liabilities of greater than $10,000,000 under GAAP as of the date of the
event described in this clause, pursuant to or within the meaning of Bankruptcy
Law: (a) commences a voluntary case, (b) consents to the entry of an order for
relief against it in an involuntary case, (c) consents to the appointment of a
Custodian of it or for all or substantially all of its property, or (d) makes a
general assignment for the benefit of its creditors, (vii) a court of competent
jurisdiction enters an order or decree under any Bankruptcy Law that: (a) is for
relief against the Company, or any Restricted Subsidiary with liabilities of
greater than $10,000,000 under GAAP as of the effective date of such order or
decree in an involuntary case, (b) appoints a custodian of the Company, or any
Restricted Subsidiary of Restricted Subsidiary with liabilities of greater than
$10,000,000 under GAAP as of the effective date of such order or decree or for
all or substantially all of its property or (c) orders the liquidation of the
Company, or any Restricted Subsidiary with liabilities greater than $10,000,000
under GAAP as of the effective date of such order or decree; and the order or
decree remains unstayed and in effect for 60 consecutive days. If any Event of
Default occurs and is continuing, the Trustee or the Holders of at least 25% in
principal amount of the then outstanding Notes may declare all the Notes to be
due and payable immediately. Notwithstanding the foregoing, in the case an Event
<PAGE>
of Default specified in clauses (6) or (7) of Section 6.01 of the Indenture
occurs with respect to the Company, or a Restricted Subsidiary with liabilities
of greater than $10,000,000 under GAAP as of the effective date of such order or
decree, all outstanding Notes will become due and payable without further action
or notice. Holders of the Notes may not enforce the Indenture or the Notes
except as provided in the Indenture. Subject to certain limitations, Holders of
a majority in principal amount of the then outstanding Notes may direct the
Trustee in its exercise of any trust or power. The Trustee may withhold from
Holders of the Notes notice of any continuing Default or Event of Default
(except a Default or Event of Default relating to the payment of principal or
interest) if it determines that withholding notice is in their interest. The
Holders of not less than a majority in aggregate principal amount of the Notes
then outstanding by notice to the Trustee may on behalf of the Holders of all of
the Notes waive any existing Default or Event of Default and its consequences
under the Indenture, except a continuing Default or Event of Default in the
payment of the principal of and Liquidated Damages, if any, or interest on, the
Notes (provided, however, that the Holders of a majority in aggregate principal
amount of the then outstanding Notes may rescind an acceleration and its
consequence, including any related payment default) or a default with respect to
any covenant or provision which cannot be modified or amended without the
consent of the Holder of each outstanding Note affected.
The Company is required to deliver to the Trustee annually a
statement regarding compliance with the Indenture, and the Company is required,
upon becoming aware of any Default or Event of Default, to deliver to the
Trustee a statement specifying such Default or Event of Default and what action
the Company is taking or proposes to take thereto.
11. Trustee Dealings with Company. The Trustee, in its
individual or any other capacity, may make loans to, accept deposits from, and
perform services for the Company or its Affiliates, and may otherwise deal with
the Company or its Affiliates, as if it were not the Trustee.
12. No Recourse Against Others. A director, officer, employee,
incorporator or stockholder of the Company, as such, shall not have any
liability for any obligations of the Company under the Notes or the Indenture or
for any claim based on, in respect of, or by reason of, such obligations or
their creation. Each Holder by accepting a Note waives and releases all such
liability including any rights against any general partner of the Company in its
capacity as general partner. The waiver and release are part of the
consideration for the issuance of the Notes.
13. Authentication. This Note shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating agent.
14. Abbreviations. Customary abbreviations may be used in the
name of a Holder or an assignee, such as: TEN COM (= tenants in common), TENENT
(= tenants by the entireties), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (=
Uniform Gifts to Minors Act).
<PAGE>
15. Additional Rights of Holders of Transfer Restricted
Securities. In addition to the rights provided to Holders of Notes under the
Indenture, Holders of Transfer Restricted Securities shall have all the rights
set forth in the Notes Registration Rights Agreement dated as of July 2, 1998,
between the Company and the party named on the signature pages thereof (the
"Registration Rights Agreement").
16. CUSIP Numbers. Pursuant to a recommendation promulgated by
the Committee on Uniform Security Identification Procedures, the Company has
caused CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP
numbers in notices of redemption as a convenience to Holders. No representation
is made as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
The Company shall furnish to any Holder upon written request
and without charge a copy of the Indenture and/or the Registration Rights
Agreement. Requests may be made to:
Adelphia Communications Corporation
Main at Water Street
Coudersport, Pennsylvania 16915
Attention: Colin H. Higgin, Esq.
<PAGE>
ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we) assign and
transfer this Note to
(Insert assignee's soc. sec. or tax I.D. no.)
(Print or type assignee's name, address and zip code)
and irrevocably appoint
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.
Date:_______________
Your Signature:
(Sign exactly as your name appears on
the face of this Note)
<PAGE>
Option of Holder to Elect Purchase
If you want to elect to have this Note purchased by the
Company pursuant to Article 3 of the Indenture, check the box below:
____Article 3
If you want to elect to have only part of the Note purchased
by the Company pursuant to Article 3 of the Indenture, state the amount you
elect to have purchased: $_______________
Date:____________________ Your Signature:
(Sign exactly as your name appears
on the Note)
Tax Identification No.:__________
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE OF EXCHANGES OF NOTES2/
The following exchanges of a part of this Global Note for
other Notes have been made:
<S> <C> <C> <C> <C>
Principal Amount of Signature of
Amount of decrease in Amount of increase in this authorized officer of
Principal Amount of Principal Amount of Global Note following Trustee or Note
Date of Exchange this this such decrease (or Custodian
Global Global increase)
Note Note
<FN>
2. This should be included only if the Note is issued in global form.
</FN>
</TABLE>
<PAGE>
EXHIBIT B-1
FORM OF CERTIFICATE FOR EXCHANGE OR REGISTRATION
OF TRANSFER OF DEFINITIVE NOTES
(Pursuant to Section 2.06(b) of the Indenture)
Bank of Montreal Trust Company
Wall Street Plaza
88 Pine Street, 19th Floor
New York, New York 10005
U.S.A.
Re: 8 1/8% Senior Notes due 2003 of Adelphia Communications Corporation.
Reference is hereby made to the Indenture, dated as of July 2,
1998 (the "Indenture"), among Adelphia Communications Corporation (the
"Company"), as Issuer and Bank of Montreal Trust Company, as Trustee.
Capitalized terms used but not defined herein shall have the meanings given to
them in the Indenture.
This letter relates to $__________ principal amount of Notes
which are evidenced by one or more Definitive Notes (CUSIP No. __________) and
registered with the Registrar in the name of
_________________________________________ (the "Transferor"). The Transferor has
requested an exchange or transfer of such Definitive Note(s) in the form of an
equal principal amount of Notes evidenced by one or more Definitive Notes (CUSIP
No. __________), to be delivered to the Transferor or, in the case of a transfer
of such Notes, to such Person as the Transferor instructs the Trustee.
In connection with such request and in respect of the Notes
surrendered to the Trustee herewith for exchange (the "Surrendered Notes"), the
Holder of such Surrendered Notes hereby certifies that:
[CHECK ONE]
____ the Surrendered Notes are being acquired for the
Transferor's own account, without transfer;
or
____ the Surrendered Notes are being transferred to the
Company;
or
____ Surrendered Notes are being transferred pursuant to
and in accordance with Rule 144A under the United States
Securities Act of 1933, as amended (the "Securities Act"),
and, accordingly, the Transferor hereby further certifies that
the Surrendered Notes are being transferred to a Person that
the Transferor reasonably believes is purchasing the
Surrendered Notes for its own account, or for one or more
accounts with respect to which such Person exercises sole
investment discretion, and such Person and each such account
is a "qualified institutional buyer" within the meaning of
Rule 144A, in each case in a transaction meeting the
requirements of Rule 144A;
or
____ the Surrendered Notes are being transferred in a
transaction permitted by Rule 144 under the Securities Act;
or
<PAGE>
____ the Surrendered Notes are being transferred pursuant
to an effective registration statement under the Securities
Act;
or
____ such transfer is being effected pursuant to an
exemption from the registration requirements of the Securities
Act other than Rule 144A or Rule 144, and the Transferor
hereby further certifies that the Notes are being transferred
in compliance with the transfer restrictions applicable to the
Global Note and in accordance with the requirements of the
exemption claimed, which certification is supported by an
Opinion of Counsel, provided by the transferor or the
transferee (a copy of which the Transferor has attached to
this certification) in form reasonably acceptable to the
Company and to the Registrar, to the effect that such transfer
is in compliance with the Securities Act;
and the Surrendered Notes are being transferred in compliance with any
applicable blue sky securities laws of any state of the United States.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and Barclays Capital Inc. (the "Initial
Purchaser"), the initial purchaser of such Notes being transferred.
[Insert Name of Transferor]
By:
Name:
Title:
Dated:
cc: Adelphia Communications Corporation
Barclays Capital Inc.
<PAGE>
B-2-3
EXHIBIT B-2
FORM OF CERTIFICATE FOR EXCHANGE OR REGISTRATION OF TRANSFER FROM
GLOBAL NOTE TO DEFINITIVE NOTE
(Pursuant to Section 2.06(c) of the Indenture)
Bank of Montreal Trust Company
Wall Street Plaza
88 Pine Street, 19th Floor
New York, New York 10005
U.S.A.
Re: 8 1/8% Senior Notes due 2003 of Adelphia Communications Corporation.
Reference is hereby made to the Indenture, dated as of July 2,
1998 (the "Indenture"), among Adelphia Communications Corporation (the
"Company"), as Issuer and Bank of Montreal Trust Company, as Trustee.
Capitalized terms used but not defined herein shall have the meanings given to
them in the Indenture.
This letter relates to $__________ principal amount of Notes
which are evidenced by the Global Note (CUSIP No. __________) held with the
Depository in the name of ________________ (the "Transferor"). The Transferor
has requested a transfer of such beneficial interest in the Notes to a Person
who will take delivery thereof in the form of an equal principal amount of Notes
evidenced by one or more Definitive Notes (CUSIP No. __________), to be
registered with the Registrar in the name of ______________.
In connection with such request and in respect of the Notes
surrendered to the Trustee herewith for exchange (the "Surrendered Notes"), the
Holder of such Surrendered Notes hereby certifies that:
[CHECK ONE]
____ the Surrendered Notes are being transferred to the
beneficial owner of such Notes;
or
____ the Surrendered Notes are being transferred pursuant
to and in accordance with Rule 144A under the United States
Securities Act of 1933, as amended (the "Securities Act"),
and, accordingly, the Transferor hereby further certifies that
the Surrendered Notes are being transferred to a Person that
the Transferor reasonably believes is purchasing the
Surrendered Notes for its own account, or for one or more
<PAGE>
accounts with respect to which such Person exercises sole
investment discretion, and such Person and each such account
is a "qualified institutional buyer" within the meaning of
Rule 144A, in each case in a transaction meeting the
requirements of Rule 144A;
or
____ the Surrendered Notes are being transferred in a
transaction permitted by Rule 144 under the Securities Act;
or
____ the Surrendered Notes are being transferred pursuant
to an effective registration statement under the Securities
Act;
or
____ such transfer is being effected pursuant to an
exemption from the registration requirements of the Securities
Act other than Rule 144A or Rule 144, and the Transferor
hereby further certifies that the Notes are being transferred
in compliance with the transfer restrictions applicable to the
Global Note and in accordance with the requirements of the
exemption claimed, which certification is supported by an
Opinion of Counsel, provided by the transferor or the
transferee (a copy of which the Transferor has attached to
this certification) in form reasonably acceptable to the
Company and to the Registrar, to the effect that such transfer
is in compliance with the Securities Act;
and the Surrendered Notes are being transferred in compliance with any
applicable blue sky securities laws of any state of the United States.
This certificate and the statements contained herein are made
for your benefit and the benefit of the Company and Barclays Capital Inc. (the
"Initial Purchaser"), the initial purchaser of such Notes being transferred.
[Insert Name of Transferor]
By:
Name:
Title:
Dated:
cc: Adelphia Communications Corporation
Barclays Capital Inc.
<PAGE>
EXHIBIT B-3
FORM OF CERTIFICATE FOR EXCHANGE OR REGISTRATION OF TRANSFER FROM
DEFINITIVE NOTE TO GLOBAL NOTE
(Pursuant to Section 2.06(e) of the Indenture)
Bank of Montreal Trust Company
Wall Street Plaza
88 Pine Street, 19th Floor
New York, New York 10005
U.S.A.
Re: 8 1/8% Senior Notes due 2003 of Adelphia Communications Corporation.
Reference is hereby made to the Indenture, dated as of July 2,
1998 (the "Indenture"), among Adelphia Communications Corporation (the
"Company"), as Issuer and Bank of Montreal Trust Company, as Trustee.
Capitalized terms used but not defined herein shall have the meanings given to
them in the Indenture.
This letter relates to $__________ principal amount of Notes
which are evidenced by one or more Definitive Notes (CUSIP No. __________) and
registered with the Registrar in the name of
_________________________________________ (the "Transferor"). The Transferor has
requested a transfer of such Definitive Notes to a Person who will take delivery
thereof in the form of an equal beneficial interest in the Global Note (CUSIP
No. ____________).
In connection with such request and in respect of the Notes
surrendered to the Trustee herewith for exchange (the "Surrendered Notes"), the
Holder of such Surrendered Notes hereby certifies that:
[CHECK ONE]
____ the Surrendered Notes are being transferred to the
beneficial owner of such Notes;
or
____ the Surrendered Notes are being transferred pursuant
to and in accordance with Rule 144A under the United States
Securities Act of 1933, as amended (the "Securities Act"),
and, accordingly, the Transferor hereby further certifies that
the Surrendered Notes are being transferred to a Person that
the Transferor reasonably believes is purchasing the
<PAGE>
Surrendered Notes for its own account, or for one or more
accounts with respect to which such Person exercises sole
investment discretion, and such Person and each such account
is a "qualified institutional buyer" within the meaning of
Rule 144A, in each case in a transaction meeting the
requirements of Rule 144A;
or
____ the Surrendered Notes are being transferred in a
transaction permitted by Rule 144 under the Securities Act;
or
____ the Surrendered Notes are being transferred pursuant
to an effective registration statement under the Securities
Act;
or
____ such transfer is being effected pursuant to an
exemption from the registration requirements of the Securities
Act other than Rule 144A or Rule 144, and the Transferor
hereby further certifies that the Notes are being transferred
in compliance with the transfer restrictions applicable to the
Global Note and in accordance with the requirements of the
exemption claimed, which certification is supported by an
Opinion of Counsel, provided by the transferor or the
transferee (a copy of which the Transferor has attached to
this certification) in form reasonably acceptable to the
Company and to the Registrar, to the effect that such transfer
is in compliance with the Securities Act;
Upon giving effect to this request to exchange a Definitive
Note for a beneficial interest in the Global Note, the
resulting beneficial interest shall be subject to the
restrictions on transfer applicable to the Global Note
pursuant to the Indenture and the Securities Act.
and the Surrendered Notes are being transferred in compliance with any
applicable blue sky securities laws of any state of the United States.
This certificate and the statements contained herein are made
for your benefit and the benefit of the Company and Barclays Capital Inc. (the
"Initial Purchaser"), the initial purchaser of such Notes being transferred.
[Insert Name of Transferor]
By:
Name:
Title:
Dated:
cc: Adelphia Communications Corporation
Barclays Capital Inc.
EXHIBIT 4.02
NOTE REGISTRATION RIGHTS AGREEMENT
Dated as of July 2, 1998
between
Adelphia Communications Corporation
and
Barclays Capital Inc.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
1
<PAGE>
This Note Registration Rights Agreement (this "Agreement") is made
and entered into as of July 2, 1998 between Adelphia Communications Corporation
(the "Company") and Barclays Capital Inc. (the "Initial Purchaser"), who has
agreed to purchase the 81/8% Senior Notes due 2003 of the Company (the "Senior
Notes") pursuant to the Purchase Agreement (as defined below).
This Agreement is made pursuant to the Purchase Agreement, dated June
29, 1998 (the "Purchase Agreement"), between the Company and the Initial
Purchaser. In order to induce the Initial Purchaser to purchase the Senior
Notes, the Company has agreed to provide the registration rights set forth in
this Agreement. The execution and delivery of this Agreement is a condition to
the obligations of the Initial Purchaser set forth in Section 2 of the Purchase
Agreement.
The parties hereby agree as follows:
SECTION 1. DEFINITIONS
As used in this Agreement, the following capitalized terms shall have
the following meanings:
Act: The Securities Act of 1933, as amended.
Broker-Dealer: Any broker or dealer registered under the Exchange
Act.
Closing Date: The date of this Agreement.
Commission: The Securities and Exchange Commission.
Consummate: A Registered Exchange Offer shall be deemed "Consummated"
for purposes of this Agreement upon the occurrence of (i) the filing and
effectiveness under the Act of the Exchange Offer Registration Statement
relating to the Exchange Notes to be issued in the Exchange Offer, (ii) the
maintenance of such Registration Statement continuously effective and the
keeping of the Exchange Offer open for a period not less than the minimum period
required pursuant to Section 3(b) hereof, and (iii) the delivery by the Company
to the Registrar under the Indenture of Exchange Notes in the same aggregate
principal amount as the aggregate principal amount of Senior Notes that were
tendered by Holders thereof pursuant to the Exchange Offer.
Damages Payment Date: With respect to the Senior Notes, each
Interest Payment Date.
Effectiveness Target Date: As defined in Section 5.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Exchange Notes: The 81/8% Senior Notes due 2003 of the Company to be
issued pursuant to the Indenture in the Exchange Offer.
Exchange Offer: The registration by the Company under the Act of the
Exchange Notes pursuant to a Registration Statement pursuant to which the
Company offers the Holders of all outstanding Transfer Restricted Securities the
opportunity to exchange all such outstanding Transfer Restricted Securities held
by such Holders for Exchange Notes in an aggregate principal amount equal to the
aggregate principal amount of the Transfer Restricted Securities tendered in
such exchange offer by such Holders.
1
<PAGE>
Exchange Offer Registration Statement: The Registration Statement
relating to the Exchange Offer, including the related Prospectus.
Exempt Resales: The transactions in which the Initial Purchaser
proposes to sell the Senior Notes to certain "qualified institutional buyers,"
as such term is defined in Rule 144A under the Act.
Holders: As defined in Section 2(b) hereof.
Indemnified Holder: As defined in Section 8(a) hereof.
Indenture: The Indenture, dated as of July 2, 1998, between the
Company and Bank of Montreal Trust Company, as trustee (the "Trustee"), pursuant
to which the Senior Notes are to be issued, as such Indenture is amended or
supplemented from time to time in accordance with the terms thereof.
Initial Purchaser: As defined in the preamble hereto.
Interest Payment Date: As defined in the Indenture and the Notes.
NASD: National Association of Securities Dealers, Inc.
Notes: The Senior Notes and the Exchange Notes.
Person: An individual, partnership, corporation, trust or
unincorporated organization, or a government or agency or political subdivision
thereof.
Prospectus: The prospectus included in a Registration Statement, as
amended or supplemented by any prospectus supplement and by all other amendments
thereto, including post-effective amendments, and all material incorporated by
reference into such prospectus.
Record Holder: With respect to any Damages Payment Date relating to
Notes, each Person who is a Holder of Notes on the record date with respect to
the Interest Payment Date on which such Damages Payment Date shall occur.
Registrar: Means the Registrar of the Notes as defined in the
Indenture.
Registration Default: As defined in Section 5 hereof.
Registration Statement: Any registration statement of the Company
relating to (a) an offering of Exchange Notes pursuant to an Exchange Offer or
(b) the registration for resale of Transfer Restricted Securities pursuant to
the Shelf Registration Statement, which is filed pursuant to the provisions of
this Agreement, in each case, including the Prospectus included therein, all
amendments and supplements thereto (including post-effective amendments) and all
exhibits and material incorporated by reference therein.
Senior Notes: As defined in the preamble hereto.
Shelf Filing Deadline: As defined in Section 4 hereof.
2
<PAGE>
Shelf Registration Statement: As defined in Section 4 hereof.
TIA: The Trust Indenture Act of 1939 (15 U.S.C.
Section 77aaa-77bbbb) as in effect on the date of the Indenture.
Transfer Restricted Securities: Each Senior Note, until the earliest
to occur of (a) the date on which such Senior Note is exchanged in the Exchange
Offer and entitled to be resold to the public by the Holder thereof without
complying with the prospectus delivery requirements of the Act, (b) the date on
which such Senior Note has been effectively registered under the Act and
disposed of in accordance with a Shelf Registration Statement and (c) the date
on which such Senior Note is distributed to the public pursuant to Rule 144
under the Act or by a Broker-Dealer pursuant to the "Plan of Distribution"
contemplated by the Exchange Offer Registration Statement (including delivery of
the Prospectus contained therein).
Underwritten Registration or Underwritten Offering: A registration in
which securities of the Company are sold to an underwriter for reoffering to the
public.
SECTION 2. SECURITIES SUBJECT TO THIS AGREEMENT
(a) Transfer Restricted Securities. The securities entitled to the
benefits of this Agreement are the Transfer Restricted Securities.
(b) Holders of Transfer Restricted Securities. A Person is deemed to
be a holder of Transfer Restricted Securities (each, a "Holder") whenever such
Person owns Transfer Restricted Securities.
SECTION 3. REGISTERED EXCHANGE OFFER
(a) Unless the Exchange Offer shall not be permissible under
applicable law or Commission policy (after the procedures set forth in Section
6(a) below have been complied with), the Company shall (i) use its reasonable
efforts to cause to be filed with the Commission as soon as practicable after
the Closing Date, but in no event later than 90 days after the Closing Date, a
Registration Statement under the Act relating to the Exchange Notes and the
Exchange Offer, (ii) use its best efforts to cause such Registration Statement
to become effective no later than 180 days after the Closing Date, (iii) in
connection with the foregoing, file (A) all pre-effective amendments to such
Registration Statement as may be necessary in order to cause such Registration
Statement to become effective, (B) if applicable, a post-effective amendment to
such Registration Statement pursuant to Rule 430A under the Act and (C) cause
all necessary filings in connection with the registration and qualification of
the Exchange Notes to be made under the Blue Sky laws of such jurisdictions as
are necessary to permit Consummation of the Exchange Offer, and (iv) upon the
effectiveness of such Registration Statement, commence the Exchange Offer. The
Exchange Offer Registration Statement shall be on the appropriate form
permitting registration of the Exchange Notes to be offered in exchange for the
Transfer Restricted Securities and to permit resales of Notes held by
Broker-Dealers as contemplated by Section 3(c) below.
(b) The Company shall cause the Exchange Offer Registration Statement
to be effective continuously and shall keep the Exchange Offer open for a period
of not less than the minimum period required under applicable federal and state
securities laws to Consummate the Exchange Offer; provided, however, that in no
event shall such period be less than 20 business days. The Company shall cause
the
3
<PAGE>
Exchange Offer to comply with all applicable federal and state securities laws.
No securities other than the Notes, shall be included in the Exchange Offer
Registration Statement. The Company shall use its best efforts to cause the
Exchange Offer to be Consummated on the earliest practicable date after the
Exchange Offer Registration Statement has become effective, but in no event
later than 30 business days thereafter.
(c) The Company shall indicate in a "Plan of Distribution" section
contained in the Prospectus contained in the Exchange Offer Registration
Statement that any Broker-Dealer who holds Senior Notes that are Transfer
Restricted Securities and that were acquired for its own account as a result of
market-making activities or other trading activities (other than Transfer
Restricted Securities acquired directly from the Company), may exchange such
Senior Notes pursuant to the Exchange Offer; however, such Broker- Dealer may be
deemed to be an "underwriter" within the meaning of the Act and may be required,
therefore, to deliver a prospectus meeting the requirements of the Act in
connection with any sales of the Exchange Notes received by such Broker-Dealer
in the Exchange Offer, which prospectus delivery requirement may be satisfied by
the delivery by such Broker-Dealer of the Prospectus contained in the Exchange
Offer Registration Statement. Such "Plan of Distribution" section shall also
contain all other information with respect to such resales by Broker-Dealers
that the Commission may require in order to permit such resales pursuant
thereto, but such "Plan of Distribution" shall not name any such Broker- Dealer
or disclose the amount of Notes held by any such Broker-Dealer except to the
extent required by the Commission as a result of a change in policy after the
date of this Agreement.
The Company shall use its best efforts to keep the Exchange Offer
Registration Statement continuously effective, supplemented and amended as
required by the provisions of Section 6(c) below to the extent necessary to
ensure that it is available for resales of Notes acquired by Broker-Dealers for
their own accounts as a result of market-making activities or other trading
activities, and to ensure that such Registration Statement conforms with the
requirements of this Agreement, the Act and the policies, rules and regulations
of the Commission as announced from time to time, for a period of one year from
the date on which the Exchange Offer Registration Statement is declared
effective.
The Company shall promptly provide sufficient copies of the latest
version of such Prospectus to Broker-Dealers promptly upon request, at any time
during such one year period in order to facilitate such sales.
SECTION 4. SHELF REGISTRATION
(a) Shelf Registration. If (i) the Company is not required to file an
Exchange Offer Registration Statement or permitted to Consummate the Exchange
Offer, in either case, because the Exchange Offer is not permitted by applicable
law or Commission policy (after the procedures set forth in Section 6(a) below
have been complied with) or (ii) if any Holder of Transfer Restricted Securities
shall notify the Company within 20 business days of the Consummation of the
Exchange Offer (A) that such Holder is prohibited by applicable law or
Commission policy from participating in the Exchange Offer, or (B) that such
Holder may not resell the Exchange Notes acquired by it in the Exchange Offer to
the public without delivering a prospectus and that the Prospectus contained in
the Exchange Offer Registration Statement is not appropriate or available for
such resales by such Holder, or (iii) if any Holder of Transfer Restricted
Securities is a Broker-Dealer and holds Senior Notes acquired directly from the
Company or an affiliate of the Company and shall so notify the Company, then the
Company shall
4
<PAGE>
(x) cause to be filed a shelf registration statement pursuant to
Rule 415 under the Act, which may be an amendment to the Exchange Offer
Registration Statement (in either event, the "Shelf Registration
Statement") on or prior to the earliest to occur of (1) the 30th day after
the date on which the Company is notified by the Commission or otherwise
determines that it is not required to file the Exchange Offer Registration
Statement or permitted to Consummate the Exchange Offer, (2) the 30th day
after the date on which the Company receives notice from a Holder of
Transfer Restricted Securities as contemplated by clauses (ii) or (iii)
above, and (3) the 60th day after the Closing Date (such earliest date
being the "Shelf Filing Deadline"), which Shelf Registration Statement
shall provide for resales of all Transfer Restricted Securities the
Holders of which shall have provided the information required pursuant to
Section 4(b) hereof; and
(y) use its best efforts to cause such Shelf Registration
Statement to be declared effective by the Commission on or before the 90th
day after the Shelf Filing Deadline.
The Company shall use its best efforts to keep such Shelf Registration
Statement continuously effective, supplemented and amended as required by the
provisions of Sections 6(b) and (c) hereof to the extent necessary to ensure
that it is available for resales of Notes by the Holders of Transfer Restricted
Securities entitled to the benefit of this Section 4(a), and to ensure that it
conforms with the requirements of this Agreement, the Act and the policies,
rules and regulations of the Commission as announced from time to time, until
the second anniversary of the Closing Date or such shorter period that will
terminate when all the Notes covered by the Shelf Registration Statement have
been sold pursuant to the Shelf Registration Statement or become eligible for
resale pursuant to Rule 144 without volume or other restrictions.
(b) Provision by Holders of Certain Information in Connection with
the Shelf Registration Statement. No Holder of Transfer Restricted Securities
may include any of its Transfer Restricted Securities in any Shelf Registration
Statement pursuant to this Agreement unless and until such Holder furnishes to
the Company in writing, within 20 business days after receipt of a request
therefor, such information as the Company may reasonably request for use in
connection with any Shelf Registration Statement or Prospectus or preliminary
Prospectus included therein. No Holder of Transfer Restricted Securities shall
be entitled to Liquidated Damages pursuant to Section 5 hereof unless and until
such Holder shall have used its best efforts to provide all such reasonably
requested information. Each Holder as to which any Shelf Registration Statement
is being effected agrees to furnish promptly to the Company all information
required to be disclosed in order to make the information previously furnished
to the Company by such Holder not materially misleading.
SECTION 5. LIQUIDATED DAMAGES
If (i) the Registration Statement required by this Agreement is not
filed with the Commission on or prior to the date specified for such filing in
this Agreement, (ii) such Registration Statement has not been declared effective
by the Commission on or prior to the date specified for such effectiveness in
this Agreement (the "Effectiveness Target Date"), (iii) the Exchange Offer has
not been Consummated within 30 business days after the Effectiveness Target Date
with respect to the Exchange Offer Registration Statement or (iv) any
Registration Statement required by this Agreement is filed and declared
effective but shall thereafter cease to be effective or fail to be usable for
its intended purpose without being succeeded immediately by a post-effective
amendment to such Registration Statement that cures such failure and that is
itself immediately declared effective (each such event referred to in clauses
(i) through (iv), a
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"Registration Default"), the Company hereby agrees to pay liquidated damages to
each Holder of Transfer Restricted Securities with respect to the first 90-day
period immediately following the occurrence of such Registration Default, in an
amount equal to 0.25% per annum on the principal amount of Transfer Restricted
Securities held by such Holder for the period that the Registration Default
continues. The amount of the liquidated damages shall increase by an additional
0.25% per annum for each subsequent 90 day period until all Registration
Defaults have been cured, up to a maximum amount of liquidated damages of 2.0%
per annum on the principal amount of Transfer Restricted Securities. All accrued
liquidated damages shall be paid to Record Holders by the Company by wire
transfer of immediately available funds or by federal funds check on each
Damages Payment Date, as provided in the Indenture. Following the cure of all
Registration Defaults relating to any particular Transfer Restricted Securities,
the accrual of liquidated damages with respect to such Transfer Restricted
Securities will cease.
All obligations of the Company set forth in the preceding paragraph
that are outstanding with respect to any Transfer Restricted Security at the
time such security ceases to be a Transfer Restricted Security shall survive
until such time as all such obligations with respect to such Security shall have
been satisfied in full.
SECTION 6. REGISTRATION PROCEDURES
(a) Exchange Offer Registration Statement. In connection with the
Exchange Offer, the Company shall comply with all of the provisions of Section
6(c) below, shall use its best efforts to effect such exchange to permit the
sale of Transfer Restricted Securities being sold in accordance with the
intended method or methods of distribution thereof, and shall comply with all of
the following provisions:
(i) If in the reasonable opinion of counsel to the Company there
is a question as to whether the Exchange Offer is permitted by applicable
law, the Company hereby agrees to seek a no-action letter or other
favorable decision from the Commission allowing the Company to Consummate
an Exchange Offer for such Senior Notes. The Company hereby agrees to
pursue the issuance of such a decision to the Commission staff level but
shall not be required to take commercially unreasonable action to effect a
change of Commission policy. The Company hereby agrees, however, to (A)
participate in telephonic conferences with the Commission, (B) deliver to
the Commission staff an analysis prepared by counsel to the Company
setting forth the legal bases, if any, upon which such counsel has
concluded that such an Exchange Offer should be permitted and (C)
diligently pursue a resolution (which need not be favorable) by the
Commission staff of such submission.
(ii) As a condition to its participation in the Exchange Offer
pursuant to the terms of this Agreement, each Holder of Transfer
Restricted Securities shall furnish, upon the request of the Company,
prior to the Consummation thereof, a written representation to the Company
(which may be contained in the letter of transmittal contemplated by the
Exchange Offer Registration Statement) to the effect that (A) it is not an
affiliate of the Company, (B) it is not engaged in, and does not intend to
engage in, and has no arrangement or understanding with any person to
participate in, a distribution of the Exchange Notes to be issued in the
Exchange Offer and (C) it is acquiring the Exchange Notes in its ordinary
course of business. In addition, all such Holders of Transfer Restricted
Securities shall otherwise cooperate in the Company's preparations for the
Exchange Offer. Each Holder hereby acknowledges and agrees that any
Broker-Dealer and any such Holder using the Exchange Offer to participate
in a distribution of the securities to be acquired in the Exchange Offer
(1) could not under Commission policy as in effect on the date of this
Agreement rely on the position of the Commission
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enunciated in Morgan Stanley and Co., Inc. (available June 5, 1991) and
Exxon Capital Holdings Corporation (available May 13, 1988), as
interpreted in the Commission's letter to Shearman & Sterling dated July
2, 1993, and similar no-action letters (including any no-action letter
obtained pursuant to clause (i) above), and (2) must comply with the
registration and prospectus delivery requirements of the Act in connection
with a secondary resale transaction and that such a secondary resale
transaction should be covered by an effective registration statement
containing the selling security holder information required by Item 507 or
508, as applicable, of Regulation S-K if the resales are of Exchange Notes
obtained by such Holder in exchange for Senior Notes acquired by such
Holder directly from the Company.
(iii) Prior to effectiveness of the Exchange Offer Registration
Statement, the Company shall, provide a supplemental letter to the
Commission stating (A) that the Company is registering the Exchange Offer
in reliance on the position of the Commission enunciated in Exxon Capital
Holdings Corporation (available May 13, 1988), Morgan Stanley and Co.,
Inc. (available June 5, 1991) and, if applicable, any no-action letter
obtained pursuant to clause (i) above and (B) including a representation
that the Company has not entered into any arrangement or understanding
with any Person to distribute the Exchange Notes to be received in the
Exchange Offer and that, to the best of the Company's information and
belief, each Holder participating in the Exchange Offer is acquiring the
Exchange Notes in its ordinary course of business and has no arrangement
or understanding with any Person to participate in the distribution of the
Exchange Notes received in the Exchange Offer.
(b) Shelf Registration Statement. In connection with the Shelf
Registration Statement, the Company shall comply with all the provisions of
Section 6(c) below and shall use its best efforts to effect such registration to
permit the sale of the Transfer Restricted Securities being sold in accordance
with the intended method or methods of distribution thereof, and pursuant
thereto the Company will as expeditiously as possible prepare and file with the
Commission a Registration Statement relating to the registration on any
appropriate form under the Act, which form shall be available for the sale of
the Transfer Restricted Securities in accordance with the intended method or
methods of distribution thereof.
(c) General Provisions. In connection with any Registration Statement
and any Prospectus required by this Agreement to permit the sale or resale of
Transfer Restricted Securities (including, without limitation, any Registration
Statement and the related Prospectus required to permit resales of Notes by
Broker-Dealers), the Company shall:
(i) use its best efforts to keep such Registration Statement
continuously effective and provide all requisite financial statements for
the period specified in Section 3 or 4 of this Agreement, as applicable;
upon the occurrence of any event that would cause any such Registration
Statement or the Prospectus contained therein (A) to contain a material
misstatement or omission or (B) not to be effective and usable for resale
of Transfer Restricted Securities during the period required by this
Agreement, the Company shall file promptly an appropriate amendment to
such Registration Statement, in the case of clause (A), correcting any
such misstatement or omission, and, in the case of either clause (A) or
(B), use its best efforts to cause such amendment to be declared effective
and such Registration Statement and the related Prospectus to become
usable for its intended purpose(s) as soon as practicable thereafter;
(ii) prepare and file with the Commission such amendments and
post-effective amendments to the Registration Statement as may be
necessary to keep the Registration Statement effective for the applicable
period set forth in Section 3 or 4 hereof, as applicable or such shorter
period as will
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terminate when all Transfer Restricted Securities covered by such
Registration Statement have been sold; cause the Prospectus to be
supplemented by any required Prospectus supplement, and as so supplemented
to be filed pursuant to Rule 424 under the Act, and to comply fully with
the applicable provisions of Rules 424 and 430A under the Act in a timely
manner; and comply with the provisions of the Act with respect to the
disposition of all securities covered by such Registration Statement
during the applicable period in accordance with the intended method or
methods of distribution by the sellers thereof set forth in such
Registration Statement or supplement to the Prospectus;
(iii) advise the underwriter(s), if any, and selling Holders
promptly and, if requested by such Persons, to confirm such advice in
writing, (A) when the Prospectus or any Prospectus supplement or
post-effective amendment has been filed, and, with respect to any
Registration Statement or any post-effective amendment thereto, when the
same has become effective, (B) of any request by the Commission for
amendments to the Registration Statement or amendments or supplements to
the Prospectus or for additional information relating thereto, (C) of the
issuance by the Commission of any stop order suspending the effectiveness
of the Registration Statement under the Act or of the suspension by any
state securities commission of the qualification of the Transfer
Restricted Securities for offering or sale in any jurisdiction, or the
initiation of any proceeding for any of the preceding purposes, (D) of the
existence of any fact or the happening of any event that makes any
statement of a material fact made in the Registration Statement, the
Prospectus, any amendment or supplement thereto, or any document
incorporated by reference therein untrue, or that requires the making of
any additions to or changes in the Registration Statement or the
Prospectus in order to make the statements therein not misleading. If at
any time the Commission shall issue any stop order suspending the
effectiveness of the Registration Statement, or any state securities
commission or other regulatory authority shall issue an order suspending
the qualification or exemption from qualification of the Transfer
Restricted Securities under state securities or Blue Sky laws, the Company
shall use its best efforts to obtain the withdrawal or lifting of such
order at the earliest possible time;
(iv) furnish to each of the selling Holders and each of the
underwriter(s), if any, before filing with the Commission, copies of any
Registration Statement or any Prospectus included therein or any
amendments or supplements to any such Registration Statement or Prospectus
(including all documents incorporated by reference after the initial
filing of such Registration Statement), which documents will be subject to
the review of such Holders and underwriter(s), if any, for a period of at
least five business days, and the Company will not file any such
Registration Statement or Prospectus or any amendment or supplement to any
such Registration Statement or Prospectus (including all such documents
incorporated by reference) to which a selling Holder of Transfer
Restricted Securities covered by such Registration Statement or the
underwriter(s), if any, shall reasonably object within five business days
after the receipt thereof. A selling Holder or underwriter, if any, shall
be deemed to have reasonably objected to such filing if such Registration
Statement, amendment, Prospectus or supplement, as applicable, as proposed
to be filed, contains a material misstatement or omission;
(v) promptly prior to the filing of any document that is to be
incorporated by reference into a Registration Statement or Prospectus,
provide copies of such document to the selling Holders and to the
underwriter(s), if any, make the Company's representatives available for
discussion of such document and other customary due diligence matters, and
include such information in such document prior to the filing thereof as
such selling Holders or underwriter(s), if any, reasonably may request;
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(vi) make available at reasonable times for inspection by the
selling Holders, any underwriter participating in any disposition pursuant
to such Registration Statement, and any attorney or accountant retained by
such selling Holders or any of the underwriters, all financial and other
records, pertinent corporate documents and properties of the Company and
cause the Company's officers, directors and employees to supply all
information reasonably requested by any such Holders, underwriter,
attorney or accountant in connection with such Registration Statement or
any post-effective amendment thereto subsequent to the filing thereof and
prior to its effectiveness;
(vii) if requested by any selling Holders or the underwriter(s),
if any, promptly incorporate in any Registration Statement or Prospectus,
pursuant to a supplement or post-effective amendment if necessary, such
information as such selling Holders and underwriter(s), if any, may
reasonably request to have included therein, including, without
limitation, information relating to the "Plan of Distribution" of the
Transfer Restricted Securities, information with respect to the principal
amount of Transfer Restricted Securities being sold to such
underwriter(s), the purchase price being paid therefor and any other terms
of the offering of the Transfer Restricted Securities to be sold in such
offering; and make all required filings of such Prospectus supplement or
post-effective amendment as soon as practicable after the Company is
notified of the matters to be incorporated in such Prospectus supplement
or post-effective amendment;
(viii) cause the Transfer Restricted Securities covered by the
Registration Statement to be rated with the appropriate rating agencies,
if so requested by the Holders of a majority in aggregate principal amount
of Notes covered thereby or the underwriter(s), if any;
(ix) furnish to each selling Holder and each of the
underwriter(s), if any, without charge, at least one copy of the
Registration Statement, as first filed with the Commission, and of each
amendment thereto, including all documents incorporated by reference
therein and all exhibits (including exhibits incorporated therein by
reference);
(x) deliver to each selling Holder and each of the
underwriter(s), if any, without charge, as many copies of the Prospectus
(including each preliminary prospectus) and any amendment or supplement
thereto as such Persons reasonably may request; the Company hereby
consents to the use of the Prospectus and any amendment or supplement
thereto by each of the selling Holders and each of the underwriter(s), if
any, in connection with the offering and the sale of the Transfer
Restricted Securities covered by the Prospectus or any amendment or
supplement thereto;
(xi) enter into such agreements (including an underwriting
agreement), and make such representations and warranties, and take all
such other actions in connection therewith in order to expedite or
facilitate the disposition of the Transfer Restricted Securities pursuant
to any Registration Statement contemplated by this Agreement, all to such
extent as may be requested by the Initial Purchaser or by any Holder of
Transfer Restricted Securities or underwriter in connection with any sale
or resale pursuant to any Registration Statement contemplated by this
Agreement; and whether or not an underwriting agreement is entered into
and whether or not the registration is an Underwritten Registration, the
Company shall:
(A) furnish to the Initial Purchaser, each selling Holder and
each underwriter, if any, in such substance and scope as they may
request and as are customarily made by issuers to underwriters in
primary underwritten offerings, (i) upon the date of the Consummation
of the
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Exchange Offer, (ii) if applicable, the effectiveness of the Shelf
Registration Statement and (iii) upon the filing of any amendment or
supplement to any Registration Statement:
(1) a certificate, dated the date of Consummation of the
Exchange Offer or the date of effectiveness of the Shelf
Registration Statement, as the case may be, signed by (y) the
President or any Vice President and (z) a principal financial or
accounting officer of the Company confirming, as of the date
thereof, the matters set forth in paragraphs (i) and (j) of
Section 7 of the Purchase Agreement and such other matters as
such parties may reasonably request;
(2) an opinion, dated the date of Consummation of the
Exchange Offer or the date of effectiveness of the Shelf
Registration Statement, as the case may be, of counsel for the
Company, covering the matters set forth in paragraphs (d), (e),
(f) and (g) of Section 7 of the Purchase Agreement and such
other matters as such parties may reasonably request, and in any
event including a statement to the effect that such counsel has
participated in conferences with officers and other
representatives of the Company's representatives of the
independent public accountants for the Company and the Initial
Purchaser's representatives and the Initial Purchaser's counsel
in connection with the preparation of such Registration
Statement and the related Prospectus and have considered the
matters required to be stated therein and the statements
contained therein, although such counsel has not independently
verified the accuracy, completeness or fairness of such
statements; and that such counsel advises that, on the basis of
the foregoing (relying as to materiality to a certain extent
upon facts provided to such counsel by officers and other
representatives of the Company and without independent check or
verification), no facts came to such counsel's attention that
caused such counsel to believe that the applicable Registration
Statement, at the time such Registration Statement or any
post-effective amendment thereto became effective, and, in the
case of the Exchange Offer Registration Statement, as of the
date of Consummation, contained an untrue statement of a
material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading, or that the Prospectus contained in such
Registration Statement as of its date and, in the case of the
opinion dated the date of Consummation of the Exchange Offer, as
of the date of Consummation, contained an untrue statement of a
material fact or omitted to state a material fact necessary in
order to make the statements therein, in light of the
circumstances under which they were made, not misleading.
Without limiting the foregoing, such counsel may state further
that such counsel assumes no responsibility for, and has not
independently verified, the accuracy, completeness or fairness
of the financial statements, notes and schedules and other
financial data included in any Registration Statement
contemplated by this Agreement or the related Prospectus; and
(3) customary comfort letters, dated as of the date of
Consummation of the Exchange Offer or the date of effectiveness
of the Shelf Registration Statement, as the case may be, from
the Company's independent accountant, Deloitte & Touche LLP, in
the customary form and covering matters of the type customarily
covered in comfort letters by underwriters in connection with
primary underwritten offerings, and affirming the matters set
forth in the comfort letters delivered pursuant to Section 7(i)
of the Purchase Agreement, without exception;
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(B) set forth in full or incorporate by reference in the
underwriting agreement, if any, the indemnification provisions and
procedures of Section 8 hereof with respect to all parties to be
indemnified pursuant to said Section; and
(C) deliver such other documents and certificates as may be
reasonably requested by such parties to evidence compliance with
clause (A) above and with any customary conditions contained in the
underwriting agreement or other agreement entered into by the Company
pursuant to this clause (xi), if any.
If at any time the representations and warranties of the Company
contemplated in clause (A)(1) above cease to be true and correct, the
Company shall so advise the Initial Purchaser and the underwriters(s), if
any, and each selling Holder promptly and, if requested by such Persons,
shall confirm such advice in writing;
(xii) prior to any public offering of Transfer Restricted
Securities, cooperate with the selling Holders, the underwriter(s), if
any, and its respective counsel in connection with the registration and
qualification of the Transfer Restricted Securities under the securities
or Blue Sky laws of such jurisdictions as the selling Holders or
underwriter(s) may request and do any and all other acts or things
necessary or advisable to enable the disposition in such jurisdictions of
the Transfer Restricted Securities covered by any Registration Statement;
provided, however, that the Company shall not be required to register or
qualify to transact business where it is not now so qualified or to take
any action that would subject it to the service of process in suits or to
taxation, other than as to matters and transactions relating to the
Registration Statement, in any jurisdiction where it is not now so
subject;
(xiii) shall issue, upon the request of any Holder of Senior
Notes covered by the Shelf Registration Statement, Exchange Notes, having
an aggregate principal amount equal to the aggregate principal amount of
Senior Notes surrendered to the Company by such Holder in exchange
therefor or being sold by such Holder; such Exchange Notes to be
registered in the name of such Holder or in the name of the purchaser(s)
of such Notes, as the case may be; in return, the Senior Notes held by
such Holder shall be surrendered to the Company for cancellation;
(xiv) cooperate with the selling Holders and the underwriter(s),
if any, to facilitate the timely preparation and delivery of certificates
representing Transfer Restricted Securities to be sold and not bearing any
restrictive legends; and enable such Transfer Restricted Securities to be
in such denominations and registered in such names as the Holders or the
underwriter(s), if any, may request at least two business days prior to
any sale of Transfer Restricted Securities made by such underwriter(s);
(xv) use its best efforts to cause the Transfer Restricted
Securities covered by the Registration Statement to be registered with or
approved by such other governmental agencies or authorities as may be
necessary to enable the seller or sellers thereof or the underwriter(s),
if any, to consummate the disposition of such Transfer Restricted
Securities, subject to the proviso contained in clause (xii) above;
(xvi) if any fact or event contemplated by clause (c)(iii)(D)
above shall exist or have occurred, prepare a supplement or post-effective
amendment to the Registration Statement or related Prospectus or any
document incorporated therein by reference or file any other required
document so that, as thereafter delivered to the purchasers of Transfer
Restricted Securities, the Prospectus will
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not contain an untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein not misleading;
(xvii) provide a CUSIP number for all Transfer Restricted
Securities not later than the effective date of the Registration Statement
and provide the Trustees under the Indenture with printed certificates for
the Transfer Restricted Securities which are in a form eligible for
deposit with The Depository Trust Company;
(xviii) cooperate and assist in any filings required to be made
with the NASD and in the performance of any due diligence investigation by
any underwriter (including any "qualified independent underwriter") that
is required to be retained in accordance with the rules and regulations of
the NASD, and use its reasonable best efforts to cause such Registration
Statement to become effective and approved by such governmental agencies
or authorities as may be necessary to enable the Holders selling Transfer
Restricted Securities to consummate the disposition of such Transfer
Restricted Securities;
(xix) otherwise use its best efforts to comply with all
applicable rules and regulations of the Commission, and make generally
available to its security holders, as soon as practicable, a consolidated
earnings statement meeting the requirements of Rule 158 (which need not be
audited) for the twelve-month period (A) commencing at the end of any
fiscal quarter in which Transfer Restricted Securities are sold to
underwriters in a firm or best efforts Underwritten Offering or (B) if not
sold to underwriters in such an offering, beginning with the first month
of the Company's first fiscal quarter commencing after the effective date
of the Registration Statement;
(xx) cause the Indenture to be qualified under the TIA not later
than the effective date of the first Registration Statement required by
this Agreement, and, in connection therewith, cooperate with the Trustee
and the Holders of Notes to effect such changes to the Indenture as may be
required for such 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 that may be required to effect such
changes and all other forms and documents required to be filed with the
Commission to enable such Indenture to be so qualified in a timely manner;
(xxi) cause all Transfer Restricted Securities covered by the
Registration Statement to be listed on each securities exchange on which
similar securities issued by the Company is then listed if requested by
the Holders of a majority in aggregate principal amount of Senior Notes or
the managing underwriter(s), if any; and
(xxii) provide promptly to each Holder upon request each
document filed with the Commission pursuant to the requirements of Section
13 and Section 15 of the Exchange Act.
Each Holder agrees by acquisition of a Transfer Restricted Security
that, upon receipt of any notice from the Company of the existence of any fact
of the kind described in Section 6(c)(iii)(D) hereof, such Holder will forthwith
discontinue disposition of Transfer Restricted Securities pursuant to the
applicable Registration Statement until such Holder's receipt of the copies of
the supplemented or amended Prospectus contemplated by Section 6(c)(xvi) hereof,
or until it is advised in writing (the "Advice") by the Company that the use of
the Prospectus may be resumed, and has received copies of any additional or
supplemental filings that are incorporated by reference in the Prospectus. If so
directed by the Company, each Holder will deliver to the Company (at the
Company's expense) all copies, other than permanent file
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copies then in such Holder's possession, of the Prospectus covering such
Transfer Restricted Securities that was current at the time of receipt of such
notice. In the event the Company shall give any such notice, the time period
regarding the effectiveness of such Registration Statement set forth in Section
3 or 4 hereof, as applicable, shall be extended by the number of days during the
period from and including the date of the giving of such notice pursuant to
Section 6(c)(iii)(D) hereof to and including the date when each selling Holder
covered by such Registration Statement shall have received the copies of the
supplemented or amended Prospectus contemplated by Section 6(c)(xvi) hereof or
shall have received the Advice.
SECTION 7. REGISTRATION EXPENSES
(a) All expenses associated with and incident to the Company's
performance of or compliance with this Agreement will be borne by the Company,
regardless of whether a Registration Statement becomes effective, including
without limitation: (i) all registration and filing fees and expenses (including
filings made by the Initial Purchaser or any Holder with the NASD and reasonable
counsel fees and disbursements in connection therewith (and, if applicable, the
fees and expenses of any "qualified independent underwriter" and its counsel
that may be required by the rules and regulations of the NASD)); (ii) all
reasonable fees and disbursements of compliance with federal securities and
state Blue Sky or securities laws (including all fees and expenses of counsel to
the underwriter(s) in connection with compliance with state Blue Sky or
securities laws); (iii) all expenses of printing (including printing
certificates for the Exchange Notes to be issued in the Exchange Offer and
printing of Prospectuses), messenger and delivery services and telephone; (iv)
all fees and disbursements of counsel for the Company and, subject to Section
7(b) below, the Holders of Transfer Restricted Securities; (v) all application
and filing fees, if any, in connection with listing the Notes on a national
securities exchange or automated quotation system pursuant to the requirements
hereof; (vi) all fees and expenses of the Trustee under the Indenture to the
extent provided in the Indenture and of any escrow agent, custodian or exchange
agent; and (vii) all fees and disbursements of independent certified public
accountants of the Company (including the expenses of any special audit and
comfort letters required by or incident to such performance).
The Company shall, in any event, bear its internal expenses
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties), the expenses of any annual
audit and the fees and expenses of any Person, including special experts,
retained by the Company.
(b) In connection with any Registration Statement required by this
Agreement (including, without limitation, the Exchange Offer Registration
Statement and the Shelf Registration Statement), the Company shall reimburse the
Initial Purchaser and the Holders of Transfer Restricted Securities being
tendered in the Exchange Offer and/or resold pursuant to the "Plan of
Distribution" contained in the Exchange Offer Registration Statement or
registered pursuant to the Shelf Registration Statement, as applicable, for the
reasonable fees and disbursements of not more than one counsel, who shall be
Latham & Watkins or such other counsel as may be chosen by the Holders of a
majority in principal amount of the Transfer Restricted Securities for whose
benefit such Registration Statement is being prepared.
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SECTION 8. INDEMNIFICATION
(a) Indemnification by the Company. Upon any registration of Transfer
Restricted Securities or Broker-Dealer Transfer Restricted Securities, as
applicable, pursuant to Sections 3 and 4 hereof, and in consideration of the
agreements of the Initial Purchaser contained herein, and as an inducement to
the Initial Purchaser to purchase the Notes, the Company shall and hereby agrees
to, (i) indemnify and hold harmless each Holder of Transfer Restricted
Securities and Broker-Dealer Transfer Restricted Securities, as applicable, to
be included in such registration and each person who participates as a placement
or sales agent or as an underwriter in any offering or sale of such Transfer
Restricted Securities or Broker-Dealer Transfer Restricted Securities, as
applicable, against any losses, claims, damages or liabilities, joint or
several, to which such Holder, agent or underwriter may become subject under the
Act or otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon an untrue statement
or alleged untrue statement of a material fact contained in any Registration
Statement under which such Transfer Restricted Securities or Broker-Dealer
Transfer Restricted Securities, as applicable, were registered under the Act, or
any preliminary, final or summary Prospectus contained therein or furnished by
the Company to any such Holder, agent or underwriter, or any amendment or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and (ii) reimburse such
Holder, such agent and such underwriter for any legal or other expenses
reasonably incurred by them in connection with investigating or defending any
such action or claim as such expenses are incurred; provided, however, that the
Company shall not be liable under (i) above to any such person in any such case
to the extent that any such loss, claim, damage or liability arises out of or is
based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in such Registration Statement, or preliminary, final or
summary Prospectus, or amendment or supplement thereto, in reliance upon and in
conformity with written information furnished to the Company by such person
expressly for use therein.
(b) Indemnification by the Holders and any Agents and Underwriters. The
Company may require, as a condition to including any Transfer Restricted
Securities or Broker-Dealer Transfer Restricted Securities, as applicable, in
any Registration Statement filed pursuant to Sections 3 and 4 hereof and to
entering into any underwriting agreement, if any, with respect thereto, that the
Company shall have received an undertaking reasonably satisfactory to them from
the Holders of such Transfer Restricted Securities or Broker-Dealer Transfer
Restricted Securities, as applicable, and from each underwriter named in any
such underwriting agreement, if any, severally and not jointly, to (i) indemnify
and hold harmless the Company, and, in the case of a Shelf Registration
Statement, all other Holders of Transfer Restricted Securities, against any
losses, claims, damages or liabilities to which the Company, or such other
Holders of Transfer Restricted Securities or Broker-Dealer Transfer Restricted
Securities, as applicable, may become subject, under the Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon an untrue statement or alleged untrue
statement of a material fact contained in such Registration Statement, or any
preliminary, final or summary Prospectus contained therein or furnished by the
Company to any such Holder, agent or underwriter, if any, or any amendment or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company by such Holder or
underwriter expressly for use therein, and (ii) reimburse the Company for any
legal or other expenses reasonably incurred by the Company in connection with
investigating or defending any such action or claim as such expenses are
incurred;
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provided, however, that no such Holder shall be required to undertake liability
to any person under this Section 8(b) for any amounts in excess of the dollar
amount of the proceeds to be received by such Holder from the sale of such
Holder's Transfer Restricted Securities or Broker-Dealer Transfer Restricted
Securities, as applicable, pursuant to such registration.
(c) Notices of Claims, Etc. Promptly after receipt by an indemnified party
under subsection (a) or (b) above of written notice of the commencement of any
action, such indemnified party shall, if a claim in respect thereof is to be
made against an indemnifying party pursuant to the indemnification provisions of
or contemplated by this Section 8, notify such indemnifying party in writing of
the commencement of such action; but the omission so to notify the indemnifying
party shall not relieve it from any liability which it may have to any
indemnified party other than under the indemnification provisions of or
contemplated by Section 8(a) or 8(b) hereof. In case any such action shall be
brought against any indemnified party and it shall notify an indemnifying party
of the commencement thereof, such indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, jointly with any
other indemnifying party similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party, and, after notice
from the indemnifying party to such indemnified party of its election so to
assume the defense thereof, such indemnifying party shall not be liable to such
indemnified party for any legal expenses of other counsel or any other expenses,
in each case subsequently incurred by such indemnified party, in connection with
the defense thereof other than reasonable costs of investigation.
Notwithstanding the foregoing, any indemnified party shall have the right to
employ separate counsel in any such action and participate in the defense
thereof, but the fees and expenses of such counsel shall be at the expense of
the indemnified party unless the indemnified party shall have been advised by
counsel that representation of the indemnified party by counsel provided by the
indemnifying party would be inappropriate due to actual or potential conflicting
interests between the indemnifying party and the indemnified party, including
situations in which there are one or more legal defenses available to the
indemnified party that are different from or additional to those available to
the indemnifying party; provided, however, that the indemnifying party shall
not, in connection with any one such action or proceeding or separate but
substantially similar actions or proceedings arising out of the same general
allegations, be liable for the fees and expenses of more than one separate firm
of attorneys at any time for all indemnified parties, except to the extent that
local counsel, in addition to its regular counsel, is required in order to
effectively defend against such action or proceeding. The indemnifying party
shall not be required to indemnify any indemnified party for any amount paid or
payable by such indemnified party in the settlement of any action, proceeding or
investigation without the written consent of the indemnifying party, which
consent shall not be unreasonably withheld. No indemnifying party shall, without
the written consent of the indemnified party, effect the settlement or
compromise of, or consent to the entry of any judgment with respect to, any
pending or threatened action or claim in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified party is an
actual or potential party to such action or claim) unless such settlement,
compromise or judgment (i) includes an unconditional release of the indemnified
party from all liability arising out of such action or claim and (ii) does not
include a statement as to or an admission of fault, culpability or a failure to
act by or on behalf of any indemnified party.
(d) Contribution. Each party hereto agrees that, if for any reason the
indemnification provisions contemplated by Section 8(a) or Section 8(b) are
unavailable to or insufficient to hold harmless an indemnified party in respect
of any losses, claims damages or liabilities (or actions in respect thereof)
referred to therein, then each indemnifying party shall contribute to the amount
paid or payable by such indemnified party as a result of such losses, claims,
damages or liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect the relative fault of the indemnifying party and the
indemnified party in connection with the statements or omissions which resulted
in such losses, claims,
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<PAGE>
damages or liabilities (or actions in respect thereof), as well as any other
relevant equitable considerations. It is understood that contribution under this
subsection (d) is unavailable to indemnified parties to the same extent that
indemnification is unavailable under the proviso at the end of subsection (a)
above. The relative fault of such indemnifying party and indemnified party shall
be determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by such indemnifying party or by
such indemnified party, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The parties hereto agree that it would not be just and equitable if
contributions pursuant to this Section 8(d) were determined by pro rata
allocation (even if the Holders or any agents or underwriters or all of them
were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations referred
to in this Section 8(d). The amount paid or payable by an indemnified party as a
result of the losses, claims, damages, or liabilities (or actions in respect
thereof) referred to above shall be deemed to include any legal or other fees or
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 8(d), no Holder shall be required to contribute any
amount in excess of the amount by which the dollar amount of the proceeds
received by such Holder from the sale of any Transfer Restricted Securities
(after deducting any fees, discounts and commissions applicable thereto) or
Broker-Dealer Transfer Restricted Securities, as applicable, exceeds the amount
of any damages which such Holder has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission, and no
underwriter shall be required to contribute any amount in excess of the amount
by which the total price at which the Transfer Restricted Securities
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages which such underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The Holders'
and any underwriters' obligations in this Section 8(d) to contribute shall be
several in proportion to the principal amount of Transfer Restricted Securities
or Broker-Dealer Transfer Restricted Securities, as applicable, registered or
underwritten, as the case may be, by them and not joint.
(e) The obligations of the Company under this Section 8 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each officer, director and partner of
each Holder, agent and underwriter and each person, if any, who controls any
Holder, agent or underwriter within the meaning of the Act; and the obligations
of the Holders and any underwriters contemplated by this Section 8 shall be in
addition to any liability which the respective Holder or underwriter may
otherwise have and shall extend, upon the same terms and conditions, to each
officer and director of the Company (including any person who, with his consent,
is named in any Registration Statement as about to become a director of the
Company) and to each person, if any, who controls the Company within the meaning
of the Act.
SECTION 9. RULE 144A
The Company hereby agrees with each Holder, for so long as any
Transfer Restricted Securities remain outstanding, to make available to any
Holder or beneficial owner of Transfer Restricted Securities in connection with
any sale thereof and any prospective purchaser of such Transfer Restricted
Securities from such Holder or beneficial owner, the information required by
Rule 144A(d)(4) under the Act in order to permit resales of such Transfer
Restricted Securities pursuant to Rule 144A.
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<PAGE>
SECTION 10. PARTICIPATION IN UNDERWRITTEN REGISTRATIONS
No Holder may participate in any Underwritten Registration hereunder
unless such Holder (a) agrees to sell such Holder's Transfer Restricted
Securities on the basis provided in any underwriting arrangements approved by
the Persons entitled hereunder to approve such arrangements and (b) completes
and executes all reasonable questionnaires, powers of attorney, indemnities,
underwriting agreements, lockup letters and other documents required under the
terms of such underwriting arrangements.
SECTION 11. SELECTION OF UNDERWRITERS
The Holders of Transfer Restricted Securities covered by the Shelf
Registration Statement who desire to do so may sell such Transfer Restricted
Securities in an Underwritten Offering. In any such Underwritten Offering, the
investment banker or investment bankers and manager or managers that will
administer the offering will be selected by the holders of a majority in
aggregate principal amount of the Transfer Restricted Securities included in
such offering; provided, that such investment bankers and managers must be
reasonably satisfactory to the Company.
SECTION 12. MISCELLANEOUS
(a) Remedies. The Company agrees that monetary damages (including the
liquidated damages contemplated hereby) would not be adequate compensation for
any loss incurred by reason of a breach by it of the provisions of this
Agreement and hereby agrees to waive the defense in any action for specific
performance that a remedy at law would be adequate.
(b) No Inconsistent Agreements. The Company will not, on or after the
date of this Agreement enter into any agreement with respect to its securities
that is inconsistent with the rights granted to the Holders in this Agreement or
otherwise conflicts with the provisions hereof. The Company has not previously
entered into any agreement granting any registration rights with respect to its
securities to any Person. 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 securities under any agreement in effect on the date
hereof.
(c) Adjustments Affecting the Notes. The Company shall not take any
action, or permit any change to occur, with respect to the Notes that would
materially and adversely affect the ability of the Holders to Consummate the
Exchange Offer.
(d) Amendments and Waivers. The provisions of this Agreement may not
be amended, modified or supplemented, and waivers or consents to or departures
from the provisions hereof may not be given unless the Company has obtained the
written consent of Holders of a majority of the outstanding principal amount of
Transfer Restricted Securities. Notwithstanding the foregoing, a waiver or
consent to departure from the provisions hereof that relates exclusively to the
rights of Holders whose securities are being tendered pursuant to the Exchange
Offer and that does not affect directly or indirectly the rights of other
Holders whose securities are not being tendered pursuant to such Exchange Offer
may be given by the Holders of a majority of the outstanding principal amount of
Transfer Restricted Securities being tendered or registered.
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<PAGE>
(e) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class mail
(registered or certified, return receipt requested), telex, telecopier, or air
courier guaranteeing overnight delivery:
(i) if to a Holder, at the address set forth on the records of
the Registrar under the Indenture, with a copy to the Registrar under the
Indenture; and
(ii) if to the Company:
Adelphia Communications Corporation
Main at Water Street
Coudersport, PA 16915
Telecopier No.: (814) 274-7098
Attention: Tim Rigas
With a copy to:
Buchanan Ingersoll Professional Corporation
1 Oxford Center
301 Grant Street, 20th Floor
Pittsburgh, PA 15219
Telecopier No.: (412) 562-1041
Attention: Carl Rothenberger
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 acknowledged, if telecopied; and on the
next business day, if timely delivered to an air 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
address specified in the Indenture.
(f) Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the successors and assigns of each of the parties,
including without limitation and without the need for an express assignment,
subsequent Holders of Transfer Restricted Securities; provided, however, that
this Agreement shall not inure to the benefit of or be binding upon a successor
or assign of a Holder unless and to the extent such successor or assign acquired
Transfer Restricted Securities from such Holder.
(g) 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.
(h) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
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<PAGE>
(i) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE
CONFLICT OF LAW RULES THEREOF.
(j) 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.
(k) Entire Agreement. This Agreement together with the Notes, the
Indenture and the Purchase Agreement is intended by the parties as a final
expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein
with respect to the registration rights granted by the Company with respect to
the Transfer Restricted Securities. This Agreement supersedes all prior
agreements and understandings between the parties with respect to such subject
matter.
[signature page follows]
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<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first written above.
Adelphia Communications Corporation
By:/S/ James R. Brown
Name: James R. Brown
Title: Vice President
Barclays Capital Inc.
By: Nicholas Daifotis
Name: Nicholas Daifotis
Title:Managing Director
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<PAGE>
EXHIBIT 10.01
$150,000,000
ADELPHIA COMMUNICATIONS CORPORATION
8 1/8% Senior Notes due 2003
PURCHASE AGREEMENT
June 29, 1998
BARCLAYS CAPITAL INC.
222 Broadway
New York, New York 10038
Ladies and Gentlemen:
Adelphia Communications Corporation, a Delaware corporation
(the "Company"), proposes, upon the terms and conditions set forth herein, to
issue and sell to you, as the initial purchaser (the "Initial Purchaser"),
$150,000,000 in aggregate principal amount of its 81/8% Senior Notes due 2003
(the "Senior Notes"). The Senior Notes will (i) have the terms and provisions
which are summarized in the Offering Memorandum (as defined herein), (ii) be in
the forms specified by the Initial Purchaser pursuant to Section 3 hereof, and
(iii) be issued pursuant to the provisions of an Indenture, to be dated as of
July 2, 1998 (the "Indenture"), between the Company and Bank of Montreal Trust
Company, as trustee (the "Trustee").
The Company wishes to confirm as follows its agreement with
you the Initial Purchaser in connection with the purchase and resale of the
Senior Notes.
1. Offering Memorandum. The Senior Notes will be offered and
sold to the Initial Purchaser without registration under the Securities Act of
1933, as amended (the "Act"), in reliance on an exemption pursuant to Section
4(2) under the Act. The Company has prepared an offering memorandum, dated June
29, 1998, which incorporates by reference the Company's Annual Report on Form
10-K for the fiscal year ended March 31, 1998 which incorporates in Items 7 and
8 to such Form 10-K, portions of the Form 10-K for the fiscal year ended
December 31, 1997 of Olympus Communications, L.P. and Olympus Capital
Corporation and the Company's definitive Proxy Statement dated September 8, 1997
(the "Offering Memorandum"), setting forth information regarding the Company,
the Senior Notes and the Exchange Notes (as defined herein). Any references
herein to the Offering Memorandum shall be deemed to include all amendments and
supplements thereto, if any. The Company hereby confirms that they have
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<PAGE>
authorized the use of the Offering Memorandum in connection with the offering
and resale of the Senior Notes by the Initial Purchaser.
The Company understands that the Initial Purchaser proposes to
make offers (the "Exempt Resales") of the Senior Notes purchased by the Initial
Purchaser hereunder only on the terms set forth in the Offering Memorandum, and
Section 2 hereof, as soon as the Initial Purchaser deems advisable after this
Agreement has been executed and delivered, solely to persons whom the Initial
Purchaser reasonably believes to be "qualified institutional buyers" as defined
in Rule 144A under the Act ("QIBs") (such persons also being referred to herein
as the "Eligible Purchasers").
It is understood and acknowledged that upon original issuance
thereof, and until such time as the same is no longer required under the
applicable requirements of the Act, the Senior Notes (and all securities issued
in exchange therefor, in substitution thereof) shall bear the following legend:
"THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND MAY NOT BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED EXCEPT (1) TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN
THE MEANING OF RULE 144A UNDER THE SECURITIES ACT PURCHASING
FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS
OF RULE 144A, (2) PURSUANT TO AN EXEMPTION FROM REGISTRATION
UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF
AVAILABLE), (3) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OR (4) TO AN INSTITUTIONAL
ACCREDITED INVESTOR IN A TRANSACTION EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, IN EACH CASE
IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE
STATES OF THE UNITED STATES AND OTHER JURISDICTIONS."
It is also understood and acknowledged that holders (including
subsequent transferees) of the Senior Notes will have the registration rights
set forth in the registration rights agreement (the "Registration Rights
Agreement"), to be dated the Closing Date, in substantially the form of Exhibit
A hereto, for so long as such Senior Notes constitute "Transfer Restricted
Securities" (as defined in the Registration Rights Agreement). Pursuant to the
Registration Rights Agreement, the Company will agree to file with the
Securities and Exchange Commission (the "Commission") under the circumstances
set forth therein, (i) a registration statement under the Act relating to the
Company's 81/8% Senior Notes due 2003 (the "Exchange Notes") to be offered in
exchange for the Senior Notes (the "Registered Exchange Offer") and (ii) under
certain circumstances, a shelf registration statement pursuant to Rule 415 under
the Act relating to the resale by certain holders of the Senior Notes, and to
use its best efforts to cause such registration statements to be declared
effective. As used herein, the Senior Notes and the Exchange Notes are
hereinafter referred to collectively as the "Notes." This Agreement, the
Indenture, the Notes and
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the Registration Rights Agreement are hereinafter referred to collectively as
the "Operative Documents."
2. Agreements to Sell, Purchase and Resell. (a) The Company
hereby agrees, on the basis of the representations, warranties and agreements of
the Initial Purchaser contained herein and subject to all the terms and
conditions set forth herein, to issue and sell to the Initial Purchaser and,
upon the basis of the representations, warranties and agreements of the Company
herein contained and subject to all the terms and conditions set forth herein,
the Initial Purchaser agrees to purchase from the Company, at a purchase price
of 98.685% of the principal amount thereof, all of the Senior Notes. The Company
shall not be obligated to deliver any of the Senior Notes to be delivered
hereunder except upon payment for all of the Senior Notes to be purchased as
provided herein.
(b) The Initial Purchaser hereby represents and warrants to
the Company that it will offer the Senior Notes for sale upon the terms and
conditions set forth in this Agreement and in the Offering Memorandum. The
Initial Purchaser hereby represents and warrants to, and agrees with, the
Company that such Initial Purchaser (i) is either a QIB or other institutional
"accredited investor," as defined in Rule 501(a)(1), (2), (3) or (7) under the
Act (each, an "Accredited Institution") in either case with such knowledge and
experience in financial and business matters as are necessary in order to
evaluate the merits and risks of an investment in the Senior Notes; (ii) is
purchasing the Senior Notes pursuant to a private sale exempt from registration
under the Act; (iii) in connection with the Exempt Resales, will solicit offers
to buy the Senior Notes only from, and will offer to sell the Senior Notes only
to, the Eligible Purchasers in accordance with this Agreement and on the terms
contemplated by the Offering Memorandum; and (iv) will not offer or sell the
Senior Notes, nor has it offered or sold the Senior Notes by, or otherwise
engaged in, any form of general solicitation or general advertising (within the
meaning of Regulation D; including, but not limited to, advertisements,
articles, notices or other communications published in any newspaper, magazine,
or similar medium or broadcast over television or radio, or any seminar or
meeting whose attendees have been invited by any general solicitation or general
advertising) in connection with the offering of the Senior Notes. The Initial
Purchaser has advised the Company that the Initial Purchaser will initially
offer the Senior Notes to Eligible Purchasers at a price of 99.488% of the
principal amount thereof, plus accrued interest, if any, from the date of
issuance of the Senior Notes. Such price may be changed by the Initial Purchaser
at any time thereafter without notice.
The Initial Purchaser understands that the Company and, for
purposes of the opinions to be delivered to the Initial Purchaser pursuant to
Sections 7(d) and 7(h) hereof, counsel to the Company and counsel to the Initial
Purchaser, will rely upon the accuracy and truth of the foregoing
representations, warranties and agreements and the Initial Purchaser hereby
consents to such reliance.
3. Delivery of the Notes and Payment Therefor. Delivery to the
Initial Purchaser of and payment for the Senior Notes shall be made at the
office of Latham & Watkins, 885 Third Avenue, Suite 1000, New York, New York
10022 at 9:00 A.M., New York City time,
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<PAGE>
on July 2, 1998 (the "Closing Date"). The place of closing for the Senior Notes
and the Closing Date may be varied by agreement between the Initial Purchaser
and the Company.
The Senior Notes will be delivered to the Initial Purchaser
against payment of the purchase price therefor in immediately available funds.
The Senior Notes will be evidenced by one or more global securities in
definitive form (the "Global Note") and will be registered in the name of Cede &
Co. as nominee of The Depository Trust Company ("DTC"). The Senior Notes to be
delivered to the Initial Purchaser shall be made available to the Initial
Purchaser in New York City for inspection and packaging not later than 9:30
A.M., New York City time, on the business day next preceding the Closing Date.
4. Agreements of the Company. The Company agrees with the
Initial Purchaser as follows:
(a) The Company will furnish to the Initial Purchaser, without
charge, such number of copies of the Offering Memorandum as the Initial
Purchaser may reasonably request.
(b) The Company will not make any amendment or supplement to
the Offering Memorandum of which the Initial Purchaser shall not previously have
been advised or to which the Initial Purchaser shall reasonably object after
being so advised, including by way of filing any document with the Commission
that would be incorporated therein by reference.
(c) The Company consents to the use of the Offering Memorandum
in accordance with the securities or Blue Sky laws of the jurisdictions in which
the Senior Notes are offered by the Initial Purchaser and by all dealers to whom
Senior Notes may be sold, in connection with the offering and sale of the Senior
Notes.
(d) If, at any time prior to completion of the distribution of
the Senior Notes by the Initial Purchaser to Eligible Purchasers, any event
shall occur that in the judgment of the Company, or in the opinion of counsel
for the Initial Purchaser, should be set forth in the Offering Memorandum in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading, or if it is necessary to supplement or
amend the Offering Memorandum in order to comply with any law, the Company will
forthwith prepare an appropriate supplement or amendment thereto, and will
expeditiously furnish to the Initial Purchaser and dealers a reasonable number
of copies thereof.
(e) The Company will cooperate with the Initial Purchaser and
with its counsel in connection with the qualification of the Senior Notes for
offering and sale by the Initial Purchaser and by dealers under the securities
or Blue Sky laws of such jurisdictions as the Initial Purchaser may designate
and will file such consents to service of process or other documents necessary
or appropriate in order to effect such qualification; provided, that in no event
shall the Company be obligated to qualify to do business in any jurisdiction
where it is not now so qualified or to take any action which would subject it to
service of process in suits, other than those arising out of the offering or
sale of the Senior Notes, in any jurisdiction where it is not now so subject.
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<PAGE>
(f) So long as any of the Notes are outstanding, the Company
will furnish to the Initial Purchaser (i) as soon as available, a copy of each
report of the Company mailed to stockholders generally or filed with any stock
exchange or regulatory body and (ii) from time to time such other information
concerning the Company as the Initial Purchaser may reasonably request.
(g) If this Agreement shall terminate or shall be terminated
after execution and delivery pursuant to any provisions hereof (otherwise than
by notice given by the Initial Purchaser terminating this Agreement pursuant to
Section 10 hereof) or if this Agreement shall be terminated by the Initial
Purchaser because of any failure or refusal on the part of the Company to comply
with the terms or fulfill any of the conditions of this Agreement, the Company
agrees to reimburse the Initial Purchaser for all out-of-pocket expenses
(including reasonable fees and expenses of its counsel) reasonably incurred by
it in connection herewith, but without any further obligation on the part of the
Company for loss of profits or otherwise.
(h) The Company will apply the net proceeds from the sale of
the Senior Notes to be sold by it hereunder substantially in accordance with the
description set forth in the Offering Memorandum under the caption "Use of
Proceeds."
(i) Except as stated in this Agreement and in the Offering
Memorandum, the Company has not taken, nor will any of them take, directly or
indirectly, any action designed to or that might reasonably be expected to cause
or result in stabilization or manipulation of the price of the Senior Notes to
facilitate the sale or resale of the Senior Notes. Except as permitted by the
Act, the Company will not distribute any offering material in connection with
the Exempt Resales.
(j) The Company will use its best efforts to permit the Notes
to be designated Private Offerings, Resales and Trading through Automated
Linkages ("PORTAL") Market securities in accordance with the rules and
regulations adopted by the National Association of Securities Dealers, Inc.
relating to trading in the PORTAL Market and to permit the Notes to be eligible
for clearance and settlement through DTC.
(k) From and after the Closing Date, so long as any of the
Notes are outstanding and are "restricted securities" within the meaning of the
Rule 144(a)(3) under the Act or, if earlier, until three years after the Closing
Date, and during any period in which the Company is not subject to Section 13 or
15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
the Company will furnish to holders of the Notes and prospective purchasers of
Notes designated by such holders, upon request of such holders or such
prospective purchasers, the information (the "Additional Company Information")
required to be delivered pursuant to Rule 144A(d)(4) under the Act to permit
compliance with Rule 144A in connection with resales of the Notes.
(l) The Company has complied and will comply with all
provisions of Florida Statutes Section 517.075 relating to issuers doing
business with Cuba.
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<PAGE>
(m) The Company agrees not to sell, offer for sale or solicit
offers to buy or otherwise negotiate in respect of any security (as defined in
the Act) that would be integrated with the sale of the Senior Notes in a manner
that would require the registration under the Act of the sale to the Initial
Purchaser or the Eligible Purchasers of the Senior Notes.
(n) The Company agrees to comply with all the terms and
conditions of the Registration Rights Agreement and all agreements set forth in
the representation letters of the Company to DTC relating to the approval of the
Notes by DTC for "book entry" transfer.
(o) The Company agrees to cause the Exchange Offer to be made
in the appropriate form, as contemplated by the Registration Rights Agreement,
to permit registration of the Exchange Notes to be offered in exchange for the
Senior Notes, and to comply with all applicable federal and state securities
laws in connection with the Registered Exchange Offer.
(p) The Company agrees that prior to any registration of the
Senior Notes pursuant to the Registration Rights Agreement, or at such earlier
time as may be required, the Indenture shall be qualified under the Trust
Indenture Act of 1939 (the "1939 Act") and any necessary supplemental indentures
will be entered into in connection therewith.
(q) The Company will not voluntarily claim, and will resist
actively all attempts to claim, the benefit of any usury laws against holders of
the Notes.
(r) The Company will do and perform all things required or
necessary to be done and performed under this Agreement by it prior to the
Closing Date, and to satisfy all conditions precedent to the Initial Purchaser's
obligations hereunder to purchase the Senior Notes.
5. Representations and Warranties of the Company. The Company
represents and warrants to the Initial Purchaser that:
(a) The Offering Memorandum has been prepared in connection
with the offering of the Senior Notes. The Offering Memorandum and any
amendments or supplements thereto did not and will not, as of their
respective dates, contain an untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading; provided, however, that this representation and
warranty shall not apply to any statements or omissions made in
reliance upon and in conformity with information furnished in writing
to the Company by the Initial Purchaser concerning the Initial
Purchaser expressly for use therein (the "Initial Purchaser
Information"). The Offering Memorandum, as of its date, contains all
the information specified in, and meeting the requirements of, Rule
144A(d)(4) under the Act.
(b) The Company has not sustained since March 31, 1998 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
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<PAGE>
or decree, otherwise than as set forth or contemplated in the Offering
Memorandum; and, since the respective dates as of which information is
given in the Offering Memorandum, there has not been any reduction in
the consolidated stockholders' equity or change in the capital stock,
as applicable (other than reductions in the ordinary course of business
consistent with prior periods), material increase in the total amount
of short-term debt (excluding trade payables) and long-term debt of the
Company or any of its material subsidiaries (the "Subsidiaries") or any
material adverse change, or any development involving a prospective
material adverse change, in or affecting the general affairs,
management, financial position, partners' equity, shareholders' equity
or results of operations of the Company and its Subsidiaries, otherwise
than as set forth or contemplated in the Offering Memorandum;
(c) Each of the Company and its Subsidiaries has good and
marketable title in fee simple to all real property and good and
marketable title to all personal property owned by them, in each case
free and clear of all liens, encumbrances and defects except such as
are described in the Offering Memorandum or such as do not affect the
value of such property and do not interfere with the use made and
proposed to be made of such property by the Company and its
Subsidiaries; and any real property and buildings held under lease by
the Company and its Subsidiaries are held by them under valid,
subsisting and enforceable leases with such exceptions as are not
material and do not interfere with the use made and proposed to be made
of such property and buildings by the Company and its Subsidiaries;
except in any case that would not have a material adverse effect on the
business, general affairs, management, financial position, partners
equity or shareholders' equity (other than reductions in the ordinary
course of business consistent with prior periods), results of
operations or prospects of the Company and its Subsidiaries, taken as a
whole a "Material Adverse Effect";
(d) (i) Each of the Subsidiaries that are partnerships has
been duly formed and is validly existing as a partnership in good
standing under the laws of its state of formation, with full power and
authority (partnership and other) to own its properties and conduct its
business as described in the Offering Memorandum, and has been duly
qualified as a foreign partnership for the transaction of business and
is in good standing under the laws of each other jurisdiction in which
it owns or leases properties or conducts any business so as to require
such qualification, or is subject to no material liability or
disability by reason of the failure to be so qualified in any such
jurisdiction except where the failure to so qualify would not have a
Material Adverse Effect; and (ii) each of the Company and the
Subsidiaries that are corporations has been duly incorporated and is
validly existing as a corporation in good standing under the laws of
its state of incorporation, with full power and authority (corporate
and other) to own its properties and conduct its business as described
in the Offering Memorandum, and has been duly qualified as a foreign
corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases
properties or conducts any business so as to require such
qualification, or is subject to no material liability or
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<PAGE>
disability by reason of the failure to be so qualified in any such
jurisdiction except where the failure to so qualify would not have a
Material Adverse Effect;
(e) Each of the Company and its Subsidiaries has the ownership
or authorized capitalizations, as the case may be, as set forth in the
Offering Memorandum, and all of the partnership interests of the
Subsidiaries that are partnerships and all of the issued shares of
capital stock of its Subsidiaries that are corporations have been duly
and validly authorized and issued and with respect to shares of capital
stock are fully paid and non-assessable; and all of the partnership
interests of the Subsidiaries disclosed in the Offering Memorandum as
being owned directly or indirectly by the Company and all of the issued
shares of capital stock of the Subsidiaries that are corporations
disclosed in the Offering Memorandum as being owned directly or
indirectly by the Company have been duly and validly authorized and
issued are fully paid and non-assessable and are owned directly or
indirectly by the Company free and clear of all liens, encumbrances,
equities or claims (other than liens to secure indebtedness under
credit facilities disclosed in the Offering Memorandum); and ownership
of the various interests and shares of the Company and its Subsidiaries
is as described in the Offering Memorandum;
(f) The Notes have been duly authorized and, when issued and
delivered pursuant to this Agreement, will have been duly executed,
authenticated, issued and delivered and will constitute valid and
legally binding obligations of the Company entitled to the benefits
provided by the Indenture under which they are to be issued, which will
be substantially in the form previously delivered to the Initial
Purchaser; the Indenture has been duly authorized by the Company and,
when executed and delivered by the Company and the Trustee, the
Indenture will constitute a valid and legally binding instrument,
enforceable in accordance with its terms against the Company, subject,
as to enforcement, to bankruptcy, insolvency, reorganization and other
laws of general applicability relating to or affecting creditors'
rights and to general equity principles; and the Notes and the
Indenture will conform to the descriptions thereof in the Offering
Memorandum and will be in substantially the form previously delivered
to the Initial Purchaser;
(g) None of the transactions contemplated by this Agreement
(including, without limitation, the use of the proceeds from the sale
of the Senior Notes) will violate or result in a violation of Section 7
of the Exchange Act, or any regulation promulgated thereunder,
including, without limitation, Regulations U and X of the Board of
Governors of the Federal Reserve System;
(h) Prior to the date hereof, none of the Company or any of
their affiliates (other than the Initial Purchaser or any person acting
on its behalf as to which the Company makes no representation) has
taken, directly or indirectly, any action which is designed to or which
has constituted or which might have been expected to cause or result in
stabilization or manipulation of the price of any security of the
Company in connection with the offering of the Senior Notes;
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<PAGE>
(i) The Registration Rights Agreement has been duly authorized
by the Company and, when executed and delivered by the Company and the
Initial Purchaser, will constitute a valid and legally binding
instrument, enforceable against the Company in accordance with its
terms, subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or
affecting creditors' rights and to general equity principles; and the
Registration Rights Agreement will conform to the description thereof
in the Offering Memorandum and will be in substantially the form
previously delivered to the Initial Purchaser;
(j) The issue and sale of the Notes and the compliance by the
Company with all of the provisions of the Notes, the Indenture, the
Registration Rights Agreement and this Agreement and the consummation
of the transactions herein and therein contemplated will not conflict
with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any material indenture,
mortgage, deed of trust, sale/leaseback agreement, loan agreement or
other similar financing agreement or instrument or other agreement or
instrument (including, without limitation, any license or franchise
granted to the Company or one of its Subsidiaries by a local
franchising governmental body) to which the Company or any of its
Subsidiaries is a party or by which the Company or any of its
Subsidiaries is bound or has rights under or to which any of the
property or assets of the Company or any of its Subsidiaries is
subject, nor will such action result in any violation of the provisions
of the certificate of incorporation or bylaws of the Company or its
Subsidiaries that are corporations or the certificates of limited
partnership or the partnership agreements of its Subsidiaries that are
partnerships or any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over the
Company or any of its Subsidiaries or any of their properties; 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 Notes or the consummation by the Company
of the transactions contemplated by this Agreement, the Indenture or
the Registration Rights Agreement, other than (i) such consents,
approvals, authorizations, registrations or qualifications as may be
required under state securities or Blue Sky laws in connection with the
purchase and distribution of the Senior Notes by the Initial Purchaser,
(ii) the filing of a registration statement by the Company with the
Commission pursuant to the Act pursuant to the Registration Rights
Agreement, and (iii) such other consents, approvals, authorizations,
registrations or qualifications as may be required under the Act, state
or foreign securities or Blue Sky laws in connection with the exchange,
offer or resale registration contemplated in the Offering Memorandum
and described in the Registration Rights Agreement in connection with
the purchase and resale of the Senior Notes by the Initial Purchaser;
(k) None of the Company or its Subsidiaries is in violation of
its certificate of incorporation or bylaws, as the case may be, or in
default in the performance or observance of any material obligation,
agreement, covenant or condition contained in any indenture, mortgage,
deed of trust, sale/leaseback agreement, loan agreement or other
similar financing agreement or instrument or other agreement or
instrument (including,
9
<PAGE>
without limitation, any license or franchise granted to the Company or
a subsidiary by a local franchising governmental body) to which the
Company or a subsidiary is a party or by which it or any of its
properties may be bound, except for such defaults as would not have
individually or in the aggregate a Material Adverse Effect;
(l) The statements set forth in the Offering Memorandum under
the caption "Description of the Notes," insofar as they purport to
constitute a summary of the terms of the Notes, and under the captions
"Business," and "Management's Discussion and Analysis of Financial
Condition and Results of Operations," insofar as they purport to
describe the provisions of the laws and documents referred to therein,
are accurate, complete and fair in all material respects;
(m) When the Senior Notes are issued and delivered pursuant to
this Agreement, the Senior Notes will not be of the same class (within
the meaning of Rule 144A under the Act) as securities of the Company
which are listed on a national securities exchange registered under
Section 6 of the Exchange Act or quoted in a U.S. automated
inter-dealer quotation system;
(n) None of the Company or its Subsidiaries is or, after
giving effect to the offering and sale of the Notes, will be an
"investment company", or an entity "controlled" by an "investment
company", as such terms are defined in the United States Investment
Company Act of 1940, as amended (the "Investment Company Act");
(o) None of the Company or any person acting on its or their
behalf (other than the Initial Purchaser, as to which the Company makes
no representation or warranty) has offered or sold the Senior Notes by
means of any general solicitation or general advertising within the
meaning of Rule 502(c) under the Act;
(p) Except for (i) the issuance of $325,000,000 aggregate
principal amount of the Company's Series B 9 1/4% Senior Notes due 2002
in exchange for previously issued and outstanding Series A 9 1/4%
Senior Notes due 2002, (ii) the issuance of $150,000,000 aggregate
principal amount of the Company's Series B 10 1/2% Senior Notes due
2004 in exchange for previously issued and outstanding Series A 10 1/2%
Senior Notes due 2004, (v) the issuance of $350,000,000 aggregate
principal amount of the Company's Series B 97/8% Senior Notes due 2007
in exchange for previously issued and outstanding Series A 97/8% Senior
Notes due 2007, (iii) the issuance of $150,000,000 aggregate principal
amount of the Company's Series A 83/8% Senior Notes due 2008 and (vii)
the issuance of $150,000,000 aggregate principal amount of the
Company's Series B 83/8% Senior Notes due 2008 in exchange for
previously issued and outstanding Series A 83/8% Senior Notes due 2008,
within the preceding six months, none of the Company or any other
person acting on behalf of the Company (other than the Initial
Purchaser, Salomon Brothers Inc or Smith Barney Inc., as to which the
Company makes no representation or warranty) has offered or sold to any
person any Notes, or any securities of the same or a similar class as
the Notes, other than Senior Notes offered or sold to the Initial
Purchaser hereunder.
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<PAGE>
The Company will take reasonable precautions designed to insure that
any offer or sale, direct or indirect, in the United States or to any
U.S. person (as defined in Rule 902 under the Act) of any Notes or any
substantially similar security issued by the Company, within six months
subsequent to the date on which the distribution of the Notes has been
completed (as notified by the Initial Purchaser), is made under
restrictions and other circumstances reasonably designed not to affect
the status of the offer and sale of the Notes in the United States and
to U.S. persons contemplated by this Agreement as transactions exempt
from the registration provisions of the Act;
(q) None of the Company or any of their affiliates does
business with the government of Cuba or with any person or affiliate
located in Cuba within the meaning of Section 517.075, Florida
Statutes;
(r) Other than as set forth in the Offering Memorandum
(including those matters referred to therein relating to general
rulemakings and similar matters relating generally to the cable
television industry), there are no legal or governmental proceedings
pending to which the Company or any of its Subsidiaries is a party or
of which any property of the Company or any of its Subsidiaries is the
subject which, if determined adversely to the Company or any of its
Subsidiaries, would individually or in the aggregate have a Material
Adverse Effect and, to the best of the Company's knowledge, no such
proceedings are threatened or contemplated by governmental authorities
or by others; and except with respect to general rulemakings and
similar matters relating generally to the cable television industry,
during the time the Systems (as defined below) have been owned by the
Company or a subsidiary (i) there has been no adverse judgment, order,
or decree issued by the United States Federal Communications Commission
(the "FCC") relating to any of the Systems that has not been disclosed
in the Offering Memorandum that would be required to be disclosed in a
public offering registered under the Act; (ii) there are no actions,
suits, proceedings, inquiries or investigations by the FCC pending or
threatened in writing against or affecting the Company, any of its
Subsidiaries or any System; and (iii) to the Company's knowledge, after
due inquiry, there is no reasonable basis for any such action, suit,
proceeding or investigation;
(s) Deloitte & Touche LLP, who have reported on the financial
statements of the Company, is an independent public accountant within
the meaning of the Act and the rules and regulations of the Commission
thereunder;
(t) This Agreement has been duly authorized, executed and
delivered by the Company;
(u) Except for matters covered by paragraph (x) below or with
respect to matters that would not individually or in the aggregate have
a Material Adverse Effect, (i) the Company and its Subsidiaries have
made all filings, recordings and registrations with, and possess all
validations or exemptions, approvals, orders, authorizations, consents,
licenses, certificates and permits from, the FCC, applicable public
utilities and other
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<PAGE>
federal, state and local regulatory or governmental bodies and
authorities or any subdivision thereof, including, without limitation,
cable television franchises, pole attachment agreements, and cable
antenna relay service, broadcast auxiliary, earth station, business
radio, microwave or special safety radio service licenses issued by the
FCC (collectively, the "Authorizations") necessary or appropriate to
own, operate and construct the cable communication systems owned by
them (the "Systems") or otherwise for the operation of their businesses
and are not in violation thereof; (ii) all such Authorizations are in
full force and effect, and no event has occurred that permits, or after
notice or lapse of time could permit, the revocation, termination or
modification of any Authorization which is necessary or appropriate to
own, operate and construct the Systems or otherwise for the operation
of any such business; (iii) none of the Company or any of its
Subsidiaries is in violation of any duty or obligation required by the
United States Communications Act of 1934, as amended (the
"Communications Act"), or any FCC rule or regulation applicable to the
operation of any portion of any of the Systems; (iv) none of the
Company or any of its Subsidiaries is in violation of any duty or
obligation required by state or local laws, or local rules or
regulations applicable to the operation of any portion of any of the
Systems; (v) there is not pending or, to the best knowledge of the
Company or any of its Subsidiaries, threatened, any action by the FCC
or state or local regulatory authority to modify, revoke, cancel,
suspend or refuse to renew any Authorization; (vi) other than as
described in the Offering Memorandum, there is not now issued or
outstanding or, to the best knowledge of the Company or any of its
Subsidiaries, threatened, any notice of any hearing, material violation
or material complaint against the Company or any of its Subsidiaries
with respect to the operation of any portion of the Systems and none of
the Company or its Subsidiaries has any knowledge that any person
intends to contest renewal of any material Authorization;
(v) (i) (A) The Company and its Subsidiaries have entered
into, or have rights under, all required programming agreements
(including, without limitation, all non-broadcast affiliation
agreements under which the Company and its Subsidiaries are accorded
retransmission rights relating to programming that the Systems provide
to their customers) that are material to the conduct of their business
as described in the Offering Memorandum; and (B) all such material
agreements are in full force and effect and none of the Company, any of
its Subsidiaries or any of its affiliates has received any written
notice of revocation or material modifications of such material
agreements; and (ii)(A) either the Company or its Subsidiaries has
entered into agreements with the television stations that have notified
the Company or its Subsidiaries that such station's respective consent
is required to carry such stations on the Systems or has ceased
carrying such stations; (B) all such agreements grant the Company or
one of its Subsidiaries retransmission consent in exchange for various
non-cash consideration; and (C) all such agreements are in full force
and effect and are not subject to revocation (except in the case of
material breach by the Company or its Subsidiaries) or material
modifications, and no event has occurred that permits, or after notice
or lapse of time could permit, the revocation, termination or material
modification of any such agreement, except where the
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<PAGE>
failure of such agreements to be in full force and effect or such
revocation would not, in either case, individually or in the aggregate
have a Material Adverse Effect;
(w) Except for matters that would not individually or in the
aggregate have a Material Adverse Effect, (i) all registration
statements and all other documents (including but not limited to annual
reports) required by the FCC in connection with the operation of the
Systems have been filed with the FCC; (ii) all frequencies within the
restricted aeronautical and navigational bands (i.e., 108-136 MHz and
225-400 MHz) which are currently being used in connection with the
operation of the Systems have been authorized for such use by the FCC;
(iii) each of the Systems subject to Equal Employment Opportunity
Commission ("EEO") compliance certification by the FCC has been
certified by the FCC for annual EEO compliance during the time such
Systems have been owned by the Company or its Subsidiaries; and (iv)
all towers associated with the Systems are in compliance with the rules
and regulations of the United States Federal Aviation Administration;
(x) Except for matters that would not individually or in the
aggregate have a Material Adverse Effect, none of the Company or any of
its Subsidiaries is in breach or violation of, or in default under, any
of the terms, conditions or provisions of the Communications Act or the
rules, regulations or policies of the FCC thereunder;
(y) (i) Except for matters that would not individually or in
the aggregate have a Material Adverse Effect, all statements of
accounts and any other filings that are required under Section 111 of
the United States Copyright Act of 1976, as amended, in connection with
the retransmission of any broadcast television and radio signals on the
Systems have been timely filed with the United States Copyright Office
and indicated royalty payments have been made for each System for each
accounting period during which such Systems have been owned by the
Company or its Subsidiaries; (ii) none of the Company, any of its
Subsidiaries or any System has received any inquiry or request from the
United States Copyright Office or from any other party challenging or
questioning any such statements of account or royalty payments; and
(iii) no claim of copyright infringement has been made or threatened in
writing against the Company, any of its Subsidiaries or any System;
(z) Neither the execution and delivery of this Agreement, the
Indenture or the Registration Rights Agreement, nor the consummation of
the transactions contemplated hereby and thereby or by the Offering
Memorandum under "Use of Proceeds," nor compliance with the terms,
conditions and provisions thereof by the Company, will conflict with
the Communications Act or the rules, regulations or policies of the FCC
thereunder, or will cause any suspension, revocation, impairment,
forfeiture, nonrenewal or termination of any material license, permit,
franchise, certificate, consent, authorization, designation,
declaration, filing, registration or qualification; and
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(aa) Neither the execution and delivery of this Agreement, the
Indenture or the Registration Rights Agreement, nor the execution,
delivery, offer, issuance and sale of the Notes, nor compliance with
the terms, conditions and provisions thereof by the Company, requires
any license, permit, franchise, certificate, consent, authorization,
designation, declaration, filing, registration or qualification by or
with the FCC.
6. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless the Initial Purchaser and each person, if any, who
controls the Initial Purchaser within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, from and against any and all losses, claims,
damages, liabilities and expenses (including reasonable costs of investigation)
arising out of or based upon any untrue statement or alleged untrue statement of
a material fact contained in the Offering Memorandum, or arising out of or based
upon any omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages, liabilities or expenses arise
out of or are based upon any untrue statement or omission or alleged untrue
statement or omission which has been made therein or omitted therefrom in
reliance upon and in conformity with the information relating to the Initial
Purchaser furnished in writing to the Company by or on behalf of the Initial
Purchaser expressly for use in connection therewith.
(b) If any action, suit or proceeding shall be brought against
the Initial Purchaser or any person controlling the Initial Purchaser in respect
of which indemnity may be sought against the Company, the Initial Purchaser or
such controlling person shall promptly notify the parties against whom
indemnification is being sought (the "indemnifying parties"), and such
indemnifying parties shall assume the defense thereof, including the employment
of counsel and payment of all fees and expenses. The Initial Purchaser or any
such controlling person shall have the right to employ separate counsel in any
such action, suit or proceeding and to participate in the defense thereof, but
the fees and expenses of such counsel shall be at the expense of the Initial
Purchaser or such controlling person unless (i) the indemnifying parties have
agreed in writing to pay such fees and expenses, (ii) the indemnifying parties
have failed to assume the defense and employ counsel, or (iii) the named parties
to any such action, suit or proceeding (including any impleaded parties) include
both the Initial Purchaser or such controlling person and the indemnifying
parties and the Initial Purchaser or such controlling person shall have been
advised in writing by its counsel that representation of such indemnified party
and any indemnifying party by the same counsel would be inappropriate under
applicable standards of professional conduct (whether or not such representation
by the same counsel has been proposed) due to actual or potential differing
interests between them (in which case the indemnifying party shall not have the
right to assume the defense of such action, suit or proceeding on behalf of the
Initial Purchaser or such controlling person). It is understood, however, that
the indemnifying parties shall, in connection with any one such action, suit or
proceeding or separate but substantially similar or related actions, suits or
proceedings in the same jurisdiction arising out of the same general allega
tions or circumstances, be liable for the reasonable fees and expenses of only
one separate firm of attorneys (in addition to any local counsel) at any time
for the Initial Purchaser and controlling persons not having actual or potential
differing interests with the Initial Purchaser or among
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<PAGE>
themselves, which firm shall be designated in writing by Barclays Capital Inc.,
and that all such fees and expenses shall be reimbursed as they are incurred.
The indemnifying parties shall not be liable for any settlement of any such
action, suit or proceeding effected without their written consent, but if
settled with such written consent, or if there be a final judgment for the
plaintiff in any such action, suit or proceeding, the indemnifying parties agree
to indemnify and hold harmless the Initial Purchaser, to the extent provided in
paragraph (a), and any such controlling person from and against any loss, claim,
damage, liability or expense by reason of such settlement or judgment.
(c) The Initial Purchaser agrees to indemnify and hold
harmless the Company and its directors and officers, and any person who controls
the Company within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act to the same extent as the indemnity from the Company to the Initial
Purchaser set forth in paragraph (a) hereof, but only with respect to Initial
Purchaser Information furnished in writing by or on behalf of the Initial
Purchaser expressly for use in the Offering Memorandum. If any action, suit or
proceeding shall be brought against the Company, any of its directors or
officers, or any such controlling person based on the Offering Memorandum, and
in respect of which indemnity may be sought against the Initial Purchaser
pursuant to this paragraph (c), the Initial Purchaser shall have the rights and
duties given to the Company by paragraph (b) above (except that if the Company
shall have assumed the defense thereof, the Initial Purchaser shall not be
required to do so, but may employ separate counsel therein and participate in
the defense thereof, but the fees and expenses of such counsel shall be at the
Initial Purchaser's expense), and the Company, its directors and officers, and
any such controlling person shall have the rights and duties given to the
Initial Purchaser by paragraph (b) above. The foregoing indemnity agreement
shall be in addition to any liability which the Initial Purchaser may otherwise
have.
(d) If the indemnification provided for in this Section 6 is
unavailable (except if inapplicable according to its terms) to an indemnified
party under paragraphs (a) or (c) hereof in respect of any losses, claims,
damages, liabilities or expenses referred to therein, then an indemnifying
party, in lieu of indemnifying such indemnified party, shall contribute to the
amount paid or payable by such indemnified party as a result of such losses,
claims, damages, liabilities or expenses (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and the Initial Purchaser on the other hand from the offering of the Senior
Notes, or (ii) if the allocation provided by clause (i) above is not permitted
by applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Company on the one hand and the Initial Purchaser on the other in connection
with the statements or omissions that resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company on the one hand and the Initial
Purchaser on the other shall be deemed to be in the same proportion as the total
net proceeds from the offering (before deducting expenses) received by the
Company bear to the total discounts and commissions received by the Initial
Purchaser. The relative fault of the Company on the one hand and the Initial
Purchaser on the other hand shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged
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<PAGE>
omission to state a material fact relates to information supplied by the Company
on the one hand or by the Initial Purchaser on the other hand and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
(e) The Company and the Initial Purchaser agree that it would
not be just and equitable if contribution pursuant to this Section 6 were
determined by a pro rata allocation or by any other method of allocation that
does not take account of the equitable considerations referred to in paragraph
(d) above. The amount paid or payable by an indemnified party as a result of the
losses, claims, damages, liabilities and expenses referred to in paragraph (d)
above shall be deemed to include, subject to the limitations set forth above,
any legal or other expenses reasonably incurred by such indemnified party in
connection with investigating any claim or defending any such action, suit or
proceeding. Notwithstanding the provisions of this Section 6, the Initial
Purchaser shall not be required to contribute any amount in excess of the amount
by which the total price of the Senior Notes purchased by it and distributed to
the purchasers pursuant to Exempt Resales exceeds the amount of any damages
which the Initial Purchaser has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation.
(f) Any losses, claims, damages, liabilities or expenses for
which an indemnified party is entitled to indemnification or contribution under
this Section 6 shall be paid by the indemnifying party to the indemnified party
as such losses, claims, damages, liabilities or expenses are incurred but only
to the extent that such losses, claims, damages, liabilities or expenses are
required to be paid by an indemnified party. The indemnity and contribution
agreements contained in this Section 6 and the representations and warranties of
the Company set forth in this Agreement shall remain operative and in full force
and effect, regardless of (i) any investigation made by or on behalf of the
Initial Purchaser or any person controlling the Initial Purchaser, the Company,
its directors or officers or any person controlling the Company, (ii) acceptance
of any Senior Notes and payment therefor hereunder, and (iii) any termination of
this Agreement. A successor to the Initial Purchaser or any person controlling
the Initial Purchaser, or to the Company, its directors or officers or any
person controlling the Company, shall be entitled to the benefits of the
indemnity, contribution and reimbursement agreements contained in this Section
6.
(g) No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened action, suit or proceeding in respect of which any indemnified party
is or could have been a party and indemnity could have been sought hereunder by
such indemnified party, unless such settlement includes an unconditional release
of such indemnified party from all liability on claims that are the subject
matter of such action, suit or proceeding.
7. Conditions of the Initial Purchaser's Obligation. The
obligation of the Initial Purchaser to purchase the Senior Notes hereunder is
subject to the following conditions:
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(a) At the time of execution of this Agreement and on the
Closing Date, no order or decree preventing the use of the Offering Memorandum,
or any order asserting that the transactions contemplated by this Agreement are
subject to the registration requirements of the Act shall have been issued and
no proceedings for that purpose shall have been commenced or shall be pending
or, to the knowledge of the Company, be contemplated. No stop order suspending
the sale of the Senior Notes in any jurisdiction designated by the Initial
Purchaser shall have been issued and no proceedings for that purpose shall have
been commenced or shall be pending or, to the knowledge of the Company, shall be
contemplated.
(b) Subsequent to the date as of which information is given in
the Offering Memorandum, except as otherwise stated in the Offering Memorandum,
there shall not have occurred (i) any change, or any development involving a
prospective change, in or affecting the condition (financial or other),
business, properties, net worth, or results of operations of the Company or its
Subsidiaries not contemplated by the Offering Memorandum, which in the opinion
of the Initial Purchaser, would materially adversely affect the market for the
Senior Notes, or (ii) any event or development relating to or involving the
Company, any of its Subsidiaries or any officer or director of the Company or
any of its Subsidiaries which makes any statement made in the Offering
Memorandum untrue or which, in the opinion of the Company and its counsel or the
Initial Purchaser and its counsel, requires the making of any addition to or
change in the Offering Memorandum in order to state a material fact required by
any law to be stated therein or necessary in order to make the statements
therein not misleading, if amending or supplementing the Offering Memorandum to
reflect such event or development would, in the opinion of the Initial
Purchaser, materially adversely affect the market for the Senior Notes.
(c) The Final Offering Memorandum shall have been printed and
copies thereof distributed to the Initial Purchaser in such quantities as shall
have been previously specified by the Initial Purchaser not later than 9:00
A.M., New York City time, on June 30, 1998, or at such later date and time as
the Initial Purchaser may approve in writing.
(d) The Initial Purchaser shall have received on the Closing
Date an opinion of Buchanan Ingersoll Professional Corporation, counsel for the
Company, dated the Closing Date and addressed to the Initial Purchaser, to the
effect that:
(i) The Company has been duly incorporated and is
validly existing as a corporation in good standing under the laws of
the state of its formation with full corporate power and authority to
own its properties and conduct its business as described in the
Offering Memorandum;
(ii) This Agreement has been duly authorized,
executed and delivered by the Company;
(iii) The Registration Rights Agreement has been duly
authorized, executed and delivered by the Company;
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(iv) The Notes have been duly authorized and, when
issued and delivered pursuant to this Agreement, will have been duly
executed, authenticated, issued and delivered and will constitute valid
and legally binding obligations of the Company entitled to the benefits
provided by the Indenture and enforceable against the Company in
accordance with its terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization, moratorium and other laws of general
applicability relating to or affecting creditors' rights and to general
equity principles and further except that (a) rights to contribution or
indemnification may be limited by the laws, rules or regulations of any
governmental authority or agency thereof or by public policy, and (b)
waivers as to usury, stay or extension laws may be unenforceable; and
the Notes and the Indenture conform in all material respects to the
descriptions thereof in the Offering Memorandum;
(v) The Indenture has been duly authorized, executed
and delivered by the Company and will constitute a valid and legally
binding instrument, enforceable in accordance with its terms against
the Company, subject, as to enforcement, to bankruptcy, insolvency,
reorganization, moratorium and other laws of general applicability
relating to or affecting creditors' rights and to general equity
principles and further except that (a) rights to contribution or
indemnification may be limited by the laws, rules or regulations of any
governmental authority or agency thereof or by public policy, and (b)
waivers as to usury, stay or extension laws may be unenforceable;
(vi) The Registration Rights Agreement has been duly
authorized by the Company and, when executed and delivered by the
parties thereto, will constitute a valid and legally binding
instrument, enforceable in accordance with its terms against the
Company, subject, as to enforcement, to bankruptcy, insolvency,
reorganization, moratorium and other laws of general applicability
relating to or affecting creditors' rights, to general equity
principles and further except that (a) rights to contribution or
indemnification may be limited by the laws, rules or regulations of any
governmental authority or agency thereof or by public policy and (b)
waivers as to usury, stay or extension laws may be unenforceable; and
the Registration Rights Agreement will conform in all material respects
to the description thereof in the Offering Memorandum;
(vii) The issue and sale of the Notes and the
compliance by the Company with all of the provisions of the Notes, the
Indenture, the Registration Rights Agreement and this Agreement and the
consummation of the transactions herein and therein contemplated will
not contravene the provisions of the certificate of incorporation and
bylaws of the Company, or to the best of our knowledge, any order, rule
or regulation of any court or governmental agency or body having
jurisdiction over the Company;
(viii) The statements set forth in the Offering
Memorandum under the caption "Description of the Notes," insofar as
they purport to constitute a summary of the terms of the Notes and the
statements set forth in the Offering Memorandum under the caption
"Management's Discussion and Analysis of Financial Condition and
Results of Operations--Liquidity and Capital Resources--Financing
Activities," insofar as they
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purport to describe the debt instruments referred to therein are, when
taken together with the other information included in the Offering
Memorandum, accurate in all material respects;
(ix) No registration of the Senior Notes under the
Act, and no qualification of an indenture under the 1939 Act with
respect thereto, is required for the offer, sale and initial resale of
the Senior Notes by the Initial Purchaser in the manner contemplated by
this Agreement; and
(x) The Company is not an "investment company" or an
entity "controlled" by an "investment company," as such terms are
defined in the Investment Company Act.
In addition, such counsel shall also state that such
counsel has participated in conferences with officers and representatives of the
Company, representatives of the independent public accountants for the Company
and the Initial Purchaser at which the contents of the Offering Memorandum and
related matters were discussed and, although such counsel is not passing upon
and does not assume any responsibility for and has not verified the accuracy,
completeness or fairness of the statements contained in the Offering Memorandum,
and has not made any independent check or verification thereof, on the basis of
the foregoing (relying as to materiality to the extent such counsel deemed
appropriate upon facts provided by officers and other representatives of the
Company), no facts have come to the attention of such counsel that lead such
counsel to believe that the Offering Memorandum, as of its date or as of the
Closing Date, contained or contains any untrue statement of material fact or
omitted or omits to state any material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading (it being understood that such counsel need express no belief or
opinion with respect to the financial statements and other financial and
statistical data included therein).
The opinion of such counsel may be limited to the laws of the
State of New York, the General Corporation Law of the State of Delaware and the
federal laws of the United States.
(e) The Initial Purchaser shall have received on the Closing
Date an opinion of Randall D. Fisher, Esq., General Counsel of the Company,
dated the Closing Date and addressed to the Initial Purchaser to the effect
that:
(i) Except as set forth in the Offering Memorandum,
each of the Company and its Subsidiaries has all of the licenses,
permits, franchises and authorizations, if any, required by the
relevant governmental authorities of each of New York, Virginia,
Pennsylvania, Ohio, New Jersey, Massachusetts, New Hampshire, Vermont,
Michigan and Connecticut and/or its political subdivisions for the
provision of cable television service (as such counsel understands
service to be provided which may be based on a certificate of an
officer of the Company, provided that such counsel shall state that
they believe that both the Initial Purchaser and he are justified in
relying on such
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certificate), where the failure to obtain or hold such license, permit,
franchise or authorization would have a Material Adverse Effect;
(ii) To the best of such counsel's knowledge after
due inquiry, each of the Company and its Subsidiaries has made all
filings, reports, applications and submissions required by the laws and
ordinances relating to cable services of each of New York, Virginia,
Pennsylvania, Ohio, New Jersey, Massachusetts, New Hampshire, Vermont,
Michigan and Connecticut, and the ordinances of the state's political
subdivisions relating thereto, and the rules and regulations
promulgated therewith;
(iii) Each of the Company and its Subsidiaries has
the consents, approvals, authorizations, licenses, certificates,
permits, or orders of any governmental authorities of the each of New
York, Virginia, Pennsylvania, Ohio, New Jersey, Massachusetts, New
Hampshire, Vermont, Michigan and Connecticut, and its political
subdivisions, if any, required for the consummations of the
transactions contemplated in the Purchase Agreement where the failure
to obtain the consents, approvals, authorizations, licenses,
certificates, permits or orders would have a Material Adverse Effect;
(iv) There are no actions, suits or proceedings
pending or, to the best of such counsel's knowledge, threatened by or
before any court or governmental body each of New York, Virginia,
Pennsylvania, Ohio, New Jersey, Massachusetts, New Hampshire, Vermont,
Michigan and Connecticut, against or affecting any of the Company or
its Subsidiaries, or the business of the Company and its Subsidiaries;
(v) The statements in the Offering Memorandum under
the headings "Risk Factors - Regulation in the Telecommunications
Industry" and "Risk Factors Competition," insofar as they relate to the
Company and its Subsidiaries operations in each of New York, Virginia,
Pennsylvania, Ohio, New Jersey, Massachusetts, New Hampshire, Vermont,
Michigan and Connecticut, and purport to describe the provisions of the
laws and documents referred to therein, are accurate, complete and fair
in all material respects; and
(vi) Neither the execution and delivery of the
Purchase Agreement nor the offering of the Senior Notes contemplated
thereby will conflict with or result in a violation of any order or
regulation of each of New York, Virginia, Pennsylvania, Ohio, New
Jersey, Massachusetts, New Hampshire, Vermont, Michigan and
Connecticut, or its political subdivisions applicable to the Company
and its Subsidiaries, the conflict with or the violation of which would
have a material adverse effect on the Company and its Subsidiaries.
(f) The Initial Purchaser shall have received on the Closing
Date an opinion of Colin H. Higgin, Deputy General Counsel to the Company, dated
the Closing Date and addressed to the Initial Purchaser, to the effect that:
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(i) None of the Company or its Subsidiaries is in
violation of its certificate of incorporation, by-laws, certificate of
limited partnership or partnership agreement, as applicable, or in
default in the performance or observance of any material obligation,
covenant or condition contained in any partnership agreement,
indenture, mortgage, deed of trust, loan agreement, lease or other
agreement or instrument to which it is a party or by which it or any of
its properties may be bound;
(ii) Each of the Company and its Subsidiaries has
been duly qualified as a foreign corporation or partnership, as the
case may be, for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases
properties or conducts any business so as to require such
qualification, or is subject to no material liability or disability by
reason of the failure to be so qualified in any such jurisdiction,
except where the failure to so qualify would not have a Material
Adverse Effect (such counsel being entitled to rely in respect of the
opinion in this clause upon opinions of local counsel and in respect of
matters of fact upon certificates of officers of the Company, provided
that such counsel shall state that he believes that both the Initial
Purchaser and he are justified in relying upon such opinions and
certificates);
(iii) Each subsidiary of the Company is owned
directly or indirectly by the Company, free and clear of all liens,
encumbrances, equities or claims (other than liens to secure
indebtedness under credit facilities disclosed in the Offering
Memorandum) (such counsel being entitled to rely in respect of the
opinion in this clause upon opinions of local counsel and in respect of
matters of fact upon certificates of officers of the Company or its
Subsidiaries, provided that such counsel shall state that he believes
that both the Initial Purchaser and he are justified in relying upon
such opinions and certificates);
(iv) To the best of such counsel's knowledge and
other than as set forth in the Offering Memorandum, there are no legal
or governmental proceedings pending to which the Company or any of its
Subsidiaries is a party or of which any property of the Company or any
of its Subsidiaries is the subject which, if determined adversely to
the Company or any of its Subsidiaries, would individually or in the
aggregate have a material adverse effect on the current or future
consolidated financial position, shareholder's equity, partners'
equity, or results of operations of the Company and its Subsidiaries;
and, to the best of such counsel's knowledge, no such proceedings are
threatened or contemplated by governmental authorities or threatened by
others;
(v) The issue and sale of the Notes and the
compliance by the Company with all of the provisions of the Notes, the
Indenture, the Registration Rights Agreement and this Agreement and the
consummation of the transactions herein and therein contemplated will
not, to the best of my knowledge after due inquiry, conflict with or
result in a breach or violation of any of the terms or provisions of,
or constitute a default under any material indenture, mortgage, deed of
trust, sale/leaseback transaction, loan agreement or other similar
financing agreement, or instrument or other agreement or instrument
(including, without limitation, any license or franchise granted to the
Company
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or a Subsidiary by a local franchising governmental body) to which the
Company or any of its Subsidiaries is a party or by which the Company
or any of its Subsidiaries is bound or to which any of the property or
assets of the Company or any of its Subsidiaries is subject, nor will
such actions result in any violation of the provisions of the
certificate of incorporation, by-laws, the certificate of limited
partnership or the partnership agreements of the Company and its
Subsidiaries, as appropriate, or any statute or any order, rule or
regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its Subsidiaries or any of
their properties; and
(vi) 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 Senior Notes
or the consummation by the Company of the transactions contemplated by
this Agreement, the Indenture or the Registration Rights Agreement,
except such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue Sky
laws in connection with the purchase and resale of the Senior Notes by
the Initial Purchaser.
In addition, such counsel shall also state that such
counsel has participated in conferences with officers and representatives of the
Company, representatives of the independent public accountants for the Company
and the Initial Purchaser at which the contents of the Offering Memorandum and
related matters were discussed and, although such counsel is not passing upon
and does not assume any responsibility for and has not verified the accuracy,
completeness or fairness of the statements contained in the Offering Memorandum,
and has not made any independent check or verification thereof, on the basis of
the foregoing (relying as to materiality to the extent such counsel deemed
appropriate upon facts provided by officers and other representatives of the
Company), no facts have come to the attention of such counsel that lead such
counsel to believe that the Offering Memorandum, as of its date or as of the
Closing Date, contained or contains any untrue statement of material fact or
omitted or omits to state any material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading (it being understood that such counsel need express no belief or
opinion with respect to the financial statements and other financial and
statistical data included therein).
(g) The Initial Purchaser shall have received on the Closing
Date an opinion of Fleischman & Walsh, P.C., special regulatory counsel for the
Company and its Subsidiaries, dated the Closing Date, and addressed to the
Initial Purchaser to the effect that:
(i) The communities listed in Section A of Attachment
1 to the opinion have been registered with the FCC in connection with
the operation of the Systems. The filing of a registration statement
constitutes initial FCC authorization for the commencement of cable
television operations in the community registered.
(ii) The Subsidiaries hold certain FCC licenses, as
that term is defined below ("FCC Licenses"). All FCC Licenses and
receive-only earth station registrations
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held by the Subsidiaries in connection with the operation of the Cable
Systems are listed on Attachment 1 to the Opinion. To the best of our
knowledge, all such FCC Licenses have been validly issued or assigned
to the present licensee and are currently in full force and effect. We
have no knowledge of any event which would allow, or after notice or
lapse of time which would allow, revocation or termination of any FCC
License held by the Subsidiaries or would result in any other material
impairment of the rights of the holder of such license. To the best of
our knowledge, no other FCC Licenses are required in connection with
the operation of the Cable Systems by the Subsidiaries in the manner we
have advised they are presently being operated. For the purposes of
this opinion, an FCC License is defined as an authorization, or renewal
thereof, issued by the FCC authorizing the transmission of radio energy
through the airways.
(iii) Other than proceedings affecting the cable
television industry generally, there is no action, suit or proceeding
pending before or, to the best of our knowledge, threatened by the FCC
which is reasonably likely to have a materially adverse impact upon the
cable television operations of the Company and its Subsidiaries taken
as a whole.
(iv) To the best of our knowledge after due inquiry,
the Company and the Subsidiaries have filed all current and routine
filings, reports, applications and submissions required under the
Communications Act, as amended, and under the rules and regulations of
the FCC.
(v) The Subsidiaries hold all authorizations and/or
have filed all notifications required by the FCC in connection with
their operation on all frequencies in the 108-137 MHz and 225-400 MHz
bands which we have been advised are currently being utilized on the
Cable Systems. The geographic and technical parameters with respect to
the authorized use of these frequencies are listed on Attachment 1
hereto.
(vi) The employment units covered by the Cable
Systems and operated by the Subsidiaries have been certified, where
required, by the FCC for compliance with equal employment opportunity
("EEO") requirements in each of calendar years 1992 through 1996 in
which such Cable Systems have been owned and operated by the Company or
the Subsidiaries. Employment certification records for the years prior
to 1992 have been purged from the FCC's database and are therefore
outside the scope of this opinion.
(vii) Statements of Account required by Section 111
of the Copyright Act of 1976, as amended have been filed, together with
royalty payments accompanying said Statements of Account, with the U.S.
Copyright Office for the Cable Systems covering each of the accounting
periods beginning with January 1 through June 30, 1994 accounting
period and ending with the July 1 through December 31, 1996 accounting
period during which such Cable Systems have been operated by the
Subsidiaries. We have not received the information or calculations
contained in these Statements, and express no opinion with
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respect to the accuracy thereof. To the best of our knowledge, there
are no currently outstanding inquiries received from the U.S. Copyright
Office or any other party which question the copyright filings or
payments made by the Company or the Subsidiaries with respect to the
Cable Systems. It is possible that there may be matters pending before
the U.S. Copyright Office relating to the Cable Systems, the Company or
the Subsidiaries of which we do not have knowledge because such matters
have not yet been incorporated into the available public files of the
U.S. Copyright Office. However, we are not aware of the pending or
threatened claim, action or demand for copyright infringement or for
non-payment of royalties with respect to the Statements of Account or
related royalty payments filed by the Company and the Subsidiaries for
the Cable Systems.
(viii) The Company has obtained all consents,
approvals and authorizations of the FCC, if any, required for the
consummation of the transactions of the transactions contemplated in
the Purchase Agreement where the failure to obtain the consents,
approval, authorizations, licenses, certificates, permits or orders
would reasonably be expected to have a materially adverse impact on the
Company or the Subsidiaries.
(ix) Neither the execution and delivery of the
Purchase Agreement nor the offering of the Senior Notes contemplated
thereby will conflict with or result in a violation of any order or
regulation of the FCC applicable to the Company and the Subsidiaries,
the conflict with or the violation of which would reasonably be
expected to have a materially adverse impact on the Company or the
Subsidiaries. However, we call your attention to the following.
(x) Under the Act as now in effect, the sale or other
disposition of certain pledged collateral and the exercise of certain
other rights and remedies conferred upon you by any agreement or by
applicable law might constitute an assignment of an FCC licensee, or
transfer of control of an FCC license, requiring for its consummation
the prior consent of the FCC granted upon an appropriate application
thereof.
(xi) Under the Act as now in effect, and as now
interpreted by the FCC, no valid security interest may be granted in an
FCC license. To the extent that the Purchase Agreement and/or related
financing documents purport to grant to you a security interest in any
FCC licenses, such security interest may not be legally enforceable.
(xii) In the course of our representation of the
Company and its Subsidiaries, no matters have come to our attention,
other than matters affecting the cable television industry generally,
which would reasonable be expected to have a materially adverse impact
upon the cable television operations of the Company and the
Subsidiaries taken as a whole.
(xiii) In our opinion, the Statements in the Offering
Memorandum under the headings "Risk Factors - Regulation in the
Telecommunications Industry" and "Risk
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Factors - Competition," insofar as the purport to describe the
provisions of the law referred to therein, are accurate, complete and
fair in all material respects.
(h) The Initial Purchaser shall have received on the Closing
date an opinion, of Latham & Watkins, counsel for the Initial Purchaser, dated
the Closing Date, and addressed to the Initial Purchaser, with respect to such
matters as the Initial Purchaser may reasonably request, and such counsel shall
have received such certificates, documents and information as they may
reasonably request to enable them to pass upon such matters.
(i) The Initial Purchaser shall have received letters
addressed to the Initial Purchaser, and dated the date hereof and the Closing
Date from Deloitte & Touche LLP, independent certified public accountants,
substantially in the forms heretofore approved by the Initial Purchaser and its
counsel.
(j)(i) There shall not have been any decrease in stockholders'
equity of the Company nor any material increase in the short-term or long-term
debt of the Company (other than in the ordinary course of business) from that
set forth or specifically contemplated in the Offering Memorandum; (ii) the
Company and its Subsidiaries shall not have any liabilities or obligations,
direct or contingent (whether or not in the ordinary course of business), that
are material to the Company and it subsidiaries, taken as a whole, other than
those reflected in the Offering Memorandum; and (iii) all the representations
and warranties of the Company contained in this Agreement shall be true and
correct in all material respects on and as of the date hereof and on and as of
the Closing Date as if made on and as of the Closing Date, and the Initial
Purchaser shall have received a certificate, dated the Closing Date and signed
by the Chief Executive Officer and the Chief Financial Officer of the Company
(or such other officers as are acceptable to the Initial Purchaser), to the
effect set forth in this Section 7(j) and in Section 7(k) hereof.
(k) The Company shall not have failed at or prior to the
Closing Date to have performed or complied in all material respects with any of
its agreements herein contained and required to be performed or complied with by
it hereunder at or prior to the Closing Date.
(l) There shall not have been any announcement by any
"nationally recognized statistical rating organization," as defined for purposes
of Rule 436(g) under the Act, that (i) it is downgrading its rating assigned to
any class of securities of the Company or any of its Subsidiaries, or (ii) it is
reviewing its ratings assigned to any class of securities of the Company or any
of its Subsidiaries with a view to possible downgrading, or with negative
implications, or direction not determined.
(m) The Senior Notes shall have been approved for trading
in the PORTAL Market.
(n) The Company shall have obtained, in writing, all consents
and waivers required under the terms of any of its material agreements necessary
to ensure that the transactions contemplated by this Agreement and the other
Operative Documents will not conflict with or
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constitute a breach of, or a default under any of such agreements. The Company
shall have furnished photocopies of such waivers and consents, if any, to the
Initial Purchaser.
(o) The Company shall have furnished or caused to be furnished
to the Initial Purchaser such further certificates and documents as the Initial
Purchaser or its counsel shall have requested.
All such opinions, certificates, letters, consents, waivers
amendments and other documents will be in compliance with the provisions hereof
only if they are reasonably satisfactory in form and substance to the Initial
Purchaser and counsel for the Initial Purchaser. Any certificate or document
signed by any officer of the Company and delivered to the Initial Purchaser, or
to counsel for the Initial Purchaser, shall be deemed a representation and
warranty by the Company to the Initial Purchaser as to the statements made
therein.
8. Expenses. The Company agrees to pay the following costs,
expenses and fees and all other costs and expenses incident to the performance
by it of any of its obligations hereunder: (i) the preparation and reproduction
of the Offering Memorandum (including, without limitation, financial statements
thereto), and each amendment or supplement to any of them, this Agreement and
the Indenture; (ii) the printing (or reproduction) and delivery (including
postage, air freight charges and charges for counting and packaging) of such
copies of the Offering Memorandum, and all amendments or supplements thereto as
may be reasonably requested for use in connection with the offering and sale of
the Senior Notes; (iii) the preparation, printing, authentication, issuance and
delivery of certificates for the Notes, including any stamp taxes in connection
with the original issuance and sale of the Notes; (iv) the printing (or
reproduction) and delivery of this Agreement, the preliminary and supplemental
Blue Sky Memoranda and all other agreements or documents printed (or reproduced)
and delivered in connection with the offering of the Senior Notes; (v) the
application for quotation of the Notes on the PORTAL Market; (vi) the
qualification of the Senior Notes for offer and sale under the securities or
Blue Sky laws of the several states as provided in Section 4(e) hereof
(including the reasonable fees, expenses and disbursements of counsel for the
Initial Purchaser relating to the preparation, printing or reproduction, and
delivery of the preliminary and supplemental Blue Sky Memoranda and such
qualification); (vii) the performance by the Company of its obligations under
the Registration Rights Agreement; (viii) fees and expenses of the Trustee and
its counsel; (ix) the transportation and other expenses, if any, incurred by or
on behalf of the Company representatives in connection with presentations to
prospective purchasers of the Senior Notes; and (x) the fees and expenses of the
Company's accountants and the fees and expenses of counsel (including local and
special counsel, if any) for the Company. The Company hereby agrees that they
will pay in full on the Closing Date the fees and expenses referred to in clause
(vi) of this Section 8 by delivering to counsel for the Initial Purchaser on
such date a check payable to such counsel in the requisite amount.
9. Effective Date of Agreement. This Agreement shall become
effective upon the execution and delivery hereof by all the parties hereto.
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10. Termination of Agreement. This Agreement shall be subject
to termination in the absolute discretion of the Initial Purchaser, without
liability on the part of the Initial Purchaser to the Company, by notice to the
Company, if prior to the Closing Date, (i) trading in securities generally on
the New York Stock Exchange, the American Stock Exchange or the Nasdaq National
Market shall have been suspended or materially limited, (ii) a general moratori
um on commercial banking activities in New York shall have been declared, or
(iii) there shall have occurred any outbreak or escalation of hostilities
involving the United States or other domestic, foreign or international
calamity, crisis or change in political, financial or economic conditions, the
effect of which on the financial markets of the United States is such as to make
it, in the judgment of the Initial Purchaser, impracticable or inadvisable to
commence or continue the offering of the Senior Notes on the terms set forth on
the cover page of the Offering Memorandum or to enforce contracts for the resale
of the Senior Notes by the Initial Purchaser. Notice of such termination may be
given to the Company by telegram, telecopy or telephone and shall be
subsequently confirmed by letter.
11. Information Furnished by the Initial Purchaser. The
statements set forth in the last paragraph of the cover page of the Offering
Memorandum and the second to last paragraph on the inside cover page of the
Offering Memorandum, constitute the only Initial Purchaser Information furnished
by or on behalf of the Initial Purchaser as such information is referred to in
Sections 5(a) and 6 hereof.
12. Miscellaneous. Except as otherwise provided in Sections 4,
9 and 10 hereof, notice given pursuant to any provision of this Agreement shall
be in writing and shall be delivered (i) if to the Company, at the office of the
Company at Main at Water Street, Coudersport, PA 16915, Attention: Chief
Financial Officer with a copy to Buchanan Ingersoll Professional Corporation, 1
Oxford Center, 301 Grant Street, 20th Floor, Pittsburgh, PA 15219, Attention:
Carl E. Rothenberger, Jr., or (ii) if to the Initial Purchaser, addressed to
Barclays Capital Inc., 222 Broadway, New York, NY 10038, Attention: Manager,
Investment Banking Division, with a copy to Latham & Watkins, 885 Third Avenue,
New York, NY 10022, Attention: Robert Zuccaro.
This Agreement has been and is made solely for the benefit of
the Initial Purchaser, the Company and their respective directors, officers and
the controlling persons referred to in Section 6 hereof and their respective
successors and assigns, to the extent provided herein, and no other person shall
acquire or have any right under or by virtue of this Agreement. Neither the term
"successor" nor the term "successors and assigns" as used in this Agreement
shall include a purchaser from the Initial Purchaser of any of the Senior Notes
in his status as such purchaser.
13. Applicable Law; Counterparts This Agreement shall be
governed by and construed in accordance with the laws of the State of New York
applicable to contracts made and to be performed within the State of New York
and without regard to the conflicts of law principles thereof.
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This Agreement may be signed in various counterparts which
together constitute one and the same instrument. If signed in counterparts, this
Agreement shall not become effective unless at least one counterpart hereof
shall have been executed and delivered on behalf of each party hereto.
[signature page follows]
28
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Please confirm that the foregoing correctly sets forth the
agreement between the Company and the Initial Purchaser.
Very truly yours,
ADELPHIA COMMUNICATIONS CORPORATION
By: /s/ James R. Brown
Name: James R. Brown
Title: Vice President
Confirmed as of the date first above mentioned.
BARCLAYS CAPITAL INC.
By: /s/ Nicholas Daifotis
Name: Nicholas Daifotis
Title: Mangaing Director
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Exhibit A
Form of Registration Rights Agreement
30
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EXHIBIT 99.01
ADELPHIA ANNOUNCES PUBLIC STOCK OFFERING
Coudersport, PA, July 20, 1998 -- Adelphia Communications Corporation
(NASDAQ-NNM: ADLAC) announced today that it is filing a supplement to its shelf
registration statement with the Securities and Exchange Commission for a public
offering of Class A Common Stock. The preliminary prospectus supplement
contained in the filing provides for a public offering by Adelphia of
approximately $177,300,000 or 4,100,000 shares of Adelphia's Class A Common
Stock (assuming a public offering price of $43.25 per share, the closing price
on July 16, 1998) prior to the exercise of any underwriters' over-allotment
option. Salomon Smith Barney, Goldman Sachs & Co., NationsBanc Montgomery
Securities LLC, Credit Suisse First Boston, Lehman Brothers and Toronto-Dominion
Securities will serve as managing underwriters for the public offering.
In addition to the 4,100,000 shares of Class A Common Stock to be sold by
Adelphia to the public, members of the family of John J. Rigas, Chairman of
Adelphia, are expected to enter into an agreement to purchase at the closing of
the public offering $125,000,000 or approximately 3,026,000 shares of Class A
Common Stock at a price per share equal to the public offering price less the
underwriting discount.
Adelphia Communications Corporation is the seventh largest cable television
operator in the United States and currently owns or manages cable television
systems serving approximately 2 million subscribers in 12 states.
This press release shall not constitute an offer to sell or the solicitation of
an offer to buy nor shall there be any sale of the Class A Common Stock in any
State in which such offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any such State.
Contact: Timothy J. Rigas, Executive Vice President and Chief Financial Officer
of Adelphia, (814) 274-9830.
