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 12, 1999
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
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Item 5. Other Events.
Adelphia has entered into a First Amendment to the Agreement and Plan
of Merger dated as of July 12, 1999 ("First Amendment") and a Second Amendment
to the Agreement and Plan of Merger dated as of July 29, 1999 (together with the
First Amendment, the "Amendments") with respect to its pending merger with
Century Communications Corp. and the related Agreement and Plan of Merger dated
as of March 5, 1999 ("Merger Agreement"). The Amendments are being filed as
exhibits to this Form 8-K and are incorporated by reference herein.
As contemplated by the Merger Agreement, Adelphia has also (i) prepared
a proxy statement to be mailed to Adelphia stockholders which reflects that
Adelphia has set the record date as August 12, 1999 and the meeting date as
October 1, 1999 for its special stockholder meeting to approve the merger with
Century, (ii) entered into a Registration Rights Agreement with respect to the
Class A common stock of Adelphia that will be received in the merger by the
holders of the Class B common stock of Century, and (iii) entered into a
Tag-Along Rights Agreement with the holders of Century Class B common stock, Ms.
Claire Tow, and holders of Adelphia Class B common stock. The Registration
Rights Agreement and the Tag-Along Rights Agreement are being filed as exhibits
to this Form 8-K and are incorporated by reference herein.
Also as contemplated by the Merger Agreement, Adelphia has agreed to
purchase from Citizens Cable Company its 50% interest in the Citizens-Century
Cable Television Joint Venture, which serves approximately 91,000 basic
subscribers in California. The purchase will take place at the effective time of
the Century merger. The purchase price for this interest will be approximately
$157.7 million, comprised of approximately $27.7 million in cash, approximately
1.85 million shares of Adelphia Class A common stock, and the assumption of
indebtedness. The agreement for this transaction is being filed as an exhibit to
this Form 8-K and is incorporated by reference herein.
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Item 7. Financial Statements and Exhibits
Exhibit No. Description
2.01 First Amendment to Agreement and Plan of Merger dated as of
July 12, 1999 with respect to merger with Century
Communications Corp. (filed herewith)
2.02 Second Amendment to Agreement and Plan of Merger dated as of
July 29, 1999 with respect to merger with Century
Communications Corp. (filed herewith)
10.01 Registration Rights Agreement dated as of July 12, 1999, among
Adelphia, the Century Class B Holders and Ms. Claire Tow
(filed herewith)
10.02 Tag-Along Rights Agreement dated as of July 12, 1999, among
Adelphia, the Century Class B Holders, Ms. Claire Tow and the
holders of Adelphia Class B Common Stock named therein (filed
herewith)
10.03 Purchase Agreement dated as of July 12, 1999, between Adelphia
and Citizens Cable Company.(filed herewith)
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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: August 12, 1999 ADELPHIA COMMUNICATIONS CORPORATION
(Registrant)
By: /s/ Timothy J. Rigas
Timothy J. Rigas
Executive Vice President,
Treasurer and Chief
Financial Officer
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EXHIBIT INDEX
Exhibit No. Description
2.01 First Amendment to Agreement and Plan of Merger dated as of
July 12, 1999 with respect to merger with Century
Communications Corp. (filed herewith)
2.02 Second Amendment to Agreement and Plan of Merger dated as of
July 29, 1999 with respect to merger with Century
Communications Corp. (filed herewith)
10.01 Registration Rights Agreement dated as of July 12, 1999, among
Adelphia, the Century Class B Holders and Ms. Claire Tow
(filed herewith)
10.02 Tag-Along Rights Agreement dated as of July 12, 1999, among
Adelphia, the Century Class B Holders, Ms. Claire Tow and the
holders of Adelphia Class B Common Stock named therein (filed
herewith)
10.03 Purchase Agreement dated as of July 12, 1999, between Adelphia
and Citizens Cable Company. (filed herewith)
EXHIBIT 2.01
FIRST AMENDMENT TO
AGREEMENT AND PLAN OF MERGER
THIS FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER (this
"First Amendment") is dated as of July 12, 1999 among Adelphia Communications
Corporation, a Delaware corporation ("Parent"), Adelphia Acquisition Subsidiary,
Inc., a Delaware corporation and a direct, wholly-owned subsidiary of Parent
("Merger Sub"), and Century Communications Corp., a New Jersey corporation (the
"Company").
RECITALS
A. Parent, Merger Sub and the Company are parties to an
Agreement and Plan of Merger dated as of March 5, 1999, as amended from time to
time (the "Merger Agreement"), pursuant to which the Company will merge with and
into Merger Sub with Merger Sub as the surviving corporation, all upon the terms
and subject to the conditions set forth in the Merger Agreement.
B. In accordance with Section 10.03 of the Merger Agreement,
the parties desire to enter into this First Amendment to amend the Merger
Agreement as provided herein.
C. Capitalized terms used in this First Amendment and not
defined herein shall have the meanings given to such terms in the Merger
Agreement.
In consideration of the premises and the respective covenants
and agreements set forth herein, the parties agree as follows.
SECTION 1. Merger Mechanics. Sections 1.02 through
1.13 of the Merger Agreement are hereby amended and restated in their entirety
as follows.
Section 1.02 Conversion of Shares. At the Effective Time:
(a)(i) Subject to the limitations set forth in Section
1.02(a)(iii), each share of Class A capital stock of the Company, par
value $0.01 per share (the "Class A Company Common Stock"), issued and
outstanding immediately prior to the Effective Time (x) will be
converted into the right to receive the Century Class A Per Share Stock
Amount (as defined in Section 1.03) or (y) at the election of the
holder thereof, which election will be available on a share-by-share
basis as provided in Section 1.04, will be converted into the right to
receive the Century Class A Per Share Cash Amount (as defined in
Section 1.03).
(ii) Subject to the limitations set forth in Section
1.02(a)(iii), each share of Class B capital stock of the Company, par
value $0.01 per share (the "Class B Company Common Stock" and together
with the Class A Company Common Stock, the ("Company Common Stock"),
issued and outstanding immediately prior to the Effective Time (x) will
be converted into the right to receive the Century Class B Per Share
Stock Amount (as defined in Section 1.03) or (y) at the election of the
holder thereof, which election will be available on a share-by-share
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basis as provided in Section 1.04, will be converted into the right to
receive the Century Class B Per Share Cash Amount (as defined in
Section 1.03).
(iii) Notwithstanding any provision contained herein to the
contrary (including the Cash Elections and the Stock Elections), at the
Effective Time (excluding shares held by Dissenting Shareholders), (w)
not more than twenty and 76/100 percent (20.76%) of the shares of Class
A Company Common Stock outstanding immediately prior to the Effective
Time (excluding shares held by Dissenting Shareholders) will be
converted into the right to receive the Century Class A Per Share Cash
Amount, (x) not more than seventy-nine and 24/100 percent (79.24%)
shares of Class A Company Common Stock outstanding immediately prior to
the Effective Time (excluding shares held by Dissenting Shareholders)
will be converted into the right to receive the Century Class A Per
Share Stock Amount, (y) not more than twenty-four and 54/100 percent
(24.54%) shares of Class B Company Common Stock outstanding immediately
prior to the Effective Time (excluding shares held by Dissenting
Shareholders) will be converted into the right to receive the Century
Class B Per Share Cash Amount and (z) not more than seventy-five and
46/100 percent (75.46%) shares of Class B Company Common Stock
outstanding immediately prior to the Effective Time (excluding shares
held by Dissenting Shareholders) will be converted into the right to
receive the Century Class B Per Share Stock Amount.
(b) Each share of Company Common Stock held by the Company as
treasury stock or owned by Parent or any of the Parent Subsidiaries immediately
prior to the Effective Time will be canceled, and no payment will be made with
respect thereto.
(c) Each issued and outstanding share of capital stock of
Merger Sub will remain outstanding and will be unchanged as a result of the
Merger.
Section 1.03 Merger Consideration. Subject to Section 1.04(f)
hereof, the term "Merger Consideration" means: (a) for each share of Class A
Company Common Stock with respect to which an election to receive shares of the
Class A Common Stock, par value $.01 per share, of the Parent ("Parent Common
Stock") has been made or deemed made pursuant to Section 1.04 and not revoked
(the "Class A Stock Election"), the right to receive 0.77269147 shares of Parent
Common Stock (the "Century Class A Per Share Stock Amount"), (b) for each share
of Class A Company Common Stock with respect to which an election to receive
cash has been made pursuant to Section 1.04 and not revoked (the "Class A Cash
Election"), the right to receive $44.14 in cash (the "Century Class A Per Share
Cash Amount"), (c) for each share of Class B Company Common Stock with respect
to which an election to receive shares of Parent Common Stock has been made or
deemed made pursuant to Section 1.04 and not revoked (the "Class B Stock
Election" and together with the Class A Stock Election, the "Stock Election"),
the right to receive 0.84271335 shares of Parent Common Stock (the "Century
Class B Per Share Stock Amount"), and (d) for each share of Class B Company
Common Stock with respect to which an election to receive cash has been made
pursuant to Section 1.04 and not revoked (the "Class B Cash Election" and
together with the Class A Cash Election "the "Cash Election"), the right to
receive $48.14 in cash (the "Century Class B Per Share Cash Amount").
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Section 1.04 Cash and Stock Elections; Proration.
(a) Each Person who, at the Effective Time, is a record holder
of Company Common Stock (other than Dissenting Shareholders and holders of
shares to be canceled as set forth in Section 1.02(b)) will have the right to
submit an Election Form (as defined in Section 1.04(b)) specifying the number of
shares of Company Common Stock that such Person desires to have converted into
the right to receive, subject to Section 1.04(f) hereof, (i) the Century Class A
Per Share Stock Amount pursuant to a Class A Stock Election, (ii) the Century
Class A Per Share Cash Amount pursuant to a Class A Cash Election, (iii) the
Century Class B Per Share Stock Amount pursuant to a Class B Stock Election or
(iv) the Century Class B Per Share Cash Amount pursuant to a Class B Cash
Election.
(b) The Parent will prepare a form of election, which form
will be subject to the reasonable approval of the Company (the "Election Form"),
to be mailed by the Company with the Proxy Statement/Prospectus (as defined in
Section 7.03(b)) to the record holders of Company Common Stock as of the record
date for the Company Shareholder Meeting (as defined in Section 7.03(a)). The
Company will use its reasonable best efforts to make the Election Form available
to all persons who become record holders of Company Common Stock during the
period between such record date and the Election Deadline (as defined in Section
1.04(c)) and to all holders of outstanding Options (as defined in Section
1.14(a)).
(c) Any Cash Election will have been validly made only if the
Exchange Agent (as defined in Section 1.05) shall have received, by 5:00 p.m.
(New York City time) on the Business Day immediately preceding the Closing Date
(the "Election Deadline"), an Election Form properly completed and executed by
such holder accompanied by the certificates for the shares of Company Common
Stock to which such Election Form relates, or by an appropriate guarantee of
delivery of such certificates from a member of any registered national
securities exchange or of the National Association of Securities Dealers, Inc.
or a commercial bank or trust company in the United States as set forth in such
Election Form. Holders of outstanding Options that become exercisable and vested
at the Effective Time may deliver an Election Form to the Exchange Agent
relating to shares of Class A Company Common Stock issuable upon exercise of
such Options up to 5:00 p.m. (New York City time) on the Closing Date. Holders
of record of shares of Company Common Stock who hold such shares as nominees,
trustees or in other representative capacities may submit multiple Election
Forms, provided that such holder certifies that each such Election Form covers
all the shares of Company Common Stock held by each such holder for a particular
beneficial owner.
(d) Any holder of Company Common Stock may revoke such
holder's election by written notice to the Exchange Agent received by the close
of business on the day prior to the Election Deadline. All Election Forms
automatically will be revoked if the Exchange Agent is notified in writing by
Parent and the Company that this Agreement has been terminated. The
determination of the Exchange Agent will be binding as to whether or not (i)
Election Forms have been properly completed, signed and submitted or revoked and
(ii) immaterial defects in an Election Form should be disregarded. The Exchange
Agent will be under no obligation to notify any person of any defect in an
Election Form submitted to the Exchange Agent.
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(e) As of the Election Deadline, to the extent that a holder
of Company Common Stock (i) shall not have submitted to the Exchange Agent an
effective, properly completed Election Form with respect to all or certain of
the shares held by such holder (including shares held by Dissenting Shareholders
as of the Election Deadline as to which appraisal rights are subsequently
withdrawn, not perfected or forfeited) or (ii) shall have properly revoked and
not properly submitted to the Exchange Agent a subsequent Election Form with
respect to all or certain of the shares, such holder will be deemed to have made
the Class A Stock Election or Class B Stock Election, as applicable, with
respect to such shares.
(f)(i) If the aggregate number of shares of Class A Company
Common Stock with respect to which Class A Cash Elections have been made exceeds
the aggregate number of shares of Class A Company Common Stock which, pursuant
to Section 1.02(a)(iii) hereof, may be converted into the right to receive cash
in the Merger, then,
(A) each share of Class A Company Common Stock with
respect to which a Class A
Stock Election shall have been made shall be converted into the right to receive
the Century Class A Per Share Stock Amount; and
(B) each share of Class A Company Common Stock with
respect to which a Class A
Cash Election shall have been made shall be converted into the right to receive:
(1) the amount in cash, without interest,
equal to the product of (x) the Century Class A Per Share Cash Amount and (y) a
fraction (the "Class A Cash Fraction"), the numerator of which shall be the
aggregate number of shares of Class A Company Common Stock which, pursuant to
Section 1.02(a)(iii) hereof, may be converted into the right to receive cash in
the Merger, and the denominator of which shall be the aggregate number of shares
of Class A Company Common Stock with respect to which Class A Cash Elections
shall have been made, and
(2) the number of shares of Parent Common
Stock equal to the product of (x) the Century Class A Per Share Stock Amount and
(y) a fraction equal to one minus the Class A Cash Fraction.
(ii) If the aggregate number of shares of Class A Company
Common Stock with respect to which Class A Stock Elections have been made
exceeds the aggregate number of shares of Class A Company Common Stock which,
pursuant to Section 1.02(a)(iii) hereof, may be converted into the right to
receive Parent Common Stock in the Merger, then,
(A) each share of Class A Company Common Stock with
respect to which a Class A
Cash Election shall have been made shall be converted into the right to receive
the Century Class A Per Share Cash Amount; and
(B) each share of Class A Company Common Stock with
respect to which a Class A Stock Election shall have been made shall be
converted into the right to receive:
(1) the number of shares of Parent Common
Stock equal to the product of (x) the Century Class A Per Share Stock Amount and
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(y) a fraction (the "Class A Stock Fraction"), the numerator of which shall be
the aggregate number of shares of Class A Company Common Stock which, pursuant
to Section 1.02(a)(iii) hereof, may be converted into the right to receive
Parent Common Stock in the Merger, and the denominator of which shall be the
aggregate number of shares of Class A Company Common Stock with respect to which
Class A Stock Elections shall have been made, and
(2) the amount in cash, without interest,
equal to the product of (x) the Century Class A Per Share Cash Amount and (y) a
fraction equal to one minus the Class A Stock Fraction.
(iii) If the aggregate number of shares of Class A Company
Common Stock with respect to which Class A Cash Elections have been made equals
the aggregate number of shares of Class A Company Common Stock which, pursuant
to Section 1.02(a)(iii) hereof, may be converted into the right to receive cash
and Parent Common Stock in the Merger, then,
(A) each share of Class A Company Common Stock with
respect to which a Class A Stock Election shall have been made shall be
converted into the right to receive the Century Class A Per Share Stock Amount;
and
(B) each share of Class A Company Common Stock with
respect to which a Class A Cash Election shall have been made shall be converted
into the right to receive the Century Class A Per Share Cash Amount.
(iv) If the aggregate number of shares of Class B Company
Common Stock with respect to which Class B Cash Elections have been made exceeds
the aggregate number of shares of Class B Company Common Stock which, pursuant
to Section 1.02(a)(iii) hereof, may be converted into the right to receive cash
in the Merger, then,
(A) each share of Class B Company Common Stock with
respect to which a Class B Stock Election shall have been made shall be
converted into the right to receive the Century Class B Per Share Stock Amount;
and
(B) each share of Class B Company Common Stock with
respect to which a Class B Cash Election shall have been made shall be converted
into the right to receive:
(1) the amount in cash, without interest,
equal to the product of (x) the Century Class B Per Share Cash Amount and (y) a
fraction (the "Class B Cash Fraction"), the numerator of which shall be the
aggregate number of shares of Class B Company Common Stock which, pursuant to
Section 1.02(a)(iii) hereof, may be converted into the right to receive cash in
the Merger, and the denominator of which shall be the aggregate number of shares
of Class B Company Common Stock with respect to which Class B Cash Elections
shall have been made, and
(2) the number of shares of Parent Common
Stock equal to the product of (x) the Century Class B Per Share Stock Amount and
(y) a fraction equal to one minus the Class B Cash Fraction.
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(v) If the aggregate number of shares of Class B Company
Common Stock with respect to which Class B Stock Elections have been made
exceeds the aggregate number of shares of Class B Company Common Stock which,
pursuant to Section 1.02(a)(iii) hereof, may be converted into the right to
receive Parent Common Stock in the Merger, then,
(A) each share of Class B Company Common Stock with
respect to which a Class B Cash Election shall have been made shall be converted
into the right to receive the Century Class B Per Share Cash Amount; and
(B) each share of Class B Company Common Stock with
respect to which a Class B
Stock Election shall have been made shall be converted into the right to
receive:
(1) the number of shares of Parent Common
Stock equal to the product of (x) the Century Class B Per Share Stock Amount and
(y) a fraction (the "Class B Stock Fraction"), the numerator of which shall be
the aggregate number of shares of Class B Company Common Stock which, pursuant
to Section 1.02(a)(iii) hereof, may be converted into the right to receive
Parent Common Stock in the Merger, and the denominator of which shall be the
aggregate number of shares of Class B Company Common Stock with respect to which
Class B Stock Elections shall have been made, and
(2) the amount in cash, without interest,
equal to the product of (x) the Century Class B Per Share Cash Amount and (y) a
fraction equal to one minus the Class B Stock Fraction.
(vi) If the aggregate number of shares of Class B Company
Common Stock with respect to which Class B Cash Elections have been made equals
the aggregate number of shares of Class B Company Common Stock which, pursuant
to Section 1.02(a)(iii) hereof, may be converted into the right to receive cash
and Parent Common Stock in the Merger, then,
(A) each share of Class B Company Common Stock with
respect to which a Class B
Stock Election shall have been made shall be converted into the right to receive
the Century Class B Per Share Stock Amount; and
(B) each share of Class B Company Common Stock with
respect to which a Class B
Cash Election shall have been made shall be converted into the right to receive
the Century Class B Per Share Cash Amount.
Section 1.05 Letter of Transmittal. On or prior to the
Effective Time, Parent will authorize one or more commercial banks or trust
companies acceptable to the Company, organized under the laws of the United
States or any state thereof, to act as Exchange Agent hereunder (the "Exchange
Agent"). Promptly after the Effective Time, Parent will cause the Exchange Agent
to mail to each record holder of Company Common Stock at the Effective Time (i)
a letter of transmittal (the "Letter of Transmittal") that will specify that
delivery will be effected, and risk of loss and title to the certificates
formerly representing the Company Common Stock will pass, upon delivery of such
certificates to the Exchange Agent and will be in such form and have such other
provisions, including appropriate provisions with respect to back-up
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withholding, as Parent reasonably may specify and (ii) instructions for use in
effecting the surrender of the certificates formerly representing shares of
Company Common Stock in exchange for the Merger Consideration.
Section 1.06 Deposit of Merger Consideration On or prior to
the Effective Time, Parent will deposit with the Exchange Agent, for the benefit
of the former holders of Company Common Stock, cash and certificates sufficient
to pay the Merger Consideration for all the shares of Company Common Stock. The
shares of Parent Common Stock into which shares of Company Common Stock will be
converted pursuant to the Merger will be deemed to have been issued at the
Effective Time for purposes of entitlement to dividends declared, if any, after
the Effective Time.
Section 1.07 Surrender and Payment.
(a) Upon surrender for cancellation to the Exchange Agent of a
certificate formerly representing shares of Company Common Stock, together with
the Letter of Transmittal, duly executed and completed in accordance with the
instructions thereto, the holder thereof will be entitled to receive (i) a
certified or bank cashier's check in the amount equal to the aggregate amount of
Merger Consideration that takes the form of cash which such holder has the right
to receive pursuant to the provisions of this Article I (including any dividends
or distributions related thereto which such former holder of Company Common
Stock is entitled to receive pursuant to the provisions of Section 1.07(c) and
any cash in lieu of fractional shares of Parent Common Stock pursuant to Section
1.09) and/or (ii) certificates representing the aggregate number of shares of
Parent Common Stock with respect to the Merger Consideration that takes the form
of Parent Company Stock which such holder has the right to receive pursuant to
the provisions of this Article I, less the amount of any required withholding
taxes, if any, in accordance with Section 1.10. After the Effective Time and
until so surrendered, each certificate representing shares of Company Common
Stock will represent for all purposes only the right to receive the Merger
Consideration.
(b) If the Merger Consideration (or any portion thereof) is to
be delivered to a Person other than the Person in whose name the surrendered
certificate or certificates are registered, it will be a condition of such
delivery that the surrendered certificate or certificates shall be properly
endorsed or otherwise be in proper form for transfer and that the Person
requesting such payment shall pay any transfer or other Taxes required by reason
of the delivery of the Merger Consideration to a Person other than the
registered holder of the surrendered certificate or certificates or such Person
shall establish to the satisfaction of the Exchange Agent that any such Tax has
been paid or is not applicable.
(c) No dividends or other distributions declared or made with
respect to Parent Common Stock on or after the Effective Time will be paid to
the holder of any certificate that theretofore evidenced shares of Company
Common Stock until such certificate is surrendered as provided in this Section
1.07. Upon such surrender, Parent will be pay to the holder of the certificates
evidencing shares of Parent Common Stock issued in exchange therefor, without
interest, the amount of dividends or other distributions with a record date
after the Effective Time payable with respect to shares of Parent Common Stock.
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(d) Any portion of the Merger Consideration made available to
the Exchange Agent pursuant to Section 1.06 that remains unclaimed by holders of
shares of Company Common Stock two years after the Effective Time will be
returned to Parent upon demand. Any such holder who has not exchanged shares of
Company Common Stock for the Merger Consideration in accordance with this
Article I prior to that time thereafter will look only to Parent for payment of
the Merger Consideration in respect of such shares of Company Common Stock.
Section 1.08 Adjustments. If at any time during the period
between the date of this Agreement and the Effective Time, any change in the
outstanding shares of capital stock of Parent occurs, including by means of any
reclassification, recapitalization, stock split or combination, exchange or
readjustment of shares, or any stock dividend thereon with a record date during
such period, the Merger Consideration will be adjusted appropriately.
Section 1.09 Fractional Shares. No fractional shares of Parent
Common Stock will be issued in the Merger. All fractional shares of Parent
Common Stock that a holder of shares of Company Common Stock otherwise would be
entitled to receive as a result of the Merger will be aggregated. If a
fractional share results from such aggregation, in lieu thereof such holder will
be entitled to receive from Parent, promptly after the Effective Time, an amount
in cash determined by multiplying the closing price of a share of Parent Common
Stock on the Nasdaq National Market on the trading day immediately preceding the
Effective Time by the fraction of a share of Parent Common Stock to which such
holder would otherwise have been entitled.
Section 1.10 Withholding of Tax. Parent or the Exchange Agent
will be entitled to deduct and withhold from the consideration otherwise payable
pursuant to this Agreement to any former holder of Company Common Stock such
amounts as Parent or the Exchange Agent are required to deduct and withhold with
respect to the making of such payment under the Code, or any provision of state,
local or foreign Tax law. To the extent that amounts are so withheld by Parent
or the Exchange Agent, such withheld amounts will be treated for all purposes of
this Agreement as having been paid to the former holder of Company Common Stock
in respect of whom such deduction and withholding was made by Parent.
Section 1.11 Lost Certificates. If any certificate evidencing
Company Common Stock has been lost, stolen or destroyed, upon the making of an
affidavit of that fact by the Person claiming such certificate to be lost,
stolen or destroyed and, if reasonably required by Parent, the posting by such
Person of a bond in such reasonable amount as Parent may direct as indemnity
against claims that may be made against it with respect to such certificate, the
Exchange Agent will issue in exchange for such lost, stolen or destroyed
certificate the Merger Consideration to which such Person may be entitled
pursuant to this Article I and cash and any dividends or other distributions to
which such Person may be entitled pursuant to Section 1.06(a).
Section 1.12 Stock Transfer Books. At the Effective Time, the
stock transfer books of the Company will be closed and there will be no further
registration of transfers of shares of Company Common Stock on the records of
the Company. Certificates formerly representing shares of Company Common Stock
that are presented to the Surviving Corporation after the Effective Time will be
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canceled and exchanged for certificates representing shares of Parent Common
Stock.
Section 1.13 Shareholder Approval. This Agreement will be
submitted for adoption and approval to the holders of shares of Class A Company
Common Stock and the holders of shares of Class B Company Common Stock at the
Company Shareholder Meeting (as defined in Section 7.03) in accordance with the
provisions of this Agreement. The affirmative vote of a majority of the votes
cast by the holders of shares entitled to vote thereon of Class A Company Common
Stock and Class B Company Common Stock (voting as separate classes) is required
to approve this Agreement. No other approval of the Company's shareholders is
required in order to consummate the Merger.
Section 1.14 Stock Options and Restricted Stock. As of
the Effective Time:
(a) Each outstanding option (an "Option") to purchase shares
of Class A Company Common Stock granted under the Company's 1985 Stock Option
Plan, the 1993 Non-Employee Directors' Stock Option Plan and the 1994 Stock
Option Plan, or any similar plan or arrangement (collectively, the "Option
Plans"), whether or not then exercisable or vested, will become fully
exercisable and vested. Any restricted shares of Class A Company Common Stock
issued pursuant to the 1992 Management Equity Incentive Plan will become fully
vested and will cease to be restricted.
(b) Each outstanding Option, at the election of each holder of
such Option, which election will be available on an option-by-option basis,
either:
(i) will be exercised, effective as of the Effective
Time, and each share of Class A Company Common Stock issuable with
respect thereto will be converted into the right to receive, at the
election of each holder, subject to Section 1.04(f), either (x) the
Century Class A Per Share Cash Amount or (y) the Century Class A Per
Share Stock Amount, as provided in Sections 1.02 and 1.03; or
(ii) will be assumed by Parent and converted into an
option to purchase, on the same terms and conditions as were applicable
under the Option Plans (except as provided herein), shares of Parent
Common Stock with the exercise price, the number of shares purchasable
pursuant to such Option and the terms and conditions of exercise of
such Option to be determined according to Section 424 of the Code, as
more fully described in a notice accompanying the Proxy
Statement/Prospectus.
(c) Parent will take all corporate action necessary to reserve
for issuance a sufficient number of shares of Parent Common Stock for delivery
upon exercise of Options assumed by it in accordance with this Section 1.14.
Promptly after the Effective Time, Parent will file with the SEC a registration
statement on Form S-3 or S-8, as appropriate, covering the shares of Parent
Common Stock subject to such Options and will use its commercially reasonable
efforts to cause such registration statement to remain effective for so long as
such Options remain outstanding.
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SECTION 2. Board of Directors. Section 7.12 of the Merger
Agreement is hereby amended and restated in its entirety as follows:
Section 7.12 Board of Directors. Parent agrees that from and
after the Effective Time, for so long as the Class B Shareholders and the
Century Permitted Assignees and Transferees (as defined below) own at least 10%
of the outstanding Common Stock of Parent (the "10% Requirement"), the Class B
Shareholders and the Century Permitted Assignees and Transferees shall be
entitled to nominate up to three members of Parent's board of directors (the
"Century Designees"). In the event any Century Designee ceases to serve as a
Director of Parent, whether as a result of his resignation, removal or
otherwise, his or her successor shall be named by the Century Designee who at
such time holds the most shares of Parent Common Stock, subject to approval by
the Parent, which approval will not be unreasonably withheld or delayed, to
serve until the next annual meeting of shareholders of Parent. Prior to the
Effective Time, Parent agrees to take all such action as is necessary so that
from and after the Effective Time, so long as the 10% Requirement is satisfied,
the Parent Board of Directors shall include Leonard Tow, Scott Schneider and
Bernard Gallagher or such other persons designated by Leonard Tow which are
reasonably acceptable to Parent. "Century Permitted Assignees and Transferees"
shall mean a person or entity (i) to whom Parent Common Stock has been
transferred from a Class B Shareholder or another Century Permitted Assignee and
Transferee and (ii) who or which is an affiliate, immediate family member or
descendant, in each case of Leonard Tow, or a trust created for the benefit of
Leonard Tow or an affiliate, immediate family member or descendant, in each case
of Leonard Tow.
SECTION 3. Effect of First Amendment. Except as expressly
provided in this First Amendment, all terms and conditions of the Merger
Agreement shall remain in full force and effect without modification.
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IN WITNESS WHEREOF, each of the parties has caused this
Agreement to be duly executed by its respective authorized officer as of the day
and year first above written.
ADELPHIA COMMUNICATIONS CORPORATION
By: /s/ Timothy Rigas_
Name: Timothy Rigas
Title:
ADELPHIA ACQUISITION SUBSIDIARY, INC.
By: /s/ Timothy Rigas
Name: Timothy Rigas
Title:
CENTURY COMMUNICATIONS CORP.
By: /s/ Scott Schneider
Name: Scott Schneider
Title: Chief Financial Officer
EXHIBIT 2.02
SECOND AMENDMENT TO
AGREEMENT AND PLAN OF MERGER
THIS SECOND AMENDMENT TO AGREEMENT AND PLAN OF MERGER (this
"Second Amendment") is dated as of July 29, 1999 among Adelphia Communications
Corporation, a Delaware corporation ("Parent"), Adelphia Acquisition Subsidiary,
Inc., a Delaware corporation and a direct, wholly-owned subsidiary of Parent
("Merger Sub"), and Century Communications Corp., a New Jersey corporation (the
"Company").
RECITALS
A. Parent, Merger Sub and the Company are parties to an
Agreement and Plan of Merger dated as of March 5, 1999, as amended by the First
Amendment to Agreement and Plan of Merger dated as of July 12, 1999 (the "Merger
Agreement"), pursuant to which the Company will merge with and into Merger Sub
with Merger Sub as the surviving corporation, all upon the terms and subject to
the conditions set forth in the Merger Agreement.
B. In accordance with Section 10.03 of the Merger Agreement,
the parties desire to enter into this Second Amendment to amend the Merger
Agreement as provided herein.
C. Capitalized terms used in this Second Amendment and not
defined herein shall have the meanings given to such terms in the Merger
Agreement.
In consideration of the premises and the respective covenants
and agreements set forth herein, the parties agree as follows.
SECTION 1. Amendment. Section 7.10 of the Merger Agreement
is hereby by amended by deleting, at the end of the first sentence, the words
"the Merger Consideration, without interest" and substituting therefor the
following:
(x) with respect to each share of Class A Company Common Stock
held by Dissenting Shareholders, $9.16426528 in cash and
0.61222732 shares of Parent Common Stock, without interest,
and (y) with respect to each share of Class B Company Common
Stock held by Dissenting Shareholders, $11.81417001 in cash
and 0.63595483 shares of Parent Common Stock, without interest
(it being understood that nothing herein shall be interpreted
to give the Class B Shareholders the right to become
Dissenting Shareholders without violating the Class B Voting
Agreement).
SECTION 2. Effect of Second Amendment. Except as expressly
provided in this Second Amendment, all terms and conditions of the Merger
Agreement shall remain in full force and effect without modification.
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IN WITNESS WHEREOF, each of the parties has caused this
Agreement to be duly executed by its respective authorized officer as of the day
and year first above written.
ADELPHIA COMMUNICATIONS CORPORATION
By: /s/ Michael J. Rigas
Name: Michael J. Rigas
Title: Executive Vice President
ADELPHIA ACQUISITION SUBSIDIARY, INC.
By: /s/ Michael J. Rigas
Name: Michael J. Rigas
Title: Executive Vice President
CENTURY COMMUNICATIONS CORP.
By: /s/ Scott N. Schneider
Name: Scott N. Schneider
Title: Chief Financial Officer
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EXHIBIT 10.01
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is dated as of
July 12, 1999 among Adelphia Communications Corporation, a Delaware corporation
("Adelphia"), the Century Class B Holders (as defined below) and Ms. Claire Tow
("Ms. Tow").
RECITALS
A. Adelphia, its wholly-owned subsidiary Adelphia Acquisition
Subsidiary, Inc., a Delaware corporation ("Merger Sub"), and Century
Communications Corp., a New Jersey corporation ("Century"), are parties to an
Agreement and Plan of Merger, dated as of March 5, 1999 (the "Merger
Agreement"), pursuant to which Century will merge (the "Merger") into Merger Sub
on the terms and conditions provided therein.
B. Pursuant to the Merger Agreement, the Century Class B Holders
entered into a Voting Agreement, dated as of March 5, 1999 (the "Century Voting
Agreement"), obligating them, on the terms and conditions therein set forth, to
vote in favor of the Merger.
C. The Century Class B Holders required, as a condition to their
willingness to sign the Voting Agreement and to approve the Merger, that
Adelphia grant certain registration and related rights to the Century Holders,
all as provided herein.
In consideration of the recitals above and the agreements and covenants
contained in this Agreement, Adelphia and the Century Holders agree as follows:
1. Definitions. The following capitalized terms have the
following meanings:
"Adelphia" has the meaning set forth in the Parties paragraph.
"Adelphia Common Stock" means the Class A Adelphia Stock and
the Class B Adelphia Stock.
"Adelphia Indemnified Parties" has the meaning set forth in
Section 8(b).
"Agreement" has the meaning set forth in the Parties
paragraph.
"Century" has the meaning set forth in the Recitals.
"Century Class B Holders" means the holders of the Class B
Century Shares listed on Schedule A.
"Century Holders" means the Century Class B Holders, Ms. Tow
and any other person holding Registrable Shares to whom the
Registration Rights have been transferred in accordance with Section
11.
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"Century Holder Indemnified Parties" has the meaning set forth
in Section 8(a).
"Century Voting Agreement" has the meaning set forth in the
Recitals.
"Class A Adelphia Stock" means the Class A Common Stock, par
value $0.01 per share of Adelphia.
"Class B Adelphia Stock" means the Class B Common Stock, par
value $0.01 per share of Adelphia.
"Class B Century Shares" means the outstanding shares of Class
B Common Stock, par value $0.01 per share of Century.
"Commission" means the Securities and Exchange Commission.
"Demand Request" has the meaning set forth in Section 2(a).
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Indemnified Parties" has the meaning set forth in
Section 8(b).
"Merger" has the meaning set forth in the Parties paragraph.
"Merger Agreement" has the meaning set forth in the Parties
paragraph.
"Merger Sub" has the meaning set forth in the Parties
paragraph.
"Misstatement" means an untrue statement of a material fact or
an omission to state a material fact required to be stated in a
registration statement or prospectus or necessary to make the
statements in a registration statement, prospectus or preliminary
prospectus not misleading.
"Register", "registered" and "registration" refer to a
registration effected by preparing and filing with the Commission a
registration statement in compliance with the Securities Act and the
declaration or ordering by the Commission of effectiveness of such
registration statement.
"Registrable Shares" includes (i) all shares of Class A
Adelphia Stock issued to the Century Holders pursuant to the Merger
Agreement and (ii) all securities of Adelphia or any other entity
issued as a dividend or other distribution with respect to, or in
exchange or replacement of any such shares. Any Registrable Shares will
cease to be Registrable Shares to the extent (x) a registration
statement with respect to the sale of such Registrable Shares has
become effective under the Securities Act and such Registrable Shares
have been disposed of in accordance with such registration statement;
(y) such Registrable Shares have been sold to the public pursuant to
Rule 144 or any successor provision under the Securities Act; or (iii)
such Registrable Shares shall have ceased to be outstanding.
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"Registration Rights" means the rights to registration of
securities provided in Section 2 and Section 3.
"Rigas Shareholders" means Dorellenic, Ionian Communications,
L.P., Syracuse Hilton Head Holdings, L.P., Highland Holdings, John J.
Rigas, Doris N. Rigas, Timothy J. Rigas, Michael J. Rigas, James P.
Rigas, Ellen K. Rigas (Mrs. Peter Venetis), any of their respective
spouses, estates or lineal descendants, any trust created by or for
the benefit of any such persons or, while and to the extent they are
serving in such capacity, the executors, administrators or personal
representatives of such persons, and any corporation, partnership or
other entity owned or controlled by one or more of the Rigas
Shareholders.
"Securities Act" means the Securities Act of 1933, as amended.
2. Demand Registration.
(a) Upon receipt of a written request (a "Demand Request") (specifying
that it is being made pursuant to this Section 2) from any Century Holder that
Adelphia file a registration statement under the Securities Act, or a similar
document pursuant to any other statute then in effect corresponding to the
Securities Act, covering the Registrable Shares that are the subject of such
request, Adelphia will file a registration statement under the Securities Act
covering such Registrable Shares. Adelphia will register all Registrable Shares
that the Century Holders have requested be registered on a form that is
appropriate for the sale of the Registrable Shares in accordance with the method
or methods of distribution specified by the Century Holders. Adelphia will not
be obligated to file a registration statement pursuant to this Section 2(a)
unless the proposed aggregate public offering price of the securities to be
included in such registration statement is at least $10,000,000.
(b) Notwithstanding the provisions of Section 2(a), Adelphia's
obligation to file such a registration statement shall be deferred for up to two
(2) periods not to exceed forty-five (45) days each from the time periods set
forth in Section (4b) if Adelphia furnishes to such Century Holder(s) within 10
days after Adelphia receives a Demand Request pursuant to Section 2(a) a
certificate signed by the President or Chief Executive Officer of Adelphia
stating that, in the reasonable determination of the Board of Directors of
Adelphia, there exist circumstances not yet disclosed to the public that would
be required to be disclosed in a registration statement filed pursuant to
Section 2(a) and the disclosure of which would be materially harmful to Adelphia
or its stockholders. Adelphia's right to defer filing of a registration
statement pursuant to this Section 2(b) may be exercised only twice as provided
above with respect to any demand for registration under this Section 2.
(c) Adelphia will be obligated pursuant to Section 2(a) to effect only
two registrations for each registered Century Holder of Registrable Shares on
the date hereof and each of their respective transferees. Any request for
registration under Section 2(a), at the discretion of the Century Holder(s)
making such request, may be for a firmly underwritten public offering to be
managed by an underwriter or underwriters of recognized national standing
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selected by such Century Holders, subject to the approval of the Board of
Directors of Adelphia, which approval will not be unreasonably withheld.
3. Piggy-back Registration.
(a) If at any time Adelphia determines to register any shares of its
capital stock under the Securities Act on a form that also would permit the
registration of the Registrable Shares (other than a registration statement on
Form S-4 or Form S-8), Adelphia promptly will, each such time, give the Century
Holders written notice of such determination at least 30 days before the
anticipated filing date of such registration statement. Upon the written request
of any Century Holder given within 20 calendar days after the delivery of any
such notice by Adelphia, Adelphia will include in such registration statement
all of the Registrable Shares that such Century Holder has requested to be
registered.
(b) Adelphia may decline to file a registration statement after giving
notice to the Century Holders pursuant to Section 3(a), or withdraw a
registration statement after filing and after such notice but prior to the
effectiveness thereof. In any such event; Adelphia promptly will notify the
Century Holders of any such action and will bear all expenses incurred by any
Century Holder in connection with such withdrawn registration statement.
(c) In connection with any registration of securities by Adelphia
subject to this Section 3 in connection with a firm commitment underwriting,
Adelphia will not be required to include any Registrable Shares of any Century
Holder in such underwriting unless such Century Holder accepts the terms of the
underwriting as agreed upon between Adelphia and the underwriters selected by
it, so long as the underwriting agreement is in customary form. If, in the
reasonable judgment of the managing underwriter of such firm commitment
underwriting expressed in a written opinion to the Century Holders, the
inclusion of all of the Registrable Shares requested to be registered would
interfere with the successful marketing of shares in such underwriting, the
number of Registrable Shares to be included in the firm commitment underwriting
will be reduced to such smaller number (but in no event less than 20% of the
securities in such underwriting, except to the extent provided in clause (ii) of
the next sentence) as, in the reasonable judgment of the underwriters, will not
interfere with the successful marketing of shares in such underwriting. In such
event, shares will be selected for participation in such offering in the
following priority (giving effect to the immediately preceding parenthetical):
(i) first, the shares of capital stock that Adelphia proposes to sell for its
own account; and (ii) second, the Registrable Shares requested to be included
(to be allocated pro rata among such Century Holders requesting such
registration based upon the number of Registrable Shares owned by such Century
Holders, pro rata among Century Holders and any third party on the basis of the
number of shares requested to be included in such registration by each such
Century Holder(s) or other party).
4. Obligations of Adelphia.
(a) Whenever Adelphia is required to register Registrable Shares under
Section 2 or Section 3, Adelphia will use its best efforts to effect such
registration to permit the sale of such Registrable Shares in accordance with
the intended plan of distribution thereof.
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(b) As soon as practicable (and in no event later than 60 days from the
date of receipt of a Demand Request), Adelphia will prepare and file with the
Commission a registration statement with respect to such Registrable Shares.
Adelphia will use its best efforts to cause such registration statement to
become effective at the earliest possible time (and in no event later than 120
days from the date of receipt of a Demand Request) and remain continuously
effective until the earlier to occur of (i) the date that is nine months from
the date such registration statement was declared effective or (ii) the date the
last of the Registrable Shares covered by such registration statement have been
sold. Adelphia will furnish to the Century Holders of the Registrable Shares
covered by such registration statement and any underwriter draft copies of the
registration statement and prospectus and any amendment or supplement thereto at
least 48 hours prior to filing. Adelphia will not file any such registration
statement, prospectus, amendment or supplement to which such Century Holders or
the underwriters reasonably object.
(c) As expeditiously as possible, Adelphia will prepare and file with
the Commission such pre-effective and post-effective amendments to the
registration statement, and such supplements to the prospectus, as may be
requested by any Century Holder of Registrable Shares covered by such
registration statement or any underwriter of Registrable Shares or as may be
required by the Securities Act, the Exchange Act or the rules and regulations
thereunder to keep the registration statement effective until all Registrable
Shares covered by such registration statement are sold in accordance with the
intended plan of distribution.
(d) As expeditiously as possible, Adelphia will notify the Century
Holders of Registrable Shares included in any offering subject to this Section
4:
(1) when the registration statement and any amendment thereto
has been filed, when the prospectus or any supplement thereto has been
filed and when the registration statement or any post-effective
amendment thereto has become effective,
(2) of any request by the Commission for amendments or
supplements to the registration statement or the prospectus or for
additional information,
(3) of the issuance by the Commission of any stop order
suspending the effectiveness of the registration statement or the
initiation of any proceeding for that purpose,
(4) if at any time the representations and warranties of
Adelphia contemplated by Section 4(m)(1) cease to be accurate in all
material respects,
(5) of the receipt by Adelphia of any notification with
respect to the suspension of the qualification of the Registrable
Shares for sale in any jurisdiction or the initiation or threatening of
any proceeding for such purpose, and
(6) of the existence of any fact that causes the registration
statement, the prospectus or any document incorporated therein by
reference to contain a Misstatement.
(e) Adelphia will make every reasonable effort to obtain the withdrawal
at the earliest possible time of any order suspending the effectiveness of the
registration statement.
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(f) Adelphia will furnish to each selling Century Holder of Registrable
Shares and the managing underwriter, without charge, at least one conformed copy
of the registration statement and any post-effective amendment thereto,
including financial statements and schedules, all documents incorporated therein
by reference and all exhibits (including those incorporated by reference), and
as many copies of each preliminary prospectus and prospectus as such persons
reasonably may request.
(g) Prior to any public offering of Registrable Shares, Adelphia will
register or qualify, or cooperate with the selling Century Holders of
Registrable Shares, any underwriters and their respective counsel in connection
with the registration or qualification of, such Registrable Shares for offer and
sale under the securities or blue sky laws of such jurisdictions as such selling
Century Holder of Registrable Shares or underwriters may designate.
(h) Adelphia will cooperate with the selling Century Holders and any
underwriter to facilitate the timely preparation and delivery of certificates
representing the Registrable Shares, without restrictive legends in the case of
Registrable Shares actually being sold under a registration statement or
pursuant to Rule 144(k) promulgated under the Securities Act, and will cause
such Registrable Shares to be in such denominations and registered in such names
as any underwriter may request at least two business days prior to any sale of
Registrable Shares.
(i) Adelphia will use its best efforts to cause the Registrable Shares
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 underwriters, if any, to consummate the
disposition of such Registrable Shares.
(j) If the registration statement or the prospectus contains a
Misstatement, Adelphia promptly will prepare a supplement or post-effective
amendment to the registration statement or the related prospectus or any
document incorporated therein by reference so that, as thereafter delivered to
the purchasers of the Registrable Shares, the prospectus will not contain a
Misstatement; provided, that Adelphia shall not be required to update, pursuant
to this Section 4(j), any such document during a period where Adelphia shall, in
good faith and using reasonable business judgment and based upon the advice of
outside counsel, believe that the premature disclosure of any event or
information would have a material effect on Adelphia, provided further that
Adelphia shall comply in all respects with the Securities Act and the Exchange
Act, together with all applicable rules and regulations of the Commission
promulgated thereunder and all applicable state securities laws and regulations.
Each Century Holder agrees that, upon receipt of any such notice from Adelphia
of the happening of any event during the period in which a registration
statement or the related prospectus contains a Misstatement (which advice shall
be accompanied by a written instruction to suspend the use of the prospectus
until the requisite changes have been made), such Century Holder will forthwith
discontinue disposition of Registrable Shares pursuant to such registration
statement until such Century Holder's receipt of the copies of the supplemented
or amended prospectus, and, if so directed by Adelphia, such Century Holder will
deliver to Adelphia all copies in its possession, other than permanent file
copies then in such Century Holder's possession, of the prospectus covering such
Registrable Shares current at the time of receipt of such notice, provided that
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the time period set forth in Section 4(b)(i) shall be extended for any period in
which the Century Holder is prevented from disposing of his or her Registrable
Shares pursuant to this Section 4(j).
(k) Adelphia will cause all Registrable Shares covered by the
registration statement to be listed on any national securities exchange or
authorized for quotation on the Nasdaq National Market prior to the time of
first sale of such Registrable Shares if requested by the Century Holders of a
majority of such Registrable Shares or any underwriter.
(l) Adelphia will provide a CUSIP number for all Registrable Shares not
later than the effective date of the Registration Statement.
(m) Adelphia will enter into such agreements, including an underwriting
agreement in customary form, and will take such action as may be necessary or
advisable in order to facilitate the disposition of such Registrable Shares,
including:
(1) making representations and warranties to the selling
Century Holders and any underwriters in substance and scope customarily
made by issuers to underwriters in primary underwritten offerings;
(2) obtaining opinions of counsel to Adelphia, reasonably
satisfactory to any underwriter and the selling Century Holders,
addressed to each selling Century Holder and any underwriter, and
covering the matters customarily covered in opinions delivered to
underwriters in primary underwritten offerings and such other matters
as reasonably may be requested by such Century Holders or underwriters;
(3) obtaining "cold comfort" letters and updates thereof from
Adelphia's independent certified accountants addressed to the selling
Century Holders and any underwriters, in customary form and covering
matters of the type customarily covered in "cold comfort" letters to
underwriters in connection with the primary underwritten offerings;
(4) causing any underwriting agreement to include the
indemnification and contribution provisions and procedures of Section 8
with respect to all parties to be indemnified pursuant to Section 8 or,
with respect to the indemnification of any underwriters, such similar
indemnification and contribution provisions as such underwriters
customarily require; and
(5) delivering such documents and certificates as reasonably
may be requested by the Century Holders of a majority of Registrable
Shares being sold and any managing underwriter to evidence compliance
with Section 4(m)(1) and with any customary conditions contained in the
underwriting agreement or other agreement entered into by Adelphia.
Each of the actions to be taken under this Section 4(m) will be taken at each
closing under such underwriting or similar agreement or as and to the extent
otherwise reasonably requested by the Century Holders of a majority of
Registrable Shares being sold.
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(n) Adelphia will make available for inspection by representatives of
the selling Century Holders, any underwriter participating in any disposition
pursuant to such registration statement and any attorney or accountant retained
by the selling Century Holders or any such underwriter, all financial and other
records and pertinent corporate documents and properties of Adelphia, and will
cause its officers, directors and employees to supply all information reasonably
requested by any such representative, underwriter, attorney or accountant.
(o) Adelphia otherwise will use its best efforts to comply with all
applicable rules and regulations of the Commission.
5. Obligations of Century Holders. The Century Holders will furnish to
Adelphia such information regarding them, the Registrable Shares held by them
and the intended method of disposition of such Registrable Shares as Adelphia
reasonably may request and as shall be required in connection with the action to
be taken by Adelphia.
6. Expenses of Registration. All expenses incurred in connection with
any registration pursuant to Section 2 or Section 3, including all registration
and qualification fees, printers' and accounting fees and reasonable fees and
disbursements of counsel for Adelphia, but not including fees and disbursements
of counsel for the selling Century Holders, will be paid by Adelphia.
The selling Century Holders will pay the fees and disbursements of their
counsel.
7. Lockup. (a) In consideration for Adelphia agreeing to its
obligations under this Agreement, each Century Holder agrees in connection with
any registration of Adelphia's securities, upon the request of Adelphia or the
underwriters managing any underwritten offering of Adelphia's securities, not to
sell, make any short sale of, loan, grant any option for the purchase of, or
otherwise dispose of any Registrable Shares (other than (i) those included in
the registration in question and (ii) sale transactions not involving a public
offering, provided that the transferee of such Century Holder as a condition
thereto and in connection therewith, agrees to be bound by and joins in this
Section 7), without the prior written consent of Adelphia or such underwriters,
as the case may be, for such period of time not to exceed 90 days from the
effective date of such registration as Adelphia or the underwriters may specify.
The restrictions under this Section 7 shall be conditioned upon an understanding
that the Rigas Shareholders will be similarly restricted during any such period.
During any period that sales of Registrable Shares by the Century Holder are
restricted under this Section 7, Adelphia will give written notice to the
Century Holder as soon as the restrictions on sale terminate. Adelphia hereby
agrees to give Century Holders among other things written notice of the filing
of a registration statement for a proposed underwritten offering to which the
restrictions in this Section 7 could apply if so requested.
(b) Notwithstanding Section 7(a) of this Agreement or comparable
provisions of any other agreement, whether now existing or hereafter entered
into, to which Adelphia, the Century Holders or any of the Rigas Shareholders
(or any of their respective affiliates) may be a party (i) Adelphia agrees that
it will not request, and will not permit the underwriters managing any
underwritten offering of Adelphia's securities to request, and (ii) each of the
Century Holders agrees that it will not agree to, and will not permit the Rigas
Shareholders to agree to, any restriction of the type described in Section 7(a)
which could, under any circumstances restrict the ability of any of the Century
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Holders to sell any Registrable Shares. If, despite the foregoing sentence, any
person shall assert that any Century Holder is or may be restricted in its
ability to sell any of the Registrable Shares as a result of restrictions of the
type described in Section 7(a) (or comparable provisions of other agreements as
described in the foregoing sentence), Adelphia hereby irrevocably consents, and
agrees to cause any underwriter managing any underwritten offering of Adelphia's
securities to irrevocably consent in writing, to such sale or sales.
(c) Nothing in this Section 7 shall be deemed to imply or constitute an
admission that sales of Registrable Shares by any Century Holder are intended to
be or would be subject to the restrictions set forth in Section 7(a) of this
Agreement or comparable provisions of any other agreement, whether now existing
or hereafter entered into, to which Adelphia, the Century Holders or any of the
Rigas Shareholders (or any of their respective affiliates) may be a party.
8. Indemnification.
(a) Adelphia will indemnify and hold harmless each Century Holder
requesting or joining in a registration, any underwriter (as defined in the
Securities Act) for the Century Holders and each person, if any, who controls
such Century Holder or underwriter within the meaning of the Securities Act (the
"Century Holder Indemnified Parties"), against any losses, claims, damages or
liabilities, joint or several, to which any Century Holder Indemnified Party may
become subject under the Securities Act, the Exchange Act or otherwise, insofar
as such losses, claims, damages or liabilities or actions in respect thereof
arise out of or are based on (i) any Misstatement in a registration statement,
including any preliminary prospectus or final prospectus contained therein or
any amendment or supplement thereto, or arise out of any violation by Adelphia
of any rule or regulation promulgated under the Securities Act or Exchange Act
relating to action or inaction required of Adelphia in connection with any such
registration, or (ii) any claim that a sale of Registrable Shares by any Century
Holder is in violation of Section 7(a). Adelphia will reimburse each such
Century Holder Indemnified Party for any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such loss,
claim, damage, liability or action. The indemnity agreement contained in this
Section 8(a) shall not apply: (i) to amounts paid in settlement of any such
loss, claim, damage, liability or action if such settlement is effected without
the consent of Adelphia (which consent will not be unreasonably withheld); or
(ii) to any such loss, claim, damage, liability or action incurred by any
Century Holder Indemnified Party to the extent that it (A) arises out of or is
based upon a Misstatement made in connection with such registration statement,
preliminary prospectus, final prospectus or amendment or supplement thereto in
reliance upon and in conformity with written information furnished expressly for
use in connection with such registration by such Century Holder Indemnified
Party, or (B) arises out of any violation by such Century Holder Indemnified
Party of any rule or regulation promulgated under the Securities Act or the
Exchange Act relating to action or inaction required of such Century Holder
Indemnified Party in connection with any such registration. This indemnity will
be in addition to any liability that Adelphia otherwise may have.
(b) Each Century Holder requesting or joining in a registration will
indemnify and hold harmless Adelphia, each of its directors, each of its
officers who have signed the registration statement, each person, if any, who
controls Adelphia within the meaning of the Securities Act, and each agent and
any underwriter for Adelphia (within the meaning of the Securities Act) (the
"Adelphia Indemnified Parties" and, together with the Century Holder Indemnified
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Parties, the "Indemnified Parties") against any losses, claims, damages or
liabilities to which any Adelphia Indemnified Party may become subject, under
the Securities Act, the Exchange Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereto) (i) arise out of
or are based upon any Misstatement in such registration statement, including any
preliminary prospectus or final prospectus contained therein or any amendment or
supplement thereto, in each case to the extent, but only to the extent, that
such Misstatement or alleged Misstatement was made in such registration
statement, preliminary or final prospectus or amendment or supplement in
reliance upon and in conformity with written information furnished by such
Century Holder expressly for use in connection with such registration, or (ii)
arise out of any violation by such Century Holder of any rule or regulation
promulgated under the Securities Act or the Exchange Act relating to action or
inaction required of such Century Holder in connection with any such
registration. Each such Century Holder will reimburse any legal or other
expenses reasonably incurred by such Adelphia Indemnified Party in connection
with investigating or defending any such loss, claim, damage, liability or
action. The indemnity agreement contained in this Section 8(b) shall not apply
to amounts paid in settlement of any such loss, claim, damage, liability, or
action if such settlement is effected without the consent of such Century Holder
(which consent shall not be unreasonably withheld). This indemnity will be in
addition to any liability which each Century Holder otherwise may have.
(c) If the indemnification provided for in this Section 8 is
unavailable to an Indemnified Party under Section 8(a) or Section 8(b) in
respect of any losses, claims, damages or liabilities referred to therein, each
indemnifying party, in lieu of indemnifying such Indemnified Party, will
contribute to the amount paid or payable by such Indemnified Party as a result
of such losses, claims, damages or liabilities in such proportion as is
appropriate to reflect the relative fault of the indemnifying party on the one
hand and of the Indemnified Party on the other in connection with the statements
or omissions which resulted in such losses, claims, damages or liabilities as
well as any other relevant equitable considerations. The amount paid or payable
by a party as a result of the losses, claims, damages, or liabilities referred
to above shall be deemed to include, subject to the limitations set forth in
Section 8(d), any legal or other fees or expenses reasonably incurred by such
party in connection with investigating or defending any action or claim. The
relative fault of the Indemnified Party on the one hand and of the indemnifying
party on the other will be determined by reference to, among other things,
whether the Misstatement or alleged Misstatement relates to information supplied
by the Indemnified Party or the indemnifying party and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such Misstatement or alleged Misstatement. Adelphia and the Century Holders
agree that it would not be just and equitable if contribution pursuant to this
Section 8(c) were determined by pro rata allocation or by any other method of
allocation that does not take account of the equitable considerations referred
to above. No Century Holder Indemnified Party shall be required to contribute
any amount in excess of the amount by which (i) the total price at which the
securities that were sold by such Century Holder Indemnified Party exceeds (ii)
the amount of any damages which such Century Holder Indemnified Party otherwise
has been required to pay by reason of such Misstatement. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) will be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.
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(d) Any person entitled to indemnification hereunder will: (i) give
prompt notice to the indemnifying party of any claim with respect to which it
seeks indemnification; and (ii) unless in such Indemnified Party's reasonable
judgment a conflict of interest between such Indemnified Party and the
indemnifying parties may exist with respect to such claim, permit such
indemnifying party to assume the defense of such claim with counsel reasonably
satisfactory to the Indemnified Party. An indemnifying party who is not entitled
or elects not to assume the defense of a claim will not be obligated to pay the
fees and expenses of more than one counsel for all Indemnified Parties with
respect to such claim, unless in the reasonable judgment of any Indemnified
Party a conflict of interest may exist between such Indemnified Party and any
other such Indemnified Parties with respect to such claim. The failure to notify
an indemnifying party promptly of the commencement of any such action, if
prejudicial to its ability to defend such action, shall relieve such
indemnifying party of any liability to the Indemnified Party under this Section
8, but the omission so to notify the indemnifying party will not relieve the
indemnifying party of any liability that it may have to any Indemnified Party
otherwise than under this Section 8.
9. Termination of Adelphia's Obligations. Adelphia will have no
obligation pursuant to Section 2 or Section 3 with respect to any request or
requests made by a Century Holder more than five years after the Effective Time.
10. Reports Under the Exchange Act. With a view to making available to
the Century Holders the benefits of Rule 144 promulgated under the Securities
Act and any other rule or regulation of the Commission that may permit a Century
Holder to sell securities of Adelphia to the public without registration,
Adelphia will use its best efforts to:
(a) make and keep public information available, as those
terms are understood and defined in Rule 144, at all times;
(b) file with the Commission in a timely manner all reports
and other documents required of Adelphia under the Securities Act and
the Exchange Act; and
(c) furnish to any Century Holder forthwith upon request (i) a
written statement by Adelphia that it has complied with the reporting
requirements of Rule 144, and of the Securities Act and the Exchange
Act, (ii) a copy of the most recent annual or quarterly report of
Adelphia and (iii) such other reports and documents so filed by
Adelphia as reasonably may be requested in availing any Century Holder
of any rule or regulation of the Commission permitting the selling of
any such securities without registration.
11. Transfer of Rights. The registration rights of the Century Holders
under Section 2 and Section 3 may be transferred to any transferee or devolve
upon any person who is (i) a nominee or descendant of such Century Holder or a
trust (including any subtrusts thereof) of which such Century Holder is the
Trustor so long as the beneficial owner of the Registrable Shares being
transferred is the Trustor or any relative of the Trustor or any charitable
foundation or other eleemosynary institution or charitable remainder trusts,
(ii) the beneficial owner of any Century Holder which is a trust, (iii) an
entity controlled by such Century Holder, (iv) a shareholder or partner, as the
case may be, of any Century Holder, (v) a bona fide purchaser for value from
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such Century Holder of Adelphia Common Stock having a market value at the time
of sale of more than $10,000,000, (vi) charitable donees or family donees, (vii)
a beneficial owner of an existing trust and otherwise to third parties for
estate planning or similar purposes. Adelphia will be given written notice by
the Century Holder at the time of any transfer stating the name and address of
any transferee and identifying the securities with respect to which the rights
hereunder are being transferred.
12. No Inconsistent Agreements. Adelphia will not enter into any
agreement with respect to its securities that is inconsistent with the rights
granted to the Century Holders in this Agreement or otherwise conflicts with the
provisions hereof.
13. Amendments and Waivers. The provisions of this Agreement may not be
amended, modified or supplemented, and waivers or consents to departures from
the provisions hereof may not be given, without the prior written consent of
Adelphia and at least the Century Holders of a majority of the Registrable
Shares.
14. Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, registered
first-class mail, telecopier or air courier guaranteeing overnight delivery:
(a) if to a Century Holder, at the most current address given
by such Century Holder to Adelphia in accordance with the provisions
hereof, which address at the date hereof is set forth on Schedule A;
and
(b) if to Adelphia, at:
Adelphia Communications Corporation
Attn: Jake Kane and Collin Higgin
Main at Water Street
Coudersport, PA 16915
with copies to:
Buchanan Ingersoll Professional Corporation
20th Floor, 301 Grant Street
Pittsburgh, PA 15219
Attn: Bruce Booken and Carl E. Rothenberger, Jr.
All such notices and communications shall be deemed to have been dully
given at the time delivered by hand, if personally delivered; five business days
after being deposited in the mail, postage prepaid, if mailed; when receipt
acknowledged, if telecopied; and on the next business day, if timely delivered
to an air courier guaranteeing overnight delivery. Adelphia will promptly
provide a list of the most current addresses of the Century Holders of
Registrable Shares given to it in accordance with the provisions hereof to any
such Century Holder for the purpose of enabling such Century Holder to
communicate with other Century Holders in connection with this Agreement.
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14. Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the successors (and any entity controlling such
successors) and assigns of each of the parties.
15. 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.
16. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware without giving effect to the
conflict of laws provisions thereof.
17. 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.
18. Forms. All references in this Agreement to particular forms of
registration statements are intended to include all successor forms which are
intended to replace, or to apply to similar transactions as, the forms herein
referenced.
19. Entire Agreement. This Agreement is intended by the parties as the
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. This Agreement supersedes all prior
agreements and understandings between the parties with respect to such subject
matter.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed, as of the day and year first above written.
ADELPHIA COMMUNICATIONS CORPORATION
By: /s/ Timothy Rigas
Name: Timothy Rigas
Title:
CENTURY HOLDERS
THE CLAIRE TOW TRUST
By: /s/ Leonard Tow
Leonard Tow, Trustee
By: /s/ Clair Tow
Claire Tow, Trustee
By: /s/ David Z. Rosensweig
David Z. Rosensweig, Trustee:
Title:
THE TRUST CREATED BY CLAIRE TOW UNDER DATE OF DECEMBER 10, 1979
By: /s/ David Z. Rosensweig
David Z. Rosensweig, Trustee
LEONARD TOW
/s/ Leonard Tow
CLAIRE TOW
/s/ Clair Tow
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SCHEDULE A
CENTURY CLASS B HOLDERS
Leonard Tow
160 Lantern Ridge Road
New Canaan, CT 06840
Telephone: 203-966-0931
Facsimile: 203-972-2821
Trust dated December 10, 1979 by Claire
Tow as Grantor
160 Lantern Ridge Road
New Canaan, CT 06840
Telephone: 203-966-0931
Facsimile: 203-972-2821
The Claire Tow Trust, created under date of
July 1973 by Leonard Tow as Grantor
160 Lantern Ridge Road
New Canaan, CT 06840
Telephone: 203-966-0931
Facsimile: 203-972-2821
in each case with copies to:
Leavy, Rosensweig & Hyman
11 East 44th Street
New York, NY 10017
Telephone: 212-983-0400
Facsimile: 212 983-2537
Attention: David R. Rosensweig
15
EXHIBIT 10.02
TAG-ALONG RIGHTS AGREEMENT
THIS TAG-ALONG RIGHTS AGREEMENT (this "Agreement") is dated as of July
12, 1999 among Adelphia Communications Corporation, a Delaware corporation
("Adelphia"), the Century Class B Holders (as defined below), Ms. Claire Tow
("Ms. Tow") and the holders (the "Adelphia Class B Holders") of the outstanding
shares of Class B Common Stock, par value $.01 per share (the "Adelphia Class B
Stock") of Adelphia listed on Schedule B.
RECITALS
A. Adelphia, its wholly-owned subsidiary Adelphia Acquisition
Subsidiary, Inc., a Delaware corporation ("Merger Sub"), and Century
Communications Corp., a New Jersey corporation ("Century"), are parties to an
Agreement and Plan of Merger, dated as of March 5, 1999 (the "Merger
Agreement"), pursuant to which Century will merge (the "Merger") into Merger Sub
on the terms and conditions provided therein.
B. Pursuant to the Merger Agreement, the Century Class B Holders
entered into a Voting Agreement, dated as of March 5, 1999, obligating them, on
the terms and conditions therein set forth, to vote in favor of the Merger.
C. The Century Class B Holders required, as a condition to their
willingness to sign the Voting Agreement and to approve the Merger, that
Adelphia grant certain tag-along rights to the Century Holders, all as provided
herein.
In consideration of the recitals above and the agreements and covenants
contained in this Agreement, Adelphia, the Century Holders and the Adelphia
Class B Holders agree as follows:
1. Definitions. The following capitalized terms have the
following meanings:
"Adelphia" has the meaning set forth in the Parties paragraph.
"Adelphia Class A Stock" means the Class A Common Stock, par
value $.01 of Adelphia.
"Adelphia Class B Holders" has the meaning set forth in the
Parties paragraph.
"Adelphia Class B Stock" has the meaning set forth in the
Recitals.
"Adelphia Common Stock" means the Adelphia Class A Stock and
the Adelphia Class B Stock.
"Adelphia Share Price" means (i) in the case of a Tag-Along
Sale consisting solely of Adelphia Class B Stock, the highest price per
share received by any Adelphia Class B Holder in such Tag-Along Sale on
account of his or her Adelphia Class B Stock, less a discount to agreed
upon by such Adelphia Class B Holder and Century Holder and (ii) in the
case of all other Tag-Along Sales not covered by clause (i) above, the
highest price per share received by the Adelphia Class B Holder in such
<PAGE>
Tag-Along Sale on account of his or her Adelphia Class A Stock. In the
event that the parties cannot agree upon the discount to be applied
pursuant to clause (i) above, the determination of a fair market
discount by an investment banker of national standing chosen by the
Board of Directors of Adelphia shall be deemed to be the discount
agreed upon by the Adelphia Class B Holder and the Century Holder.
Notwithstanding the foregoing, in the event of a Tag-Along Sale
consisting of a combination of Adelphia Class A Stock and Adelphia
Class B Stock in which the price paid by any third party for either the
Adelphia Class A Stock or the Adelphia Class B Stock does not represent
a bona fide purchase price for such shares as determined in good faith
by the Board of Directors of Adelphia, then the Adelphia Share Price
shall equal the highest price per share received by any Adelphia Class
B Holder in such Tag-Along Sale on account of his or her Adelphia
Common Stock.
"Adelphia Shares" includes (i) all shares of Adelphia Class A
Stock issued to the Century Holders pursuant to the Merger Agreement
and (ii) all securities of Adelphia or any other entity issued as a
dividend or other distribution with respect to, or in exchange or
replacement of any such shares.
"Agreement" has the meaning set forth in the Parties
paragraph.
"Century" has the meaning set forth in the Recitals.
"Century Class B Holders" means the holders of the Class B
Century Shares listed on Schedule A.
"Century Holders" means the Century Class B Holders, Ms. Tow
and any other person to whom the Tag-Along Rights have been
transferred in accordance with Section 11.
"Class B Century Shares" means the Class B Common Stock of
Century, par value $.01 per share.
"Merger" has the meaning set forth in the Parties paragraph.
"Merger Agreement" has the meaning set forth in the Parties
paragraph.
"Other Century Holders" is defined in Section 2(e).
"Reference Shares" has the meaning set forth in Section 2(a).
"Securities Act" means the Securities Act of 1933, as amended.
"Tag-Along Pro Rata Amount" means for each Century Holder,
that number of Adelphia Shares derived by multiplying the aggregate
number of Adelphia Shares owned by such Century Holder at the time of
the proposed Transfer by a fraction, the numerator of which is equal to
the aggregate number of Reference Shares proposed to be sold pursuant
to the Tag-Along Sale and the denominator of which is the aggregate
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number of shares of Adelphia Common Stock owned by the Adelphia Class B
Holders at the time of the proposed Transfer.
"Tag-Along Offer" is defined in Section 2(a).
"Tag-Along Sale" is defined in Section 2(a).
"Tag-Along Rights" means the rights of co-sale provided in
Section 2.
"Transfer" means with respect to any Reference Shares, the
sale, assignment or, conveyance, provided however that (i) no bona fide
pledge or hypothecation of Adelphia Common Stock by Adelphia Class B
Holders or any entity controlled by one or more of the Adelphia Class B
Holders shall be deemed to be a Transfer; (ii) no sale or other
conveyance of Adelphia Common Stock by Adelphia Class B Holders or any
entity controlled by one or more of the Adelphia Class B Holders to
other Adelphia Class B Holders or any entity controlled by one or more
of the Adelphia Class B Holders shall be deemed to be a Transfer, so
long as such transferee complies with Section 2(b); and (iii) no sale
or other conveyance of Adelphia Common Stock by Adelphia Class B
Holders or any entity controlled by one or more of the Adelphia Class B
Holders to immediate family members or descendants of any Adelphia
Class B Holder or trusts created for the benefit of any such persons
for estate planning or similar purposes shall be deemed to be a
Transfer, so long as such transferee complies with Section 2(b).
"Unaccepted Shares" is defined in Section 2(e).
2. Tag-Along Rights.
(a) If any Adelphia Class B Holder, or any entity directly or
indirectly controlled by any Adelphia Class B Holder, at any time or from time
to time after the Effective Date, in one transaction or in a series of related
transactions, intends to Transfer (a "Tag-Along Sale") (i) any shares of
Adelphia Class B Stock, (ii) any shares of Adelphia Class A Stock in a
transaction not involving a sale of Adelphia Class A Stock made publicly
pursuant to a registration statement filed under the Securities Act or Rule 144
under the Securities Act (other than sales of Adelphia Class A Stock in excess
of 500,000 shares) or (iii) any shares of Adelphia Common Stock in a transaction
involving a combination of clause (i) and clause (ii) above, (collectively,
"Reference Shares"), such Adelphia Class B Holder will be required to make an
offer, or will cause such controlled entity to make an offer (a "Tag-Along
Offer"), to each Century Holder of Adelphia Shares, upon the terms and
conditions set forth in Section 2(c), to permit such Century Holder to
participate in such Tag-Along Sale and sell up to its Tag-Along Pro Rata Amount
(plus any Unaccepted Shares as provided in Section 2(e)) for the Adelphia Share
Price, on the same terms and conditions applicable to such Adelphia Class B
Holder or such entity directly or indirectly controlled by such Adelphia Class B
Holder.
(b) Unless and until the Century Holders have transferred all of their
Adelphia Shares pursuant to this Agreement, to transferees other than those
named in Section 3 of this Agreement, or pursuant to the Registration Rights
Agreement by and among Adelphia and the Class B Holders of even date herewith,
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<PAGE>
if any Adelphia Class B Holder, or any entity directly or indirectly controlled
by any Adelphia Class B Holder, intends to Transfer (other than by sale) any
Reference Shares to any third party, such Adelphia Class B Holder will, or will
cause such controlled entity to, obtain from such third party its agreement to
be bound by this Section 2 as if such third party were an Adelphia Class B
Holder and to obtain from such third party's transferees a similar agreement to
be so bound and to obtain similar agreements.
(c) If any Adelphia Class B Holder, or any entity directly or
indirectly controlled by any Adelphia Class B Holder, is required by the terms
of Section 2(a) to make a Tag-Along Offer, it shall promptly (but in any event
at least thirty business days prior to the closing of any sale of Reference
Shares) give written notice of its intention to sell Reference Shares to each
Century Holder. Such notice shall indicate that a Tag-Along Offer is being made
pursuant to this Section 2 and describe in reasonable detail:
(i) the price at which it intends to sell such Reference
Shares (broken out separately for Adelphia Class A Stock and Adelphia
Class B Stock),
(ii) the number of Reference Shares to be sold (broken out
separately for Adelphia Class A Stock and Adelphia Class B Stock),
(iii) the Tag-Along Pro Rata Amount for each Century Holder
and
(iv) the general terms upon which such Adelphia Class B Holder
proposes to effect the sale (including, without limitation, the name of
the proposed buyer and the form of consideration).
(d) The Tag-Along Offer may be accepted by any Century Holder holding
Adelphia Shares within ten business days from the date of receipt by such
Century Holder of such notice by delivering notice of such Century Holder's
agreement to sell all or part of such Century Holder's Tag-Along Pro Rata Amount
(plus any Unaccepted Shares) for the Adelphia Share Price, upon the terms and
conditions pursuant to which the Adelphia Class B Holder's shares are to be sold
subject to purchase documentation substantially identical to that accepted by
the Adelphia Class B Holder in the proposed transaction, except to the extent
that the purchase price differs in accordance with this Agreement.
(e) In the event that any of the Century Holders elects not to accept
the Tag-Along Offer to the fullest extent permitted by his Tag-Along Pro Rata
Amount, then all the Adelphia Shares for which such Century Holder does not
accept the Tag-Along Offer (the "Unaccepted Shares") shall be aggregated and
made available to the other Century Holders (the "Other Century Holders") for
sale by such Other Century Holders pursuant to the Tag-Along Offer. The
Unaccepted Shares shall be allocated to the Other Century Holders (excluding in
each case each Century Holder which has not accepted the Tag-Along Offer to the
fullest extent available to it) based on the ratio of Adelphia Shares then owned
by the Other Century Holders, one to the other, and shall be in addition to any
Adelphia Shares that such Other Century Holder may otherwise be permitted to
sell pursuant to the Tag-Along Offer based on his Tag-Along Pro Rata Amount.
Notice may be given by the Other Century Holder or Holders of acceptance for
4
<PAGE>
sale in the Tag-Along Offer of applicable Unaccepted Shares within five business
days after the termination of the aforesaid ten day period. In the event any
Other Century Holder does not accept all of the Unaccepted Shares available to
him in a particular Tag-Along Offer, the aforesaid procedure shall be repeated
until there are no Other Century Holders, with each five-day notice period to
commence at the end of the immediately preceding five-day period.
(f) No Adelphia Class B Holder will sell any Reference Shares without
obtaining the agreement of the transferee thereof to purchase shares of Adelphia
Common Stock from the Century Holders as provided in this Section 2, provided,
however, that in the event that an acquiror is unwilling to purchase each
Century Holder's Tag-Along Pro Rata Amount (including any Unaccepted Shares as
provided in Section 2(e)), the Adelphia Class B Holders will have the right to
purchase such Adelphia Shares from such Century Holder for the Adelphia Share
Price on the same terms and conditions as the Tag-Along Sale, which purchase is
a prerequisite to such sale of Reference Shares by an Adelphia Class B Holder.
Any Transfer or attempt to Transfer any Adelphia Common Stock by any Adelphia
Class B Holder in violation of the terms and conditions of this Agreement shall
be null and void and of no force and effect.
3. Transfer Rights. The Tag-Along Rights of the Century Holders under
Section 2 may be transferred to any transferee or devolve upon any person who is
(i) a nominee or descendant of such Century Holder or a trust (including any
subtrusts thereof) of which such Century Holder is the Trustor so long as the
beneficial owner of the Adelphia Shares being transferred is the Trustor or any
relative of the Trustor or any charitable foundation or other eleemosynary
institution or charitable remainder trusts, (ii) the beneficial owner of any
Century Holder which is a trust, (iii) an entity controlled by such Century
Holder, (iv) a shareholder or partner, as the case may be, of any Century
Holder, (v) a bona fide purchaser for value from such Century Holder of Adelphia
Common Stock having a market value at the time of sale of more than $10,000,000,
(vi) charitable donees or family donees, (vii) a beneficial owner of an existing
trust controlled by any Century Holder and otherwise to third parties for estate
planning or similar purposes. Adelphia will be given written notice by the
Century Holder at the time of any transfer stating the name and address of any
transferee and identifying the securities with respect to which the rights
hereunder are being transferred.
4. No Inconsistent Agreements. Neither Adelphia nor any Adelphia Class
B Holder will enter into any agreement with respect to its securities that is
inconsistent with the rights granted to the Century Holders in this Agreement or
otherwise conflicts with the provisions hereof.
5. Amendments and Waivers. The provisions of this Agreement may not be
amended, modified or supplemented, and waivers or consents to departures from
the provisions hereof may not be given, without the prior written consent of
Adelphia and at least the Century Holders holding a majority of the Adelphia
Shares.
6. Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, registered
first-class mail, telecopier or air courier guaranteeing overnight delivery:
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<PAGE>
(a) if to a Century Holder, at the most current address given
by such Century Holder to Adelphia in accordance with the provisions
hereof, which address at the date hereof is set forth on Schedule A;
and
(b) if to Adelphia or any Adelphia Class B Holder, at the
address set forth on Schedule B.
All such notices and communications shall be deemed to have been dully
given at the time delivered by hand, if personally delivered; five business days
after being deposited in the mail, postage prepaid, if mailed; when receipt
acknowledged, if telecopied; and on the next business day, if timely delivered
to an air courier guaranteeing overnight delivery. Adelphia will promptly
provide a list of the most current addresses of the Century Holders of Adelphia
Shares given to it in accordance with the provisions hereof to any such Century
Holder for the purpose of enabling such Century Holder to communicate with other
Century Holders in connection with this Agreement.
7. Successors and Assigns. This Agreement shall inure to the benefit of
and be binding upon the successors and assigns of each of the parties.
8. 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.
9. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware without giving effect to the
conflict of laws provisions thereof.
10. 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.
11. Entire Agreement. This Agreement is intended by the parties as the
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. This Agreement supersedes all prior
agreements and understandings between the parties with respect to such subject
matter.
12. Voting Rights. Each of the Adelphia Class B Holders agree that, so
long as the Century Class B Holders and the Century Permitted Assignees and
Transferees (as defined in the Merger Agreement) own at least 10% of the
outstanding Adelphia common stock, each Adelphia Class B Holder will vote or
cause to be voted his Adelphia common stock so as to (i) elect Leonard Tow,
Scott Schneider and Bernard Gallagher to the Board of Directors of Adelphia and
(ii) subject to the reasonable discretion of each Adelphia Class B Holder, elect
such other Century Designees (as defined in the Merger Agreement) as may be
nominated.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed, as of the day and year first above written.
ADELPHIA COMMUNICATIONS CORPORATION
By: /s/ Timothy Rigas
Name: Timothy Rigas
Title:
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CENTURY HOLDERS
THE CLAIRE TOW TRUST
By: /s/ Leonard Tow
Leonard Tow, Trustee
By: /s/ Claire Tow
Claire Tow, Trustee
By: /s/ David Z. Rosensweig
David Z. Rosensweig, Trustee:
Title:
THE TRUST CREATED BY CLAIRE TOW UNDER DATE OF DECEMBER 10, 1979
By: /s/ David Z. Rosensweig
David Z. Rosensweig, Trustee
LEONARD TOW
/s/ Leonard Tow
CLAIRE TOW
/s/ Claire Tow
8
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ADELPHIA CLASS B HOLDERS
/s/ John J. Rigas
John J. Rigas
/s/ Michael J. Rigas
Michael J. Rigas
/s/ Timothy J. Rigas
Timothy J. Rigas
/s/ James P. Rigas
James P. Rigas
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SCHEDULE A
CENTURY CLASS B HOLDERS
Leonard Tow
160 Lantern Ridge Road
New Canaan, CT 06840
Telephone: 203-966-0931
Facsimile: 203-972-2821
Trust dated December 10, 1979 by Claire
Tow as Grantor
160 Lantern Ridge Road
New Canaan, CT 06840
Telephone: 203-966-0931
Facsimile: 203-972-2821
The Claire Tow Trust, created under date of
July 1973 by Leonard Tow as Grantor
160 Lantern Ridge Road
New Canaan, CT 06840
Telephone: 203-966-0931
Facsimile: 203-972-2821
in each case with copies to:
Leavy, Rosensweig & Hyman
11 East 44th Street
New York, NY 10017
Telephone: 212-983-0400
Facsimile: 212 983-2537
Attention: David R. Rosensweig
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SCHEDULE B
ADELPHIA CLASS B HOLDERS
John J. Rigas
Adelphia Communications Corporation
Main at Water Street
Coudersport, PA 16915
Telephone: 814-274-9830
Facsimile: 814-274-6586
Michael J. Rigas
Adelphia Communications Corporation
Main at Water Street
Coudersport, PA 16915
Telephone: 814-274-9830
Facsimile: 814-274-6586
Timothy J. Rigas
Adelphia Communications Corporation
Main at Water Street
Coudersport, PA 16915
Telephone: 814-274-9830
Facsimile: 814-274-6586
James P. Rigas
Adelphia Communications Corporation
Main at Water Street
Coudersport, PA 16915
Telephone: 814-274-9830
Facsimile: 814-274-6586
in each case with copies to:
Buchanan Ingersoll Professional Corporation
20th Floor, 301 Grand Street
Pittsburgh, PA 15219
Attention: Bruce Booken and Carl Rothenberger
11
EXHIBIT 10.03
PURCHASE AGREEMENT
This Agreement (this "Agreement") is dated as of July 12, 1999 by and
between Adelphia Communications Corporation, a Delaware corporation ("Adelphia")
and Citizens Cable Company, a Delaware corporation ("Citizens").
RECITALS
A. Adelphia, Adelphia Acquisition Subsidiary, Inc. and Century
Communications Corp. ("Century") are parties to an Agreement and Plan of Merger
dated as of March 5, 1999 (as amended from time to time, the "Merger Agreement")
pursuant to which Adelphia has agreed to acquire Century on the terms and
subject to the conditions set forth in the Merger Agreement.
B. Century Telecommunications Venture Corp. ("CTVC"), an indirect
wholly-owned subsidiary of Century, and Citizens are parties to a Joint Venture
Agreement, dated as of September 22, 1994, as amended from time to time (the
"Joint Venture Agreement"), pursuant to which the parties thereto formed a joint
venture named Citizens Century Cable Television Venture (the "Joint Venture").
C. Citizens owns a 50% interest in the Joint Venture (the "Citizens JV
Interest").
D. Citizens desires to sell the Citizens JV Interest to Adelphia, and
pursuant to Section 7.13 of the Merger Agreement, Adelphia has agreed to
purchase the Citizens JV Interest from Citizens at the Effective Time.
E. Capitalized terms used herein and not defined herein have the
meanings given to such terms in the Merger Agreement.
In consideration of the premises and the respective representations,
warranties, covenants, and agreements set forth herein, the parties agree as
follows.
SECTION 1. Purchase and Sale of the Citizens JV Interest. Subject to
the terms and conditions of this Agreement, at the Effective Time, Citizens will
sell, transfer, convey, assign and deliver to Adelphia and Adelphia will
purchase from Citizens, the Citizens JV Interest. The purchase price to be paid
by Adelphia to Citizens for the Citizens JV Interest is (i) cash in an amount
equal to $27,726,609.78821, (ii) 1,852,302 shares of Adelphia Class A Common
Stock and (iii) 0.119666 fractional shares of Adelphia Class A Common Stock to
be treated in accordance with Section 1.09 of the Merger Agreement
(collectively, the "Purchase Price"). On the Closing Date, Adelphia will (i) pay
to Citizens cash in amount equal to $27,726,609.78821 (plus any cash in lieu of
fractional shares) by wire transfer of immediately available funds to an account
designated by Citizens at least three Business Days prior to Closing and (ii)
deliver to Citizens stock certificates representing 1,852,302 shares of Adelphia
Class A Common Stock. Adelphia will cause the Registration Statement to include
the shares of Adelphia Class A Common Stock to be issued to Citizens pursuant to
this Agreement or, if Adelphia reasonably determines that registration on the
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Registration Statement is not permitted under the Securities Act, such shares
will be included in a separate effective registration statement at the time such
shares are issued to Citizens. Adelphia agrees that the provisions of Sections
1.08 and 6.03 of the Merger Agreement shall also be applicable to the shares of
Adelphia Class A Common Stock to be issued to Citizens pursuant to this
Agreement. The closing of the purchase and sale of the Citizens JV Interest will
take place at such time, date and place as the Closing of the Merger.
SECTION 2. Citizens Representations and Warranties. Citizens
represents and warrants to Adelphia that:
(a) Citizens has all requisite power and authority to execute
and deliver this Agreement and to consummate the transaction
contemplated hereby. This Agreement has been duly authorized, executed
and delivered by Citizens and (assuming due execution and delivery by
Adelphia) constitutes the legal, valid and binding obligation of
Citizens, enforceable against Citizens in accordance with is terms,
except as such enforceability may be limited by bankruptcy, insolvency,
reorganization or similar laws affecting creditors' rights generally or
by general equitable principles.
(b) Citizens has sole power of disposition with respect to the
Citizens JV Interest.
(c) The Citizens JV Interest is now, and at all times prior to
the Closing Date will be, held by Citizens free and clear of all Liens.
(d) The execution and delivery of this Agreement and
consummation of the transactions contemplated hereby does not:
(i) conflict with or contravene the charter documents
of Citizens, contravene, conflict with or violate any agreement to
which Citizens or the Joint Venture is a party or by which either of
them or any of their property is bound, result in a breach or violation
of or constitute a default under or give rise to termination or any
loss of any material right of or material benefit to the Joint Venture,
or result in the creation of any lien on the Citizens JV Interest or on
any asset of the Joint Venture, except in each case (other than with
respect to the charter documents of Citizens or the Joint Venture) for
such contraventions, conflicts, breaches, violations, defaults, rights
of termination, losses or liens that in the aggregate would not have a
material adverse effect on Citizens or the Joint Venture; or
(ii) require the consent of or notice to any
Governmental Entity or of any third party other than (a) consents under
the HSR Act, (b) consents from or notices to relevant Franchising
Authorities or other third parties in connection with a change of
control of the holder of the Franchises and of the FCC in connection
with a change of control or a transfer of assets of the holder of the
FCC licenses, (c) consents from or notices to lenders under the $200
million Credit Agreement dated as of April 15, 1997 among the Joint
Venture, Societe Generale, as Agent and the banks named therein, (d)
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consent from CTVC and (e) such consents or notices that, if not
obtained or given would not in the aggregate have a material adverse
effect on Citizens or the Joint Venture.
(e) At March 31, 1999, the Joint Venture (1) had not less than
91,000 basic subscribers and (2) had not in excess of $47 million of
liabilities (excluding working capital items incurred in the ordinary
course of business).
(f) Following the transfer of the assets and liabilities of
the Joint Venture to the Century-TCI California joint venture and
transfer of an interest (the "TCI JV Interest") in the Century-TCI
California joint venture to the Joint Venture, the Joint Venture will
not (1) pledge, hypothecate, grant a security interest in, lien,
restrict, transfer, assign, distribute, dividend or otherwise encumber
or dispose of, directly or indirectly, the TCI JV Interest, and (2)
incur, assume or guarantee any indebtedness.
SECTION 3. Adelphia Representations and Warranties. Adelphia represents
and warrants to Citizens that Adelphia has all requisite power and authority to
execute and deliver this Agreement and to consummate the transaction
contemplated hereby. This Agreement has been duly authorized, executed and
delivered by Adelphia and (assuming due execution and delivery by Citizens)
constitutes the legal, valid and binding obligation of Adelphia, enforceable
against Adelphia in accordance with is terms, except as such enforceability may
be limited by bankruptcy, insolvency, reorganization or similar laws affecting
creditors' rights generally or by general equitable principles. In addition,
Adelphia hereby makes all of the representations and warranties contained in
Article 4 of the Merger Agreement to Citizens as if such representations and
warranties were fully set forth herein.
SECTION 4. Conditions.
(a) The respective obligations of the parties to consummate
the transactions contemplated hereby are subject to the satisfaction,
at or prior to the Effective Time, of each of the following conditions:
(1) The Merger shall have been consummated.
(2) All notices to and authorizations, consents,
orders and approvals from applicable Governmental Entities
necessary to consummate the transactions contemplated hereby
shall have been obtained and shall be in effect.
(b) The obligation of Adelphia to consummate the transactions
contemplated by this Agreement is subject to the condition that each of
the representations and warranties of Citizens contained in this
Agreement shall have been true and correct in all material respects
when made and on and as of the Closing Date as if made on and as of
such date, and Citizens shall have executed the mutual release in the
form attached hereto as Exhibit 1.
(c) The obligation of Citizens to consummate the transactions
contemplated by this Agreement is subject to the condition that each of
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the representations and warranties of Adelphia contained in this
Agreement shall have been true and correct in all material respects
when made and on and as of the Closing Date as if made on and as of
such date, and Adelphia shall have executed the mutual release in the
form attached hereto as Exhibit 1.
SECTION 5. Covenants and Acknowledgments.
(a) CTVC and Citizens hereby waive any and all restrictions on
transfer contained in the Joint Venture Agreement or any other
organizational document of the Joint Venture to the extent required to
consummate the transactions contemplated by this Agreement or any other
aspect of Adelphia's acquisition of the Citizens JV Interest.
(b) The parties hereto acknowledge and agree that the Joint
Venture is a Company Subsidiary as that term is defined and used in the
Merger Agreement.
SECTION 6. Miscellaneous.
(a) This Agreement will automatically terminate on the date of
termination of the Merger Agreement.
(b) Upon the closing of the purchase and sale of the Citizens
JV Interest, the Joint Venture Agreement and related Management
Agreement between Citizens and Century shall automatically terminate.
(c) This Agreement will be construed in accordance with and
governed by the law of the state of Delaware applicable to agreements
entered into and to be performed wholly within such State.
(d) This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect
as if the signatures thereto and hereto were upon the same instrument.
this Agreement will become effective when each party shall have
received counterparts hereof signed by all of the other parties.
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IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
duly executed by its respective authorized representative as of the day and year
first above written.
CITIZENS CABLE COMPANY
By: /s/ Leonard Tow
Name: Leonard Tow
Title: Chairman and CEO
ADELPHIA COMMUNICATIONS CORPORATION
By: /s/ Timothy Rigas
Name: Timothy Rigas
Title: Executive Vice President
By executing this signature page, the undersigned agrees to Section 5(a) above:
CENTURY TELECOMMUNICATIONS
VENTURE CORP.
By: /s/ Scott N. Schneider
Name: Scott N. Schneider
Title: CFO
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Exhibit 1
FORM OF MUTUAL RELEASE
For good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged the undersigned, the Citizens
Century Cable Television Venture (the "Joint Venture") and Adelphia
Communications Corporation, a Delaware corporation ("Adelphia"), hereby each
irrevocably release and forever discharge Citizens Cable Company, a Delaware
corporation ("Citizens") as well as its respective successors, assigns,
affiliates, directors, officers, employees, agents, and shareholders, and
Citizens hereby irrevocably releases and forever discharges the Joint Venture
and Adelphia as well as their respective successors, assigns, affiliates,
directors, officers, employees, agents, shareholders and partners (collectively,
the "Released Parties"), from all liabilities, costs, expenses, obligations,
claims and demands of any nature whatsoever which any of the undersigned ever
had, now has or hereafter may have against any of the Released Parties in
connection with the Joint Venture, the Joint Venture Agreement of the Joint
Venture dated as of September 22, 1994 (as the same may have heretofore been or
hereafter be amended, restated, modified or supplemented the "Joint Venture
Agreement"), or arising out of or relating to Citizen's or Century
Telecommunications Venture Corp.'s status as a partner of the Joint Venture,
other than any such liabilities, costs, expenses, obligations, claims and
demands arising out of (i) Citizens and Adelphia's obligations under the
Purchase Agreement dated as of the date hereof pursuant to which Adelphia has
agreed to purchase Citizens' interest in the Joint Venture and (ii) any breach
of any provision of the Joint Venture Agreement which results in a material
adverse effect on the non-breaching party and is caused by, results from or
arises out of an act of fraud, gross negligence or willful misconduct on the
part of the breaching party (each a "Released Claim").
The undersigned agree to execute and deliver such additional
releases and other documents which may be reasonably necessary to evidence the
release contemplated hereby.
This Mutual Release may be executed in one or more
counterparts which, when taken together, shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the undersigned have executed this Mutual
Release as of the ________ day of July, 1999.
CITIZENS CENTURY CABLE
TELEVISION VENTURE
By: CENTURY TELECOMMUNICATIONS VENTURE CORP., as partner
By:
Name:
Title:
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ADELPHIA COMMUNICATIONS CORP.
By:
Name:
Title:
CITIZENS CABLE COMPANY
By:
Name:
Title:
