Document:

AMENDED AND RESTATED LIMITED LIABILITY AGREEMENT

 

Exhibit 10.2

AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT

OF

CHARTER COMMUNICATIONS OPERATING, LLC

(a Delaware Limited Liability Company)

     This AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT OF CHARTER
COMMUNICATIONS OPERATING, LLC (as amended from time to time, this “Agreement”)
is entered into as of June 19, 2003 by CCO Holdings, LLC, a Delaware limited
liability company (“CCO Parent”), as the sole member of Charter Communications
Operating, LLC, a Delaware limited liability company (the “Company”).

W I T N E S S E T H:

     WHEREAS, the Certificate of Formation of the Company was executed and
filed in the office of the Secretary of State of the State of Delaware on
February 10, 1999;

     WHEREAS, simultaneously with the execution hereof, (i) Charter
Communications Holdings, LLC (“Holdings”), the sole member of the Company prior
to giving effect to this Agreement, is transferring its entire limited
liability company interest in the Company to CCO Parent, (ii) CCO Parent is
being admitted to the Company as a member in respect of such limited liability
company interest, (iii) immediately after the admission of CCO Parent pursuant
to clause (ii) above, Holdings is deemed withdrawn from the Company, and (iv)
the Company is continuing without dissolution; and

     WHEREAS, Bank of America, N.A. is currently the “Funding Agent,” as
defined in that certain Credit Agreement with the Company as Borrower, dated as
of March 18, 1999, as Amended and Restated as of January 3, 2002 and as further
amended and restated by the Second Amended and Restated Credit Agreement dated
as of June 19, 2003 (and as it may be amended, supplemented, modified,
restated, refunded, renewed, replaced or refinanced from time to time, the
“Credit Agreement”), and the Funding Agent from time to time under the Credit
Agreement is intended by CCO Parent and the Company to have certain rights as
set forth herein and to be an express third party beneficiary of those
provisions of this Agreement conferring such rights upon the Funding Agent;

     NOW, THEREFORE, in consideration of the terms and provisions set forth
herein, the benefits to be gained by the performance thereof and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the party hereby agrees as follows:

     SECTION 1. General.

     (a)  Formation. Effective as of the date and time of filing of the
Certificate of Formation in the office of the Secretary of State of the State
of Delaware, the Company was formed as a limited liability company under the
Delaware Limited Liability Company Act, 6 Del.C. § 18-101, et. seq., as amended
from time to time (the “Act”). Except as expressly

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 provided herein, the rights and obligations of the Members (as defined in
Section 1(h)) in connection with the regulation and management of the Company
shall be governed by the Act.

     (b)  Name. The name of the Company shall continue to be “Charter
Communications Operating, LLC”. The business of the Company shall be conducted
under such name or any other name or names that the Manager (as defined in
Section 4(a)(i) hereof) shall determine from time to time.

     (c)  Registered Agent. The address of the registered office of the Company
in the State of Delaware shall continue to be c/o Corporation Service Company,
2711 Centerville Road, Suite 400, Wilmington, Delaware 19808. The name and
address of the registered agent for service of process on the Company in the
State of Delaware shall continue to be Corporation Service Company, 2711
Centerville Road, Suite 400, Wilmington , Delaware 19808. The registered
office or registered agent of the Company may be changed from time to time by
the Manager.

     (d)  Principal Office. The principal place of business of the Company
shall be at 12405 Powerscourt Drive, St. Louis, MO 63131. At any time, the
Manager may change the location of the Company’s principal place of business.

     (e)  Term. The term of the Company commenced on the date of the filing of
the Certificate of Formation in the office of the Secretary of State of the
State of Delaware, and the Company will have perpetual existence until
dissolved and its affairs wound up in accordance with the provisions of this
Agreement.

     (f)  Certificate of Formation. The execution of the Certificate of
Formation by Collen Hegarty and the Certificate of Amendment thereto by Marcy
Lifton and the filing thereof in the office of the Secretary of State of the
State of Delaware, are hereby ratified, confirmed and approved.

     (g)  Qualification; Registration. The Manager shall cause the Company to
be qualified, formed or registered under assumed or fictitious name statutes or
similar laws in any jurisdiction in which the Company transacts business and in
which such qualification, formation or registration is required or desirable.
The Manager, as an authorized person within the meaning of the Act, shall
execute, deliver and file any certificates (and any amendments and/or
restatements thereof) necessary for the Company to qualify to do business in a
jurisdiction in which the Company may wish to conduct business.

     (h)  Voting. Each member of the Company (if there is only one member of
the Company, the “Member”; or if there are more than one, the “Members”) shall
have one vote in respect of any vote, approval, consent or ratification of any
action (a “Vote”) for each one percentage point of Percentage Interest (as
defined in Section 7) held by such Member (totaling 100 Votes for all Members)
(any fraction of such a percentage point shall be entitled to an equivalent
fraction of a Vote). So long as no Triggering Event has occurred and is
continuing, any vote, approval, consent or ratification as to any matter under
the Act or this Agreement by a Member may be evidenced by such Member’s
execution of any document or agreement (including this Agreement or an
amendment hereto in accordance

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 with the provisions thereof) that would otherwise require as a
precondition to its effectiveness such vote, approval, consent or ratification
of the Members. “Triggering Event” shall mean (i) the occurrence and
continuance of an Event of Default (as defined in the Credit Agreement) and
(ii) the Funding Agent’s giving notice in any manner provided for in the Credit
Agreement to the Company and CCO Parent that it intends to exercise the rights
described herein during the occurrence and continuance of such Event of
Default. “LLC Arrangement” shall mean the provisions of this Section 1(h)
relating to the rights and powers of the Funding Agent respecting any vote,
approval, consent or ratification, whether or not inchoate. If a Triggering
Event has occurred and is continuing, then the Members shall continue to have
the right to exercise their Votes; provided that, in the event the Funding
Agent’s determination with respect to any matter requiring or permitting a vote
hereunder or under the Act is contrary to the vote, approval, consent or
ratification of the Members, the Funding Agent’s determination with respect to
such matter shall, for all purposes of this Agreement and the Act, control and
supersede any contrary vote, approval, consent or ratification of the Members
(including, for the sake of clarity, any matter requiring or permitting
unanimity of Votes hereunder). The Funding Agent’s rights and powers
respecting any vote, approval, consent or ratification hereunder may only be
exercised if the Triggering Event has occurred until such time that the Event
of Default (as defined in the Credit Agreement) which gave rise to such rights
and powers respecting any vote, approval, consent or ratification has been
cured. The LLC Arrangement shall be effective from and after the date hereof
until a LLC Arrangement Notice (as defined below) shall have been delivered and
will continue to be effective until the Funding Agent shall have delivered
written confirmation (the “LLC Arrangement Notice”) to the Company and CCO
Parent that an LLC Arrangement Retraction Event (as defined below) has
occurred. The LLC Arrangement Notice shall be promptly delivered by the
Funding Agent if 91 days shall have passed since the date on which the CCO
Parent shall have complied with the provisions of Section 6.13 of the Credit
Agreement (the date on which the LLC Arrangement Notice is delivered, the
“Conditional Notice Date”), including, without limitation, becoming a party to
the Guarantee and Collateral Agreement (as defined in the Credit Agreement),
and after the occurrence of the Guarantee and Pledge Date (as defined in the
Credit Agreement), and to the knowledge of the Funding Agent, no Event of
Default has occurred during such period and is continuing as of the Conditional
Notice Date (such circumstances being collectively referred to as the “LLC
Arrangement Retraction Event”); provided, that, if an Event of Default shall
have occurred during such 91-day period and be continuing on the Conditional
Notice Date, the Funding Agent shall not be required to give the LLC
Arrangement Notice until such Event of Default shall no longer be continuing.
Immediately upon delivery of the LLC Arrangement Notice, the specific rights
and benefits of the Funding Agent under this Agreement shall immediately
terminate (other than, and without prejudice to, the provisions set forth in
Sections 6(c) and 15(g) (as relating to Section 6(c)), which shall survive any
such termination) and the LLC Arrangement shall no longer be effective;
provided, however, that unless the LLC Arrangement Notice shall have been
delivered, the LLC Arrangement shall remain effective notwithstanding any cure
of a Triggering Event and the Funding Agent shall retain all rights and
benefits hereunder, without prejudice, with respect to the occurrence of any
subsequent Triggering Event. If the Event of Default (as defined in the Credit
Agreement) which gave rise to such rights and powers respecting any vote,
approval, consent or ratification has been cured before the LLC Arrangement
Notice shall have been delivered, then the Funding Agent’s rights and powers
respecting any vote, approval, consent or ratification under the LLC
Arrangement may be

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 triggered again upon a subsequent Triggering Event. However, the Funding
Agent’s rights and powers respecting any vote, approval, consent or
ratification under the LLC Arrangement shall not become effective after an LLC
Arrangement Notice is delivered by the Funding Agent following the LLC
Arrangement Retraction Event.

     SECTION 2. Purposes. The Company was formed for the object and purpose
of, and the nature of the business to be conducted by the Company is, engaging
in any lawful act or activity for which limited liability companies may be
formed under the Act.

     SECTION 3. Powers. The Company shall have all powers necessary,
appropriate or incidental to the accomplishment of its purposes and all other
powers conferred upon a limited liability company pursuant to the Act.

     SECTION 4. Management.

     (a)  Management by Manager.

          i) CCO Parent, as the sole member of the Company, hereby confirms the
election of Charter Communications, Inc., a Delaware corporation (“CCI”), or
its successor-in-interest that acquires directly or indirectly substantially
all of the assets or business of CCI, as the Company’s manager (the “Manager”).
CCI shall be the Manager until a simple majority of the Votes elects
otherwise. No additional person may be elected as Manager without the approval
of a simple majority of the Votes (for purposes of this Agreement, to the
extent the context requires, the term “person” refers to both individuals and
entities). Except as otherwise required by applicable law and as provided
below with respect to the Board, the powers of the Company shall at all times
be exercised by or under the authority of, and the business, property and
affairs of the Company shall be managed by, or under the direction of, the
Manager. The Manager is a “manager” of the Company within the meaning of the
Act. Any person appointed as Manager shall accept its appointment by execution
of a consent to this Agreement.

          ii) The Manager shall be authorized to elect, remove or replace directors
and officers of the Company, who shall have such authority with respect to the
management of the business and affairs of the Company as set forth herein or as
otherwise specified by the Manager in the resolution or resolutions pursuant to
which such directors or officers were elected.

          iii) Except as otherwise required by this Agreement or applicable law, the
Manager shall be authorized to execute or endorse any check, draft, evidence of
indebtedness, instrument, obligation, note, mortgage, contract, agreement,
certificate or other document on behalf of the Company without the consent of
any Member or other person.

          iv) No annual or regular meetings of the Manager or the Members are
required. The Manager may, by written consent, take any action which it is
otherwise required or permitted to take at a meeting.

          v) The Manager’s duty of care in the discharge of its duties to the
Company and the Members is limited to discharging its duties pursuant to this
Agreement in

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good faith, with the care a director of a Delaware corporation would
exercise under similar circumstances, in the manner it reasonably believes to
be in the best interests of the Company and its Members.

          vi) Except as required by the Act, no Manager shall be liable for the
debts, liabilities and obligations of the Company, including without limitation
any debts, liabilities and obligations under a judgment, decree or order of a
court, solely by reason of being a manager of the Company.

     (b)  Board of Directors.

          i) Notwithstanding paragraph (a) above, upon the effectiveness of this
Agreement, the Manager may delegate its power to manage the business of the
Company to a board of natural persons designated as “directors” (the “Board”)
which, subject to the limitations set forth below, shall have the authority to
exercise all such powers of the Company and do all such lawful acts and things
as may be done by a manager of a limited liability company under the Act and as
are not by statute, by the Certificate of Formation (as amended from time to
time, the “Certificate”), or by this Agreement (including without limitation
Section 4(c) hereof) directed or required to be exercised or done by the
Manager; provided, that until such time as the Funding Agent shall have
delivered the LLC Arrangement Notice, no such delegation hereunder shall be
effective unless written copies of such delegation have been delivered to the
Funding Agent. As of the date of effectiveness of this Agreement, no such
delegation is in effect. Except for the rights and duties that are assigned to
officers of the Company, the rights and duties of the directors may not be
assigned or delegated to any person. No action, authorization or approval of
the Board shall be required, necessary or advisable for the taking of any
action by the Company that has been approved by the Manager. In the event that
any action of the Manager conflicts with any action of the Board, the action of
the Manager shall control.

          ii) Except as otherwise provided herein, directors shall possess and may
exercise all the powers and privileges and shall have all of the obligations
and duties to the Company and the Members granted to or imposed on directors of
a corporation organized under the laws of the State of Delaware.

          iii) The number of directors on the date hereof is one, which number may
be changed from time to time by the Manager. The director as of the date
hereof shall be as set forth on Exhibit A hereto, provided that Exhibit A need
not be amended whenever the director(s) or his or her successors are changed in
accordance with the terms of this Agreement.

          iv) Each director shall be appointed by the Manager and shall serve in
such capacity until the earlier of his resignation, removal (which may be with
or without cause) or replacement by the Manager.

          v) No director shall be entitled to any compensation for serving as a
director. No fee shall be paid to any director for attendance at any meeting
of the Board; provided, however, that the Company may reimburse directors for
the actual reasonable costs incurred in such attendance.

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     (c)  Consent Required.

          i) None of the Members, Managers, directors or officers of the Company or
the Funding Agent (in the exercise of the LLC Arrangement) shall:

               (1) do any act in contravention of this Agreement;

               (2) cause the Company to engage in any business not permitted by the
Certificate or the terms of this Agreement;

               (3) cause the Company to take any action that would make it impossible to
carry on the usual course of business of the Company (except to the extent
expressly provided for hereunder); it being hereby agreed that any actions
necessary to comply with the Company’s obligations under the Credit Agreement
are in the ordinary course of the Company’s business; or

               (4) possess Company property or assign rights in Company property other
than for Company purposes; it being hereby agreed that any actions necessary to
comply with the Company’s obligations under the Credit Agreement are within the
Company’s purposes.

          ii) In addition to any approval that may be required under Section 15(b)
to the extent amendment of this Agreement is required for any of the following
actions, one hundred percent (100%) of the Votes shall be required to:

               (1) issue limited liability company interests in the Company to any
person;

               (2) change or reorganize the Company into any other legal form;

               (3) approve a merger or consolidation of the Company with another person;

               (4) sell all or substantially all of the assets of the Company; or

               (5) voluntarily dissolve the Company.

          iii) In addition to any approval that may be required under Section 15(b)
to the extent amendment of this Agreement is required for any of the following
actions, the affirmative vote, approval, consent or ratification of the Manager
shall be required to:

               (1) alter the primary purposes of the Company as set forth in Section 2;

               (2) issue limited liability company interests in the Company to any
person;

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               (3) enter into or amend any agreement which provides for the management of
the business or affairs of the Company by a person other than the Manager (and
the Board);

               (4) change or reorganize the Company into any other legal form;

               (5) approve a merger or consolidation of the Company with another person;

               (6) sell all or substantially all of the assets of the Company;

               (7) operate the Company in such a manner that the Company becomes an
“investment company” for purposes of the Investment Company Act of 1940;

               (8) except as otherwise provided or contemplated herein, enter into any
agreement to acquire property or services from any person who is a director or
officer of the Company;

               (9) settle any litigation or arbitration with any third party, any Member,
or any affiliate of any Member, except for any litigation or arbitration
brought or defended in the ordinary course of business where the present value
of the total settlement amount or damages will not exceed $5,000,000;

               (10) materially change any of the tax reporting positions or elections of
the Company;

               (11) make or commit to any expenditures which, individually or in the
aggregate, exceed or are reasonably expected to exceed the Company’s total
budget (as approved by the Manager) by the greater of 5% of such budget or Five
Million Dollars ($5,000,000);

               (12) make or incur any secured or unsecured indebtedness which
individually or in the aggregate exceeds Five Million Dollars ($5,000,000),
provided that this restriction shall not apply to (i) any refinancing of or
amendment to existing indebtedness which does not increase total borrowing
(including obligations under the Credit Agreement and the Loan Documents (as
defined in the Credit Agreement), all of which have been, and are hereby,
ratified and confirmed), (ii) any indebtedness to (or guarantee of indebtedness
of) any entity controlled by or under common control with the Company
(“Intercompany Indebtedness”), (iii) the pledge of any assets to support any
otherwise permissible indebtedness of the Company or any Intercompany
Indebtedness or (iv) indebtedness necessary to finance a transaction or
purchase approved by the Manager; or

               (13) voluntarily dissolve the Company.

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     (d)  Board Meetings.

          i) Regular Meetings. Regular meetings of the Board may be held without
notice at such time and at such place as shall from time to time be determined
by the Board, but not less often than annually.

          ii) Special Meetings. Special meetings of the Board may be called by the
President or any director on twenty-four (24) hours’ notice to each director;
special meetings shall be called by the President or Secretary in like manner
and on like notice on the written request of Members holding a simple majority
of the Votes. Notice of a special meeting may be given by facsimile.
Attendance in person of a director at a meeting shall constitute a waiver of
notice of that meeting, except when the director objects, at the beginning of
the meeting, to the transaction of any business because the meeting is not duly
called or convened.

          iii) Telephonic Meetings. Directors may participate in any regular or
special meeting of the Board, by means of conference telephone or similar
communications equipment, by means of which all persons participating in the
meeting can hear each other. Participation in a meeting pursuant to this
Section 4(d)(iii) will constitute presence in person at such meeting.

          iv) Quorum. At all meetings of the Board, a majority of the directors
shall constitute a quorum for the transaction of business, and the act of a
majority of the directors present at any meeting at which there is a quorum
shall be the act of the Board, except as may be otherwise specifically provided
by statute, the Certificate or this Agreement. If a quorum is not present at
any meeting of the Board, the directors present thereat may adjourn the meeting
from time to time until a quorum shall be present. Notice of such adjournment
shall be given to any director not present at such meeting.

          v) Action Without Meeting. Unless otherwise restricted by the Certificate
or this Agreement, any action required or permitted to be taken at any meeting
of the Board may be taken without a meeting if all directors consent thereto in
writing and such written consent is filed with the minutes of proceedings of
the Board.

     (e)  Director’s Duty of Care. Each director’s duty of care in the
discharge of his or her duties to the Company and the Members is limited to
discharging his duties pursuant to this Agreement in good faith, with the care
a director of a Delaware corporation would exercise under similar
circumstances, in the manner he or she reasonably believes to be in the best
interests of the Company and its Members.

     SECTION 5. Officers.

     (a)  Officers. The Company shall have such officers as may be necessary or
desirable for the business of the Company. The officers may include a Chairman
of the Board, a President, a Treasurer and a Secretary, and such other
additional officers, including one or more Vice Presidents, Assistant
Secretaries and Assistant Treasurers as the Manager, the Board, the Chairman of
the Board, or the President may from time to time elect. Any two or more
offices may be held by the same individual.

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     (b)  Election and Term. The President, Treasurer and Secretary shall, and
the Chairman of the Board may, be appointed by and shall hold office at the
pleasure of the Manager or the Board. The Manager, the Board, or the President
may each appoint such other officers and agents as such person shall deem
desirable, who shall hold office at the pleasure of the Manager, the Board, or
the President, and who shall have such authority and shall perform such duties
as from time to time shall, subject to the provisions of Section 5(d) hereof,
be prescribed by the Manager, the Board, or the President.

     (c)  Removal. Any officer may be removed by the action of the Manager or
the action of at least a majority of the directors then in office, with or
without cause, for any reason or for no reason. Any officer other than the
Chairman of the Board, the President, the Treasurer or the Secretary may also
be removed by the Chairman of the Board or the President, with or without
cause, for any reason or for no reason.

     (d)  Duties and Authority of Officers.

          i) President. The President shall be the chief executive officer and (if
no other person has been appointed as such) the chief operating officer of the
Company; shall (unless the Chairman of the Board elects otherwise) preside at
all meetings of the Members and Board; shall have general supervision and
active management of the business and finances of the Company; and shall see
that all orders and resolutions of the Board or the Manager are carried into
effect; subject, however, to the right of the directors to delegate any
specific powers to any other officer or officers. In the absence of direction
by the Manager, Board or the Chairman of the Board to the contrary, the
President shall have the power to vote all securities held by the Company and
to issue proxies therefor. In the absence or disability of the President, the
Chairman of the Board (if any) or, if there is no Chairman of the Board, the
most senior available officer appointed by the Manager or the Board shall
perform the duties and exercise the powers of the President with the same force
and effect as if performed by the President, and shall be subject to all
restrictions imposed upon him.

          ii) Vice President. Each Vice President, if any, shall perform such
duties as shall be assigned to such person and shall exercise such powers as
may be granted to such person by the Manager, the Board or by the President of
the Company. In the absence of direction by the Manager, the Board or the
President to the contrary, any Vice President shall have the power to vote all
securities held by the Company and to issue proxies therefor.

          iii) Secretary. The Secretary shall give, or cause to be given, a notice
as required of all meetings of the Members and of the Board. The Secretary
shall keep or cause to be kept, at the principal executive office of the
Company or such other place as the Board may direct, a book of minutes of all
meetings and actions of directors and Members. The minutes shall show the time
and place of each meeting, whether regular or special (and, if special, how
authorized and the notice given), the names of those present at Board meetings,
the number of Votes present or represented at Members’ meetings, and the
proceedings thereof. The Secretary shall perform such other duties as may be
prescribed from time to time by the Manager or the Board.

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          iv) Treasurer. The Treasurer shall have custody of the Company funds and
securities and shall keep or cause to be kept full and accurate accounts of
receipts and disbursements in books of the Company to be maintained for such
purpose; shall deposit all moneys and other valuable effects of the Company in
the name and to the credit of the Company in depositories designated by the
Manager or the Board; and shall disburse the funds of the Company as may be
ordered by the Manager or the Board.

          v) Chairman of the Board. The Chairman of the Board, if any, shall
perform such duties as shall be assigned, and shall exercise such powers as may
be granted to him or her, by the Manager or the Board.

          vi) Authority of Officers. The officers, to the extent of their powers
set forth in this Agreement or otherwise vested in them by action of the
Manager or the Board not inconsistent with this Agreement, are agents of the
Company for the purpose of the Company’s business and the actions of the
officers taken in accordance with such powers shall bind the Company.

     SECTION 6. Members.

     (a)  Members. The Members of the Company shall be set forth on Exhibit B
hereto as amended from time to time. At the date hereof, CCO Parent is the
sole Member, and it (or its predecessor) has heretofore contributed to the
capital of the Company. CCO Parent is not required to make any additional
capital contribution to the Company; however, CCO Parent may make additional
capital contributions to the Company at any time in its sole discretion (for
which its capital account balance shall be appropriately increased). Each
Member shall have a capital account in the Company, the balance of which is to
be determined in accordance with the principles of Treasury Regulation section
1.704-1(b)(2)(iv). The provisions of this Agreement, other than those related
to the LLC Arrangement, are intended to benefit the Members and, to the fullest
extent permitted by law, shall not be construed as conferring any benefit upon
any creditor of the Company. Notwithstanding anything to the contrary in this
Agreement, CCO Parent shall not have any duty or obligation to any creditor of
the Company to make any contribution to the Company.

     (b)  Admission of Members. Other persons may be admitted as Members from
time to time pursuant to the provisions of this Agreement. The Funding Agent
is not a Member of the Company. Moreover, in connection with the exercise of
the LLC Arrangement by the Funding Agent, the Funding Agent shall not be
admitted as a Member of the Company and shall not acquire any limited liability
company interest, membership interest or other interest in the profits, losses
and capital of the Company; rather, the Funding Agent shall only acquire the
specific rights set forth in this Agreement. If an admission of a new Member
results in the Company having more than one Member, this Agreement shall be
amended in accordance with the provisions of Section 15(b) to establish the
rights and responsibilities of the Members and to govern their relationships.

     (c)  Limited Liability. Except as required by the Act, no Member shall be
liable for the debts, liabilities and obligations of the Company, including
without limitation any debts, liabilities and obligations of the Company under
a judgment, decree or order of a court, solely by reason of being a member of
the Company. Under no circumstances shall

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 the Funding Agent be liable for the debts, liabilities and obligations of
the Company, including without limitation any debts, liabilities and
obligations of the Company under a judgment, decree or order of a court.

     (d)  Competing Activities. Notwithstanding any duty otherwise existing at
law or in equity, (i) neither a Member nor a Manager of the Company, or any of
their respective affiliates, partners, members, shareholders, directors,
managers, officers or employees, shall be expressly or impliedly restricted or
prohibited solely by virtue of this Agreement or the relationships created
hereby from engaging in other activities or business ventures of any kind or
character whatsoever and (ii) except as otherwise agreed in writing or by
written Company policy, each Member and Manager of the Company, and their
respective affiliates, partners, members, shareholders, directors, managers,
officers and employees, shall have the right to conduct, or to possess a direct
or indirect ownership interest in, activities and business ventures of every
type and description, including activities and business ventures in direct
competition with the Company.

     (e)  Bankruptcy. Notwithstanding any other provision of this Agreement,
the bankruptcy (as defined in the Act) of a Member shall not cause the Member
to cease to be a member of the Company and, upon the occurrence of such an
event, the Company shall continue without dissolution.

     SECTION 7. Percentage Interests. For purposes of this Agreement,
“Percentage Interest” shall mean with respect to any Member as of any date the
proportion (expressed as a percentage) of the respective capital account
balance of such Member to the capital account balances of all Members. So long
as CCO Parent is the sole member of the Company, CCO Parent’s Percentage
Interest shall be 100 percent.

     SECTION 8. Distributions. The Company may from time to time distribute to
the Members such amounts in cash and other assets as shall be determined by the
Members acting by simple majority of the Votes. Each such distribution (other
than liquidating distributions) shall be divided among the Members in
accordance with their respective Percentage Interests. Liquidating
distributions shall be made to the Members in accordance with their respective
positive capital account balances. Each Member shall be entitled to look
solely to the assets of the Company for the return of such Member’s positive
capital account balance. Notwithstanding that the assets of the Company
remaining after payment of or due provision for all debts, liabilities, and
obligations of the Company may be insufficient to return the capital
contributions or share of the Company’s profits reflected in such Member’s
positive capital account balance, a Member shall have no recourse against the
Company or any other Member. Notwithstanding any provision to the contrary
contained in this Agreement, the Company shall not be required to make a
distribution to the Members on account of their interest in the Company if such
distribution would violate the Act or any other applicable law.

     SECTION 9. Allocations. The profits and losses of the Company shall be
allocated to the Members in accordance with their Percentage Interests from
time to time.

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     SECTION 10. Dissolution; Winding Up.

     (a)  Dissolution. The Company shall be dissolved upon (i) the adoption of
a plan of dissolution by the Members acting by unanimity of the Votes and the
approval of the Manager or (ii) the occurrence of any other event required to
cause the dissolution of the Company under the Act.

     (b)  Effective Date of Dissolution. Any dissolution of the Company shall
be effective as of the date on which the event occurs giving rise to such
dissolution, but the Company shall not terminate unless and until all its
affairs have been wound up and its assets distributed in accordance with the
provisions of the Act and the Certificate is cancelled.

     (c)  Winding Up. Upon dissolution of the Company, the Company shall
continue solely for the purposes of winding up its business and affairs as soon
as reasonably practicable. Promptly after the dissolution of the Company, the
Manager shall immediately commence to wind up the affairs of the Company in
accordance with the provisions of this Agreement and the Act. In winding up
the business and affairs of the Company, the Manager may to the fullest extent
permitted by law, take any and all actions that it determines in its sole
discretion to be in the best interests of the Members, including, but not
limited to, any actions relating to (i) causing written notice by registered or
certified mail of the Company’s intention to dissolve to be mailed to each
known creditor of and claimant against the Company, (ii) the payment,
settlement or compromise of existing claims against the Company, (iii) the
making of reasonable provisions for payment of contingent claims against the
Company and (iv) the sale or disposition of the properties and assets of the
Company. It is expressly understood and agreed that a reasonable time shall be
allowed for the orderly liquidation of the assets of the Company and the
satisfaction of claims against the Company so as to enable the Manager to
minimize the losses that may result from a liquidation.

     SECTION 11. Transfer. At such time as the Company has more than one
Member, no Member shall transfer (whether by sale, assignment, gift, pledge,
hypothecation, mortgage, exchange or otherwise) all or any part of his, her or
its limited liability company interest in the Company to any other person
without the prior written consent of each of the other Members; provided,
however, that this Section 11 shall not restrict the ability of any Member to
transfer (at any time) all or a portion of its limited liability company
interest in the Company to another Member or pursuant to the Loan Documents (as
defined in the Credit Agreement). Upon the transfer of a Member’s limited
liability company interest, the Manager shall provide notice of such transfer
to each of the other Members and shall amend Exhibit B hereto to reflect the
transfer.

     SECTION 12. Admission of Additional Members. The admission of additional
or substitute Members to the Company shall be accomplished by the amendment of
this Agreement, including Exhibit B, in accordance with the provisions of
Section 15(b), pursuant to which amendment each additional or substitute Member
shall agree to become bound by this Agreement.

-12-

 

     SECTION 13. Tax Matters. As of the date of this Agreement, the Company is
a single-owner entity for United States federal tax purposes. So long as the
Company is a single-owner entity for federal income tax purposes, it is
intended that for federal, state and local income tax purposes the Company be
disregarded as an entity separate from its owner for income tax purposes and
its activities be treated as a division of such owner. In the event that the
Company has two or more Members for federal income tax purposes, it is intended
that (i) the Company shall be treated as a partnership for federal, state and
local income tax purposes, and the Members shall not take any position or make
any election, in a tax return or otherwise, inconsistent therewith and (ii)
this Agreement will be amended to provide for appropriate book and tax
allocations pursuant to subchapter K of the Internal Revenue Code of 1986, as
amended.

     SECTION 14. Exculpation and Indemnification.

     (a)  Exculpation. Neither the Members, the Manager, the directors of the
Company, the officers of the Company, their respective affiliates, nor any
person who at any time shall serve, or shall have served, as a director,
officer, employee or other agent of any such Members, Manager, directors,
officers, or affiliates and who, in such capacity, shall engage, or shall have
engaged, in activities on behalf of the Company (a “Specified Agent”) shall be
liable, in damages or otherwise, to the Company or to any Member for, and
neither the Company nor any Member shall take any action against such Members,
Manager, directors, officers, affiliates or Specified Agent, in respect of any
loss which arises out of any acts or omissions performed or omitted by such
person pursuant to the authority granted by this Agreement, or otherwise
performed on behalf of the Company, if such Member, Manager, director, officer,
affiliate, or Specified Agent, as applicable, in good faith, determined that
such course of conduct was in the best interests of the Company and within the
scope of authority conferred on such person by this Agreement or approved by
the Manager. Each Member shall look solely to the assets of the Company for
return of such Member’s investment, and if the property of the Company
remaining after the discharge of the debts and liabilities of the Company is
insufficient to return such investment, each Member shall have no recourse
against the Company, the other Members or their affiliates, except as expressly
provided herein; provided, however, that the foregoing shall not relieve any
Member or the Manager of any fiduciary duty, duty of care or duty of fair
dealing to the Members that it may have hereunder or under applicable law.

     (b)  Indemnification. In any threatened, pending or completed claim,
action, suit or proceeding to which a Member, a Manager, a director of the
Company, any officer of the Company, their respective affiliates, or any
Specified Agent was or is a party or is threatened to be made a party by reason
of the fact that such person is or was engaged in activities on behalf of the
Company, including without limitation any action or proceeding brought under
the Securities Act of 1933, as amended, against a Member, a Manager, a director
of the Company, any officer of the Company, their respective affiliates, or any
Specified Agent relating to the Company, the Company shall to the fullest
extent permitted by law indemnify and hold harmless the Members, Manager,
directors of the Company, officers of the Company, their respective affiliates,
and any such Specified Agents against losses, damages, expenses (including
attorneys’ fees), judgments and amounts paid in settlement actually and
reasonably incurred by or in connection with such claim, action, suit or
proceeding; provided, however, that none of the Members, Managers, directors of
the

-13-

 

 Company, officers of the Company, their respective affiliates or any
Specified Agent shall be indemnified for actions constituting bad faith,
willful misconduct, or fraud. Any act or omission by any such Member, Manager,
director, officer, or any such affiliate or Specified Agent, if done in
reliance upon the opinion of independent legal counsel or public accountants
selected with reasonable care by such Member, Manager, director, officer, or
any such affiliate or Specified Agent, as applicable, shall not constitute bad
faith, willful misconduct, or fraud on the part of such Member, Manager,
director, officer, or any such affiliate or Specified Agent.

     (c)  No Presumption. The termination of any claim, action, suit or
proceeding by judgment, order or settlement shall not, of itself, create a
presumption that any act or failure to act by a Member, a Manager, a director
of the Company, any officer of the Company, their respective affiliates or any
Specified Agent constituted bad faith, willful misconduct or fraud under this
Agreement.

     (d)  Limitation on Indemnification. Any such indemnification under this
Section 14 shall be recoverable only out of the assets of the Company and not
from the Members.

     (e)  Reliance on the Agreement. To the extent that, at law or in equity, a
Member, Manager, director of the Company, officer of the Company or any
Specified Agent has duties (including fiduciary duties) and liabilities
relating thereto to the Company or to any Member or other person bound by this
Agreement, such Member, Manager, director, officer or any Specified Agent
acting under this Agreement shall not be liable to the Company or to any Member
or other person bound by this Agreement for its good faith reliance on the
provisions of this Agreement. The provisions of this Agreement, to the extent
that they restrict the duties and liabilities of a Member, Manager, director of
the Company, officer of the Company or any Specified Agent otherwise existing
at law or in equity, are agreed by the parties hereto to replace such other
duties and liabilities of such Member, Manager, director or officer or any
Specified Agent.

     SECTION 15. Miscellaneous.

     (a)  Certificate of Limited Liability Company Interest. A Member’s limited
liability company interest may be evidenced by a certificate of limited
liability company interest executed by the Manager or an officer in such form
as the Manager may approve; provided that such certificate of limited liability
company interest shall not bear a legend that causes such limited liability
company interest to constitute a security under Article 8 (including Section
8-103) of the Uniform Commercial Code as enacted and in effect in the State of
Delaware, or the corresponding statute of any other applicable jurisdiction.

     (b)  Amendment. The terms and provisions set forth in this Agreement may
be amended, and compliance with any term or provision set forth herein may be
waived, only by a written instrument executed by persons holding a simple
majority of the Votes; provided, however, that (i) Sections 1(h), 4(c), 6(c),
11 and 15 hereof may not be amended without the consent of the Funding Agent,
(ii) Sections 4(c), 6, 7, 8, 9, 10, 11, 12, 13 and 14 hereof shall not be
amended except by unanimity of the Votes, (iii) this Agreement shall not be
amended in any manner, and none of the Members, the Manager, the Board, the
officers, or any permitted delegee of any thereof shall take any action, or
cause the Company to

-14-

 

 engage in transactions, that directly or indirectly, impair, reduce or
otherwise modify the rights of the Funding Agent under the LLC Arrangement, or
prevent the LLC Arrangement from becoming effective in accordance with its
terms, unless the Funding Agent consents in writing, and (iv) this Agreement
shall not be amended in any manner, and none of the Funding Agent, the Manager
or the Board shall take any action or cause the Company to engage in
transactions that modify or change any Member’s share of any of the following:
(i) allocations and distributions of the Company’s profits and losses; (ii)
current distributions; (iii) liquidating distributions; (iv) distributions in
redemption or withdrawal; or (v) any other distributions of the Company’s
assets, unless such Member consents in writing. This sentence and the
foregoing sentence may not be amended except by unanimity of the Votes. No
failure or delay on the part of any party in exercising any right, power or
privilege granted hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right, power or privilege preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege granted hereunder.

     (c)  Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the Members and their respective successors and assigns.

     (d)  Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware, without regard to any
conflicts of law principles that would require the application of the laws of
any other jurisdiction.

     (e)  Severability. In the event that any provision contained in this
Agreement shall be held to be invalid, illegal or unenforceable for any reason,
the invalidity, illegality or unenforceability thereof shall not affect any
other provision hereof.

     (f)  Multiple Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

     (g)  Funding Agent as an Intended Beneficiary. Notwithstanding any other
provision of this Agreement, the Funding Agent is an intended beneficiary of
the provisions of this Agreement related to the LLC Arrangement to the extent
provided herein, and the Members agree that this Agreement constitutes a legal,
valid and binding agreement of the Members, and is enforceable against the
Members by the Funding Agent, in accordance with its terms.

     (h)  Entire Agreement. This Agreement constitutes the entire agreement of
the parties hereto with respect to the subject matter hereof and supersedes and
replaces any prior or contemporaneous understandings. This Agreement amends
and restates the Limited Liability Company Agreement of the Company dated as of
February 10, 1999.

     (i)  Relationship between the Agreement and the Act. Regardless of whether
any provision of this Agreement specifically refers to particular Default Rules
(as defined below), (i) if any provision of this Agreement conflicts with a
Default Rule, the provision of this Agreement controls and the Default Rule is
modified or negated accordingly, and (ii) if it is necessary to construe a
Default Rule as modified or negated in order to effectuate any provision of
this Agreement, the Default Rule is modified or negated accordingly. For

-15-

 

 purposes of this Section 15(i), “Default Rule” shall mean a rule stated in
the Act which applies except to the extent it may be negated or modified
through the provisions of a limited liability company’s Limited Liability
Company Agreement.

     (j)  LLC Arrangement. It is the intent of each of the parties hereto that
the LLC Arrangement shall remain in full force and effect under any and all
circumstances as set forth herein, including, without limitation, during the
pendency of any event, condition or proceeding contemplated by Section 8(g) of
the Credit Agreement (including, but not limited to, any bankruptcy or
reorganization proceeding of CCO Parent or the Company).

     (k)  Governmental Approval.

          i) Notwithstanding anything herein to the contrary, this Agreement and the
transactions contemplated hereby, prior to the exercise by the Funding Agent of
any rights and powers respecting any vote, approval, consent or ratification
provided in this Agreement, except to the extent not prohibited by applicable
law, (i) do not and will not constitute, create, or have the effect of
constituting or creating, directly or indirectly, actual or practical ownership
of the Company or any of its subsidiaries by the Funding Agent or the Lenders
(under the Credit Agreement), or control, affirmative or negative, direct or
indirect, by the Funding Agent or its affiliates over the management or any
other aspect of the operation of the Company or any of its subsidiaries, which
ownership and control remains exclusively and at all times in the Members and
the members of the Company’s subsidiaries, and (ii) do not and will not
constitute the transfer, assignment, or disposition in any manner, voluntarily
or involuntarily, directly or indirectly, of any License (as defined in the
Credit Agreement) at any time issued to the Company or any of its subsidiaries,
or the transfer of control of the Company or any of its subsidiaries,
including, without limitation, within the meaning of Section 310(d) of the
Communications Act of 1934, as amended.

          ii) Notwithstanding anything to the contrary contained in this Agreement,
the Funding Agent shall not, without first obtaining the approval of the
Federal Communications Commission (“FCC”) or any other applicable Governmental
Authority (as defined in the Credit Agreement), take any action pursuant to
this Agreement which would constitute or result in, or be deemed to constitute
or result in, any assignment of a License, including, without limitation, any
CATV Franchise (as defined in the Credit Agreement) of the Company or any of
its subsidiaries, or any change of control of the Company or any of its
subsidiaries, if such assignment or change in control would require, under then
existing law (including the written rules and regulations promulgated by the
FCC), the prior approval of the FCC or such other Governmental Authority;
provided that this Section 15(k)(ii) shall not apply in the event that any such
assignment or change of control has occurred (or is deemed to have occurred)
for any reason other than through the exercise by the Funding Agent of its
rights and powers respecting any vote, approval, consent or ratification under
this Agreement.

          iii) If counsel to the Funding Agent reasonably determines that the
consent of the FCC or any other Governmental Authority is required in
connection with any of the actions which may be taken by the Funding Agent in
the exercise of its rights and powers respecting any vote, approval, consent or
ratification under this Agreement, then the Company, at its sole cost and
expense, shall use its best efforts to secure such consent and to

-16-

 

cooperate fully with the Funding Agent in any action commenced by the
Funding Agent to secure such consent. Upon the exercise by the Funding Agent
of any rights and powers respecting any vote, approval, consent or ratification
pursuant to this Agreement which requires any consent, approval, recording,
qualification or authorization of the FCC or any other Governmental Authority
or instrumentality, the Company will promptly prepare, execute, deliver and
file, or will promptly cause the preparation, execution, delivery and filing
of, all applications, certificates, instruments and other documents and papers
that the Funding Agent reasonably deems necessary or advisable to obtain such
governmental consent, approval, recording, qualification or authorization.
Subject to the provisions of applicable law, if the Company fails or refuses to
execute, or fails or refuses to cause another person to execute, such
documents, the Funding Agent, as attorney-in-fact for the Company appointed
pursuant to Section 15(k)(v), or the clerk of any court of competent
jurisdiction, may execute and file the same on behalf of the Company. In
addition to the foregoing, the Company agrees to take, or cause to be taken,
any action which the Funding Agent may reasonably request in order to obtain
and enjoy the full rights, powers and benefits of the Funding Agent under this
Agreement, including, without limitation, at the Company’s cost and expense,
the exercise of the Company’s best efforts to cooperate in obtaining FCC or
other governmental approval of any action or transaction contemplated by this
Agreement which is then required by law.

          iv) The Company recognizes that the authorizations, permits and Licenses
held by the Company or any of its subsidiaries are unique assets, and the
Company agrees to take all reasonable steps to effectuate the rights and powers
respecting vote, approval, consent or ratification of the Funding Agent under
this Agreement. The Company further recognizes that a violation of this
provision would result in irreparable harm to the Funding Agent and its
affiliates for which monetary damages are not readily ascertainable.
Therefore, in addition to any other remedy which may be available to the
Funding Agent and its affiliates at law or in equity, the Funding Agent and its
affiliates shall have the remedy of specific performance of the provisions of
this Section 15(k).

          v) The Company hereby irrevocably constitutes and appoints the Funding
Agent and any officer or agent thereof, with full power of substitution, as its
true and lawful attorney-in-fact with full irrevocable power and authority in
the place and stead of the Company and in the name of the Company or in its
own name, for the purpose of carrying out the rights and powers of the Funding
Agent under this Agreement, to take any and all appropriate action and to
execute any and all documents and instruments which may be necessary or
desirable to implement rights and powers of the Funding Agent under this
Agreement. Anything in this Section 15(k)(v) to the contrary notwithstanding,
the Funding Agent agrees that it will not exercise any rights under the power
of attorney provided for in this Section 15(k)(v) except as provided in Section
1(h). The expenses of the Funding Agent incurred in connection with actions
undertaken as provided in this Section 15(k)(v), together with interest thereon
at a rate per annum equal to the highest rate per annum at which interest would
then be payable on any category of past due ABR Loans, as defined in, and under
the Credit Agreement, from the date of payment by the Funding Agent to the date
reimbursed by Section 15(k)(v), shall be payable by Section 15(k)(v) to the
Funding Agent on demand. Pursuant to Section 15(k)(v), the Members hereby
ratify all that said attorneys shall lawfully do or cause to be done by virtue
hereof. All powers, authorizations and

-17-

 

agencies contained in this Agreement are coupled with an interest and are
irrevocable until the LLC Arrangement Notice shall have been delivered.

-18-

 

     IN WITNESS WHEREOF, the party has caused this Agreement to be duly
executed on the date first above written.

	 	 	 	 	 
	 	 	CCO HOLDINGS, LLC, a Delaware limited

liability company
	 	 	 	 	 
	 	 	
By:
	 	/s/ MARCY A. LIFTON
	 	 	 	 	

	 	 	 	 	Marcy A. Lifton
	 	 	 	 	Vice President

Accepting its appointment as the Company’s Manager subject to the provisions of
this Agreement, approving the amendment and restatement of the prior limited
liability company agreement by this Agreement, and agreeing to be bound by this
Agreement:

	 	 	 	 	 
	 	 	CHARTER COMMUNICATIONS, INC.,
a Delaware corporation
	 	 	 	 	 
	 	 	
By:
	 	/s/ MARCY A. LIFTON
	 	 	 	 	

	 	 	 	 	Marcy A. Lifton
	 	 	 	 	Vice President

Acknowledging its withdrawal from the Company:

	 	 	 	 	 
	 	 	CHARTER COMMUNICATIONS HOLDINGS, LLC, a Delaware limited liability company as withdrawing member
	 	 	 	 	 
	 	 	
By:
	 	/s/ MARCY A. LIFTON
	 	 	 	 	

	 	 	 	 	Marcy A. Lifton
	 	 	 	 	Vice President

-19-

 

EXHIBIT A

Director

Carl Vogel

EXHIBIT B

Member

CCO Holdings, LLC

-20-COMMITMENT LETTER

 

Exhibit 10.3a

Vulcan Inc.

505 Union Station

505 Fifth Avenue South, Suite 900

Seattle, WA 98104

April 14, 2003

Charter Communications VII, LLC

12405 Powerscourt Drive

St. Louis, MO 63131

Ladies and Gentlemen:

     You have requested that Vulcan Inc. (“Vulcan”) agree to, or cause one or
more of its affiliates to, provide a senior secured credit facility (the
“Facility”) to you (the “Borrower”), in an amount not to exceed $300 million
(the “Commitment Amount”). Initially, the Facility will be utilized by the
Borrower to make investments in Falcon Cable Communications, LLC (“CC VII”).
The Borrower will concurrently cause CC VII to utilize loans under the Facility
to repay revolving loans under its credit facility, loan an amount equal to the
loans under the Facility directly to Holdings and/or distribute an amount equal
to such loans to the Borrower. If CC VII makes a distribution to the Borrower,
the Borrower will then distribute such amount to Charter Communications
Holdings LLC (“Holdings”). Holdings will utilize the amount of such loan or
distribution to make direct or indirect investments in Charter Communications
Operating, LLC (“CCO”), CC VI Operating Company, LLC (“CC VI”), and CC VIII
Operating, LLC (“CC VIII Operating”). Each of CC VII, CCO, CC VI and CC VIII
Operating (the “Operating Companies”) will be required to use such amounts to
repay revolving loans under their respective credit facilities, in order to
enable the Operating Companies to create or preserve a 5% (or such higher
percentage, not to exceed 10%, as may be reasonably determined by the Operating
Companies) cushion with respect to the leverage ratio required for compliance
under their respective credit facilities through March 31, 2004 (after giving
effect to the actions reasonably available to the Operating Companies to cause
compliance with financial covenants under the Operating Company credit
facilities).

     The Facility will include a letter of credit subfacility of $100 million;
provided that the aggregate amount of the entire Facility shall not exceed the
Commitment Amount. After such time as 100% of the equity interests in the
Borrower, CCV Holdings, LLC, CC VI Holdings, LLC, and, to the extent permitted
by the lenders under its credit facility, 100% of the equity interests of CCO,
have been contributed to CCH II, LLC (“NewCo”), NewCo will become the borrower
of all subsequent advances under the Facility.

 

-2-

     Vulcan is pleased to advise you of its commitment to provide the entire
amount of the Facility, upon the terms and subject to the conditions set forth
or referred to in this commitment letter (the “Commitment Letter”) and in the
Summary of the Terms of the Facility attached hereto as Exhibit A (the “Term
Sheet”). Vulcan may provide the entire amount of the Facility directly or
indirectly through one or more of its affiliates.

     You hereby represent and covenant that (a) all information other than
financial projections (the “Information”) that has been or will be made
available to Vulcan or Vulcan’s affiliates, representatives and advisors by you
or any of your affiliates, representatives or advisors is or will be, when
furnished, complete and correct in all material respects and does not or will
not, when furnished, contain any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements contained
therein not misleading in light of the circumstances under which such
statements are made and (b) the financial projections that have been or will be
made available to Vulcan or Vulcan’s affiliates, representatives and advisors
by you or any of your affiliates, representatives or advisors have been or will
be prepared in good faith based upon reasonable assumptions, it being
understood that the projections are subject to significant uncertainties and
contingencies, many of which are beyond your control and that no assurance can
be given that such projections will be realized. You understand that we may
use and rely on the Information and financial projections without independent
verification thereof.

     As consideration for Vulcan’s commitment hereunder, you agree to pay to
Vulcan a Facility Fee equal to 1.5% of the Commitment Amount; provided that (a)
a portion of the Facility Fee in an amount equal to 0.5% of the Commitment
Amount shall be earned upon execution of this Commitment Letter and shall be
payable in equal quarterly installments during a three year period commencing
on the date of this Commitment Letter and (b) the remainder of the Facility Fee
in an amount equal to 1% of the Commitment Amount shall be earned upon
execution of the Definitive Documentation (as defined below) and shall be
payable in equal quarterly installments, commencing on the execution of the
Definitive Documentation and ending on the third anniversary of the date of
this Commitment Letter.

     Vulcan’s commitment hereunder is subject to (a) our not becoming aware
after the date hereof of any information or other matter affecting Charter
Communications, Inc., the Borrower, any of their subsidiaries or the
transactions contemplated hereby which is inconsistent in a material and
adverse manner with any such information or other matter disclosed to us prior
to the date hereof, (b) the negotiation, execution and delivery on or before
June 30, 2003 of definitive documentation (the “Definitive Documentation”) with
respect to the Facility reasonably satisfactory to Vulcan and its counsel, (c)
there not being any default or event of default under any of the credit
facilities of the Operating Companies on April 30, 2003 and (d) the other
conditions set forth or referred to in the Term Sheet. The

 

-3-

 terms and conditions of Vulcan’s commitment hereunder and of the Facility
are not limited to those set forth herein and in the Term Sheet; provided that
Vulcan acknowledges and agrees that any additional terms and conditions
required by Vulcan will be consistent with the terms and conditions set forth
in this Commitment Letter and the Term Sheet. Those matters that are not
covered by the provisions hereof and of the Term Sheet are subject to the
approval and agreement of Vulcan and the Borrower.

     You agree (a) to indemnify and hold harmless Vulcan and its affiliates and
their respective officers, directors, employees, representatives, advisors and
agents (each, an “indemnified person”) from and against any and all losses,
claims, damages and liabilities to which any such indemnified person may become
subject arising out of or in connection with this Commitment Letter, the
Facility, the use of the proceeds thereof or any related transaction or any
claim, litigation, investigation or proceeding relating to any of the
foregoing, regardless of whether any indemnified person is a party thereto, and
to reimburse each indemnified person upon demand for any legal or other
expenses incurred in connection with investigating or defending any of the
foregoing, provided that the foregoing indemnity will not, as to any
indemnified person, apply to losses, claims, damages, liabilities or related
expenses to the extent (1) they are found by a final, non-appealable judgment
of a court to arise from the willful misconduct or gross negligence of such
indemnified person, or (2) they relate to the duties owed by an indemnified
person or any of its affiliates as a director or stockholder of Charter
Communications, Inc., including any claims that arise out of claims that the
transactions contemplated by this Commitment Letter and the Term Sheet involve
transactions with an interested director, and (b) to reimburse Vulcan and its
affiliates on demand for all reasonable out-of-pocket expenses (including
reasonable fees, charges and disbursements of counsel) incurred in connection
with the Facility and any related documentation (including this Commitment
Letter, the Term Sheet, and the Definitive Documentation) or the
administration, amendment, modification or waiver thereof; provided that
expenses to be reimbursed pursuant to this clause (b) incurred through the date
of execution of the Definitive Documentation shall not exceed $1,000,000. No
indemnified person shall be liable for any damages arising from the use by
others of Information or other materials obtained through electronic,
telecommunications or other information transmission systems or for any
special, indirect, consequential or punitive damages in connection with the
Facilities.

     This Commitment Letter shall not be assignable by you, other than to
NewCo, without the prior written consent of Vulcan (and any purported
assignment without such consent shall be null and void), is intended to be
solely for the benefit of the parties hereto and is not intended to confer any
benefits upon, or create any rights in favor of, any person other than the
parties hereto. This Commitment Letter may not be amended or waived except by
an instrument in writing signed by you and Vulcan. Any provision of this
Commitment Letter which is prohibited or unenforceable in any jurisdiction
shall, as to such provision and jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without

 

-4-

 invalidating the remaining provisions of this Commitment Letter or
affecting the validity or enforceability of such provision in any other
jurisdiction. This Commitment Letter may be executed in any number of
counterparts, each of which shall be an original, and all of which, when taken
together, shall constitute one agreement. Delivery of an executed signature
page of this Commitment Letter by facsimile transmission shall be effective as
delivery of a manually executed counterpart hereof. This Commitment Letter is
the only agreement that has been entered into among us with respect to the
Facility and sets forth the entire understanding of the parties with respect
thereto.

     This Commitment Letter shall be governed by, and construed in accordance
with, the laws of the State of New York. To the fullest extent permitted by
applicable law, each of the parties hereto hereby irrevocably submits to the
nonexclusive jurisdiction of any New York State court or Federal court sitting
in the Borough of Manhattan in New York City in respect of any suit, action or
proceeding arising out of or relating to the provisions of this Commitment
Letter or the making of the commitment and irrevocably agrees that all claims
in respect of any such suit, action or proceeding may be heard and determined
in any such court. Each of the parties hereto waives to the fullest extent
permitted by applicable law, any objection which it may now or hereafter have
to the laying of the venue of any such suit, action or proceeding brought in
any such court, any claim that any such suit, action or proceeding brought in
any such court has been brought in an inconvenient forum and any right to trial
by jury in any such suit, action or proceeding. Service of any process,
summons, notice or document by registered mail addressed to either party shall
be effective service of process against such party for any suit, action or
proceeding brought in any court.

     The compensation, reimbursement and indemnification provisions contained
herein shall remain in full force and effect regardless of whether Definitive
Documentation shall be executed and notwithstanding the termination of this
Commitment Letter or Vulcan’s commitment hereunder.

     This Commitment Letter is delivered to you on the understanding that
neither this Commitment Letter nor the Term Sheet nor any of their terms or
substance shall be disclosed, directly or indirectly, to any other person
except (a) to your officers, agents, auditors and advisors who are directly
involved in the consideration of this matter, (b) to your lenders if required
by them (in which case you agree to consult with us prior to such disclosure),
or (c) as may be compelled in a judicial or administrative proceeding or as
otherwise required by law (in which case you agree to inform us prior to such
disclosure). Notwithstanding the foregoing, the parties (and each employee,
representative, or other agent of the parties) may disclose to any and all
persons, without limitation of any kind, the tax treatment and tax structure of
the Facility, provided, however, that no party (and no employee,
representative, or other agent thereof) shall, except as otherwise permitted
herein, disclose any information that is not necessary to understanding the tax
treatment and tax structure of the

 

-5-

 Facility (including any information to the extent that such disclosure
could result in a violation of any federal or state securities law).

[Remainder of page intentionally left blank.]

 

-6-

          If the foregoing correctly sets forth our agreement, please indicate your
acceptance of the terms hereof and of the Term Sheet by returning to us an
executed counterpart hereof not later than 5:00 p.m., New York City time, on
April 18, 2003. Vulcan’s commitment will expire at such time in the event
Vulcan has not received such executed counterparts in accordance with the
immediately preceding sentence, along with payment of the initial installment
of the Facility Fee.

	 	 	 	 	 
	 	 	Very truly yours,
	 	 	 	 	 
	 	 	VULCAN INC.
	 	 	 	 	 
	 	 	
By:	 	/s/ William D. Savoy
	 	 	 	 	

	 	 	 	 	William D. Savoy,
President and CEO,

Portfolio and Asset Management Division of Vulcan Inc.

 

 

 

 

 

[Remainder of page intentionally left blank.]

 

 

Accepted and agreed to as of

the date first written above by:

CHARTER COMMUNICATIONS VII, LLC

	 	 	 	 	 
	By:	 	
/s/ Curtis S. Shaw
	 	 
	 	 	

	 	 
	 	 	
Name: Curtis S. Shaw	 	 
	 	 	
Title: Senior Vice President	 	 

 

 

Exhibit A

Summary of the Terms of the Facility

     Set forth below is a summary of certain of the material terms of the
Facility. Capitalized terms used herein without being defined shall have the
meaning ascribed to such terms in the Commitment Letter (the “Commitment
Letter”) to which this Exhibit A is attached. This summary is intended merely
as an outline, and does not include descriptions of all of the terms,
conditions and other provisions that are to be contained in the Definitive
Documentation relating to the Facility; provided that the Lender acknowledges
and agrees that any additional terms and conditions required by the Lender will
be consistent with the terms and conditions set forth in this Commitment Letter
and the Term Sheet.

	 	 	 
	Initial Borrower:	 	
Charter Communications VII, LLC (“CC VII Holdings”).
	 	 	 
	NewCo:	 	
Charter Communications, Inc. (“CCI”) shall (i) use its commercially reasonable efforts to cause
Charter Communications Holdings, LLC (“Holdings”) to contribute (the “Equity Contribution”) to CCH
II, LLC (“NewCo”) all of the equity of CC VI Holdings, LLC (“CC VI Holdings”), the Borrower, CC V
Holdings, LLC (“CC V”), Charter Communications Ventures, LLC, CC Systems, LLC, CC Fiberlink, LLC and
Charter Communications Operating, LLC (“CCO”), as illustrated by Appendix A, and (ii) use its
commercially reasonable efforts to cause NewCo to hold the real estate located at 12405 Powerscourt
Drive, St. Louis, MO 63131 and corporate aircraft owned by CCI and its subsidiaries (collectively,
the “Real Estate and Aircraft”). Loans will be made only to NewCo after the Equity Contribution.
If it is impracticable for NewCo to hold the Real Estate and Aircraft directly, CCI shall cause the
owner(s) of the Real Estate and Aircraft (the “Real Estate and Aircraft Subsidiaries”) to (x) become
direct, wholly-owned subsidiaries of NewCo, (y) guarantee the Facility on a senior basis and (z)
grant a first priority security interest in the Real Estate and Aircraft to the Lender.
	 	 	 
	Facility; Use of Proceeds:	 	
Senior secured credit facility (the “Facility”) in an amount (not to exceed $300 million) equal to
the amount necessary to enable CCO, CC VI Operating Company, LLC (“CC VI”), Falcon Cable
Communications, LLC (“CC VII”) and CC VIII Operating, LLC (“CC VIII Operating”) (each of the
foregoing, an “Operating Company”) to create or preserve a 5% (or such higher percentage, not to
exceed 10%, as may be reasonably determined by the Operating Companies) cushion with respect to the
leverage ratio required for compliance under their respective credit facilities through March 31,
2004 (after giving effect to the actions reasonably available to the Operating Companies to cause
compliance with financial covenants under the Operating Company credit facilities, as identified on
Appendix D hereto). Prior to the Equity Contribution, loans under the Facility will only be made
available to CC VII Holdings (collectively, the “CC VII Loans”).

1

 

	 	 	 
	 	 	
After the Equity Contribution, loans under the Facility will only be made
available to NewCo (collectively, the “NewCo Loans”, and, together with the CC
VII Loans, the “Loans”). For purposes of this Term Sheet, “Borrower” shall
refer (1) with respect to all CC VII Loans, to CC VII Holdings, and (2) with
respect to all NewCo Loans, to NewCo.
	 	 	 
	 	 	
Upon the Equity Contribution, the Lender, NewCo and
the Borrower shall, in good faith, negotiate to
cause (a) the Loans and all other obligations to be
assumed by NewCo and (b) CC VI Holdings and CC VII
Holdings to be released from their obligations
under the Facility. The assumption of the Loans
and other obligations by NewCo and the release of
CC VI Holdings and CC VII Holdings may be referred
to hereinafter as the “Assumption.”
	 	 	 
	 	 	
It shall be a condition to the Assumption that
NewCo have no obligations to other persons or liens
on its assets except to or in favor of the Lender
and, to the extent all of the CCO equity has been
transferred to NewCo, the lenders under the CCO
credit facility (the “CCO Bank Facility”).
	 	 	 
	 	 	
In connection with the Assumption, the interest
rate shall be reduced to 12% per annum from and
after the date of the Assumption and the maturity
date shall be shortened to March 1, 2007.
	 	 	 
	 	 	
The proceeds of each CC VII Loan will be invested
in CC VII and CC VII will either repay revolving
loans under the CC VII credit facility or,
substantially concurrently with such investment,
loan an amount equal to such Loan directly to
Holdings or distribute an amount equal to such Loan
to CC VII Holdings. If CC VII makes a distribution
to CC VII Holdings, CC VII Holdings will then
distribute such amount to Holdings. Holdings will
utilize the amount of such loan or distribution to
make direct or indirect investments in CCO, CC VI
or CC VIII, LLC (“CC VIII”). The proceeds of each
NewCo Loan will be used to fund direct or indirect
investments in Operating Companies. Each
investment by NewCo to an Operating Company will be
funded through a separate NewCo Loan. Investments
in Operating Companies funded with Loans will be
used to repay revolving loans under the Operating
Company credit facilities.
	 	 	 
	 	 	
The Facility will include up to $100 million of
letters of credit (the “Letters of Credit”), issued
in replacement for letters of credit currently
outstanding under the Operating Company credit
facilities. Up to $85 million of such Letters of
Credit will be directly issued for the account of
CCO (outside of CCO’s credit facility), and
guaranteed by NewCo, the Guarantors and the Lender.
Such Letters of Credit will be issued by a
financial institution to be determined, for the
account of the Borrower, NewCo, CC VI Holdings, CC
VIII and/or CCO (up to $85 million), and the

2

 

	 	 	 
	 	 	
Guarantors and the Lender (and if NewCo becomes the Borrower, NewCo) will
guarantee the obligations of the Borrower, NewCo, CC VI Holdings, CC VIII
and/or CCO to such financial institution. Upon any payment by the Lender with
respect to such guarantee, the amount of such payment shall constitute (i) in
the case of Letters of Credit issued for the account of CCO, a subrogation
claim of the Lender against CCO guaranteed by the Borrower and the Guarantors
and having terms identical to the Loans, (ii) in the case of Letters of Credit
issued for the account of the Borrower, a Loan to the Borrower having the same
terms as the other Loans, (iii) in the case of Letters of Credit issued for the
account of CC VI Holdings and drawn prior to the Assumption, a loan to CC VI
Holdings having the same terms as the other Loans, and (iv) in the case of
Letters of Credit issued for the account of CC VIII and drawn prior to the
Assumption, a Loan to CC VIII having the same terms as the other Loans.
	 	 	 
	 	 	
The initial commitment (the “Commitment”) under the
Facility shall be $300 million. Availability under
the Commitment shall be reduced by the aggregate
amount of (x) all outstanding Loans, (y) all
outstanding Letters of Credit and (z) all drawings
under Letters of Credit that have not been repaid
to the Lender.
	 	 	 
	 	 	
Loans and issuances of Letters of Credit may only
be made during the last five business days of each
fiscal quarter ending during the period of April
30, 2003 to (and including) March 31, 2004.
	 	 	 
	 	 	
Usage of Loans under the Facility will only be
permitted to the extent necessary to maintain such
compliance (including the cushions referred to in
“Facility; Use of Proceeds” above).
	 	 	 
	Lender:	 	
Paul Allen, Vulcan Inc. and/or one of their
affiliates or any combination of the foregoing.
	 	 	 
	Ranking and Security:	 	
The Facility will constitute senior obligations of
the Borrower and the Guarantors; provided that
NewCo’s obligations shall be secured by a perfected
lien on all of NewCo’s assets including, without
limitation, the Real Estate and Aircraft (or, in
the event that the Real Estate and Aircraft are not
transferred to NewCo, the Facility will be
guaranteed by the Real Estate and Aircraft
Subsidiaries and such guarantees will be secured by
a perfected first priority lien on the Real Estate
and Aircraft) and, after consummation of the Equity
Contribution, the equity interests in CCO, CC VI
Holdings, CC VII Holdings and CC V and other
subsidiaries of Holdings transferred to NewCo
(collectively, the “Collateral”); provided, that
the lien on such equity interests shall only be
granted if such lien is not prohibited under the
CCO Bank Facility (and NewCo shall use its
commercially reasonable efforts to obtain a waiver
or amendment of the CCO Bank Facility to the extent
necessary to permit the grant of such lien). The
liens on the Collateral in favor of the Lender
shall be first priority liens, subject to no other
liens or

3

 

	 	 	 
	 	 	
encumbrances, except that the equity interests of CCO and other entities owned
by NewCo may be subject to a first priority lien in favor of the lenders under
the CCO Bank Facility.
	 	 	 
	 	 	
All the above-described liens shall be created on
terms, and pursuant to documentation (prepared by
the Lender’s counsel), reasonably satisfactory to
the Lender and none of the Collateral shall be
subject to any other pledges, security interests or
mortgages (subject to customary exceptions to be
determined, including the exception for the CCO
Bank Facility described above). In connection
therewith, no liens or other encumbrances of any
kind shall be placed on any such Collateral so long
as the Commitment Letter is in effect or the
Facility is available, the Letters of Credit are
outstanding or any Loans or drawings under the
Letters of Credit are outstanding (subject to
customary exceptions to be determined, including
the exception for the CCO Bank Facility described
above).
	 	 	 
	 	 	
The Facility will also be secured on a pari passu
basis by liens or security interests granted on any
assets or properties (other than assets or
properties of NewCo, which shall secure the
Facility on a first priority basis, subject to the
exception for the CCO Bank Facility described
above) to secure any indebtedness of CCI, HoldCo,
Holdings or any of their respective subsidiaries
(other than the Operating Company credit facilities
and other ordinary and customary exceptions to be
determined).
	 	 	 
	Guarantees:	 	
Senior guarantees of all Loans will be provided by
CCI, Charter Communications Holding Company, LLC
(“HoldCo”), Holdings, CC VI Holdings, CC VIII and
the Real Estate and Aircraft Subsidiaries, if
applicable, and senior guarantees of all CC VII
Loans will be provided by NewCo (collectively, the
“Guarantors”); provided that the Guarantee by CC VI
Holdings shall be release by the Assumption. In
addition, if any other subsidiary of CCI, HoldCo or
Holdings guarantees any debt of CCI, HoldCo and
Holdings or any of their respective subsidiaries
(other than debt outstanding under the Operating
Company credit facilities and other ordinary and
customary exceptions to be determined), then such
subsidiary shall guarantee the Facility on a senior
basis. Notwithstanding the foregoing, the
guarantees by CC VIII will be limited to the extent
required by the CC V indenture.
	 	 	 
	Interest Rate:	 	
13% per annum (subject to reduction to 12% per
annum in the event of the Assumption); provided
that to the extent the Operating Companies are not
permitted under the Operating Company credit
facilities to make amounts available to fund such
interest payments in cash, then the portion of such
interest that may not be paid in cash may be paid
in kind at the rate of 15% per annum (subject to
reduction to 14% per annum upon the Assumption).
Any loans constituting interest so paid in kind
shall otherwise be identical to the original loans.

4

 

	 	 	 
	 	 	
Interest will be calculated based on a year of 360
days and actual days elapsed.
	 	 	 
	 	 	
Interest shall be paid quarterly in arrears on
January 31, April 30, July 31 and October 31 of
each year.
	 	 	 
	Default Rate:	 	
Following an event of default, interest on the
Loans and, to the extent permitted by law, overdue
interest, as well as any other overdue amounts,
shall accrue at the rate per annum which is 200
basis points above the rate then borne by the
Loans. Such interest shall be payable on demand.
	 	 	 
	Amortization:	 	
None, prior to maturity of the Loans.
	 	 	 
	Facility Fee:	 	
1.5% of the amount of the Facility; as set forth in
the Commitment Letter.
	 	 	 
	Letter of Credit Fees:	 	
8% per annum, plus customary issuance fees.
	 	 	 
	Commitment Fee:	 	
A per annum fee equal to 0.50% of the unutilized
Commitment, payable quarterly in arrears commencing
upon execution of the Definitive Documentation.
Such fee shall be calculated based on a year of 360
days and actual days elapsed.
	 	 	 
	Maturity:	 	
November 12, 2009; provided that in the event of
the Assumption, the maturity date shall be March 1,
2007.
	 	 	 
	Call Protection;

Optional Prepayment:	 	
The Facility may be canceled by the Borrower at any
time that no Loans or Letters of Credit are
outstanding. The Loans may not be prepaid on or
prior to March 31, 2004. Optional prepayments may
be made in whole or in part at any time after March
31, 2004, on at least ten days prior written notice
for a price equal to the outstanding principal
amount thereof and all accrued interest thereon.
	 	 	 
	Offers to Purchase:	 	
The Borrower shall, subject to exceptions to be
negotiated, be required to offer to purchase the
Loans, at par, plus accrued and unpaid interest,
with (a) 100% of the net cash proceeds of all
non-ordinary-course asset sales or other
dispositions of property (including insurance and
condemnation proceeds) by CCI, HoldCo, Holdings and
any new holding companies that are parents of
NewCo, (b) 100% of the net cash proceeds of all
non-ordinary-course asset sales or other
dispositions of property (including insurance and
condemnation proceeds) by any subsidiary of NewCo,
CCI, HoldCo or Holdings not referred to in clause
(a) unless, within 5 business days of such sale or
disposition, Holdings certifies to the Lender that
it reasonably expects that all of the Operating
Companies will be in compliance with their credit
facilities for the four full fiscal quarters
following the date of such sale or disposition,
except to the extent used to permanently repay

5

 

	 	 	 
	 	 	
indebtedness under the Operating Company credit facilities, and (c) 100% of the
net cash proceeds of issuances of debt obligations of CCI, HoldCo or Holdings
and each of their respective subsidiaries, excluding borrowings under the
Operating Company credit facilities (subject to the ability to use cash
proceeds of debt issued by CCI, HoldCo, Holdings or, subject to compliance with
the “Restrictions on the Creation of Holding Companies” covenant below, new
holding companies that are parents of NewCo (in each case, without duplication)
to repay outstanding indebtedness under the Operating Company credit
facilities).
	 	 	 
	Conditions Precedent to
Borrowing:	 	
The effectiveness of the Facility and
the Commitment is subject to the
satisfaction or waiver by the Lender of
the conditions set forth in Appendix B
on the date of the initial Loan or
issuance of a Letter of Credit (the
“Closing Date”). Each issuance of
Letters of Credit and each Loan under
the Facility (including any Letters of
Credit issued or Loans made on the
Closing Date) is subject to the
satisfaction or waiver by the Lender of
the conditions set forth in Appendix C.
	 	 	 
	Representations and
Warranties:	 	
The Definitive Documentation relating
to the Facility will contain
representations and warranties that are
usual and customary for transactions of
this nature or reasonably required by
the Lender for this transaction in
particular (subject to customary
exceptions, limitations and
qualifications), including but not
limited to (i) Corporate Existence and
Power; (ii) Authorization, Execution
and Enforceability of Material
Agreements; (iii) Governmental
Authorization; (iv) Non-Contravention
of Laws or Material Agreements; (v)
Financial Information; (vi) Litigation;
(vii) Taxes; (viii) Subsidiaries; (ix)
Not an Investment Company; (x) ERISA;
(xi) Environmental; (xii) Permits and
Licenses; (xiii) Leases; (xiv) Full
Disclosure; (xv) Capitalization; (xvi)
Solicitation; Access to Information;
(xvii) Absence of Any Undisclosed
Liabilities; (xviii) Historical
Financial Statements; (xix) No Material
Adverse Change; (xx) Absence of
Defaults; Ability to Satisfy Drawing
Conditions under Operating Company
Credit Facilities during the current
quarter (after giving effect to
waivers/amendments under Operating
Company credit facilities and the use
of proceeds from any Loans or Letters
of Credit made or issued under the
Facility); (xxi) Governmental
Regulations; and (xxii) Limitations on
Activities of the Borrower, NewCo, CC
VI Holdings and CC VIII.
	 	 	 
	 	 	
It is acknowledged and agreed that the
representations and warranties shall be
similar to those contained in the
Operating Company credit facilities
except to the extent relating to the
structure, terms and purpose of the
Facility or covering the Borrower and
Guarantors not subject to the Operating
Company credit facilities.
	 	 	 
	Covenants:	 	
The Definitive Documentation relating
to the Facility will contain covenants
that are usual and customary for
transactions of this

6

 

	 	 	 
	 	 	
nature or reasonably required by the Lender for
this transaction in particular (subject to
customary exceptions, limitations and
qualifications), including but not limited to
covenants with respect to (i) Furnishing of
Information; (ii) Use of Proceeds; (iii)
Compliance with Laws; (iv) Insurance; (v)
Restrictions on Indebtedness of NewCo, CCO, CC VI
Holdings, CC VII Holdings, CC V and their
respective subsidiaries; (vi) Restrictions on
Dividends and Redemptions; (vii) Restrictions on
the Sale of Assets; (viii) Restrictions on
Business Activities; (ix) Restrictions on
Transactions with Affiliates; (x) Restrictions on
Merger or Consolidation by NewCo, CCO, CC V, CC VI
Holdings, CC VII Holdings, CC VIII and their
subsidiaries; (xi) Restrictions on Liens; (xii)
Restrictions on Investments and Acquisitions;
(xiii) Limitations on Activities of NewCo, CCO, CC
V, CC VI Holdings, CC VII Holdings and their
respective subsidiaries; (xiv) Restrictions on
Significant Modifications or Restructurings of
Existing Indebtedness of NewCo, CCO, CC V, CC VI
Holdings, CC VII Holdings and their respective
subsidiaries, (xv) Restrictions on the Creation of
Holding Companies, and (xvi) Right of First Offer
on Issuances of Equity by CCI or its Subsidiaries.
	 	 	 
	 	 	
It is acknowledged and agreed that the covenants
shall be similar to those contained in the
Operating Company credit facilities with respect
to the borrowers under the Operating Company
credit facilities and subsidiaries thereof.
	 	 	 
	 	 	
The Restrictions on Indebtedness covenant will (i)
prohibit additional indebtedness of CC VII
Holdings, NewCo, CCVI Holdings and CC VIII, (ii)
restrict indebtedness of other subsidiaries of
CCI, HoldCo or Holdings that are subject to the
Operating Company credit facilities, except
indebtedness under the Operating Company credit
facilities and other exceptions to be determined
(including indebtedness permitted under the
current Operating Company credit facilities) and,
in each case, subject to protection of the
structural seniority of the Facility, and (iii)
require that any subsidiary of CCI shall guarantee
the Facility on a senior basis as provided above
under “Guarantees.”
	 	 	 
	 	 	
The Restrictions on the Sale of Assets Covenant
will (a) restrict sales of assets outside the
ordinary course of business by the Real Estate and
Aircraft Subsidiaries, CCO, CC VI Holdings, CC VII
Holdings, CC V and their respective subsidiaries,
except for sales of assets by the Operating
Companies to the extent permitted by the current
Operating Company credit facilities and subject to
compliance with the requirements of “Offers to
Purchase” set forth above; provided that sales or
issuances of equity interests in the Operating
Companies or subsidiaries thereof to CCI and its
subsidiaries will not be permitted except to other
Operating Companies and subsidiaries thereof and
(b) prohibit sales of assets by NewCo (provided
that cash distributions will be permitted as
provided below to pay interest on indebtedness of
CCI, Holdings,

7

 

	 	 	 
	 	 	
HoldCo and, subject to compliance with the
“Restrictions on the Creation of Holding
Companies” covenant below, new holding companies
that are parents of NewCo (in each case, without
duplication) and management fees).
	 	 	 
	 	 	
The Restrictions on the Creation of Holding
Companies covenant will protect the structural
seniority of the Facility as to all indebtedness
of CCI, HoldCo, Holdings and their respective
subsidiaries, except for indebtedness under the
credit facilities, the Avalon bonds and other
ordinary and customary exceptions to be
determined. The covenant will prohibit the
creation of new holding companies by NewCo, CCO,
CC V, CC VI Holdings, CC VII Holdings and their
respective subsidiaries. The covenant will permit
the creation of additional holding companies as
direct or indirect subsidiaries of Holdings so
long as 100% of the equity interests in CCO, CC V,
CC VI Holdings and CC VII Holdings have been
contributed to NewCo prior to the formation of any
such holding companies. The covenant will not
restrict the creation of holding companies that
are subsidiaries of CCI and parent companies of
Holdings (or NewCo, after the Equity
Contribution), so long as before any equity
interests are offered to any person other than a
wholly-owned subsidiary of HoldCo, they are first
offered to Vulcan as set forth in “The Right of
Offer on Issuances of Equity by CCI to is
Subsidiaries Covenant.” All new holding company
subsidiaries of CCI will guarantee the Facility on
a senior basis. No transfer by Holdings of its
equity interests in CCO, CC V, CC VI Holdings and
CC VII Holdings will be permitted except to NewCo.
After the Equity Contribution, CCO, CC V, CC VI
Holdings and CC VII Holdings will be direct
wholly-owned subsidiaries of NewCo, and NewCo will
not be permitted to transfer such equity
interests.
	 	 	 
	 	 	
The Right of First Offer on Issuances of Equity by
CCI or its Subsidiaries covenant will prohibit the
issuance of any equity interests of CCI or any of
its subsidiaries to any person (other than NewCo)
unless the Lender is first offered the opportunity
to acquire such equity interests on the same (or,
in the case of issuances for other than cash,
economically equivalent) terms to be provided to
any other person or entity, and the Lender
declines to acquire such interests for 30 days
after such offer is made. This will be subject to
customary exceptions, including for issuance of
options to employees.
	 	 	 
	 	 	
The Restrictions on Liens Covenant will (a)
require the granting of liens on the assets of
NewCo and the Real Estate and Aircraft
Subsidiaries, as provided under “Ranking and
Security” and otherwise prohibit the creation of
any other liens on the assets of NewCo or the Real
Estate and Aircraft Subsidiaries; provided that
the equity interests of CCO and other entities
owned by NewCo may be subject to a first priority
lien in favor of the lenders under the CCO Bank
Facility, (b) to the extent not prohibited by the

8

 

	 	 	 
	 	 	
Operating Company credit facilities, restrict the
creation of liens by CCV, CC VI Holdings, CC VII
Holdings, and their respective subsidiaries, and
(c) require that CCI and its subsidiaries (other
than NewCo, CCO, CC V, CC VI Holdings, CC VII
Holdings and their respective subsidiaries) secure
the Facility as set forth above under “Ranking and
Security.”
	 	 	 
	 	 	
The Restrictions on Investments and Acquisitions
Covenant will restrict investments and
acquisitions by NewCo, CCO, CC V, CC VI Holdings,
CC VII Holdings and their respective subsidiaries
but will permit investments by Operating Companies
in other Operating Companies and other
investments, in each case, to the extent permitted
by the Operating Company credit facilities;
provided that, notwithstanding the foregoing,
investments in CCI and its subsidiaries (other
than NewCo and its subsidiaries) will be
prohibited except for guarantees of the Facility
and investments by CC VII in Holdings from the
proceeds of any CC VII Loans.
	 	 	 
	 	 	
The Restrictions on Significant Modifications or
Restructurings of Existing Indebtedness covenant
will permit amendments and refinancings of the
Operating Company credit facilities and the Avalon
bonds, so long as such amendments or modifications
do not (a) modify the dividend covenants, (b) the
Change of Control defaults or covenants in any
manner that increases the threshold for control,
(c) the financial covenants (subject to the right
of the Operating Companies to modify existing
financial covenant ratios or to give effect to the
impact of accounting adjustments on such financial
covenants), or (d) the transaction with affiliates
covenants (to the extent relating to the Facility,
the Equity Contribution or the other transactions
contemplated hereby), in each case, (1) in a
manner that is materially adverse to the Lender
and (2) restricts, limits or impairs (x) the
ability of the Operating Companies to distribute
funds to NewCo, CC VI Holdings, CC VII Holdings or
CC VIII, or (y) the operation or effectiveness of
covenants and structural protections contained in
the Facility.
	 	 	 
	 	 	
The Restrictions on Dividends and Redemptions
covenant will prohibit dividends, distributions
and redemptions by (a) NewCo, CCO, CC VI Holdings,
CC VII Holdings, CC V and their respective
subsidiaries prior to the Assumption, (b) NewCo
and its subsidiaries after the Assumption, if 100%
of the equity interests of CCO are contributed to
NewCo prior to the Assumption, and (c) NewCo, CCO
and their respective subsidiaries after the
Assumption, if 100% of the equity interests of CCO
are not contributed to NewCo prior to the
Assumption; provided that distributions to pay
interest on indebtedness of CCI, Holdings, HoldCo
and, subject to compliance with the “Restrictions
on the Creation of Holding Companies” covenant
above, new holding companies that are parents of
NewCo (in each case, without duplication) and
management fees will be permitted to the extent
permitted under the Operating Company credit
facilities so long as

9

 

	 	 	 
	 	 	
(a) no Default or Event of Default shall have
occurred and be continuing and (b) the Total
Leverage Ratio and Interest Coverage Ratio (in
each case modeled after the comparable ratios
under the credit facilities, with appropriate
adjustments) at the time of such distribution is
less than (in the case of the Total Leverage
Ratio) or greater than (in the case of the
Interest Coverage Ratio) an amount to be
determined.
	 	 	 
	Financial Covenants:	 	
The Definitive Documentation relating to the
Facility will contain a Total Leverage
Covenant and Interest Coverage Covenant, in
each case modeled after the comparable
covenants in the Operating Company credit
facilities, with appropriate adjustments to
be determined. The Total Leverage Ratio and
Interest Coverage Ratio will be calculated
for (x) the Borrower, CC VI Holdings and CC
V prior to the Equity Contribution and (y)
NewCo subsequent to the Equity Contribution.
When CCO is contributed to NewCo,
appropriate adjustments will be made to the
Total Leverage Ratio and Interest Coverage
Ratio.
	 	 	 
	Events of Default:	 	
The Definitive Documentation relating to the
Facility will contain Events of Default that
are usual and customary for transactions of
this nature or reasonably required by the
Lender for this transaction in particular,
including, but not limited to, the following
(but subject to customary exceptions,
qualifications and grace periods): (i) the
failure of the Borrower to pay principal,
interest or fees on the Loans or other
amounts under the Facility when due; (ii) a
default in (x) the payment of principal when
due, (y) the payment of interest when due
after giving effect to any applicable grace
period or (z) a non-payment default which
causes, or permits the holders of
indebtedness to cause, after giving any
required notice, such indebtedness to become
due prior to its stated maturity, in each
case, under any instrument or instruments
governing indebtedness of CCI, HoldCo,
Holdings, NewCo, CC VII Holdings, CC VI
Holdings, or CC VIII or any of their
subsidiaries; (iii) final judgments
aggregating in excess of a threshold amount
to be agreed rendered against CCI, HoldCo,
Holdings, NewCo, CC VII Holdings, CC VI
Holdings or CC VIII or any of their
subsidiaries; (iv) certain events of
bankruptcy, insolvency or reorganization
with respect to CCI, HoldCo, Holdings,
NewCo, CC VII Holdings, CC VI Holdings or CC
VIII or any of their subsidiaries; (v)
misrepresentations in the Definitive
Documentation relating to the Facility; (vi)
Change of Control (to be defined but, in any
event, to exclude any Change of Control
caused by Lender (or any of its affiliates
other than CCI and its subsidiaries); (vii)
defaults under material agreements or
material loss of licenses; or (viii)
non-compliance with any covenant in the
Definitive Documentation relating to the
Facility.
	 	 	 
	Expenses and Indemnification:	 	
All reasonable out-of-pocket costs of the
Lender associated with the Facility are to
be paid by the Borrower whether or not any
funds are drawn thereunder; provided that
expenses to be reimbursed through

10

 

	 	 	 
	 	 	
the date of execution of the Definitive Documentation shall not exceed $1,000,000.
	 	 	 
	 	 	
The Borrower and the Guarantors will indemnify the Lender and its officers,
directors, employees, affiliates and agents collectively (“indemnified persons”) and
hold them harmless from and against all reasonable costs, expenses (including
reasonable fees, disbursements and other charges of counsel) and liabilities of any
such indemnified person arising out of or relating to those matters set forth in the
Definitive Documentation relating to the Facility, including, without limitation, any
claim or any litigation or other proceedings (regardless of whether any such
indemnified person is a party thereto) that relate to the Facility, the formation of
NewCo or any transactions connected therewith (including, without limitation, the
Equity Contribution), provided that no indemnified person will be indemnified for
such costs, expenses and liabilities (a) arising from its gross negligence or willful
misconduct as determined by a court of competent jurisdiction in a final and
nonappealable decision, or (b) to the extent they relate to the duties owed by an
indemnified person or any of its affiliates as a director or stockholder of CCI,
including any claims that arise out of any claim that the transactions contemplated
hereby involve interested director transactions.
	 	 	 
	Transfers:	 	
The Notes and the commitments shall not be transferable, other than to any affiliate
of the Lender, without the prior written consent of the Borrower, which may not be
unreasonably withheld.

11

 

APPENDIX A

A-1

 

APPENDIX B

Conditions to Effectiveness of Facility on Closing Date

     The effectiveness of the Facility on the Closing Date is subject to the
execution of definitive documentation (the “Definitive Documentation”) and to
satisfaction, on or prior to the Closing Date, of the conditions precedent
reasonably deemed appropriate by the Lender for leveraged financings generally
and for the Facility in particular including, without limitation, the
following:

	 	(a)	 	The Definitive Documentation shall be prepared by counsel to
the Lender and shall be in form and substance reasonably satisfactory
to the Lender in all respects. The Definitive Documentation shall be
in full force and effect;
	 
	 	(b)	 	CCI, Holdings and the Operating Companies shall have
consummated the actions reasonably available to the Operating
Companies to cause compliance with financial covenants under the
Operating Company credit facilities, as summarized in Appendix D
hereto, with respect to the quarter ending March 31, 2003, and each
subsequent quarter prior to the Closing Date;
	 
	 	(c)	 	All limited liability company, corporate and other proceedings
relating to the formation of NewCo and the financings and the other
transactions contemplated hereby shall be reasonably satisfactory to
the Lender and its counsel in all respects;
	 
	 	(d)	 	Receipt of all material governmental and third party consents
and approvals necessary or desirable in connection with the formation
of NewCo, the financings and the other transactions contemplated
hereby;
	 
	 	(e)	 	There shall be no material adverse change in the facts and
information previously provided to the Lender;
	 
	 	(f)	 	All representations and warranties contained in the Definitive
Documentation shall be true and correct. Such representations and
warranties will include, without limitation, representations and
warranties as to:

	 	(i)	 	Absence of any material adverse effect on or change
in, or any event, development or circumstance that could
reasonably be expected to have a material adverse effect on or
change in, the business, property, operations, income or
condition (financial or otherwise) of any of (1) CC VII
Holdings, CC VI Holdings, CC VIII and NewCo, (2) Holdings, (3)
CCI, (4) HoldCo, (5) CCO and its subsidiaries, taken as a
whole, (6) CC VI and its subsidiaries, taken as a whole, (7) CC
VII and its subsidiaries on a consolidated basis, or (8) CC
VIII and its subsidiaries, taken as a whole since (x) December
31, 2002, in the case of the CC VII Holdings, CC VI Holdings,
CC VIII, NewCo, Holdings, CCI and HoldCo, (y) December 31,
2000, in the case of CCO, CC VII and CC VIII Operating and (z)
June 30, 1999, in the case of CC VI;

B-1

 

	 	(ii)	 	Absence of any material adverse effect on, or any
event, development or circumstance that could reasonably be
expected to have a material adverse effect on, (x) the validity
or enforceability of any material provision of the Definitive
Documentation or the material rights and remedies of the Lender
thereunder or (y) the ability of the Borrower and the
Guarantors to perform their obligations under the Definitive
Documentation;
	 
	 	(iii)	 	Absence of any action, suit, investigation,
litigation or proceeding pending or threatened in any court or
before any arbitrator or governmental instrumentality that has
had or could reasonably be expected to have a material adverse
effect on (a) the business, property, operations, income or
condition (financial or otherwise) of any of (1) the Borrower,
(2) Holdings, (3) CCI, (4) HoldCo, (5) CCO and its
subsidiaries, taken as a whole, (6) CC VI and its subsidiaries,
taken as a whole, (7) CC VII its subsidiaries on a consolidated
basis, and (8) CC VIII and its subsidiaries, taken as a whole
or (b) the validity or enforceability of any material provision
of the Definitive Documentation or the material rights and
remedies of the Lender thereunder or the ability of the
Borrower and the Guarantors to perform their obligations under
the Definitive Documentation; and
	 
	 	(iv)	 	Accuracy of the matters set forth in clause (j)
below.

	 	 	 	The Lender acknowledges that the conditions set forth above in
clauses (i) through (iii) of this clause (f) shall not fail to be
satisfied solely as a result of information actually known to the
Lender as of April 14, 2003 or disclosed in public filings made by
CCI or any of its subsidiaries with the Securities and Exchange
Commission on or prior to April 14, 2003; provided that events,
developments or circumstances arising after April 14, 2003 or
resulting in changes to information actually known or contained in
such filings as of April 14, 2003 may result in such conditions not
being satisfied.
	 
	 	 	 	The Lender, CCI and the Borrower acknowledge that the conditions set
forth in clauses (i), (ii) and (iii) above shall be satisfied, to
the extent relating to the Operating Companies, so long as each of
the Operating Companies satisfies the analogous
conditions/representations in the Operating Company credit
facilities. Such conditions/representations shall also be satisfied
with respect to the Borrower and the Guarantors so long as (i) each
of the Operating Companies satisfies the analogous
conditions/representations in the Operating Company credit
facilities and (ii) there are no other events, developments or
circumstances relating to the Borrower and the Guarantors which
result in the conditions/representations above failing to be
satisfied with respect to the Borrower and the Guarantors.
	 
	 	(g)	 	The Lender shall have received satisfactory opinions of counsel
to the Borrower, the Guarantors and their respective subsidiaries as
to the transactions contemplated hereby, and such resolutions,
certificates and other documents as the Lender shall reasonably
request;

B-2

 

	 	(h)	 	Absence of any Event of Default under the Definitive
Documentation or event that, with notice and/or the passage of time,
would become an Event of Default;
	 
	 	(i)	 	Holdings shall have received a fairness opinion in connection
with the Facility, the Loans and the transactions contemplated
hereby, as required under the high yield bonds of Holdings (the
“Holdings Bonds”); and
	 
	 	(j)	 	The Lender shall be reasonably satisfied that no default or
event of default shall exist under the Holdings Bonds, the
convertible notes of CCI (the “CCI Convertible Notes”), the Avalon
bonds, the Renaissance Media Bonds or the Operating Company credit
facilities on the Closing Date.

B-3

 

APPENDIX C

Conditions to Each Drawdown and Letter of Credit Issuance

     Each drawdown of Loans and Letter of Credit issuance is subject to the
satisfaction, on the date of such borrowing or issuance, as applicable, of the
conditions precedent deemed appropriate by the Lender for leveraged financings
generally and for the Facility in particular including, without limitation, the
following:

	 	(a)	 	Each drawdown of Loans and Letter of Credit issuance shall be
made during the last five business days of a fiscal quarter ending
during the period of June 30, 2003 to (and including) March 31, 2004
and shall be used to repay revolving loans under the Operating
Company credit facilities prior to the end of the fiscal quarter in
which such Loan is made and, in the case of Letters of Credit, to
replace letters of credit issued under the Operating Company credit
facilities prior to the end of the fiscal quarter in which such
Letter of Credit is issued;
	 
	 	(b)	 	CCI, Holdings and the Operating Companies shall have
consummated the actions reasonably available to the Operating
Companies to cause compliance with financial covenants under the
Operating Company credit facilities, as summarized in Appendix D
hereto, with respect to the quarter in which such drawdown or
issuance is requested;
	 
	 	(c)	 	The Borrower shall have provided, at least five business days
prior to each drawdown of Loans and Letter of Credit issuance, a
request for borrowing or issuance containing a certification as to
the satisfaction of the conditions precedent set forth herein as well
as calculations showing that, after giving effect to such drawdown of
Loans or Letter of Credit issuance, the Borrower reasonably expects
each Operating Company to be in compliance with all financial
covenants contained in the Operating Company credit facilities, in
each case with respect to the quarter in which such drawdown or
issuance is requested. Such certification and calculations shall be
reasonably satisfactory to the Lender;
	 
	 	(d)	 	All representations and warranties contained in the Definitive
Documentation shall be true and correct in all material respects.
Such representations and warranties will include, without limitation,
representations and warranties as to:

	 	(i)	 	Absence of any material adverse effect on or change
in, or any event, development or circumstance that could
reasonably be expected to have a material adverse effect on or
change in, the business, property, operations, income or
condition (financial or otherwise) of any of (1) NewCo, CC VII
Holdings, CC VI Holdings, or CC VIII, (2) Holdings, (3) CCI,
(4) HoldCo, (5)CCO and its subsidiaries, taken as a whole, (6)
CC VI and its subsidiaries, taken as a whole, (7) CC VII and
its subsidiaries on a consolidated basis, or (8) CC VIII
Operating and its subsidiaries, taken as a whole since (x)
December 31, 2002, in the case of the CC VII Holdings, NewCo,
CC VI Holdings, CC VIII, Holdings, CCI and HoldCo, (y) December
31, 2000, in

C-1

 

	 	 	 	the case of CCO, CC VII and CC VIII Operating and (z) June 30,
1999, in the case of CC VI;
	 
	 	(ii)	 	Absence of any material adverse effect on, or any
event, development or circumstance that has had or could
reasonably be expected to have a material adverse effect on,
(x) the validity or enforceability of any material provision of
the Definitive Documentation or the material rights and
remedies of the Lender thereunder or (y) the ability of the
Borrower and the Guarantors to perform their obligations under
the Definitive Documentation;
	 
	 	(iii)	 	Absence of any action, suit, investigation,
litigation or proceeding pending or threatened in any court or
before any arbitrator or governmental instrumentality that has
had or could reasonably be expected to have a material adverse
effect on (a) the business, property, operations, income or
condition (financial or otherwise) of any of (1) CC VII
Holdings, NewCo, CC VI Holdings or CC VIII, (2) Holdings, (3)
CCI, (4) HoldCo, (5) CCO and its subsidiaries, taken as a
whole, (6) CC VI and its subsidiaries, taken as a whole, (7) CC
VII its subsidiaries on a consolidated basis, and (8) CC VIII
and its subsidiaries, taken as a whole or (b) the validity or
enforceability of any material provision of the Definitive
Documentation or the material rights and remedies of the Lender
thereunder or the ability of the Borrower and the Guarantors to
perform their obligations under the Definitive Documentation;
and
	 
	 	(iv)	 	Accuracy of the matters set forth in clause (g)
below.

		
	 	     The Lender acknowledges that the conditions set forth above in
clauses (i) through (iii) of this clause (d) shall not fail to be
satisfied solely as a result of information actually known to the Lender
as of April 14, 2003 or disclosed in public filings made by CCI or any of
its subsidiaries with the Securities and Exchange Commission on or prior
to April 14, 2003; provided that events, developments or circumstances
arising after April 14, 2003 or resulting in changes to information
actually known as of April 14, 2003 may result in such conditions not
being satisfied.

		
	 	     The Lender, CCI and the Borrower acknowledge that the conditions set
forth in clauses (i), (ii) and (iii) above shall be satisfied, to the
extent relating to the Operating Companies, so long as each of the
Operating Companies satisfies the analogous conditions/representations in
the Operating Company credit facilities. Such conditions/representations
shall also be satisfied with respect to the Borrower and the Guarantors so
long as (i) each of the Operating Companies satisfies the analogous
conditions/representations in the Operating Company credit facilities and
(ii) there are no other events, developments or circumstances relating to
the Borrower and the Guarantors which result in the
conditions/representations above failing to be satisfied with respect to
the Borrower and the Guarantors.

	 	(e)	 	Absence of any Event of Default under the Definitive
Documentation or event that, with notice and/or the passage of time,
would become an Event of Default;

C-2

 

	 	(f)	 	With respect to any drawings in the quarter ending March 31,
2004, the Lender shall have received the consolidated financial
statements of CCI and Holdings and the consolidated financial
statements of each of the Operating Companies for the fiscal year
ended December 31, 2003, including balance sheets as of the end of
such fiscal year and income and cash flow statements for such fiscal
year, audited by KPMG and prepared in conformity with GAAP, together
with the reports thereon, which financial statements shall not
include any “going concern” qualification or similar qualification or
exception as to CCI, Holdings, any Operating Company or any
subsidiary thereof; and
	 
	 	(g)	 	The Lender shall be reasonably satisfied that no default or
event of default shall exist under the Holdings Bonds, the CCI
Convertible Notes, the Avalon bonds, the Renaissance Media Bonds or
the Operating Company credit facilities on the date of drawdown or
issuance or is reasonably expected to occur in the fiscal quarter in
which such drawdown or issuance is to occur.

C-3

 

APPENDIX D

Covenant Compliance Transactions

	•	 	Utilization of available cash to pay down debt under the Operating
Company credit facilities, subject to maintaining appropriate cash
balances as reasonably determined by the Operating Companies
	 
	•	 	Repayment of intercompany debt, subject to reserves to pay interest on
the CCI Convertible Notes
	 
	•	 	Investments or distributions from CC VII to the extent it has a 5% (or
such higher percentage, not to exceed 10%, as may be reasonably
determined by CC VII) cushion under the leverage ratio of its credit
facility to Holdings to be utilized to make investments in Operating
Companies that do not have such cushion, subject to availability under
its credit facility and available cash or cash equivalents.

D-1

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