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Exhibit 1.1
EXECUTION COPY
CSC HOLDINGS, INC.
(a Delaware corporation)
7 5/8 % Senior Notes due 2011
PURCHASE AGREEMENT
Dated: March 15, 2001
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CSC HOLDINGS, INC.
(a Delaware corporation)
$1,000,000,000 7 5/8 % Senior Notes due 2011
PURCHASE AGREEMENT
March 15, 2001
To the Initial Purchasers Named in Schedule I
Ladies and Gentlemen:
CSC Holdings, Inc., a Delaware corporation (the "Company"),
proposes to issue and sell to you (the "Initial Purchasers") $1,000,000,000
aggregate principal amount of its 7 5/8% Senior Notes due 2011 (the
"Securities"). The Securities are to be sold to each Initial Purchaser, acting
severally and not jointly, in the respective principal amounts as are set forth
in Schedule I opposite the name of the Initial Purchaser. The Securities are to
be issued pursuant to an indenture to be dated as of March 22, 2001 (the
"Indenture"), between the Company and The Bank of New York, as trustee (the
"Trustee"). The Securities and the Indenture are more fully described in the
Offering Memorandum referred to below. Capitalized terms used herein without
definition have the respective meanings specified in the Offering Memorandum.
The Securities will be offered and sold to you without each
being registered under the Securities Act of 1933, as amended (the "1933 Act"),
in reliance on an exemption therefrom. The Company has prepared an offering
memorandum, dated March 15, 2001 (such offering memorandum, together with the
documents incorporated by reference therein in the form first furnished to the
Initial Purchasers for use in connection with the offering of the Securities,
being hereinafter referred to as the "Offering Memorandum"), setting forth
information regarding the Company and the Securities. The Company hereby
confirms that it has authorized the use of the Offering Memorandum in connection
with the offering and resale of the Securities.
The Company understands that you propose to make an offering
of the Securities on the terms set forth in the Offering Memorandum, as soon as
you deem advisable after this Agreement has been executed and delivered, (i) to
persons in the United States whom you reasonably believe to be qualified
institutional buyers ("Qualified Institutional Buyers") as defined in Rule 144A
under the 1933 Act, as such rule may be amended from time to time ("Rule 144A"),
in a transaction under Rule 144A and/or (ii) to non-U.S. persons outside the
United States to whom offers and sales of the Securities may be made in reliance
upon Regulation S under the 1933 Act, provided that such offers and sales are
made in the manner contemplated by Section 2(d) hereof.
The holders of the Securities will be entitled to the benefits
of a registration rights agreement to be dated as of March 22, 2001 (the
"Registration Rights Agreement") between you and the Company, substantially in
the form attached hereto as Exhibit A.
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Section 1. Representations and Warranties. (a) The Company
represents and warrants to you and agrees that:
(i) As of the date of the Offering Memorandum, and at all
times subsequent thereto up to the Closing Time referred to below,
neither the Offering Memorandum nor any amendment or supplement thereto
will include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading,
except that this representation and warranty does not apply to
statements or omissions made in reliance upon and in conformity with
information furnished in writing by you to the Company expressly for
use in the Offering Memorandum or any amendment or supplement thereto.
(ii) The documents incorporated by reference in the Offering
Memorandum, at the time they were filed with the Securities and
Exchange Commission (the "Commission"), complied in all material
respects with the requirements of the Securities Exchange Act of 1934,
as amended (the "1934 Act"), and the rules and regulations of the
Commission thereunder (the "1934 Act Regulations").
(iii) When the Securities are issued and delivered pursuant to
this Agreement, such Securities will not be of the same class (within
the meaning of Rule 144A) as securities of the Company which are listed
on a national securities exchange registered under Section 6 of the
1934 Act or quoted in a U.S. automated inter-dealer quotation system.
(iv) The Company is subject to Section 13 or 15(d) of the 1934
Act.
(v) Neither the Company nor any affiliate (as defined in Rule
501(b) under the ▇▇▇▇ ▇▇▇) of the Company has, directly or through any
agent, sold, offered for sale, solicited offers to buy, or otherwise
negotiated in respect of, any security (as defined in the 1933 Act)
which is or will be integrated with the sale of the Securities in a
manner that would require the registration of the Securities under the
1933 Act.
(vi) None of the Company, any of its affiliates or any person
acting on its or their behalf (other than you, as to whom the Company
makes no representation) has engaged, in connection with the offering
of the Securities, in any form of general solicitation or general
advertising within the meaning of Rule 502(c) under the 1933 Act. With
respect to those Securities sold in reliance on Regulation S, (A) none
of the Company, its affiliates or any person acting on its or their
behalf (other than you, as to whom the Company makes no representation)
has engaged in any directed selling efforts within the meaning of
Regulation S and (B) each of the Company, its affiliates and each
person acting on its or their behalf (other that you, as whom the
Company makes no representation) has complied with the offering
restrictions requirement of Regulation S.
(vii) KPMG LLP, who are reporting upon the audited financial
statements and schedules included or incorporated by reference in the
Offering Memorandum, are independent accountants within the meaning of
Rule 101 of the American Institute of Certified Public Accountants.
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(viii) The consolidated historical financial statements
included or incorporated by reference in the Offering Memorandum
present fairly the consolidated financial position of the Company and
its subsidiaries as of the dates indicated and the consolidated results
of operations and changes in financial position of the Company and its
subsidiaries for the periods specified. Such financial statements have
been prepared in conformity with generally accepted accounting
principles applied on a consistent basis throughout the periods
involved. The selected financial data included in the Offering
Memorandum present fairly the information shown therein and have been
compiled on a basis consistent with that of the audited consolidated
financial statements included or incorporated by reference in the
Offering Memorandum.
(ix) The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware
with power and authority (corporate and other) under such laws to own,
lease and operate its properties and conduct its business as described
in the Offering Memorandum; and the Company is duly qualified to
transact business as a foreign corporation and is in good standing in
each other jurisdiction in which it owns or leases property of a
nature, or transacts business of a type, that would make such
qualification necessary, except to the extent that the failure to so
qualify or be in good standing would not have a material adverse effect
on the Company and its subsidiaries, considered as one enterprise.
(x) The subsidiaries of the Company set forth on Schedule III
are, as of the date hereof, all of the "Restricted Subsidiaries", as
such term is defined in the Indenture and the Bank Credit Agreement (as
such term is defined in the Indenture). The subsidiaries of the Company
set forth on Schedule IV are "Unrestricted Subsidiaries", as such term
is defined in the Indenture (the Restricted Subsidiaries and the
Unrestricted Subsidiaries are hereinafter referred to collectively as
the "Subsidiaries"). The Subsidiaries on Schedules III and IV with an
asterisk by their names are the only subsidiaries of the Company which
had at December 31, 2000 assets in excess of 10% of the consolidated
assets of the Company and its subsidiaries as at that date or had, in
the aggregate, for the fiscal year then ended revenues or operating
cash flow in excess of 10% of consolidated revenues or consolidated
operating cash flow of the Company and its subsidiaries for such period
(such Subsidiaries are referred to herein as the "Material
Subsidiaries"). In making this determination, any subsidiary acquired
after December 31, 2000 shall be deemed to have been acquired as of
such date.
(xi) Each Material Subsidiary that is a corporation is duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation with power and authority (corporate
and other) under such laws to own, lease and operate its properties and
conduct its business; and each such Material Subsidiary is duly
qualified to transact business as a foreign corporation and is in good
standing in each other jurisdiction in which it owns or leases property
of a nature, or transacts business of a type, that would make such
qualification necessary, or the Company is subject to no material
liability or disability by reason of any failure of such Material
Subsidiary to be so qualified or in good standing. All of the
outstanding shares of capital stock of each Material Subsidiary have
been duly authorized and validly issued and are fully paid and
nonassessable and, except as disclosed on Schedule III or IV to this
Agreement or as
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disclosed or contemplated by the Offering Memorandum, are owned by the
Company, directly or through one or more subsidiaries, free and clear
of any pledge, lien, security interest, charge, claim, equity or
encumbrance of any kind.
(xii) Each of the Material Subsidiaries in which the Company
or a subsidiary of the Company is a limited or general partner
(hereinafter called the "Partnerships") has been duly formed and is
validly existing as a limited or general partnership, as the case may
be, under the laws of its jurisdiction of organization, with full power
and authority to own, lease and operate properties and conduct its
business; all necessary filings with respect to the formation of the
Partnerships as limited or general partnerships (as the case may be)
have been made under such laws; and each of the Partnerships is duly
qualified to transact business and is in good standing in each other
jurisdiction in which it owns or leases property of a nature, or
transacts business of a type, that would make such qualification
necessary, or the Company is subject to no material liability or
disability by reason of any failure of such Partnerships to be so
qualified and in good standing.
(xiii) The Company had at December 31, 2000 a duly authorized
and outstanding capitalization as set forth in the Offering Memorandum
under the caption "Capitalization"; the Securities conform in all
material respects to the description thereof contained in the Offering
Memorandum and such description conforms in all material respects to
the rights set forth in the instruments defining the same.
(xiv) The Securities have been duly authorized by the Company.
When executed, authenticated, issued and delivered in the manner
provided for in the applicable Indenture and sold and paid for as
provided herein, the Securities will constitute valid and binding
obligations of the Company entitled to the benefits of the applicable
Indenture and enforceable against the Company in accordance with their
terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and general principles of
equity (regardless of whether enforcement is considered in a proceeding
in equity or at law).
(xv) All of the outstanding shares of capital stock of the
Company have been duly authorized and validly issued and are fully paid
and nonassessable; and none of the outstanding shares of capital stock
of the Company was issued in violation of the preemptive rights of any
stockholder of the Company.
(xvi) This Agreement has been duly authorized, executed and
delivered by the Company.
(xvii) Each of the Indenture and the Registration Rights
Agreement has been duly authorized by the Company, will be
substantially in the form heretofore delivered to you or attached
hereto as Exhibit A, respectively, and, when duly executed and
delivered by the Company and the other parties thereto will constitute
a valid and binding obligation of the Company, enforceable against the
Company in accordance with its terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar
laws of general applicability relating to or affecting creditors'
rights and
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general principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law) and, in the case of the
Registration Rights Agreement, except as any rights to indemnity
thereunder may be limited by federal and state securities laws and
public policy considerations underlying such laws; and the form of the
Indenture conforms in all material respects to the description thereof
contained in the Offering Memorandum.
(xviii) Since the respective dates as of which information is
given in the Offering Memorandum, except as otherwise stated therein or
contemplated thereby, there has not been (A) any material loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree and there has
not been any change in the capital stock or long-term debt of the
Company or any of its Subsidiaries or any change which the Company has
reasonable cause to believe will involve any material adverse change,
or any development involving a prospective material adverse change, in
or affecting the financial position, stockholder's equity or results of
operations of the Company and its subsidiaries, considered as one
enterprise, or (B) any transaction entered into by the Company or any
subsidiary, other than in the ordinary course of business, that is
material to the Company and its subsidiaries, considered as one
enterprise, or (C), except for the cash and stock dividends on the
Series H Preferred Stock and the Series M Preferred Stock, any dividend
or distribution of any kind declared, paid or made by the Company on
its capital stock.
(xix) Neither the Company nor any Subsidiary is in default in
the performance or observance of any obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, loan
agreement, note, lease or other agreement or instrument to which it is
a party or by which it may be bound or to which any of its properties
may be subject, except for such defaults that would not have a material
adverse effect on the financial position, stockholder's equity or
results of operations of the Company and its subsidiaries, considered
as one enterprise. The execution and delivery of this Agreement, the
Indenture and the Registration Rights Agreement (collectively, the
"Operative Documents"), the issuance and delivery of the Securities,
the consummation by the Company of the transactions contemplated by the
Operative Documents and the compliance by the Company with the terms of
the Operative Documents have been duly authorized by all necessary
corporate action on the part of the Company and do not and will not
result in any violation of the charter or by-laws of the Company or any
Subsidiary, and do not and will not conflict with, or result in a
breach of any of the terms or provisions of, or constitute a default
under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any
Subsidiary under, (A) any contract, indenture, mortgage, loan
agreement, note, lease or other agreement or instrument to which the
Company or any Subsidiary is a party or by which it may be bound or to
which any of its properties may be subject (except for such conflicts,
breaches or defaults or liens, charges or encumbrances that would not
have a material adverse effect on the financial position, stockholder's
equity or results of operations of the Company and its subsidiaries,
considered as one enterprise) or (B) any existing applicable law, rule,
regulation, judgment, order or decree of any government, governmental
instrumentality or court, domestic or foreign, having jurisdiction over
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Company or any Subsidiary or any of its properties (except for such
conflicts, breaches or defaults or liens, charges or encumbrances that
would not have a material adverse effect on the financial position,
stockholder's equity or results of operations of the Company and its
subsidiaries, considered as one enterprise) or (C) any material
agreement or other material instrument (including any franchise
agreement, license, permit or other governmental authorization granted
by the Federal Communications Commission (hereinafter called the
"FCC"), The New York State Public Service Commission on Cable
Television or any other governing body having jurisdiction over cable
television operations) binding upon the Company or any of its
Subsidiaries (except for such conflicts, breaches or defaults or liens,
charges or encumbrances that would not have a material adverse effect
on the financial position, stockholder's equity or results of
operations of the Company and its subsidiaries, considered as one
enterprise).
(xx) The statements in the Offering Memorandum under "Risk
Factors" and "Description of Securities" and the statements in the
Company's annual report on Form 10-K for the year ended December 31,
1999 (the "1999 Form 10-K"), which is incorporated by reference in the
Offering Memorandum, under "Business -- Competition -- Cable
Television" and "Business -- Regulation -- Cable Television", insofar
as such statements constitute a summary of the legal matters, documents
or proceedings referred to therein, with respect to such legal matters,
documents and proceedings, do not contain any untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements therein not
misleading.
(xxi) Except as disclosed in the Offering Memorandum, no
authorization, approval, consent or license of any government,
governmental instrumentality or court, domestic or foreign, is required
(i) for the valid authorization, issuance, sale and delivery of the
Securities in the United States, or (ii) for the execution, delivery or
performance by the Company of this Agreement, the Indenture or the
Registration Rights Agreement except for registrations in connection
with the registration of the Securities pursuant to the Registration
Rights Agreement under the 1933 Act and registrations under state
securities or blue sky laws and except for any such consent, approval,
authorization, order or registration the failure of which to obtain or
make or the absence of which would result in no material adverse effect
on the Company and its subsidiaries, considered as one enterprise.
(xxii) Except as disclosed in the Offering Memorandum, there
is no action, suit or proceeding before or by any government,
governmental instrumentality or court, domestic or foreign, now pending
or, to the best of the Company's knowledge, threatened against or
affecting the Company or any Subsidiary that the Company has reasonable
cause to believe will result in any material adverse change in the
consolidated financial position, stockholder's equity or results of
operations of the Company and its subsidiaries, considered as one
enterprise, or that will materially and adversely affect the properties
or assets of the Company and its subsidiaries, considered as one
enterprise, or that the Company has reasonable cause to believe will
materially adversely affect the consummation of the transactions
contemplated in this Agreement.
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(xxiii) The Company and the Subsidiaries each has good and
marketable title to all material properties and assets described in the
Offering Memorandum as owned by it, free and clear of all liens,
charges, encumbrances or restrictions, except such as (A) are described
in the Offering Memorandum or (B) are neither material in amount nor
materially significant in relation to the business of the Company and
its subsidiaries, considered as one enterprise; and any material real
property and buildings under lease by the Company and the Subsidiaries
are held by them under valid, subsisting and enforceable leases with
such exceptions as do not interfere, to an extent material to the
Company and its subsidiaries, considered as one enterprise, with the
use made and proposed to be made of such property and buildings by the
Company and the Subsidiaries.
(xxiv) Except as disclosed in the Offering Memorandum, the
Company and the Subsidiaries each owns, possesses or has obtained all
material agreements, governmental licenses, permits, certificates,
consents, orders, approvals and other material authorizations
(including, without limitation, all material governmental
authorizations and agreements with public utilities and microwave
transmission companies and pole access and rental agreements) necessary
to own or lease, as the case may be, and to operate its properties and
to carry on its business as presently conducted; and neither the
Company nor any Subsidiary has received any notice of proceedings
relating to revocation or modification of any such licenses, permits,
certificates, consents, orders, approvals or authorizations.
(xxv) To the best knowledge of the Company and except as
disclosed in the Offering Memorandum, no labor problem exists with its
employees or with employees of the Subsidiaries that could reasonably
be expected to materially and adversely affect the financial position,
stockholder's equity or results of operations of the Company and its
subsidiaries, considered as one enterprise.
(b) Any certificate signed by any officer of the Company or
any Subsidiary and delivered to you or to counsel for the Initial Purchasers in
connection with the offering of the Securities shall be deemed a representation
and warranty by the Company to each Initial Purchaser as to the matters covered
thereby.
Section 2. Purchase, Sale and Resale of the Securities;
Closing. (a) On the basis of the representations and warranties herein
contained, and subject to the terms and conditions herein set forth, the Company
agrees to sell to you, and you agree, severally and not jointly, to purchase
from the Company, at the purchase price to be paid by the Initial Purchasers set
forth in Schedule II, the principal amount of Securities set forth opposite your
name on Schedule I, plus accrued interest, if any, from March 22, 2001, plus any
additional principal amount of Securities which you may become obligated to
purchase pursuant to Section 10 hereof.
(b) Payment of the purchase price for, and delivery of, the
Securities shall be made at the offices of Shearman & Sterling, ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or at such other place in The City of New
York, at 10:00 A.M. on March 22, 2001, or at such other time not more than ten
full Business Days thereafter as shall be agreed upon by the
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Company and you, or as shall otherwise be provided in Section 10 (such date and
time of payment and delivery being herein called the "Closing Time"). Payment
shall be made by wire transfer of same day federal funds to the Company to an
account designated by the Company to the Initial Purchasers, against delivery of
the Securities to you for the respective accounts of the several Initial
Purchasers. Except as otherwise provided in Schedule II hereto, the Securities
shall be in such denominations ($1,000 or an integral multiple thereof) and
registered in such names as you may request in writing at least two full
business days before the Closing Time.
(c) You have advised the Company that you propose to offer the
Securities for sale at the price set forth on Schedule II, upon the terms and
conditions set forth in this Agreement and in the Offering Memorandum. Each of
you hereby, severally, represents and warrants to, and agrees with, the Company
that you (i) are a qualified institutional buyer within the meaning of Rule 144A
(a "Qualified Institutional Buyer"), (ii) have not and will not solicit offers
for, or offer or sell, such Securities by means of any form of general
solicitation or general advertising or in any manner involving a public offering
within the meaning of Section 4(2) of the 1933 Act, including but not limited to
the methods described in Rule 502(c) of the 1933 Act, (iii) have not and will
not engage in any directed selling efforts (as defined in Rule 902 of the ▇▇▇▇
▇▇▇) in the United States in connection with the Securities being offered and
sold pursuant to Regulation S under the 1933 Act and (iv) have solicited and
will solicit offers for such Securities only from, and have offered and will
offer, sell or deliver such Securities, as part of their initial offering, only
to (A) persons in the United States whom you reasonably believe to be Qualified
Institutional Buyers or, if any such person is buying for one or more
institutional accounts for which such person is acting as fiduciary or agent,
only when such person has represented to you that each such account is a
Qualified Institutional Buyer to whom notice has been given that such sale or
delivery is being made in reliance on Rule 144A, and, in each case, in a
transaction under Rule 144A and (B) non-U.S. persons outside the United States
to whom offers and sales of the Securities may be made in reliance upon
Regulation S under the 1933 Act.
(d) In connection with the transactions described in Section
2(c)(iv)(B), each Initial Purchaser, severally, represents and warrants to, and
agrees with, the Company that such Initial Purchaser will sell the Securities in
such transactions only in accordance with Regulation S under the 1933 Act and
has not offered or sold, and will not offer or sell, the Securities to, or for
the account or benefit of, U.S. persons (i) as part of its distribution at any
time or (ii) otherwise until 40 days after the Closing Time, and each Initial
Purchaser will send to each distributor, dealer or other person receiving a
selling concession, fee or remuneration to which it sells the Securities during
the restricted period a confirmation or other notice setting forth the
restrictions on offers and sales of the Securities within the United States or
to, or for the account or benefit of, U.S. persons. Terms used in this paragraph
have the meanings given to them by Regulation S under the 1933 Act.
(e) Each of you hereby severally represents that (i) it has
not offered or sold, and will not offer or sell, any Securities in the United
Kingdom by means of any document, other than to persons whose ordinary
activities involve them in acquiring, holding, managing or disposing of
investments (as principal or agent) for the purposes of their businesses or
otherwise in transactions which have not resulted and will not result in an
offer to the public within the meaning of the Public Offer of Securities
Regulations 1995 (the "Regulations"), (ii) it has complied and will comply with
all applicable provisions of the Financial Services ▇▇▇ ▇▇▇▇ and
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the Regulations with respect to anything done by it in relation to the
Securities in, from or otherwise involving the United Kingdom, and (iii) it has
only issued or passed on and will only issue or pass on to any persons in the
United Kingdom any document received by it in connection with the issue of the
Securities if that person is of a kind described in Article 11(3) of the
Financial Services ▇▇▇ ▇▇▇▇ (Investment Advertisements) (Exemptions) Order 1988
or is a person to whom such document may otherwise lawfully be issued or passed
on.
(f) Each of you severally represents that it has not offered
or sold and will not offer or sell any Securities in transactions described in
Section 2(c)(iv)(B) except in compliance with the applicable laws and
regulations of the jurisdictions in which such sales occur.
Section 3. Certain Covenants of the Company. The Company
covenants with you as follows:
(a) The Company has furnished or will furnish to you as many
copies of the Offering Memorandum, as it may then be amended or supplemented, as
you may reasonably request from time to time.
(b) The Company will not at any time make any amendment or
supplement to the Offering Memorandum (other than amendments of the documents
incorporated by reference to the Offering Memorandum or the filing of subsequent
documents under the 1934 Act), of which you shall not have previously been
advised and furnished a copy, or to which you or your counsel shall reasonably
object. The Company shall not file any document under the 1934 Act before the
completion of the offering of the Securities by you, if such document would be
deemed to be incorporated by reference in the Offering Memorandum and if the
filing of such document would cause the Offering Memorandum, as amended or
supplemented by the filing of such document, to contain an untrue statement of a
material fact or to omit to state a material fact necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading.
(c) If at any time prior to completion of the distribution of
the Securities by you to purchasers who are not your affiliates, any event shall
occur or condition exist as a result of which it is necessary, in the opinion of
counsel for you or counsel for the Company to amend or supplement the Offering
Memorandum in order that the Offering Memorandum will not include an untrue
statement of a material fact or omit to state a material fact necessary in order
to make the statements therein not misleading in the light of the circumstances
existing at the time it is delivered to a purchaser, the Company will promptly
prepare such amendment or supplement as may be necessary to correct such untrue
statement or omission and furnish you such number of copies as you may
reasonably request. Except as otherwise required by the preceding sentence, the
Company will not be obligated to update the Offering Memorandum. Such updating
may be done by means of the filing of one or more documents under the 1934 Act
which are deemed incorporated by reference in the Offering Memorandum.
(d) Notwithstanding any provision of paragraph (b) or (c) to
the contrary, however, the Company's obligations under paragraphs (b) and (c)
shall terminate on the earliest to occur of (i) the third anniversary of the
Closing Time, (ii) the closing date of an Exchange Offer pursuant to the
Registration Rights Agreement, (iii) the effective date of a Shelf
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Registration Statement pursuant to the Registration Rights Agreement and (iv)
the date upon which you and your affiliates cease to hold Securities acquired by
you as part of their initial distribution.
(e) The Company will use its reasonable best efforts, in
cooperation with you, to qualify the Securities for offering and sale under the
applicable securities laws of such states and other jurisdictions as you may
designate, if any, and to maintain such qualifications in effect for a period of
not less than one year from the date of the Offering Memorandum; provided,
however, that the Company shall not be obligated to file any general consent to
service of process or to qualify as a foreign corporation or as a dealer in
securities in any jurisdiction in which it is not so qualified or to subject
itself to taxation in respect of doing business in any jurisdiction in which it
is not otherwise so subject. The Company will file such statements and reports
as may be required by the laws of each jurisdiction in which the Securities have
been qualified as above provided.
(f) For a period of three years after the Closing Time, the
Company will furnish to you copies of all annual reports, quarterly reports and
current reports filed with the Commission on Forms 10-K, 10-Q and 8-K, or such
other similar forms as may be designated by the Commission, and such other
documents, reports and information as shall be furnished by the Company to its
securityholders generally.
(g) Neither the Company nor any affiliate (as defined in Rule
501(b) of the ▇▇▇▇ ▇▇▇) will solicit any offer to buy or offer or sell the
Securities by means of any form of general solicitation or general advertising.
With respect to those Securities sold in reliance on Regulation S, (A) none of
the Company, its affiliates or any person acting on its or their behalf (other
than you, as to whom the Company makes no representation) will engage in any
directed selling efforts within the meaning of Regulation S and (B) each of the
Company, its affiliates and each person acting on its or their behalf (other
than you, as to whom the Company makes no representation) will comply with the
offering restrictions requirement of Regulation S.
(h) Neither the Company nor any affiliate (as defined in Rule
501(b) of the ▇▇▇▇ ▇▇▇) of the Company will offer, sell or solicit offers to buy
or otherwise negotiate in respect of any security (as defined in the 1933 Act)
which will be integrated with the sale of the Securities in a manner that would
require the registration of the Securities under the 1933 Act at a time when
such Securities are not so registered.
(i) The Company will not be or become, at any time prior to
the expiration of three years after the Closing Time, an open-end investment
trust, unit investment trust or face-amount certificate company that is or is
required to be registered under Section 8 of the Investment Company Act of 1940,
as amended (the "Investment Company Act").
(j) During the period from the Closing Time to the earlier of
(i) two years after the Closing Time, or (ii) the date of effectiveness of a
registration statement as contemplated in the Registration Rights Agreement, the
Company will not, and will not permit any of its "affiliates" (as defined in
Rule 144 under the ▇▇▇▇ ▇▇▇) to, resell any of the Securities that have been
reacquired by them, except for Securities purchased by the Company or any of its
affiliates and resold in a transaction registered under the 1933 Act.
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(k) The Company will, so long as the Securities are
outstanding and are "restricted securities" within the meaning of Rule 144(a)(3)
under the 1933 Act, either (i) file reports and other information with the
Commission under Section 13 or 15(d) of the 1934 Act, or (ii) in the event it is
not subject to Section 13 or 15(d) of the 1934 Act, furnish to holders of
Securities and prospective purchasers of Securities designated by such holders,
upon request of such holders or such prospective purchasers, the information
required to be delivered pursuant to Rule 144A(d)(4) under the 1933 Act to
permit compliance with Rule 144A in connection with resales of the Securities.
(l) The Company will use its reasonable best efforts in
cooperation with you to permit the Securities sold in transactions described in
Section 2(c)(iv)(A) to be eligible for clearance and settlement through The
Depository Trust Company.
(m) Each of the Securities will bear the following legend
until, in the opinion of counsel to the Company, such legend is no longer
advisable because the Securities are no longer subject to the restrictions on
transfer described therein:
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN
MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION. THE HOLDER OF THIS SECURITY BY ITS
ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY,
PRIOR TO THE DATE WHICH IS TWO YEARS AFTER THE DATE OF ORIGINAL ISSUE HEREOF
ONLY (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN
DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES
ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY
BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING
MADE IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (D) PURSUANT TO
OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES
MEETING THE REQUIREMENTS OF RULE 903 OR 904 OF REGULATION S UNDER THE SECURITIES
ACT, OR (E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT; PROVIDED THAT THE COMPANY SHALL HAVE THE
RIGHT PRIOR TO ANY SUCH OFFER, SALE, PLEDGE OR TRANSFER PURSUANT TO CLAUSE (E)
ABOVE TO REQUIRE THE DELIVERY OF AN OPINION (IN FORM AND SUBSTANCE SATISFACTORY
TO THE COMPANY) OF COUNSEL SATISFACTORY TO THE COMPANY, AND CERTIFICATION AND/OR
OTHER INFORMATION SATISFACTORY TO THE COMPANY.
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(n) The Company will apply the net proceeds that it receives
from the offer and sale of the Securities in the manner set forth in the
Offering Memorandum under the caption "Use of Proceeds".
(o) The Company has been advised in writing by KPMG LLP,
independent public accountants to the Company, that the consolidated financial
statements and schedules audited by them and included in the Company's 1999 Form
10-K comply in form in all material respects with the applicable accounting
requirements of the 1934 Act and the related published rules and regulations
thereunder.
Section 4. Payment of Expenses. The Company will pay and bear
all costs and expenses incident to the performance of its obligations under this
Agreement, including (a) the preparation and printing of the Offering Memorandum
and any amendments or supplements thereto, and the cost of furnishing copies
thereof to the Initial Purchasers, (b) the preparation, printing and
distribution of this Agreement, the Indenture and the Securities, (c) the
delivery of the Securities to the Initial Purchasers, (d) the fees and
disbursements of the Company's counsel and accountants, (e) any fees charged by
rating agencies for rating the Securities and (f) the fees and expenses of the
Trustee, including the fees and disbursements of counsel for the Trustee and the
Transfer Agent, in connection with the Indenture and the Securities.
If this Agreement is terminated by you in accordance with the
provisions of Section 5 or 9(a)(i), the Company shall reimburse the Initial
Purchasers for their reasonable out-of-pocket expenses, including the reasonable
fees and disbursements of counsel for the Initial Purchasers.
Section 5. Conditions of Initial Purchasers' Obligations. The
obligations of the several Initial Purchasers to purchase and pay for the
Securities that they have respectively agreed to purchase hereunder are subject
to the accuracy of the representations and warranties of the Company contained
herein or in certificates of any officer of the Company or any Subsidiary
delivered pursuant to the provisions hereof, to the performance by the Company
of its obligations hereunder, and to the following further conditions:
(a) At the Closing Time, you shall have received a signed
opinion of ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel for the Company, dated as of the Closing
Time, in form and substance satisfactory to counsel for the Initial Purchasers,
to the effect that:
(i) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware.
(ii) Each of the Indenture and the Registration Rights
Agreement has been duly authorized, executed and delivered by the
Company; the Securities have been duly authorized, executed,
authenticated, issued and delivered; and the Indenture and the
Securities constitute valid and legally binding obligations of the
Company enforceable in accordance with their terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium
and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles.
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(iii) The execution and delivery by the Company of the
Indenture, this Agreement and the Registration Rights Agreement, the
issuance of the Securities in accordance with the Indenture and the
sale of the Securities by the Company to you pursuant to this Agreement
do not, and the performance by the Company of its obligations under the
Indenture and this Agreement will not, violate the Company's
Certificate of Incorporation or By-Laws.
(iv) All regulatory consents, authorizations, approvals and
filings required to be obtained or made by the Company under the
Federal laws of the United States, the laws of the State of New York
and the General Corporation Law of the State of Delaware for the
issuance, sale and delivery of the Securities by the Company to you
have been obtained or made.
(v) This Agreement has been duly authorized, executed and
delivered by the Company.
(vi) Neither registration of the Securities under the 1933 Act
nor qualification of the Indenture under the Trust Indenture Act of
1939 is required for (i) the offer and sale of the Securities by the
Company to the Initial Purchasers or (ii) the reoffer and resale of the
Securities by the Initial Purchasers, in each case (i) and (ii) in the
manner contemplated by the Purchase Agreement and the Offering
Memorandum relating to the Securities.
Such counsel shall also furnish you with a letter to the
effect that as counsel to the Company, they reviewed the Offering Memorandum,
participated in discussions with representatives of the Initial Purchasers and
of the Company and its accountants; between the execution of this Agreement and
the Closing Time, such counsel participated in further discussions with
representatives of the Initial Purchasers and of the Company and its accountants
in which the contents of certain portions of the Offering Memorandum and related
matters were discussed and reviewed, reviewed certain documents filed by the
Company with the Commission, certificates of certain officers of the Company, an
opinion addressed to the Initial Purchasers from ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq., Vice
Chairman, Secretary and General Counsel for the Company, and a letter from the
Company's independent accountants; on the basis of the information that such
counsel gained in the course of the performance of the services referred to
above, considered in the light of such counsel's understanding of the applicable
law and the experience such counsel have gained through their practice, they
confirm to you that, in such counsel's opinion, nothing that came to such
counsel's attention in the course of such review has caused such counsel to
believe that, as of the date of the Offering Memorandum or as of the date
hereof, the Offering Memorandum contained or contains any untrue statement of a
material fact or omitted or omits to state any material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; such counsel shall
state that the limitations inherent in the independent verification of factual
matters and the character of determinations involved in the process of preparing
an offering memorandum are such that such counsel does not assume any
responsibility for the accuracy, completeness or fairness of the statements
contained in the Offering Memorandum except for those made under the captions
"Description of Securities" and "Plan of Distribution" in the Offering
Memorandum insofar as they relate to provisions of documents therein described;
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also, such counsel need express no opinion or belief as to the financial
statements, pro forma financial statements, if any, or other financial data
contained in the Offering Memorandum, or as to the description of statutes,
regulations, proceedings or matters referred to in Section 5(c) hereof.
In rendering such opinion, such counsel may state that they
express no opinion as to the laws of any jurisdiction other than the Federal
laws of the United States, the laws of the State of New York and the General
Corporation Law of the State of Delaware, and no opinion as to federal or state
communications laws. Such counsel may also state that, insofar as such opinion
involves factual matters, they have relied, to the extent they deem proper, upon
certificates of officers of the Company and the Subsidiaries and certificates of
public officials.
(b) At the Closing Time, you shall have received a signed
opinion of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq., Vice Chairman, Secretary and General Counsel
for the Company, in form and substance satisfactory to counsel to the Initial
Purchasers, to the effect that:
(i) The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware
with corporate power and authority under such laws to own, lease and
operate its properties and conduct its business as described in the
Offering Memorandum.
(ii) The Company is duly qualified to transact business as a
foreign corporation and is in good standing in each other jurisdiction
in which it owns or leases property of a nature, or transacts business
of a type, that would make such qualification necessary, except where
the failure to be so qualified would not have a material adverse effect
on the Company and its subsidiaries, considered as one enterprise.
(iii) Each Material Subsidiary that is a corporation is duly
incorporated, validly existing and in good standing under the laws of
the jurisdiction of its incorporation, with corporate power and
authority under such laws to own, lease and operate its properties and
conduct its business. Each Material Subsidiary that is a partnership is
duly organized under the laws of the jurisdiction of its organization.
(iv) All of the outstanding shares of capital stock of each
Material Subsidiary have been duly authorized and validly issued and
are fully paid and nonassessable; except as set forth on Schedules III
and IV to this Agreement or as disclosed in or as contemplated by the
Offering Memorandum, all of such shares are owned by the Company,
directly or through one or more subsidiaries, free and clear of any
material pledge, lien, security interest, charge, claim, equity or
encumbrance of any kind; no holder thereof is subject to personal
liability under the certificate of incorporation or by-laws of the
respective Material Subsidiary or the corporation law of the
jurisdiction in which such Material Subsidiary is organized by reason
of being such a holder and none of such shares was issued in violation
of the preemptive rights of any stockholder of such Material Subsidiary
under the certificate of incorporation or by-laws of such Material
Subsidiary or the corporation law of the jurisdiction in which such
Material Subsidiary is organized.
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(v) To such counsel's knowledge, there are no legal or
governmental proceedings pending or threatened to which the Company or
any of its subsidiaries is or may be a party, or of which any of their
properties are or may be the subject, of a character which are required
to be disclosed in the 1999 Form 10-K or any Form 10-Q of the Company,
other than those disclosed therein.
(vi) The documents incorporated by reference in the Offering
Memorandum or any further amendment or supplement thereto made by the
Company prior to the Closing Time (other than the financial statements
and related schedules therein and any untrue statement or omission of a
material fact contained therein which was corrected in the Offering
Memorandum, as to which such counsel need express no opinion), when
they were filed with the Commission, complied as to form in all
material respects with the requirements of the Exchange Act and the
rules and regulations of the Commission thereunder; and he has no
reason to believe that such documents, read together, as of the date of
the Offering Memorandum or as of the Closing Time, contained or contain
an untrue statement of a material fact or omitted or omit to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
(vii) Such counsel does not know of any contracts or documents
of a character required to be described or referred to in the documents
incorporated by reference in the Offering Memorandum or to be filed as
exhibits to the documents incorporated by reference in the Offering
Memorandum that are not described, referred to or filed as required.
(viii) To the knowledge of such counsel, no default exists in
the performance or observance of any material obligation, agreement,
covenant or condition contained in any contract, indenture, loan
agreement, note, lease or other agreement or instrument that is
described or referred to in the Company's 1999 Form 10-K or filed as an
exhibit to the 1999 Form 10-K or any subsequent Form 10-Q of the
Company, which default would have a material adverse effect on the
financial position, stockholder's equity or results of operations of
the Company and its subsidiaries, considered as one enterprise.
(ix) The execution and delivery of this Agreement, the
Indenture and the Registration Rights Agreement by the Company, the
issuance and delivery of the Securities, the consummation by the
Company of the transactions contemplated in this Agreement and
compliance by the Company with the terms of this Agreement, the
Indenture and the Registration Rights Agreement will not conflict with
the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement or other agreement
or instrument (including any franchise agreement, license, permit or
other governmental authorization granted by the FCC, The New York State
Public Service Commission on Cable Television or any other Federal or
New York State governing body having jurisdiction over cable television
operations) known to such counsel to which the Company or any
Subsidiary is a party or by which the Company or any Subsidiary is
bound or to which any of the property or assets of the Company or any
Subsidiary is subject, which conflict, breach, violation or default
would have a material adverse effect on the financial position,
stockholder's equity or results of operations of
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the Company and its subsidiaries, taken as a whole, nor will such
action result in any violation of the provisions of the Certificate of
Incorporation or By-laws of the Company or any Federal, New York or
Delaware General Corporation Law statute or any order, rule or
regulation known to such counsel of any Federal, New York or Delaware
court or governmental agency or body having jurisdiction over the
Company or any Subsidiary or any of their properties, which violation
in each case would have a material adverse effect on the financial
position, stockholder's equity or results of operations of the Company
and its subsidiaries, taken as a whole; and no consent, approval,
authorization, order, registration or qualification of or with any such
court or governmental agency or body is required for the issue and sale
of the Securities or the consummation by the Company of the
transactions contemplated by this Agreement, except with respect to
such consents, approvals, authorizations, registrations or
qualifications as may be required under state or foreign securities
laws in connection with the purchase and distribution of the Securities
by the Initial Purchasers.
In rendering such opinion, such counsel may state that he
expresses no opinion as to the laws of any jurisdiction other than the Federal
laws of the United States (other than federal communications laws, as to which
such counsel need express no opinion), the laws of the State of New York and the
General Corporation Law of the State of Delaware. In giving such opinion, such
counsel may rely, as to all matters governed by the laws of any other
jurisdiction, upon opinions of other counsel, who shall be counsel satisfactory
to counsel for the Initial Purchasers, in which case the opinion shall state
that he believes you and he are entitled to so rely. Such counsel may also state
that, insofar as such opinion involves factual matters, he has relied, to the
extent he deems proper, upon certificates of officers of the Company and the
Subsidiaries and certificates of public officials.
(c) At the Closing Time, you shall have received a signed
opinion of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C., as special
communications counsel to the Company, in form and substance satisfactory to
counsel to the Initial Purchasers, to the effect that:
(i) The approvals, if any, required to be obtained from the
FCC to consummate the transactions contemplated by this Agreement have
been obtained and are in full force and effect.
(ii) Such counsel does not know of any federal communications
and copyright statutes that are principally directed to the regulation
of cable properties applicable to the Company that are not described in
the Offering Memorandum but would be material and relevant to the
business of the Company, and the descriptions in the Offering
Memorandum of such statutes therein described are accurate and fairly
summarize the information shown.
(iii) The information in the Offering Memorandum under the
captions "Risk Factors -- Regulatory risks are inherent and substantial
in our businesses" and "Risk Factors -- We are exposed to a significant
and credible risk of competition" and in the 1999 Form 10-K under the
captions "Business -- Competition -- Cable Television" and "Business --
Regulation -- Cable Television", to the extent that such sections
describe
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statutes, regulations and governmental proceedings or matters involving
federal communications and copyright law and policy and the impact
thereof on the business in which the Company and its subsidiaries are
engaged, has been reviewed by them and fairly represents the
communications and copyright law described therein applicable to the
Company and its subsidiaries as disclosed in the Offering Memorandum
and material and relevant to the business of the Company and its
subsidiaries.
In giving such opinion, such counsel may rely, as to all
matters governed by the laws of jurisdictions other than the law of the District
of Columbia, the Federal law of the United States and the corporate law of the
State of Delaware, upon opinions of other counsel, who shall be counsel
satisfactory to counsel for the Initial Purchasers, in which case the opinion
shall state that they believe you and they are entitled to so rely. Such counsel
may also state that, insofar as such opinion involves factual matters, they have
relied, to the extent they deem proper, upon certificates of officers of the
Company and the Subsidiaries and certificates of public officials.
(d) At the Closing Time, you shall have received the favorable
opinion of Shearman & Sterling, counsel for the Initial Purchasers, dated as of
the Closing Time, to the effect that the opinions delivered pursuant to Sections
5(a), 5(b) and 5(c) appear on their face to be appropriately responsive to the
requirements of this Agreement except, specifying the same, to the extent waived
by you, and with respect to the incorporation and legal existence of the
Company, the Securities, this Agreement, the Indenture, the Registration Rights
Agreement, the Offering Memorandum, the documents incorporated by reference
therein and such other related matters as you may require. In rendering such
opinion, such counsel may state that they express no opinion as to the laws of
any jurisdiction other than the Federal laws of the United States, the laws of
the State of New York and the General Corporation Law of the State of Delaware,
and no opinion as to federal or state communications laws. Such counsel may also
state that, insofar as such opinion involves factual matters, they have relied,
to the extent they deem proper, upon certificates of officers of the Company and
the Subsidiaries and certificates of public officials.
(e) At the Closing Time, (i) the Offering Memorandum, as it
may then be amended or supplemented, shall not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, (ii) there shall not
have been, since the respective dates as of which information is given in the
Offering Memorandum, any material adverse change or any development involving a
prospective material adverse change, in or affecting the financial position,
stockholder's equity or results of operations of the Company and its
subsidiaries, considered as one enterprise, (iii) the Company shall have
complied with all agreements and satisfied all conditions on its part to be
performed or satisfied at or prior to the Closing Time and (iv) the other
representations and warranties of the Company set forth in Section 1(a) shall be
accurate as though expressly made at and as of the Closing Time. At the Closing
Time, you shall have received a certificate of the President, a Vice Chairman or
a Vice President, and the Treasurer or Controller, of the Company, dated as of
the Closing Time, to such effect.
(f) You shall have received from KPMG LLP the letter specified
in Sections 1 and 2 of Exhibit B at the date hereof and the letter specified in
Section 3 of Exhibit B at the Closing Time.
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(g) On or after the date hereof, (i) no downgrading shall have
occurred in the rating accorded the Company's debt securities by any "nationally
recognized statistical rating organization", as that term is defined by the
Commission for purposes of Rule 436(g)(2) under the 1933 Act, and (ii) no such
organization shall have publicly announced that it has under surveillance or
review, with possible negative implications, its rating of any of the Company's
debt securities.
(h) At the Closing Time, the Securities shall have been
designated as eligible for trading in the Private Offering, Resale and Trading
through Automatic Linkages (PORTAL) market.
(i) At the Closing Time, counsel for the Initial Purchasers
shall have been furnished with all such documents, certificates and opinions as
they may reasonably request for the purpose of enabling them to pass upon the
issuance and sale of the Securities contemplated in this Agreement and the
matters referred to in Section 5(d) and in order to evidence the accuracy and
completeness of any of the representations, warranties or statements of the
Company, the performance of any of the covenants of the Company, or the
fulfillment of any of the conditions herein contained.
If any of the conditions specified in this Section 5 shall not
have been fulfilled when and as required by this Agreement to be fulfilled, this
Agreement may be terminated by you on notice to the Company at any time at or
prior to the Closing Time, and such termination shall be without liability of
any party to any other party. Notwithstanding any such termination, the
provisions of Sections 6, 7 and 8 shall remain in effect.
Section 6. Indemnification. (a) The Company agrees to
indemnify and hold harmless each Initial Purchaser and each person, if any, who
controls any Initial Purchaser within the meaning of Section 15 of the 1933 Act
as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of an untrue statement or
alleged untrue statement of a material fact contained in or included
the Offering Memorandum (or any amendment or supplement thereto), and
any documents incorporated therein by reference, or the omission or
alleged omission therefrom of a material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or investigation or proceeding by
any governmental agency or body, commenced or threatened, or of any
claim whatsoever based upon any such untrue statement or omission, or
any such alleged untrue statement or omission, if such settlement is
effected with the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including fees and disbursements of counsel chosen by you), reasonably
incurred in investigating, preparing or defending against any
litigation, or investigation or proceeding by any governmental
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agency or body, commenced or threatened, or any claim whatsoever based
upon any such untrue statement or omission, or any such alleged untrue
statement or omission, to the extent that any such expense is not paid
under subparagraph (i) or (ii) above;
provided, however, that this indemnity agreement does not apply to any loss,
liability, claim, damage or expense to the extent arising out of an untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Initial Purchaser expressly for use in the Offering Memorandum (or any amendment
or supplement thereto).
(b) Each Initial Purchaser severally agrees to indemnify and
hold harmless the Company, its directors, officers, and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act, against
any and all loss, liability, claim, damage and expense described in the
indemnity agreement in Section 6(a), as incurred, but only with respect to
untrue statements or omissions, or alleged untrue statements or omissions, made
in the Offering Memorandum (or any amendment or supplement thereto) in reliance
upon and in conformity with written information furnished to the Company by such
Initial Purchaser through you expressly for use in the Offering Memorandum (or
any amendment or supplement thereto).
(c) Each indemnified party shall give prompt notice to each
indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, but failure to so notify an indemnifying
party shall not relieve it from any liability which it may have otherwise than
on account of this indemnity agreement. An indemnifying party may participate at
its own expense in the defense of such action; provided, however, that counsel
to the indemnifying party shall not (except with the consent of the indemnified
party) also be counsel to the indemnified party. In no event shall the
indemnifying party or parties be liable for the fees and expenses of more than
one counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances.
Section 7. Contribution. In order to provide for just and
equitable contribution in circumstances under which the indemnity provided for
in Section 6 is for any reason held to be unenforceable by the indemnified
parties although applicable in accordance with its terms, the Company and the
Initial Purchasers shall contribute to the aggregate losses, liabilities,
claims, damages and expenses of the nature contemplated by such indemnity
incurred by the Company and one or more of the Initial Purchasers, as incurred,
in such proportions that the Initial Purchasers are responsible for that portion
represented by the percentage that the discount hereunder with respect to the
offering of the Securities bears to the offering price of the Securities, and
the Company is responsible for the balance; provided, however, that no person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the ▇▇▇▇ ▇▇▇) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. For purposes of this Section, each
person, if any, who controls an Initial Purchaser within the meaning of Section
15 of the 1933 Act shall have the same rights to contribution as such Initial
Purchaser, and each director or officer of the Company and each person, if any,
who controls the Company within the meaning of Section 15 of the 1933 Act shall
have the same rights to contribution as the Company.
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Section 8. Agreements to Survive Delivery. The agreements and
other statements of the Company or its officers and of the Initial Purchasers
set forth in or made pursuant to this Agreement will remain operative and in
full force and effect regardless of any investigation made by or on behalf of
the Company, or any Initial Purchaser or controlling person within the meaning
of Section 15 of the 1933 Act and will survive delivery of and payment for the
Securities.
Section 9. Termination of Agreement. (a) You may terminate
this Agreement, by notice to the Company, at any time at or prior to the Closing
Time (i) if there has been, since the respective dates as of which information
is given in the Offering Memorandum, any material adverse change or any
development involving a prospective material adverse change in or affecting the
financial position, stockholder's equity or results of operations of the Company
and its subsidiaries, considered as one enterprise, or (ii) if there has
occurred any outbreak or escalation of hostilities or other calamity or crisis
the effect of which on the financial markets of the United States is such as to
make it, in your judgment, impracticable to market the Securities or enforce
contracts for the sale of Securities, or (iii) if trading in any securities of
the Company has been suspended by the Commission, the National Association of
Securities Dealers, Inc. or the New York Stock Exchange, or if trading generally
on the New York Stock Exchange or in the over-the-counter market has been
suspended, or minimum or maximum prices for trading have been fixed, or maximum
ranges for prices for securities have been required, by such exchange or by
order of the Commission, the National Association of Securities Dealers, Inc. or
any other governmental authority, or (iv) if a banking moratorium has been
declared by either federal or New York authorities.
(b) If this Agreement is terminated pursuant to this Section,
such termination shall be without liability of any party to any other party,
except to the extent provided in Section 4. Notwithstanding any such
termination, the provisions of Sections 6, 7 and 8 shall remain in effect.
Section 10. Default by One or More of the Initial Purchasers.
If one or more of the Initial Purchasers shall fail at the Closing Time to
purchase the Securities that it or they are obligated to purchase pursuant to
this Agreement (the "Defaulted Securities"), you shall have the right, within 24
hours thereafter, to make arrangements for one or more of the non-defaulting
Initial Purchasers, or any other Initial Purchasers, to purchase all, but not
less than all, of the Defaulted Securities in such amounts as may be agreed upon
and upon the terms set forth in this Agreement; if, however, you have not
completed such arrangements within such 24-hour period, then:
(a) if the aggregate principal amount of Defaulted Securities
does not exceed 10% of the Securities to be purchased pursuant to this
Agreement, the non-defaulting Initial Purchasers shall be obligated to purchase
the full amount thereof in the proportions that their respective purchase
obligation proportions bear to the purchase obligations of all non-defaulting
Initial Purchasers, or
(b) if the aggregate principal amount of Defaulted Securities
exceeds 10% of the Securities to be purchased pursuant to this Agreement, this
Agreement shall terminate without liability on the part of any non-defaulting
Initial Purchaser.
21
22
No action taken pursuant to this Section shall relieve any
defaulting Initial Purchaser from liability in respect of its default.
In the event of any such default that does not result in a
termination of this Agreement, either you or the Company shall have the right to
postpone the Closing Time for a period not exceeding seven days in order to
effect any required changes in the Offering Memorandum or in any other documents
or arrangements. As used herein, the term "Initial Purchaser" includes any
person substituted for an Initial Purchaser under this Section 10.
Section 11. Notices. All notices and other communications
under this Agreement shall be in writing and shall be deemed to have been duly
given if delivered, mailed or transmitted by any standard form of
telecommunication. Notices to you shall be directed to Banc of America
Securities LLC, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
attention of ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇; Bear, ▇▇▇▇▇▇▇ & Co. Inc., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, attention of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇; ▇▇▇▇▇▇▇ Lynch, Pierce,
▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated, World Financial Center, North Tower, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, attention of ▇▇▇▇ ▇▇▇▇▇▇, and notices to the
Company shall be directed to it at CSC Holdings, Inc., ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, attention of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq., Vice Chairman,
General Counsel and Secretary, with a copy to ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, attention of ▇▇▇▇ ▇. ▇▇▇▇, Esq.
Section 12. Parties. This Agreement is made solely for the
benefit of the several Initial Purchasers, the Company and, to the extent
expressed, any person controlling the Company or any of the Initial Purchasers,
and the directors and officers of the Company, and their respective executors,
administrators, successors and assigns and, subject to the provisions of Section
10, no other person shall acquire or have any right under or by virtue of this
Agreement. The term "successors and assigns" shall not include any purchaser, as
such purchaser, from any of the several Initial Purchasers of the Securities.
All of the obligations of the Initial Purchasers hereunder are several and not
joint.
Section 13. Governing Law and Time. This Agreement shall be
governed by the laws of the State of New York. Specified times of the day refer
to New York City time.
Section 14. Captions. The captions included in this Agreement
are included solely for convenience of reference and are not considered to be
part of this Agreement.
Section 15. Counterparts. This Agreement may be executed in
one or more counterparts and when a counterpart has been executed by each party,
all such counterparts taken together shall constitute one and the same
agreement.
22
23
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us a counterpart hereof, whereupon this
instrument will become a binding agreement between the Company and the Initial
Purchasers in accordance with its terms.
Very truly yours,
CSC HOLDINGS, INC.
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Vice Chairman
24
CONFIRMED AND ACCEPTED,
as of the date first above written:
By: ▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
Acting on behalf of itself and the other Initial Purchasers named in Schedule I
hereto
By /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Director, Investment Banking
25
SCHEDULE I
Initial Purchaser
----------------- Principal Amount of
7 5/8 % Senior Notes due 2011
-----------------------------
Banc of America Securities LLC............................. $ 200,000,000
Bear, ▇▇▇▇▇▇▇ & Co. Inc.................................... 200,000,000
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated................................ 200,000,000
Chase Securities Inc....................................... 80,000,000
TD Securities (USA) Inc.................................... 80,000,000
BMO ▇▇▇▇▇▇▇ ▇▇▇▇▇ Corp..................................... 30,000,000
BNY Capital Markets, Inc................................... 30,000,000
Barclays Capital Inc....................................... 30,000,000
Credit Lyonnais Securities (USA) Inc....................... 30,000,000
First Union Securities, Inc................................ 30,000,000
Fleet Securities, Inc...................................... 30,000,000
RBC Dominion Securities Corporation........................ 30,000,000
Scotia Capital (USA) Inc. ................................. 30,000,000
--------------
Total...................................................... $1,000,000,000
==============
Schedule I
26
SCHEDULE II
CSC HOLDINGS, INC.
7 5/8% Senior Notes due 2011
Principal amount to be issued: $1,000,000,000
Interest rate: 7 5/8%
Interest accrues from: March 22, 2001
Date of maturity: April 1, 2011
Redemption Provisions: None
Sinking fund requirements: None
Initial offering price to investors: 99.679% of the principal amount of the Notes plus accrued
interest, if any, from March 22, 2001.
Purchase price: 98.429% of the principal amount of the Notes plus accrued
interest, if any, from March 22, 2001.
Method of Payment: Payment shall be made to the Company in same day federal
funds by wire transfer.
Closing date, time and location: 10:00 A.M., March 22, 2001, at the offices of Shearman &
Sterling, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇.
Listing requirement: None
Schedule II
27
SCHEDULE III
RESTRICTED SUBSIDIARIES
(* - material subsidiary)
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Corporation
A-R Cable Services - NY, Inc.
Arsenal MSub 2 Inc.
Cablevision Area 9 Corporation
Cablevision Fairfield Corporation
Cablevision Lightpath, Inc.
Cablevision MFR, Inc.
Cablevision of Brookhaven, Inc.
Cablevision of Brookline, Inc.
Cablevision of Cleveland G.P., Inc.
Cablevision of Cleveland L.P., Inc.
Cablevision of Cleveland, L.P.
Cablevision of Connecticut Corporation
Cablevision of Connecticut Limited Partnership
Cablevision of ▇▇▇▇▇▇ County, Inc.
Cablevision of Litchfield, Inc.
Cablevision of Monmouth, Inc.
Cablevision of New Jersey, Inc.
Cablevision of Newark
Cablevision of Oakland, Inc.
Cablevision of Ossining Limited Partnership (f/k/a Cablevision of
Brookline LP)
Cablevision of Paterson, Inc.
Cablevision of Rockland/Ramapo, Inc.
Cablevision of Southern Westchester, Inc.
Cablevision of the Midwest Holding, Inc.
Cablevision of Wappingers Falls, Inc. (f/k/a Cablevision of Boston,
Inc.)
Cablevision of Warwick, Inc.
Cablevision Systems Brookline Corporation
Cablevision Systems Dutchess Corporation
Cablevision Systems East Hampton Corporation
Cablevision Systems Great Neck Corporation
Cablevision Systems Huntington Corporation
Cablevision Systems Islip Corporation
Cablevision Systems Long Island Corporation
*Cablevision Systems New York City Corporation (f/k/a NYC LP Corp.)
Cablevision Systems of Southern Connecticut Limited Partnership
Cablevision Systems Suffolk Corporation Cablevision Systems Westchester
Corporation Communications Development Corporation
CSC Acquisition - MA, Inc.
CSC Acquisition - NY, Inc.
Schedule III-1
28
CSC Acquisition Corporation
CSC Gateway Corporation
CSC TKR, Inc.
CSC TKR I, Inc.
KRC/CCC Investment Partnership
Montague Cable Company, Inc.
Petra Cablevision Corporation
Samson Cablevision Corp.
Suffolk Cable Corporation
Suffolk Cable of Shelter Island, Inc.
Suffolk Cable of Smithtown, Inc.
Telerama, Inc.
Schedule III-2
29
SCHEDULE IV
UNRESTRICTED SUBSIDIARIES
(* - material subsidiary)
AMC II Holding Corporation (1)
AMC Productions, Inc. (1)
American Movie Classics Company (1)
American Movie Classics Holding Corporation (1)
American Pop, LLC
American Sports Classics, L.L.C.
Bravo Company
Bravo Holding Corporation
Bravo II Holding Corporation
Bravo Programming, Inc.
Cable Networks, Inc.
Foxwatch Productions, Inc.
Garden Programming, L.L.C.
IFC Entertainment LLC
IFC Films LLC
IFC Productions I L.L.C.
IFC Theatres, LLC
*Madison Square Garden, L.P. (2)
Madison Square Garden CT, LLC
Metro Channel, L.L.C.
Metro Channel Holdings I, LLC
Metro Channel Holdings II, LLC
Metro Channel Productions, LLC
Metro New York LLC
MSG Aircraft Leasing, LLC
MSG Boxing, LLC
MSG Eden Corp.
MSG Flight Operations, LLC
MSG/TJF Scarlet Productions, LLC
MuchMusic U.S.A. Venture
National Advertising Partners
National PSNA Holdings I, LLC
National PSNA Holdings II, LLC
National Sports Partners
News ▇▇.▇▇▇, Inc. (f/k/a Neighborhood News Holdings, Inc.)
News 12 Holding Corporation
News 12 II Holding Corporation
News 12 New Jersey L.L.C.
News 12 The Bronx, LLC
News 12 The Bronx Holding Corporation
Next Wave Films, L.L.C.
Schedule IV-1
30
New England Sea Wolves, L.L.C.
New York Rangers Enterprises Company
Prime SportsChannel Networks Associates
Radio City Networks LLC
Radio City Networks Holdings I, LLC
Radio City Networks Holdings II, LLC
Radio City Productions, L.L.C.
Radio City Trademarks, L.L.C.
Rainbow Advertising Holdings, LLC
Rainbow Advertising Sales Corporation
Rainbow CT Holdings, Inc.
Rainbow DBS Holdings, Inc.
Rainbow Films Holding LLC
Rainbow Garden Corp.
Rainbow Media Group, LLC
*Rainbow Media Holdings, Inc.
*Rainbow Media Sports Holdings, Inc.
Rainbow MM Holdings Corporation
Rainbow MM Holdings II Corporation
Rainbow National Sports Holdings, LLC
Rainbow Network Communications
Rainbow News 12 Company
Rainbow NJ Holdings, Inc.
Rainbow NJ Holdings II, Inc.
*Rainbow Regional Holdings, LLC
Rainbow Regional Sports News Holdings, LLC
Rainbow Travel, Inc.
Rainbow Westchester Holdings, Inc.
RCE Humbug Productions LLC
RCE/4KE Productions LLC
Regional Chicago Holdings, LLC
Regional Cincinnati Holdings I, LLC
Regional Cincinnati Holdings II, LLC
*Regional MSG Holdings, LLC
Regional NE Holdings I, LLC
Regional NE Holdings II, LLC
Regional Ohio Holdings I, LLC
Regional Ohio Holdings II, LLC
Regional Pacific Holdings, LLC
*Regional Programming Partners
Regional Sports News, LLC
RNC Holding Corporation
RNC II Holding Corporation
Romance Classics Productions, Inc. (1)
SC America Holding Corporation
Schedule IV-2
31
SC Florida Holding Company, L.L.C.
SC Florida Holding Corporation
SC Los Angeles Holding Corporation
Soccer/USA Partners, L.P.
SportsChannel America Associates
SportsChannel America Soccer, Inc.
SportsChannel Associates (2)
SportsChannel Chicago Associates
SportsChannel Cincinnati Associates
SportsChannel Florida Associates
SportsChannel Florida Holding Company L.L.C.
SportsChannel Los Angeles Holding Corporation
SportsChannel New England Limited Partnership
SportsChannel Ohio Associates
SportsChannel Pacific Associates
SportsChannel Ventures, Inc.
The 31st Street Company, L.L.C.
The Independent Film Channel LLC
The Story Channel, Inc.
WE: Women's Entertainment LLC (f/k/a Romance Classics, LLC)
World Cinema, division of Bravo Company
WSN, LLC
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Corp.
▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ Corporation
1111 ▇▇▇▇▇▇▇ Corporation
▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Corporation
AC Productions West, Inc.
AC Productions, Inc.
ACEP LLC
American Catholic Enterprises At The Movies Productions East LLC
American Catholic Enterprises Chat Productions East LLC
American Catholic Enterprises Hub Productions East LLC
American Catholic Enterprises Masters Productions East LLC
American Catholic Enterprises News Productions East LLC
American Catholic Enterprises Productions East LLC
American Catholic Enterprises Studios Productions East LLC
American Catholic LLC
Boston Holding, LLC
Boston PCS, LLC
Cablevision Digital Development, LLC
*Cablevision Electronics Investments, Inc.
Cablevision Lightpath - CT, Inc.
Cablevision Lightpath - MA, Inc.
Schedule IV-2
32
Cablevision Lightpath - MI, Inc.
Cablevision Lightpath - NJ, Inc.
Cablevision Lightpath - NY, Inc.
Cablevision Lightpath - OH, Inc.
Cablevision NYI L.L.C.
Cablevision PCS Investment, Inc.
Cablevision PCS Management, Inc.
Cablevision Real Estate Corporation
Cleveland Holding, LLC
Cleveland PCS Realty, LLC
Cleveland PCS, LLC
Coram Route 112 Corporation
*CCG Holdings, Inc.
CCC Cobble Hill Cinema Corp.
CCC Franklin Square Cinema Corp.
CSC @Security Holding, LLC
CSC At Home Holding Corporation
CSC Charter Holdings I, Inc.
CSC Charter Holdings II, Inc.
CSC Charter Holdings III, Inc.
CSC Investments, Inc.
CSC Leapfrog Holdings, LLC
CSC MA Holdings I, Inc.
CSC MA Holdings II, Inc.
CSC MA Holdings III, Inc.
CSC Metro Cinema LLC
CSC Nassau, Inc.
CSC Ohio Holdings I, Inc.
CSC Ohio Holdings II, Inc.
CSC Ohio Holdings III, Inc.
CSC Sterling Holdings, LLC
CSC Technology, Inc. (f/k/a CSC Realty, Inc.)
CSC Transport, Inc.
CSC Transport II, Inc.
CSC Transport III, Inc.
ECC Holding Corporation
▇▇▇▇▇▇▇ Road Corporation
Knollwood Development Corp.
Missouri Cable Partners, L.P.
NCC LP Corp.
New York PCS Holding, LLC
New York PCS, LLC
Northcoast Communications, L.L.C.
PVI Holding, LLC
Sterling Digital LLC
The New York Interconnect L.L.C.
Schedule IV-4
33
U.S. Cable Television Group, L.P.
V-C Mo. G.P., Inc.
-------------------
1 Shares of AMC Productions, Inc., Romance Classics Productions, Inc. and
partnership interests in American Movie Classics Company held by AMC II
Holding Corporation ("AMC II") and American Movie Classics Holdings
Corporation ("AMCHC") are pledged to Toronto-Dominion under the terms
of a Stock Pledge Agreement, dated as of April 2, 1997, between
American Movie Classics Holding Company and Toronto-Dominion (Texas),
Inc., as agent for the Banks and a Partners Pledge Agreement, dated as
of April 2, 1997, by and between AMC II and AMCHC and Toronto Dominion
(Texas), Inc.
2 All of the capital stock, partnership interests or limited liability
company interests are pledged under the Credit Party Pledge Agreement,
dated as of June 6, 1997 to the Madison Square Garden, L.P. Credit
Agreement.
Schedule IV-5
34
EXHIBIT A
Form of Registration Rights Agreement
A-1
35
EXHIBIT B
March 15, 2001
MATTERS TO BE COVERED BY LETTER OR LETTERS OF
INDEPENDENT PUBLIC ACCOUNTANTS
KPMG LLP shall have furnished to you the following letter or
letters (in each case in form and substance satisfactory to you):
(1) At the date hereof, a letter to the effect that:
(a) they are independent accountants with respect to
the Company and its subsidiaries within the meaning of the
1933 Act and the applicable published 1933 Act Regulations;
(b) in their opinion, except as disclosed in the
Offering Memorandum, the audited consolidated financial
statements and the related financial statement schedules of
the Company and its subsidiaries included or incorporated by
reference in such annual report on Form 10-K comply as to form
in all material respects with the applicable accounting
requirements of the 1934 Act as it applies to Form 10-K and
the related published 1934 Act Regulations; and
(c) in addition to their examinations, inspections,
inquiries and other procedures referred to therein, they have
performed such other procedures, specified by you, not
constituting an audit, as they have agreed to perform and
report on with respect to certain amounts, percentages,
numerical data and other financial information in the Form
10-K and have compared certain of such amounts, percentages,
numerical data and financial information with, and have found
such items to be in agreement with or derived from, the
detailed accounting records of the Company and its
subsidiaries.
(2) At the date hereof, a letter with respect to each of
the Company's quarterly reports on Form 10-Q (each a "10-Q Letter")
filed prior to the date hereof and subsequent to the Company's most
recently filed annual report on Form 10-K, to the effect that:
(a) they reaffirm as of the date of such letter (and
as though made on the date of such letter) all statements made
in the 10-K Letter, except that the procedures specified
therein shall have been carried out to a specified date not
more than five days prior to the date of such 10-Q Letter;
(b) on the basis of procedures (but not an
examination in accordance with generally accepted auditing
standards) consisting of:
(i) a reading of minutes of all meetings of
the stockholders and directors of the Company and its
subsidiaries and the Pricing Committee of the
Company's Board of Directors and any subsidiary
committees from
B-1
36
(ii) the date of the latest audited
consolidated financial statements to the specified
date referred to in Section 2(a);
(iii) a reading of the unaudited condensed
consolidated financial statements of the Company and
its subsidiaries included or incorporated by
reference in the quarterly report on Form 10-Q dated
the date of such 10-Q Letter;
(iv) inquiries of certain officials of the
Company and its subsidiaries; and
nothing came to their attention that caused them to believe
that the unaudited condensed consolidated financial statements
included or incorporated by reference in such quarterly report
on Form 10-Q do not comply as to form in all material respects
with the applicable accounting requirements of the 1934 Act as
it applies to Form 10-Q and the related published 1934 Act
Regulations or that any material modifications should be made
to the unaudited condensed consolidated financial statements
included or incorporated by reference in such quarterly report
for them to be in conformity with generally accepted
accounting principles, except as disclosed in the notes to
such unaudited condensed consolidated financial statements or
as otherwise described in such 10-Q Letter;
(c) in addition to their examinations, inspections,
inquiries and other procedures referred to therein, they have
performed such other procedures, specified by you, not
constituting an audit, as they have agreed to perform and
report on with respect to certain amounts, percentages,
numerical data and other financial information in the Form
10-Q and have compared certain of such amounts, percentages,
numerical data and financial information with, and have found
such items to be in agreement with or derived from, the
detailed accounting records of the Company and its
subsidiaries.
(3) At the Closing Time, a letter dated the Closing Time
(the "Closing Letter"), to the effect that:
(a) they reaffirm as of the date of the Closing
Letter (and as though made on the date of the Closing Letter)
all statements made in the 10-K Letter and in each 10-Q
Letter, if any, except that the procedures specified therein
shall have been carried out to a specified date not more than
five days prior to the date of the Closing Letter; and
(b) based on the procedures set forth in Section 2(b)
(but carried out to the specified date referred to in Section
3(a)), nothing came to their attention that caused them to
believe that, from the date of the latest balance sheet of the
Company and its subsidiaries included or incorporated by
reference in the Prospectus to such specified date, there were
any increases or decreases in financial statement amounts
specified by you as they have agreed to perform.
B-2