Document:

EX-10.8: CREDIT AGREEMENT

 

Exhibit 10.8

Conformed Copy

EXECUTION COPY

 

FALCON CABLE COMMUNICATIONS, LLC

as Borrower

 

CREDIT AGREEMENT

 

Dated as of June 30, 1998, as Amended and Restated as of November 12, 1999,

as further Amended and Restated as of September 26, 2001

 

BANK OF AMERICA, N.A. AND FLEET NATIONAL BANK

as Documentation Agents

 

J.P. MORGAN SECURITIES INC.

as Syndication Agent

and

TORONTO DOMINION (TEXAS), INC.

as Administrative Agent

J.P. MORGAN SECURITIES INC. AND TD SECURITIES (USA) INC.

as Joint Lead Arrangers and Joint Bookrunners

 

 

Table of Contents

	 	 	 	 	 	 
	 	 	 	Page
	 	 	 	

	1. Definitions; Certain Rules of Construction
	 	 	1	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	2. The Credits
	 	 	25	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	2.1. Revolving Credit
	 	 	25	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	2.2. Term Loan B
	 	 	28	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	2.3. Term Loan C
	 	 	28	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	2.4. Supplemental Credit
	 	 	28	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	2.5. New Restatement Revolving Facility
	 	 	32	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	2.6. Application of Proceeds
	 	 	35	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	2.7. Nature of Obligations of Lenders to Extend Credit
	 	 	35	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	3. Interest; Eurodollar Pricing Options; Fees
	 	 	35	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	3.1. Interest
	 	 	35	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	3.2. Eurodollar Pricing Options
	 	 	35	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	3.3. Commitment Fees
	 	 	38	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	3.4. Taxes
	 	 	39	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	3.5. Capital Adequacy
	 	 	39	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	3.6. Regulatory Changes
	 	 	39	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	3.7. Computations of Interest and Fees
	 	 	40	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	3.8. Interest Limitation
	 	 	40	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	4. Payment
	 	 	40	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	4.1. Payment at Maturity
	 	 	40	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	4.2. Fixed Required Prepayments
	 	 	40	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	4.3. Maximum Amount of Revolving Credit, etc
	 	 	41	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	4.4. Asset Sales
	 	 	41	 

 

 

	 	 	 	 	 	 
	 	4.5. Designated Financing Debt
	 	 	42	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	4.6. Voluntary Prepayments
	 	 	42	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	4.7. Application of Payments
	 	 	43	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	5. Conditions to Extending Credit
	 	 	43	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	5.1. Conditions to Effectiveness of Amendment and Restatement
	 	 	43	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	5.2. Conditions to Each Extension of Credit
	 	 	44	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	5.3. Conditions on Supplemental Facility Closing Dates
	 	 	44	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	6. Guarantees
	 	 	45	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	6.1. Guarantees of Credit Obligations
	 	 	45	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	6.2. Continuing Obligation
	 	 	45	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	6.3. Waivers with Respect to Credit Obligations
	 	 	46	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	6.4. Lenders’ Power to Waive, etc
	 	 	47	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	6.5. Information Regarding Obligors, etc
	 	 	48	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	6.6. Certain Guarantor Representations
	 	 	48	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	6.7. No Subrogation
	 	 	49	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	6.8. Subordination
	 	 	49	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	6.9. Contribution Among Guarantors
	 	 	49	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	6.10. Future Subsidiaries; Further Assurances
	 	 	49	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	6.11. Release of Guarantor
	 	 	50	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	7. General Covenants
	 	 	50	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	7.1. Taxes and Other Charges; Accounts Payable
	 	 	50	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	7.2. Conduct of Business, etc
	 	 	50	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	7.3. Insurance
	 	 	51	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	7.4. Financial Statements and Reports
	 	 	51	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	7.5. Certain Financial Tests
	 	 	54	 

 

 

	 	 	 	 	 	 
	
	
	
	

	 	7.6. Indebtedness
	 	 	55	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	7.7. Guarantees; Letters of Credit
	 	 	56	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	7.8. Liens
	 	 	56	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	7.9. Investments and Acquisitions
	 	 	58	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	7.10. Distributions
	 	 	59	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	7.11. Merger, Consolidation and Dispositions of Assets
	 	 	61	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	7.12. Issuance of Stock by Subsidiaries; Subsidiary Distributions
	 	 	62	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	7.13. ERISA, etc
	 	 	62	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	7.14. Transactions with Affiliates
	 	 	62	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	7.15. Interest Rate Protection
	 	 	63	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	7.16. Compliance with Environmental Laws. Each of the Restricted
Companies will:
	 	 	63	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	7.17. No Outside Management Fees
	 	 	63	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	7.18. Derivative Contracts
	 	 	64	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	7.19. Negative Pledge Clauses
	 	 	64	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	8. Representations and Warranties
	 	 	64	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	8.1. Organization and Business
	 	 	64	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	8.2. Financial Statements and Other Information; Material Agreements
	 	 	65	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	8.3. Changes in Condition
	 	 	65	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	8.4. Title to Assets
	 	 	65	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	8.5. Licenses, etc
	 	 	66	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	8.6. Litigation
	 	 	66	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	8.7. Tax Returns
	 	 	66	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	8.8. Authorization and Enforceability
	 	 	67	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	8.9. No Legal Obstacle to Agreements
	 	 	67	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	8.10. Defaults
	 	 	67	 

 

 

	 	 	 	 	 	 
	
	
	
	

	 	8.11. Certain Business Representations
	 	 	67	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	8.12. Environmental Regulations
	 	 	68	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	8.13. Pension Plans
	 	 	69	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	8.14. Government Regulation; Margin Stock
	 	 	69	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	8.15. Disclosure
	 	 	69	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	9. Defaults
	 	 	69	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	9.1. Events of Default
	 	 	69	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	9.2. Certain Actions Following an Event of Default
	 	 	72	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	9.3. Annulment of Defaults
	 	 	73	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	9.4. Waivers
	 	 	73	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	10. Expenses; Indemnity
	 	 	74	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	10.1. Expenses
	 	 	74	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	10.2. General Indemnity
	 	 	75	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	11. Operations
	 	 	75	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	11.1. Interests in Credits
	 	 	75	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	11.2. Agents’ Authority to Act, etc
	 	 	75	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	11.3. Borrower to Pay Agent, etc
	 	 	75	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	11.4. Lender Operations for Advances, etc
	 	 	76	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	11.5. Sharing of Payments, etc
	 	 	77	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	11.6. Agent’s Resignation or Removal
	 	 	77	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	11.7. Concerning the Agents
	 	 	77	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	11.8. Rights as a Lender
	 	 	79	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	11.9. Independent Credit Decision
	 	 	79	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	11.10. Indemnification
	 	 	79	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	12. Successors and Assigns; Lender Assignments and Participations
	 	 	80	 

 

 

	 	 	 	 	 	 
	
	
	
	

	 	12.1. Assignments by Lenders
	 	 	80	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	12.2. Credit Participants
	 	 	82	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	12.3. Replacement of Lender
	 	 	83	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	13. Confidentiality
	 	 	83	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	14. Foreign Lenders
	 	 	84	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	15. Notices
	 	 	84	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	16. Limited Recourse Against Partners
	 	 	85	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	17. Amendments, Consents, Waivers, etc
	 	 	85	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	17.1. Lender Consents for Amendments
	 	 	85	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	17.2. Course of Dealing; No Implied Waivers
	 	 	87	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	18. General Provisions
	 	 	87	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	18.1. Defeasance
	 	 	87	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	18.2. No Strict Construction
	 	 	87	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	18.3. Certain Obligor Acknowledgments
	 	 	87	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	18.4. Venue; Service of Process; Certain Waivers
	 	 	87	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	18.5. WAIVER OF JURY TRIAL
	 	 	88	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	18.6. Interpretation; Governing Law; etc
	 	 	88	 
	
	
	
	

	 
	 	 	 	 
	
	
	
	

	 	18.7. Pledge and Subordination Agreement
	 	 	89	 

 

 

EXHIBITS

	 	 	 
	Exhibit	 	 
	
	 	 
	1-A	 	
-Borrower, Restricted Companies and Guarantors
	
	
	
	

	 	 	 
	
	
	
	

	1-B	 	
-Example of Pro Rata Revolver Prepayment
	
	
	
	

	 	 	 
	
	
	
	

	1-C	 	
-Form of Subordinated Note
	
	
	
	

	 	 	 
	
	
	
	

	2.1.3	 	
-Form of Revolving Note
	
	
	
	

	 	 	 
	
	
	
	

	2.2.2	 	
-Form of Term Loan B Note
	
	
	
	

	 	 	 
	
	
	
	

	2.3.2	 	
-Form of Term Loan C Note
	
	
	
	

	 	 	 
	
	
	
	

	5.2.1	 	
-Officer’s Certificate
	
	
	
	

	 	 	 
	
	
	
	

	7.6.10	 	
-Financing Debt, Certain Investments, etc.
	
	
	
	

	 	 	 
	
	
	
	

	7.14	 	
-Affiliate Contractual Obligations
	
	
	
	

	 	 	 
	
	
	
	

	8.1	 	
-Holding Companies
	
	
	
	

	 	 	 
	
	
	
	

	8.2.2	 	
-Material Agreements
	
	
	
	

	 	 	 
	
	
	
	

	11.1	 	
-Commitments in respect of Revolving Loan/New Restatement Revolving Loan
	
	
	
	

	 	 	 
	
	
	
	

	12.1.1	 	
-Assignment and Acceptance

 

 

                  This Agreement, dated as of June 30, 1998, as amended and restated as of
November 12, 1999, as further amended and restated as of September 26, 2001, is
among Falcon Cable Communications, LLC, a Delaware limited liability company
(the “Borrower”), the Guarantors (as defined below) parties hereto, the Lenders
(as defined below) parties hereto, Bank of America, N.A. and Fleet National
Bank, as Documentation Agents, J.P. Morgan Securities Inc., as Syndication
Agent, and Toronto Dominion (Texas), Inc., as Administrative Agent.

                  Recitals: The parties hereto have agreed to amend and restate the Credit
Agreement, dated as of June 30, 1998, as amended and restated as of November
12, 1999 (the “Existing Credit Agreement”), among the Borrower and the other
parties named therein, as provided in this Agreement, which Agreement shall
become effective upon the satisfaction of the conditions precedent set forth in
Section 5.1 hereof. It is the intent of the parties hereto that this Agreement
not constitute a novation of the obligations and liabilities existing under the
Existing Credit Agreement or evidence repayment of any of such obligations and
liabilities and that this Agreement amend and restate in its entirety the
Existing Credit Agreement and re-evidence the obligations of the Borrower
outstanding thereunder.

                  The parties hereto hereby agree that on the Second Restatement Effective
Date (as defined below) the Existing Credit Agreement shall be amended and
restated in its entirety as follows:

                  1. Definitions; Certain Rules of Construction

                  Certain capitalized terms are used in this Agreement and in the other
Credit Documents with the specific meanings defined below in this Section 1.
Except as otherwise explicitly specified to the contrary, (a) the capitalized
term “Section” refers to sections of this Agreement, (b) the capitalized term
“Exhibit” refers to exhibits to this Agreement, (c) references to a particular
Section include all subsections thereof, (d) the word “including” shall be
construed as “including without limitation”, (e) accounting terms not otherwise
defined herein shall have the meaning provided under GAAP, (f) references to a
particular statute or regulation include all rules and regulations thereunder
and any successor statute, regulation or rules, in each case as from time to
time in effect, (g) references to a particular Person include such Person’s
successors and assigns to the extent not prohibited by this Agreement and the
other Credit Documents, (h) references to “Dollars” or “$” mean United States
Funds and (i) references to the “date hereof” mean June 30, 1998. In addition,
the Administrative Agent is authorized to insert in the definitive execution
copy of this Agreement the respective dollar amounts of the scheduled
reductions of the Maximum Amount of Revolving Credit and the Maximum Amount of
New Restatement Revolving Credit pursuant to Sections 2.1.1 and 2.5.1 based on
the aggregate amount thereof as of the Second Restatement Effective Date and
the respective scheduled percentage reductions set forth in said Sections,
together with a final version of Exhibit 11.1. Notwithstanding anything to the
contrary in this Agreement, the Borrower and no more than one Revolving Lender
may agree that such Revolving Lender shall convert its Commitment in respect of
the Revolving Loan into a Commitment in respect of the New Restatement
Revolving Loan (not to exceed $20,000,000) at any time during the period from
the Second Restatement Effective Date to the date that is 10 days thereafter.
Any such conversion shall be deemed to be effective as of the Second
Restatement Effective Date.

                  “Accumulated Benefit Obligations” means the actuarial present value of the
accumulated benefit obligations under any Plan, calculated in a manner
consistent with Statement No. 87 of the Financial Accounting Standards Board.

                  “Administrative Agent” means Toronto Dominion in its capacity as
administrative agent for the Lenders hereunder, as well as its successors and
assigns in such capacity pursuant to Section 11.6.

                  “Affected Lender” is defined in Section 12.3.

 

2

                  “Affiliate” means, with respect to any Restricted Company (or any other
specified Person, including a Lender), any other Person directly or indirectly
controlling, controlled by or under direct or indirect common control with such
Restricted Company (or other specified Person) or, in the case of any Lender
which is an investment fund, the investment advisor thereof and any investment
fund having the same investment advisor, and shall include (a) any officer
(having a title of senior vice president or equal or greater seniority) or
director or general partner of such Restricted Company (or other specified
Person) and (b) any Person of which the Restricted Company (or other specified
Person) or any Affiliate (as defined in clause (a) above) of such Restricted
Company (or other specified Person) shall, directly or indirectly, beneficially
own either (i) at least 15% of the outstanding Equity Interests having the
general power to vote or (ii) at least 15% of all Equity Interests.

                  “Agent” means each of the Documentation Agents, the Syndication Agent and
the Administrative Agent.

                  “Aggregate Percentage Interests” means, at any date, the sum of the dollar
amounts represented by the Percentage Interests in each of the Revolving Loan,
New Restatement Revolving Loan, Term Loan B, Term Loan C and Supplemental Loan.

                  “Agreement” means this Agreement as from time to time in effect.

                  “Annualized Asset Cash Flow Amount” means, with respect to any disposition
of assets, an amount equal to the portion of Consolidated Operating Cash Flow
for the most recent fiscal quarter as to which financial statements have been
delivered pursuant to Section 7.4.1 or 7.4.2 which was contributed by such
assets multiplied by four.

                  “Applicable Margin” means, on any date, the percentage in the table below
for the applicable portion of the Revolving Loan, New Restatement Revolving
Loan, Supplemental Restatement Revolving Loan, Term Loan B or Term Loan C, as
the case may be, set opposite the applicable Reference Leverage Ratio.

Revolving Loan

	 	 	 	 	 	 	 	 	 
	Reference Leverage Ratio	 	Base Rate	 	Eurodollar Pricing Option
	
	 	
	 	

	Greater than or equal to 5.50
	 	 	1.000	%	 	 	2.000	%
	
	
	
	

	Greater than or equal to 5.00 but less than 5.50
	 	 	0.750	%	 	 	1.750	%
	
	
	
	

	Greater
than or equal to 4.50 but less than 5.00
	 	 	0.500	%	 	 	1.500	%
	
	
	
	

	Greater than or equal to 4.00 but less than 4.50
	 	 	0.250	%	 	 	1.250	%
	
	
	
	

	Less than 4.00
	 	 	0.000	%	 	 	1.000	%

New Restatement Revolving Loan/Supplemental Restatement Revolving Loan

	 	 	 	 	 	 	 	 	 
	Reference Leverage Ratio	 	Base Rate	 	Eurodollar Pricing Option
	
	 	
	 	

	Greater than or equal to 5.50
	 	 	1.250	%	 	 	2.250	%
	
	
	
	

	Greater than or equal to 4.50 but less than 5.50
	 	 	1.000	%	 	 	2.000	%
	
	
	
	

	Greater than or equal to 2.50 but less than 4.50
	 	 	0.750	%	 	 	1.750	%
	
	
	
	

	Less than 2.50
	 	 	0.500	%	 	 	1.500	%

 

3

Term Loan B

	 	 	 	 	 	 	 	 	 
	Reference Leverage Ratio	 	Base Rate	 	Eurodollar Pricing Option
	
	 	
	 	

	Greater than or equal to 5.50
	 	 	1.250	%	 	 	2.250	%
	
	
	
	

	Greater than or equal to 2.50 but less than 5.50
	 	 	1.000	%	 	 	2.000	%
	
	
	
	

	Less than 2.50
	 	 	0.750	%	 	 	1.750	%

Term Loan C

	 	 	 	 	 	 	 	 	 
	Reference Leverage Ratio	 	Base Rate	 	Eurodollar Pricing Option
	
	 	
	 	

	Greater than or equal to 5.50
	 	 	1.500	%	 	 	2.500	%
	
	
	
	

	Less than 5.50
	 	 	1.250	%	 	 	2.250	%

                  Any adjustment in the Applicable Margin shall take effect on the third
Banking Day following the receipt by the Administrative Agent of the financial
statements required to be furnished by Section 7.4.1 or 7.4.2; provided,
however, that if for any reason the Restricted Companies shall not have
furnished the financial statements required by Section 7.4.1 or 7.4.2 for any
fiscal quarter by the time required by such Sections and the Administrative
Agent reasonably determines that the Applicable Margin indicated by the
Reference Leverage Ratio for such fiscal quarter would be increased from that
previously in effect, commencing on the date which is three Banking Days after
such financial statements were due until the third Banking Day following
receipt by the Administrative Agent of such financial statements, the
Applicable Margin shall be the Applicable Margin as so increased. In the case
of the New Restatement Revolving Loan, the Supplemental Restatement Revolving
Loan and Term Loan B, the Applicable Margin corresponding to a Reference
Leverage Ratio of less than 2.50 shall not be available until the Borrower has
delivered financial statements pursuant to Section 7.4.1 with respect to its
fiscal year ending December 31, 2001.

                  “Applicable Maturity Date” means (a) with respect to the Revolving Loan,
the Final Revolving Maturity Date, (b) with respect to Term Loan B, the Final
Term Loan B Maturity Date, (c) with respect to Term Loan C, the Final Term Loan
C Maturity Date, (d) with respect to the New Restatement Revolving Loan, the
Final New Restatement Revolving Maturity Date, (e) with respect to the
Supplemental Restatement Revolving Loan, the Final Supplemental Restatement
Revolving Maturity Date and (f) with respect to any other Supplemental Loan,
the final maturity date of the applicable portion of such Supplemental Loan.

                  “Applicable Rate” means, at any date, the sum of:

		
	 	     (a) (i) with respect to each portion of the Loan (including the
Supplemental Restatement Revolving Loan) subject to a Eurodollar Pricing
Option, the sum of the Applicable Margin plus the Eurodollar Rate with
respect to such Eurodollar Pricing Option;

 

4

		
	 	     (ii) with respect to each other portion of the Loan (including the
Supplemental Restatement Revolving Loan), the sum of the Applicable
Margin plus the Base Rate; and
	 
	 	     (iii) with respect to any Supplemental Facility (other than the
Supplemental Restatement Revolving Facility), the rate per annum agreed
in writing by the Borrower and the Lenders extending such Supplemental
Facility in accordance with Section 2.4;
	 
	 	     plus, (b) an additional 2% beginning on the occurrence of an Event
of Default and ending on the date such Event of Default is no longer
continuing.

                  “Asset Reinvestment Reserve Amount” is defined in Section 4.4.3.

                  “Assignee” is defined in Section 12.1.1.

                  “Assignment and Acceptance” is defined in Section 12.1.1.

                  “Banking Day” means any day other than Saturday, Sunday or a day on which
banks in Houston, Texas or New York, New York are authorized or required by law
or other governmental action to close and, if such term is used with reference
to a Eurodollar Pricing Option, any day on which dealings are effected in the
Eurodollars in question by first-class banks in the inter-bank Eurodollar
markets in New York, New York and at the location of the applicable Eurodollar
Office.

                  “Bankruptcy Code” means Title 11 of the United States Code (or any
successor statute) and the rules and regulations thereunder, all as from time
to time in effect.

                  “Bankruptcy Default” means an Event of Default referred to in Section
9.1.11.

                  “Base Rate” means, on any day, the greater of (a) the rate of interest
announced by the Administrative Agent at the Houston Office from time to time
as its corporate base rate (which may not be its lowest commercial lending
rate) or (b) the sum of 1/2% plus the Federal Funds Rate.

                  “Basic Eurodollar Rate” means, with respect to each day during each
Interest Period pertaining to a Loan subject to a Eurodollar Pricing Option,
the rate per annum determined on the basis of the rate for deposits in Dollars
for a period equal to such Interest Period commencing on the first day of such
Interest Period appearing on Page 3750 of the Telerate screen as of 11:00 A.M.,
London time, two Banking Days prior to the beginning of such Interest Period.
In the event that such rate does not appear on Page 3750 of the Telerate screen
(or otherwise on such screen), the “Basic Eurodollar Rate” shall be determined
by reference to such other comparable publicly available service for displaying
eurodollar rates as may be selected by the Administrative Agent or, in the
absence of such availability, by reference to the rate at which the
Administrative Agent is offered Dollar deposits at or about 10:00 A.M., Houston
time, two Banking Days prior to the beginning of such Interest Period in the
interbank eurodollar market where its eurodollar and foreign currency and
exchange operations are then being conducted for delivery on the first day of
such Interest Period for the number of days comprised therein. Each
determination by the Administrative Agent of any Basic Eurodollar Rate pursuant
to the foregoing sentence shall, in the absence of manifest error, be
conclusive.

                  “Borrower” is defined in the preamble hereto.

                  “By-laws” means all written by-laws, rules, regulations and all other
documents relating to the management, governance or internal regulation of any
Person other than an individual, or interpretive of the Charter of such Person,
all as from time to time in effect.

 

5

                  “Capital Expenditures” means, for any period, amounts added or required to
be added to the property, plant and equipment or other fixed assets account on
the Consolidated balance sheet of the Restricted Companies, prepared in
accordance with GAAP, in respect of (a) the acquisition, construction,
improvement or replacement of land, buildings, machinery, equipment, leaseholds
and any other real or personal property, (b) to the extent not included in
clause (a) above, materials, contract labor and direct labor relating thereto
(excluding amounts properly expensed as repairs and maintenance in accordance
with GAAP) and (c) software development costs to the extent not expensed in
accordance with GAAP; provided, however, that Capital Expenditures shall not
include the purchase price for the acquisition of another Person (or all or a
portion of the assets of another Person) as a going concern permitted by
Section 7.9; and provided, further, that Capital Expenditures shall not include
amounts funded with insurance proceeds received in respect of the loss of or
damage to property, plant, equipment or other fixed assets of the Restricted
Companies.

                  “Capitalized Lease” means any lease which is required to be capitalized on
the balance sheet of the lessee in accordance with GAAP, including Statement
Nos. 13 and 98 of the Financial Accounting Standards Board.

                  “Capitalized Lease Obligations” means the amount of the liability
reflecting the aggregate discounted amount of future payments under all
Capitalized Leases calculated in accordance with GAAP, including Statement Nos.
13 and 98 of the Financial Accounting Standards Board.

                  “Cash Equivalents” means:

		
	 	     (a) negotiable certificates of deposit, time deposits (including
sweep accounts), demand deposits and bankers’ acceptances issued by any
Lender or any United States financial institution having capital and
surplus and undivided profits aggregating at least $100,000,000 and rated
at least Prime-2 by Moody’s Investors Service, Inc. or A-2 by Standard &
Poor’s Ratings Services;
	 
	 	     (b) short-term corporate obligations rated at least Prime-2 by
Moody’s Investors Service, Inc. or A-2 by Standard & Poor’s Ratings
Services, or issued by any Lender;
	 
	 	     (c) any direct obligation of the United States of America or any
agency or instrumentality thereof, or of any state or municipality
thereof, (i) which has a remaining maturity at the time of purchase of
not more than one year or (ii) which is subject to a repurchase agreement
with any Lender (or any other financial institution referred to in clause
(a) above) exercisable within one year from the time of purchase and
(iii) which, in the case of obligations of any state or municipality, is
rated Aa2 or better by Moody’s Investors Service, Inc.;
	 
	 	     (d) any mutual fund or other pooled investment vehicle rated Aa2 or
better by Moody’s Investors Service, Inc. which invests principally in
obligations described above; and
	 
	 	     (e) in an amount not to exceed $5,000,000, deposits in overnight
sweep accounts offered by a bank described in clause (a) above.

                  “CERCLA” means the federal Comprehensive Environmental Response,
Compensation and Liability Act of 1980.

                  “CERCLIS” means the federal Comprehensive Environmental Response
Compensation Liability Information System List (or any successor document)
promulgated under CERCLA.

 

6

                  “Charter” means the articles of organization, certificate of
incorporation, statute, constitution, joint venture agreement, partnership
agreement, limited liability company operating agreement, trust indenture or
other charter document of any Person other than an individual, each as from
time to time in effect.

                  “Charter Communications VII” means Charter Communications VII, LLC, a
Delaware limited liability company, and any successor corporation, partnership,
limited liability company or other entity that would not create an Event of
Default immediately as a result of such succession and that enters into
assumption agreements with respect to the Pledge and Subordination Agreement
and the other Credit Documents to which Charter Communications VII is a party
reasonably satisfactory to such successor and the Administrative Agent in all
respects.

                  “Charter Communications VII Debt” means any Indebtedness of Charter
Communications VII.

                  “Charter Group” means the collective reference to Charter Communications,
Inc., Charter Communications Holding Company, LLC, the Borrower and its
Subsidiaries, together with any member of the Paul Allen Group or any Affiliate
of any such member that, in each case, directly or indirectly owns Equity
Interests (determined on the basis of economic interests) in the Borrower or
any of its Subsidiaries. Notwithstanding the foregoing, no individual and no
entity organized for estate planning purposes shall be deemed to be a member of
the Charter Group.

                  “Closing Date” means the Initial Closing Date and each subsequent date on
which any extension of credit is made pursuant to Section 2.1, or 2.4 or 2.5.

                  “Code” means, collectively, the federal Internal Revenue Code of 1986 (or
any successor statute) and the rules and regulations thereunder.

                  “Commitment” means, with respect to any Lender, such Lender’s Percentage
Interest in the obligations to extend the credits contemplated by the Credit
Documents.

                  “Commitment Notice” is defined in Section 2.4.1.

                  “Commonly Controlled Entity” means an entity, whether or not incorporated,
that is under common control with the Borrower within the meaning of Section
4001 of ERISA or is part of a group that includes the Borrower and that is
treated as a single employer under Section 414 of the Code.

                  “Communications Act” means the federal Communications Act of 1934, the
federal Cable Television Consumer Protection and Competition Act of 1992 and
the federal Telecommunications Act of 1996.

                  “Computation Covenants” means Sections 7.5, 7.6.6, 7.6.7, 7.6.14, 7.6.15,
7.6.16, 7.7.3, 7.9.7, 7.9.8, 7.9.9, 7.9.11, 7.10.3, 7.10.7, 7.10.8, 7.11.3,
7.11.5, 7.11.7 and 7.17.

                  “Consolidated” and “Consolidating”, when used with reference to any term,
mean that term as applied to the accounts of the Restricted Companies (or other
specified Person) and all of their respective Subsidiaries (or other specified
group of Persons), or such of their respective Subsidiaries as may be
specified, consolidated or combined or consolidating or combining, as the case
may be, in
accordance with GAAP and with appropriate deductions for minority
interests in Subsidiaries, as required by GAAP; provided, however, that in no
event shall the Excluded Companies be included in the

 

7

Consolidated financial
statements of the Restricted Companies for purposes of compliance with Section
7 (other than Section 7.4) or for purposes of determining the Applicable Margin
and the related definitions.

                  “Consolidated Annualized Operating Cash Flow” means the product of
Consolidated Operating Cash Flow multiplied by four.

                  “Consolidated Cash Interest Expense” means, for any period, the aggregate
amount of interest, including payments in the nature of interest under
Capitalized Leases and net payments under Interest Rate Protection Agreements,
accrued by the Restricted Companies on Consolidated Total Debt and Interest
Rate Protection Agreements (whether such interest is reflected as an item of
expense or capitalized) in accordance with GAAP on a Consolidated basis;
provided, however, that Consolidated Cash Interest Expense shall include
commitment fees and other Lender fees included in interest expense in
accordance with GAAP and Distributions to any Qualified Parent Company or
Charter Communications VII described in Section 7.10.3 on account of interest
on Indebtedness incurred by any Qualified Parent Company or Charter
Communications VII, as the case may be, but shall not include PIK Interest
Payments.

                  “Consolidated Excess Cash Flow” means, for any period, Consolidated
Operating Cash Flow minus Consolidated Total Fixed Charges.

                  “Consolidated Interest Coverage Ratio” means, for any fiscal quarter of
the Restricted Companies, a ratio, expressed as a percentage, equal to
Consolidated Operating Cash Flow for the three-month period ending on the last
day of such fiscal quarter divided by Consolidated Cash Interest Expense for
such three-month period.

                  “Consolidated Net Income” means, for any period, the net income (or loss)
of the Restricted Companies determined in accordance with GAAP on a
Consolidated basis (giving pro forma effect to the results of operations for
such period of any Person or other business acquired through purchase or
exchange by the Restricted Companies in accordance with Section 7.9 during such
period, but not giving effect to the results of operations for such period
contributed by any System or other assets sold by the Restricted Companies
during such period); provided, however, that Consolidated Net Income shall not
include:

		
	 	     (a) the income (or loss) of any Person (other than a Restricted
Company or a Subsidiary of a Restricted Company) in which any Restricted
Company has an ownership interest; provided, however, that Consolidated
Net Income shall include amounts in respect of the income of such Person
when actually received in cash by the Restricted Companies in the form of
dividends or similar Distributions (except as otherwise provided in
Section 7.6.15);
	 
	 	     (b) all amounts included in computing such net income (or loss) in
respect of the write-up of any asset or the retirement of any
Indebtedness at less than face value after December 31, 1997;
	 
	 	     (c) the effect of extraordinary and nonrecurring items of gain,
income, loss or expense, including in any event the following items: (i)
litigation and tax judgments and settlements of up to an aggregate of
$2,500,000 (or such larger amount as may be approved by the Specified
Agents, whose approval shall not be unreasonably withheld) during any
fiscal year of the Restricted Companies and (ii) payments of up to an
aggregate of $5,000,000 (or such larger amount as may be approved by the
Specified Agents) during any fiscal quarter of the Restricted
Companies in respect of: franchise taxes relating to prior periods;
payments, refunds or credits in 

 

8

		
	 	respect of customer late fees relating to
prior periods; other similar items relating to prior periods; and
acquisition deposits that are forfeited during such period;
	 
	 	     (d) the income of any Subsidiary (other than a Restricted Company)
to the extent the payment of such income in the form of a Distribution or
repayment of Indebtedness to any Restricted Company is not permitted,
whether on account of any Charter or By-law restriction, any agreement,
instrument, deed or lease or any law, statute, judgment, decree or
governmental order, rule or regulation applicable to such Subsidiary or
otherwise; and
	 
	 	     (e) any after-tax gains or losses attributable to returned surplus
assets of any Plan.

                  For purposes of computing Consolidated Net Income for any fiscal quarter,
to the extent such items have not previously been accrued or allocated to a
prior period, (i) payments of insurance deductible amounts and discretionary
employee or management bonuses shall be allocated one fourth to the fiscal
quarter in which payment is made and one fourth to each of the next three
fiscal quarters and (ii) Consolidated Net Income shall include 100% of the
income of each Restricted Company, notwithstanding that such Restricted Company
may not be a Wholly Owned Subsidiary of the Borrower and that, as a result
thereof, GAAP would otherwise require a portion of such Restricted Company’s
income from Consolidated Net Income to be deducted on account of minority
interests in such Restricted Company.

                  “Consolidated Operating Cash Flow” means, for any three-month period, the
total of:

		
	 	     (a) Consolidated Net Income

		
	 	     plus (b) all amounts deducted in computing such Consolidated Net
Income in respect of:

		
	 	     (i) depreciation, amortization and other charges that
are not expected to be paid in cash;
	 
	 	     (ii) interest on Financing Debt (including payments in
the nature of interest under Capitalized Leases) and net
payments in the nature of interest under Interest Rate
Protection Agreements;
	 
	 	     (iii) federal, state and local taxes based upon or
measured by income;
	 
	 	     (iv) other non-cash charges; and
	 
	 	     (v) any reasonable costs incurred or expensed in
connection with an acquisition or disposition permitted by
Sections 7.9 or 7.11.

		
	 	     minus (c) to the extent Consolidated Net Income has not already
been reduced thereby, payments of a type described in Section 7.17 (in
respect of management fees and expenses), whether or not permitted
thereby.

                  “Consolidated Pro Forma Debt Service” means, for any period, the sum of
the following items, projected to be accrued by the Restricted Companies:

		
	 	     (a) Consolidated Cash Interest Expense,

		
	 	     plus (b) the aggregate amount of all mandatory scheduled payments
(excluding the final scheduled principal payment on each Term Loan) and
mandatory prepayments of revolving loans 

 

9

		
	 	as a result of mandatory
reductions in revolving credit availability, all with respect to
Financing Debt of the Restricted Companies in accordance with GAAP on a
Consolidated basis, including payments in the nature of principal under
Capitalized Leases, but in no event including contingent prepayments
required by Sections 4.3, 4.4 or 4.5 or voluntary payments contemplated
by Section 4.6.

For purposes of computing Consolidated Pro Forma Debt Service:

		
	 	     (i) the amount of Financing Debt outstanding on the first day of
such period shall be assumed to remain outstanding during the entire
period, except to the extent required to be reduced by mandatory
scheduled payments, mandatory payments on the Revolving Loan and other
items described in paragraph (b) above; and

		
	 	     (ii) where interest varies with a floating rate, the rate in effect
on the first day of such period will be assumed to remain constant during
the entire period (giving effect to any applicable Interest Rate
Protection Agreements).

                  “Consolidated Revenues” means, for any period:

		
	 	     (a) the net operating revenues (after reductions for
discounts) of the Restricted Companies determined in
accordance with GAAP on a Consolidated basis;

		
	 	     minus (b) any proceeds included in such net operating revenues
from the sale, refinancing, condemnation or destruction of any Systems;

		
	 	     minus (c) actual bad debt expense to the extent not already
deducted in computing such net operating revenues.

                  “Consolidated Total Debt” means, at any date, the principal amount of all
Financing Debt of the Restricted Companies on a Consolidated basis minus the
lesser of (a) cash and Cash Equivalents of the Restricted Companies on a
Consolidated basis in accordance with GAAP or (b) $5,000,000.

                  “Consolidated Total Fixed Charges” means, for any period, the sum of:

		
	 	     (a) Consolidated Cash Interest Expense;

		
	 	     plus,(b) the aggregate amount of all mandatory scheduled payments
and mandatory prepayments of revolving loans as a result of mandatory
reductions in revolving credit availability, all with respect to
Financing Debt of the Restricted Companies in accordance with GAAP on a
Consolidated basis, including payments in the nature of principal under
Capitalized Leases, but in no event including contingent prepayments
required by Sections 4.4 or 4.5 or voluntary prepayments contemplated by
Section 4.6;

		
	 	     plus,(c) Capital Expenditures;

		
	 	     plus, (d) federal, state and local taxes based upon or measured by
income actually paid by any Restricted Company, other than taxes with
respect to extraordinary and nonrecurring gains;

 

10

		
	 	     plus, (e) Distributions by the Restricted Companies to their
partners or members that are not Restricted Companies of a type described
in Section 7.10.5 (in respect of taxes), whether or not permitted
thereby;

		
	 	     plus, (f) to the extent not included in the foregoing clauses,
Distributions by the Restricted Companies to any Qualified Parent Company
or Charter Communications VII of a type described in Section 7.10.3 (for
debt service), whether or not permitted thereby.

                  “Copyright Act” is defined in Section 8.5.2.

                  “Credit Document” means:

		
	 	     (a) this Agreement, the Notes, the Pledge and Subordination
Agreement, any fee agreement with the Administrative Agent entered into
by the Borrower on or after the First Restatement Effective Date, each
Interest Rate Protection Agreement provided by a Lender (or an Affiliate
of a Lender) to any Restricted Company and the documentation governing
any Lender Letter of Credit, each as from time to time in effect; and

		
	 	     (b) any other present or future agreement or instrument from time to
time entered into among any Restricted Company or (so long as any
Restricted Company is also party thereto) any Affiliate of any of them,
on one hand, and either the Administrative Agent or all the Lenders, on
the other hand, relating to, amending or modifying this Agreement or any
other Credit Document referred to above or which is stated to be a Credit
Document, each as from time to time in effect.

                  “Credit Obligation” means all present and future liabilities, obligations
and Indebtedness of any Restricted Company or any of their Affiliates party to
a Credit Document owing to any Lender (or, in the case of Interest Rate
Protection Agreements or Lender Letters of Credit, any Affiliate of a Lender)
under or in connection with this Agreement, any other Credit Document or any
Lender Letter of Credit, including obligations in respect of principal,
interest, commitment fees, payment and reimbursement obligations under Interest
Rate Protection Agreements and Lender Letters of Credit, amounts provided for
in Sections 3.2.4, 3.4, 3.5, 3.6 and 10 and other fees, charges, indemnities
and expenses from time to time owing hereunder or under any other Credit
Document or any Lender Letter of Credit (all whether accruing before or after a
Bankruptcy Default and whether or not allowed in a bankruptcy proceeding).

                  “Credit Participant” is defined in Section 12.2.

                  “Credit Security” means all assets from time to time hereafter subjected
to a security interest, mortgage or charge (or intended or required so to be
subjected pursuant to the Pledge and Subordination Agreement or any other
Credit Document) to secure the payment or performance of any of the Credit
Obligations.

                  “Default” means any Event of Default and any event or condition which with
the passage of time or giving of notice, or both, would become an Event of
Default.

                  “Delinquency Period” is defined in Section 11.4.3.

                  “Delinquent Lender” is defined in Section 11.4.3.

                  “Delinquent Payment” is defined in Section 11.4.3.

 

11

                  “Designated Financing Debt” means Financing Debt incurred by a Restricted
Company after the Second Restatement Effective Date other than Financing Debt
permitted by Sections 7.6.1 (the Credit Obligations), 7.6.7 (purchase money
Indebtedness and Capitalized Leases), 7.6.9 (intercompany Indebtedness), 7.6.10
(existing Indebtedness), 7.6.14 (Specified Long-Term Indebtedness), 7.6.15
(assumed Indebtedness) and 7.6.16 (other Indebtedness).

                  “Distribution” means, with respect to any Restricted Company (or other
specified Person):

		
	 	     (a) the binding declaration or payment of any dividend or
distribution, including dividends payable in Equity Interests of any
Restricted Company, on or in respect of any Equity Interests of any
Restricted Company;

		
	 	     (b) the purchase, redemption or other retirement by any Restricted
Company of any Equity Interests of any Holding Company (or of options,
warrants or other rights for the purchase of such Equity Interests),
directly, indirectly through a Subsidiary or otherwise;

		
	 	     (c) any other distribution on or in respect of any Equity Interest
in any Restricted Company;

		
	 	     (d) any payment by any Restricted Company of principal or interest
with respect to, or any purchase, redemption or defeasance by any
Restricted Company of, any Specified Long-Term Indebtedness (other than
(i) the payment of scheduled interest payments required to be made in
cash, (ii) the prepayment of any Specified Long-Term Indebtedness with
the proceeds of other Specified Long-Term Indebtedness, so long as such
new Indebtedness has terms no less favorable to the interests of the
Borrower and the Lenders than those applicable to the Indebtedness being
refinanced, and (iii) the prepayment of Specified Subordinated Debt with
the proceeds of other Specified Long-Term Indebtedness or of the Loan);
and

		
	 	     (e) any payment (including amounts accrued and payable for
management fees and reimbursement of expenses), loan or advance by any
Restricted Company to, or any other Investment by any Restricted Company
in, the holder of any Equity Interest in any Holding Company or any
Affiliate of such holder;

provided, however, that the term “Distribution” shall not include payments in
the ordinary course of business in respect of (i) reasonable compensation paid
to employees, officers and directors, (ii) advances to employees for travel
expenses, drawing accounts and similar expenditures, (iii) rent paid to or
accounts payable for services rendered or goods sold by non-Affiliates or (iv)
intercompany accounts payable and real property leases to non-Affiliates. It is
understood that any Distribution permitted by this Agreement to be made to any
Qualified Parent Company may be made through Charter Communications VII.

                  “Documentation Agents” means each of Bank of America, N.A. and Fleet
National Bank in its capacity as Documentation Agent for the Lenders hereunder,
as well as its successors and assigns in such capacity pursuant to Section
11.6.

                  “Environmental Laws” means all applicable federal, state or local
statutes, laws, ordinances, codes, rules, regulations and guidelines having the
force of law (including consent decrees and administrative orders) relating to
public health and safety and protection of the environment.

                  “Equity Interests” means any and all shares, interests, participations or
other equivalents (however designated) of capital stock of a corporation, any
and all classes of membership interests in a

 

12

limited liability company, any and all classes of partnership interests in
a partnership and any and all other equivalent ownership interests in a Person,
and any and all warrants, rights or options to purchase any of the foregoing.

                  “ERISA” means the Employee Retirement Income Security Act of 1974, as
amended from time to time.

                  “Eurodollar Pricing Options” means the options granted pursuant to Section
3.2.1 to have the interest on any portion of the Loan computed on the basis of
a Eurodollar Rate.

                  “Eurodollars” means, with respect to any Lender, deposits of United States
Funds in a non-United States office or an international banking facility of
such Lender.

                  “Eurodollar Office” means such office of any Lender as such Lender may
from time to time select in connection with Loans made in Eurodollars.

                  “Eurodollar Rate” for any Interest Period means the rate, rounded to the
nearest 1/100%, obtained by dividing (a) the Basic Eurodollar Rate for such
Eurodollar Interest Period by (b) an amount equal to 1 minus the Eurodollar
Reserve Rate; provided, however, that if at any time during such Interest
Period the Eurodollar Reserve Rate applicable to any outstanding Eurodollar
Pricing Option changes, the Eurodollar Rate for such Interest Period shall
automatically be adjusted to reflect such change, effective as of the date of
such change.

                  “Eurodollar Reserve Rate” means the stated maximum rate (expressed as a
decimal) of all reserves (including any basic, supplemental, marginal or
emergency reserve or any reserve asset), if any, as from time to time in
effect, required by any Legal Requirement to be maintained by any Lender
against (a) “Eurocurrency liabilities” as specified in Regulation D of the
Board of Governors of the Federal Reserve System (or any successor regulation),
(b) any other category of liabilities that includes Eurodollar deposits by
reference to which the interest rate on portions of the Loan covered by
Eurodollar Pricing Options is determined, (c) the principal amount of or
interest on any portion of the Loan covered by a Eurodollar Pricing Option or
(d) any other category of extensions of credit, or other assets, that includes
loans covered by a Eurodollar Pricing Option.

                  “Event of Default” is defined in Section 9.1.

                  “Exchange Act” means the federal Securities Exchange Act of 1934.

                  “Excluded Companies” means Falcon Lake Las Vegas Cablevision, L.P., a
Delaware limited partnership, Falcon/Capital Cable, a Delaware general
partnership, Falcon/Capital Cable Partners, L.P., a Delaware limited
partnership, Wilcat Transmission Company, Inc., a Delaware corporation, SFC
Transmissions, a California joint venture, and 212 Seventh Street, Inc., a
Missouri corporation, Bend Cable Communications, LLC, Central Oregon Cable
Advertising, LLC and any other Subsidiary (including a Subsidiary that is a
Permitted Joint Venture) of a Restricted Company that at the time of
determination shall be designated as an Excluded Company by written notice of
such Restricted Company to the Administrative Agent. The Borrower may
designate any Subsidiary of the Restricted Companies (including any newly
acquired or newly organized Subsidiary of the Restricted Companies) to be an
Excluded Company by written notice to the Administrative Agent, provided the
acquisition or organization of such Subsidiary would be permitted under Section
7.9. The Borrower may designate any Excluded Company to be a Restricted
Company by written notice to the Administrative Agent, provided that no Default
shall occur and be continuing or shall result as a consequence thereof.

 

13

                  “Excluded Swap Excess Amount” means any Swap Excess Amount determined
pursuant to one or more Permitted Asset Swaps consummated after the First
Restatement Effective Date until the aggregate Swap Excess Percentages equal
15%. For the purposes of this definition, the “Swap Excess Percentage” with
respect to any Permitted Asset Swap that results in a Swap Excess Amount shall
equal the quotient (expressed as a percentage) of such Swap Excess Amount
divided by Consolidated Annualized Operating Cash Flow as shown in the most
recently submitted compliance computations pursuant to Section 7.4.2(b).

                  “FCC” means the Federal Communications Commission and any successor
governmental agency.

                  “FCC License” means any broadcasting, community antenna television or
relay systems, each station, business radio, microwave and other license issued
by the FCC under the Communications Act.

                  “Federal Funds Rate” means, for any day, (a) the rate equal to the
weighted average of the rates on overnight federal funds transactions with
members of the Federal Reserve System arranged by federal funds brokers, as
such weighted average is published for such day (or, if such day is not a
Banking Day, for the immediately preceding Banking Day) by the Federal Reserve
Bank of New York or (b) if such rate is not so published for such Banking Day,
as determined by the Administrative Agent using any reasonable means of
determination. Each determination by the Administrative Agent of the Federal
Funds Rate shall, in the absence of manifest error, be conclusive.

                  “Final New Restatement Revolving Maturity Date” means June 29, 2007.

                  “Final Revolving Maturity Date” means December 29, 2006.

                  “Final Supplemental Restatement Revolving Maturity Date” means December
31, 2007.

                  “Final Term Loan B Maturity Date” means June 29, 2007.

                  “Final Term Loan C Maturity Date” means December 31, 2007.

                  “Financial Officer” means in the case of any specified Person, the chief
financial officer, treasurer, corporate controller or vice president whose
primary responsibility is for the financial affairs of such Person, and whose
incumbency and signatures will have been certified to the Administrative Agent
by an appropriate attesting officer prior to or contemporaneously with the
delivery of any certificates delivered to the Administrative Agent hereunder.

                  “Financing Debt” means:

		
	 	     (a) Indebtedness in respect of borrowed money;
	 
	 	     (b) Indebtedness evidenced by notes, debentures or similar
instruments;
	 
	 	     (c) Indebtedness in respect of Capitalized Leases;
	 
	 	     (d) Indebtedness in respect of the deferred purchase price of assets
(other than normal trade accounts payable that are not overdue beyond
customary practice); and

 

14

		
	 	     (e) Indebtedness in respect of mandatory redemption, repurchase or
dividend rights on Equity Interests.

                  “First Restatement Effective Date” means November 12, 1999.

                  “Franchise” means any franchise, permit, license or other authorization
granted by any governmental unit or authority that authorizes the construction
and operation of a System.

                  “GAAP” means generally accepted accounting principles, as defined by the
United States Financial Accounting Standards Board, as from time to time in
effect; provided, however, that (a) for purposes of compliance with Section 7
(other than Section 7.4) and the related definitions, “GAAP” means such
principles as in effect on December 31, 2000 as applied by the Restricted
Companies in the preparation of the December 31, 2000 financial statements
referred to in Section 8.2.1, and consistently followed, without giving effect
to any subsequent changes thereto and (b) in the event of a change in generally
accepted accounting principles after such date, either the Borrower or the
Required Lenders may request a change in the definition of “GAAP”, in which
case the parties hereto shall negotiate in good faith with respect to an
amendment of this Agreement implementing such change.

                  “Guarantee” means, with respect to any Restricted Company (or other
specified Person):

		
	 	     (a) any guarantee by the Restricted Company of the payment or
performance of, or any contingent obligation by the Restricted Company in
respect of, any Financing Debt of any other Person;

		
	 	     (b) any other arrangement whereby credit is extended to a Person on
the basis of any promise or undertaking of the Restricted Company
(including any “comfort letter” or “keep well agreement” written by the
Restricted Company to a creditor or prospective creditor of such Person)
to (i) pay the Financing Debt of such Person, (ii) purchase an obligation
owed by such Person, (iii) pay for the purchase or lease of assets or
services regardless of the actual delivery thereof or (iv) maintain the
capital, working capital, solvency or general financial condition of such
Person, in each case whether or not such arrangement is disclosed in the
balance sheet of the Restricted Company or referred to in a footnote
thereto;

		
	 	     (c) any liability of the Restricted Company as a general partner of
a partnership in respect of Financing Debt of such partnership;

		
	 	     (d) any liability of the Restricted Company as a joint venturer of a
joint venture in respect of Financing Debt of such joint venture; and

		
	 	     (e) reimbursement obligations with respect to letters of credit,
surety bonds and other financial guarantees;

provided, however, that the term “Guarantee” shall not include endorsements for
collection or deposit in the ordinary course of business. The amount of any
Guarantee and the amount of Indebtedness resulting from such Guarantee shall be
the amount which should be carried on the balance sheet of the obligor whose
obligations were guaranteed in respect of such obligations, determined in
accordance with GAAP.

                  “Guarantor” means Charter Communications VII, each Restricted Company and
each Subsidiary of a Restricted Company that is party hereto and is not either
the Borrower or an Excluded Company. Exhibit 1-A lists the Guarantors as of
the Second Restatement Effective Date. It is understood that no Minority
Interest HoldCo in its capacity as such shall be a Guarantor.

 

15

                  “Hazardous Material” means, collectively, any pollutant, toxic or
hazardous material or waste, including any “hazardous substance” or “pollutant”
or “contaminant” as defined in section 101(14) of CERCLA or any similar state
or local statute or regulation or regulated as toxic or hazardous under the
Resource Conservation and Recovery Act or any similar state or local statute or
regulation, and the rules and regulations thereunder, as from time to time in
effect.

                  “Holding Companies” means any Minority Interest HoldCo, Charter
Communications VII and the Restricted Companies.

                  “Houston Office” means the principal banking office of the Administrative
Agent in Houston, Texas.

                  “Indebtedness” means all obligations, contingent or otherwise, which in
accordance with GAAP are required to be classified upon the balance sheet of
any Restricted Company (or other specified Person) as liabilities, but in any
event including:

		
	 	     (a) indebtedness in respect of borrowed money;

		
	 	     (b) indebtedness evidenced by notes, debentures or similar
instruments;

		
	 	     (c) Capitalized Lease Obligations;

		
	 	     (d) the deferred purchase price of assets (including trade accounts
payable);

		
	 	     (e) mandatory redemption, repurchase or dividend obligations with
respect to Equity Interests;

		
	 	     (f) unfunded pension fund obligations and liabilities;

		
	 	     (g) all Guarantees and endorsements in respect of Indebtedness of
others; and

		
	 	     (h) liabilities secured by any Lien existing on property owned or
acquired by any Restricted Company, whether or not the liability secured
thereby shall have been assumed; provided, however, that, to the extent
that a liability secured by a Lien on such property is otherwise
nonrecourse to the Restricted Company, the amount of Indebtedness in
respect of such liability shall be the lesser of the fair market value of
such property or the amount of such liability.

                  “Indemnified Party” is defined in Section 10.2.

                  “Initial Closing Date” means the first Closing Date hereunder, which date
was June 30, 1998.

                  “Insolvency” means, with respect to any Multiemployer Plan, the condition
that such Plan is insolvent within the meaning of Section 4245 of ERISA.

                  “Insolvent” means the condition of Insolvency.

                  “Interest Period” means any period, selected as provided in Section 3.2.1,
of one, two, three and six months (or any longer period to which all the
Lenders have given their consent to the Administrative Agent), commencing on
any Banking Day and ending on the corresponding date in the

 

16

subsequent calendar month so indicated (or, if such subsequent calendar
month has no corresponding date, on the last day of such subsequent calendar
month); provided, however, that subject to Section 3.2.3, if any Interest
Period so selected would otherwise begin or end on a date which is not a
Banking Day, such Interest Period shall instead begin or end, as the case may
be, on the immediately preceding or succeeding Banking Day as determined by the
Administrative Agent in accordance with the then current banking practice in
the inter-bank Eurodollar market with respect to Eurodollar deposits at the
applicable Eurodollar Office, which determination by the Administrative Agent
shall, in the absence of manifest error, be conclusive.

                  “Interest Rate Protection Agreement” means any interest rate swap,
interest rate cap, interest rate hedge or other contractual arrangement
protecting a Person against increases in variable interest rates or converting
fixed interest rates into variable interest rates on Financing Debt.

                  “Investment” means, with respect to any Restricted Company (or other
specified Person):

		
	 	     (a) any Equity Interest, evidence of Indebtedness or other security
issued by any other Person;

		
	 	     (b) any loan, advance or extension of credit to, or contribution to
the capital of, any other Person;

		
	 	     (c) any Guarantee of the Indebtedness of any other Person;

		
	 	     (d) any acquisition of all or any part of the business of any other
Person or the assets comprising such business or part thereof;

		
	 	     (e) any commitment or option to make any Investment if the
consideration for such commitment or option exceeds $1,000,000; and

		
	 	     (f) any other similar investment.

                  The investments described in the foregoing clauses (a) through (f) shall
constitute Investments whether they are made or acquired by purchase, exchange,
issuance of stock or other securities, merger, reorganization or any other
method, provided, however, that Investments shall not include (i) current trade
and customer accounts receivable for property leased, goods furnished or
services rendered in the ordinary course of business and payable in accordance
with customary trade terms, (ii) advances, payments and prepayments to
suppliers for property leased, goods furnished and services rendered in the
ordinary course of business, (iii) advances to employees for travel expenses,
drawing accounts and similar expenditures, (iv) stock or other securities
acquired in connection with the satisfaction or enforcement of Indebtedness or
claims due to any Restricted Company or as security for any such Indebtedness
or claim or (v) demand deposits in banks or trust companies.

                  In determining the amount of outstanding Investments for purposes of
Section 7.9, the amount of any Investment shall be the cost thereof (including
the amount of any Indebtedness assumed in any purchase or secured by any asset
acquired in such purchase (whether or not any Indebtedness is assumed) or for
which any Person that becomes a Subsidiary is liable on the date on which the
securities of such Person are acquired) minus any returns of capital on such
Investment actually received in cash (determined in accordance with GAAP
without regard to amounts realized as income on such Investment).

 

17

                  “Legal Requirement” means any requirement imposed upon any of the Lenders
by (a) any law, rule or regulation of any governmental authority or (b) any
regulation, order, interpretation, ruling or official directive of the Board of
Governors of the Federal Reserve System or any other board or governmental or
administrative agency. Any such requirement not having the force of law shall
be deemed to be a Legal Requirement if any of the Lenders reasonably believes
that compliance therewith is in accordance with customary commercial practice.

                  “Lender” means the Persons owning a Percentage Interest in the Credit
Obligations under this Agreement or having a Commitment and their respective
Assignees permitted by Section 12.1.

                  “Lender Consent Letter” means a consent letter in a form approved by the
Administrative Agent pursuant to which a Lender consents to the amendments to
the Existing Credit Agreement effected pursuant to this Agreement and, if
applicable, agrees to convert its existing Commitment in respect of the
Revolving Loan into a Commitment in respect of the New Restatement Revolving
Loan or to provide a new or additional Commitment in respect of the New
Restatement Revolving Loan.

                  “Lender Letters of Credit” means letters of credit issued by any Lender
(or any Affiliate thereof) for the account of the Borrower, so long as the
aggregate undrawn face amount thereof, together with any unreimbursed
reimbursement obligations in respect thereof, does not exceed $15,000,000 at
any one time.

                  “Lending Officer” shall mean such officers or employees of the
Administrative Agent as from time to time designated by it in writing to the
Borrower.

                  “Lien” means, with respect to any Restricted Company (or any other
specified Person):

		
	 	     (a) any encumbrance, mortgage, pledge, lien, charge or security
interest of any kind upon any property or assets of the Restricted
Company, whether now owned or hereafter acquired, or upon the income or
profits therefrom;

		
	 	     (b) the acquisition of, or the agreement to acquire, any property or
asset upon conditional sale or subject to any other title retention
agreement, device or arrangement (including a Capitalized Lease); and

		
	 	     (c) the sale, assignment, pledge or transfer for security of any
accounts, general intangibles or chattel paper of the Restricted Company,
with or without recourse.

                  “Loan” means, collectively, the Revolving Loan, the New Restatement
Revolving Loan, the Term Loan and the Supplemental Loan.

                  “Margin Stock” means “margin stock” within the meaning of Regulations T, U
or X (or any successor provisions) of the Board of Governors of the Federal
Reserve System, or any regulations, interpretations or rulings thereunder, all
as from time to time in effect.

                  “Material Adverse Change” means a material adverse change since December
31, 2000 in the business, assets, financial condition or income of the
Restricted Companies (on a Consolidated basis) (or any other specified Persons)
as a result of any event or development.

                  “Material Agreements” means the partnership agreements or limited
liability company agreements for each Restricted Company that is a limited
partnership or limited liability company, in each case as amended, modified and
supplemented in accordance with Section 7.2.3.

 

18

                  “Material Financing Debt” means any Financing Debt (other than the Credit
Obligations under this Agreement) outstanding in an aggregate amount of
principal (whether or not due) and accrued interest exceeding $10,000,000.

                  “Maximum Amount of New Restatement Revolving Credit” is defined in Section
2.5.1.

                  “Maximum Amount of Relevant Supplemental Revolving Credit” is defined in
Section 2.4.1.

                  “Maximum Amount of Revolving Credit” is defined in Section 2.1.1.

                  “Maximum Amount of Supplemental Credit” is defined in Section 2.4.1.

                  “Maximum Amount of Supplemental Restatement Revolving Credit” is defined
in Section 2.4.5.

                  “Minority Interest HoldCo” means any Affiliate of any Restricted Company
that directly holds a minority Equity Interest in any Restricted Company.

                  “Multiemployer Plan” means a Plan that is a multiemployer plan as defined
in Section 4001(a)(3) of ERISA.

                  “Net Cash Proceeds” means the cash proceeds of an Operating Asset Sale by
any Restricted Company net of (a) any Indebtedness permitted by Section 7.6.7
(Capitalized Leases and purchase money indebtedness) secured by assets being
sold in such transaction required to be paid from such proceeds, (b) with
respect to any such Restricted Company that is not a tax flow-through entity,
income taxes that will be required to be paid as a result of such asset sale as
estimated by such Restricted Company in good faith, and with respect to any
such Restricted Company that is a tax flow-through entity, distributions to all
the direct or indirect holders of the equity of such Restricted Company, in
proportion to their ownership interests, sufficient to permit each such direct
or indirect holder of the equity of such Restricted Company to pay income taxes
that may be required to be paid by it as a result of such asset sale as
estimated by such Restricted Company in good faith, (c) all reasonable expenses
of such Restricted Company incurred in connection with the transaction and (d)
amounts subject to a reserve or escrow to fund indemnification obligations
incurred in connection with such asset sale; provided, however, that the
principal (but not interest) component of amounts described in this clause (d)
will become Net Cash Proceeds upon release from such reserve or escrow.

                  “Net Debt Proceeds” means the cash proceeds of the incurrence of
Designated Financing Debt by any Restricted Company (net of reasonable
out-of-pocket transaction fees and expenses).

                  “New Restatement Revolving Facility” is defined in Section 2.5.1.

                  “New Restatement Revolving Lenders” is defined in Section 2.5.1.

                  “New Restatement Revolving Loan” is defined in Section 2.5.1.

                  “New Restatement Revolving Note” is defined in Section 2.5.3.

                  “Nonperforming Lender” is defined in Section 11.4.3.

 

19

                  “Notes” means each of the Revolving Notes, the New Restatement Revolving
Notes, the Term B Notes, the Term C Notes and the Supplemental Notes.

                  “Obligor” means the Borrower and each other Restricted Company
guaranteeing or granting collateral to secure any Credit Obligations.

                  “Operating Assets” means (a) a group of tangible and intangible assets
used by a Person to provide cable television services or to conduct any related
activities, or (b) all of the outstanding Equity Interests in a Person engaged
in the provision of cable television services or conducting any related
activities.

                  “Operating Asset Sale” is defined in Section 4.4.1.

                  “Paul Allen Group” means the collective reference to (a) Paul G. Allen,
(b) his estate, spouse, immediate family members and heirs and (c) any trust,
corporation, partnership or other entity, the beneficiaries, stockholders,
partners or other owners of which consist exclusively of Paul G. Allen or such
other Persons referred to in clause (b) above or a combination thereof.

                  “Payment Date” means the last Banking Day of each March, June, September
and December.

                  “PBGC” means the Pension Benefit Guaranty Corporation established pursuant
to Subtitle A of Title IV of ERISA (or any successor).

                  “Percentage Interest” is defined in Section 11.1.

                  “Performing Lender” is defined in Section 11.4.3.

                  “Permitted Asset Swap” means the exchange by any Restricted Company of
Operating Assets (including Systems) (a) for fair value in a single transaction
(or a substantially contemporaneous series of related transactions) pursuant to
which, within five Banking Days of the transfer of such Operating Assets, the
Restricted Companies receive Operating Assets related to businesses permitted
by Section 7.2.1 or (b) in a transaction which qualifies as a like-kind
exchange under section 1031 of the Code or any successor provision (with any
cash received by the Restricted Company in connection with such exchange
constituting Net Cash Proceeds therefrom and any cash paid by the Restricted
Company in connection with such exchange being subject to the limitations of
Section 7.9).

                  “Permitted Joint Venture” means a joint venture, limited partnership,
corporation, general partnership or limited liability company or other entity
between or involving a Restricted Company pursuant to which the new entity
would operate a business not prohibited by Section 7.2.1; provided, however,
that if the Permitted Joint Venture is not a Restricted Company, the Restricted
Companies shall in no event incur any Financing Debt, by way of guarantee,
general partner or joint venturer liability or otherwise, as a result of the
incurrence of Financing Debt by any such joint venture, limited partnership,
corporation, general partnership or limited liability company.

                  “Person” means any present or future natural person or any corporation,
association, partnership, joint venture, company, limited liability company,
business trust, trust, organization, business or government or any governmental
agency or political subdivision thereof.

                  “PIK Interest Payments” means any accrued interest payments on Financing
Debt that are postponed, evidenced by book-entry accrual or made through the
issuance of “payment-in-kind” notes or

 

20

other securities, all in accordance with the terms of such Financing Debt;
provided, however, that in no event shall PIK Interest Payments include
payments made with cash or Cash Equivalents.

                  “Plan” means, at a particular time, any employee pension benefit plan
subject to the provisions of Title IV of ERISA or Section 412 of the Code or
Section 302 of ERISA or any welfare plan providing post-employment healthcare
benefits, and in respect of which the Borrower or a Commonly Controlled Entity
is (or, if such plan were terminated at such time, would under Section 4069 of
ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.

                  “Pledge and Subordination Agreement” means the Pledge and Subordination
Agreement, dated as of June 30, 1998, as amended and restated as of November
12, 1999, among the Restricted Companies, Charter Communications VII, any
Minority Interest HoldCo and the Administrative Agent, as the same may be
amended, supplemented or otherwise modified from time to time.

                  “Pro Rata New Restatement Revolver Prepayment Portion” means, at any date,
with respect to specified Net Cash Proceeds from any Operating Asset Sale that
will be allocated to repay the New Restatement Revolving Loan, the portion of
such Net Cash Proceeds calculated as follows:

		
	 	     (a) add all percentage reductions of the New Restatement Revolving
Loan occurring on or after the date of such Operating Asset Sale through
the Final New Restatement Revolving Maturity Date;

		
	 	     (b) divide the percentage reduction of each remaining Payment Date
by the sum in clause (a) above; and

		
	 	     (c) multiply the Net Cash Proceeds by the percentage determined
under clause (b) above for each such Payment Date.

                  “Pro Rata Revolver Prepayment Portion” means, at any date, with respect to
specified Net Cash Proceeds from any Operating Asset Sale that will be
allocated to repay the Revolving Loan, the portion of such Net Cash Proceeds
calculated as follows:

		
	 	     (a) add all percentage reductions of the Revolving Loan occurring on
or after the date of such Operating Asset Sale through the Final
Revolving Maturity Date;

		
	 	     (b) divide the percentage reduction of each remaining Payment Date
by the sum in clause (a) above; and

		
	 	     (c) multiply the Net Cash Proceeds by the percentage determined
under clause (b) above for each such Payment Date.

An example of the computation of the Pro Rata Revolver Prepayment Portion is
set forth in Exhibit 1-B.

                  “Pro Rata Supplemental Restatement Revolver Prepayment Portion” means, at
any date, with respect to specified Net Cash Proceeds from any Operating Asset
Sale that will be allocated to repay the Supplemental Restatement Revolving
Loan, the portion of such Net Cash Proceeds calculated as follows:

		
	 	     (a) add all percentage reductions of the Supplemental Restatement
Revolving Loan occurring on or after the date of such Operating Asset
Sale through the Final Supplemental Restatement Revolving Maturity Date;

 

21

		
	 	     (b) divide the percentage reduction of each remaining Payment Date
by the sum in clause (a) above; and

		
	 	     (c) multiply the Net Cash Proceeds by the percentage determined
under clause (b) above for each such Payment Date.

                  “Pro Rata Term Loan B Prepayment Portion” means, at any date, with respect
to specified Net Cash Proceeds from any Operating Asset Sale that will be
allocated to repay Term Loan B, the portion of such Net Cash Proceeds
calculated as follows:

		
	 	     (a) add all percentage reductions of Term Loan B occurring on or
after the date of such Operating Asset Sale up to but excluding the Final
Term Loan B Maturity Date;

		
	 	     (b) divide the percentage reduction of each remaining Payment Date
by the sum in clause (a) above; and

		
	 	     (c) multiply the Net Cash Proceeds by the percentage determined
under clause (b) above for each such Payment Date.

                  “Pro Rata Term Loan C Prepayment Portion” means, at any date, with respect
to specified Net Cash Proceeds from any Operating Asset Sale that will be
allocated to repay Term Loan C, the portion of such Net Cash Proceeds
calculated as follows:

		
	 	     (a) add all percentage reductions of Term Loan C occurring on or
after the date of such Operating Asset Sale up to but excluding the Final
Term Loan C Maturity Date;

		
	 	     (b) divide the percentage reduction of each remaining Payment Date
by the sum in clause (a) above; and

		
	 	     (c) multiply the Net Cash Proceeds by the percentage determined
under clause (b) above for each such Payment Date.

                  “Pro Rata Term Prepayment Portions” means, collectively, the Pro Rata Term
Loan B Prepayment Portion and the Pro Rata Term Loan C Prepayment Portion.

                  “Qualified Institutional Buyer” means:

		
	 	     (a) a duly authorized domestic bank, savings and loan association,
insurance company, registered investment company, registered investment
adviser or registered dealer, acting for its own account or the accounts
of other Qualified Institutional Buyers, which in the aggregate owns and
invests on a discretionary basis at least $100,000,000 in securities and
(if a bank or savings and loan association) which has a net worth of at
least $25,000,000; or

		
	 	     (b) a foreign bank or savings and loan association or equivalent
institution, acting for its own account or the account of other Qualified
Institutional Buyers, which in the aggregate owns and invests on a
discretionary basis at least $100,000,000 in securities and has a net
worth of at least $25,000,000; or

		
	 	     (c) any other entity which also constitutes a “qualified
institutional buyer” as defined in Rule 144A under the Securities Act; or

 

22

		
	 	     (d) any other entity acceptable to the Restricted Companies.

                  “Qualified Parent Company” means Charter Communications, Inc. or any of
its direct or indirect Subsidiaries, in each case provided that the Borrower
shall be an indirect Subsidiary of such Person.

                  “Redeemable Capital Stock” means any class or series of Equity Interests
of any Person that, either by its terms, by the terms of any security into
which it is convertible or exchangeable or otherwise, is or upon the happening
of an event or passage of time would be, required to be redeemed (in whole or
in part) prior to the final maturity of any portion of the Loan or is
redeemable (in whole or in part) at the option of the holder thereof at any
time prior to the final maturity of any portion of the Loan.

                  “Reference Leverage Ratio” means, at any date, the ratio of (a)
Consolidated Total Debt as of the end of the most recent fiscal quarter for
which financial statements have been furnished to the Lenders in accordance
with Section 7.4.2 prior to such date to (b) Consolidated Annualized Operating
Cash Flow for such period.

                  “Register” is defined in Section 12.1.3.

                  “Related Fund” means, with respect to any Lender that is a fund that
invests in senior bank loans, any other fund or entity that invests in bank
loans and is advised or managed by the same investment advisor as such Lender
or by an Affiliate of such investment advisor.

                  “Remaining Dollar-Years” of any Indebtedness means, at any date, the sum
of the products obtained by multiplying (a) the amount of each remaining
scheduled payment of principal (or in the case of a revolving credit facility,
each scheduled reduction in the revolving credit commitment) by (b) the number
of years (calculated to the nearest twelfth) which will elapse between such
date and the making of the payment (or in the case of a revolving credit
facility, such scheduled reduction in the revolving credit commitment).

                  “Reorganization” means, with respect to any Multiemployer Plan, the
condition that such plan is in reorganization within the meaning of Section
4241 of ERISA.

                  “Replacement Lender” is defined in Section 12.3.

                  “Reportable Event” means any of the events set forth in Section 4043(b) of
ERISA, other than those events as to which the thirty day notice period is
waived under subsections .27, .28, .29, .30, .31, .32, .34 or .35 of PBGC Reg.
§ 4043.

                  “Required Lenders” means, with respect to any consent or other action to
be taken by either the Lenders or any Agent under the Credit Documents, such
Lenders as own at least a majority of the Aggregate Percentage Interests;
provided, however, that with respect to the matters referred to in the proviso
to Section 17.1, Required Lenders means such Lenders as own at least the
respective portions of the Percentage Interests indicated therein.

                  “Resource Conservation and Recovery Act” means the federal Resource
Conservation and Recovery Act, 42 U.S.C. section 690, et seq.

                  “Restricted Company” means each of the Borrower, the Guarantors (other
than Charter Communications VII) and their respective Subsidiaries that are
Guarantors and that are not Excluded Companies. Exhibit 1-A lists the
Restricted Companies as of the Second Restatement Effective Date.

 

23

                  “Revolving Lender” means each Lender owning a Percentage Interest in the
Revolving Loan or having a Commitment to extend a portion of the Revolving Loan
and its Assignees permitted by Section 12.1.

                  “Revolving Loan” is defined in Section 2.1.1.

                  “Revolving Note” is defined in Section 2.1.3.

                  “Second Restatement Effective Date” is defined in Section 5.1.

                  “Securities Act” means the federal Securities Act of 1933.

                  “Single Employer Plan” means any Plan that is covered by Title IV of
ERISA, but that is not a Multiemployer Plan.

                  “Specified Agents” means the Syndication Agent and the Administrative
Agent.

                  “Specified Change of Control” means a “Change of Control” (or any defined
term having a comparable purpose) contained in the documentation governing any
Charter Communications VII Debt or any Specified Long-Term Indebtedness.

                  “Specified Long-Term Indebtedness” means any Indebtedness incurred
pursuant to Section 7.6.14.

                  “Specified Subordinated Debt” means any Indebtedness of the Borrower
issued directly or indirectly to Paul G. Allen or any of his Affiliates, so
long as such Indebtedness (a) qualifies as Specified Long-Term Indebtedness and
(b) has subordination terms substantially identical to those set forth in
Exhibit 1-C.

                  “Subscriber” means each home with one or more television sets connected to
a System and each subscriber equivalent represented by a bulk account
(determined by dividing the total monthly bill for the account by the basic
monthly charge for a single outlet in the area).

                  “Subsidiary” means any Person of which the Borrower (or other specified
Person) shall at the time, directly or indirectly through one or more of its
Subsidiaries, (a) own at least 50% of the outstanding Equity Interests entitled
to vote generally, (b) hold at least 50% of the partnership, joint venture or
similar interests or (c) be a general partner or joint venture.

                  “Supplemental Agent” is defined in Section 2.4.1.

                  “Supplemental Facility” is defined in Section 2.4.1.

                  “Supplemental Lenders” is defined in Section 2.4.1.

                  “Supplemental Loan” is defined in Section 2.4.4.

                  “Supplemental Note” is defined in Section 2.4.4.

                  “Supplemental Restatement Revolving Facility” is defined in Section 2.4.5.

                  “Supplemental Restatement Revolving Lenders” is defined in Section 2.4.5.

 

24

                  “Supplemental Restatement Revolving Loan” is defined in Section 2.4.5.

                  “Swap Excess Amount” is defined in Section 7.11.5.

                  “Syndication Agent” means J.P. Morgan Securities Inc., in its capacity as
syndication agent hereunder, as well as its successors and assigns in such
capacity pursuant to Section 11.6.

                  “System” means the assets constituting a cable television system most of
which is within a geographical area covered by one or more Franchises held by
any Restricted Company serving subscribers who are connected by drop lines to
trunk or distribution lines carrying signals from one or more head-end
facilities.

                  “Tax” means any tax, levy, duty, deduction, withholding or other charges
of whatever nature at any time required by any Legal Requirement (a) to be paid
by any Lender or (b) to be withheld or deducted from any payment otherwise
required hereby to be made to any Lender, in each case on or with respect to
(i) the principal amount of or interest on any portion of the Loan, (ii) any
fees, expenses, indemnities or other amounts payable to any Lender under any
Credit Document or (iii) funds transferred from a non-United States office or
an international banking facility of any Lender to a United States office of
such Lender in order to fund (or deemed by Section 3.2.6 to have funded) a
portion of the Loan subject to a Eurodollar Pricing Option; provided, however,
that the term “Tax” shall not include (A) taxes imposed upon or measured by the
net income of such Lender or (B) franchise or similar business licensing taxes
for qualification of offices of such Lender in any jurisdiction.

                  “Term Lender” means each Lender owning a Percentage Interest in the Term
Loans and its Assignees permitted by Section 12.1.

                  “Term Loan” means Term Loan B and Term Loan C, collectively.

                  “Term Loan B” is defined in Section 2.2.1.

                  “Term Loan B Lender” means each Lender owning a Percentage Interest in
Term Loan B and its Assignees permitted by Section 12.1.

                  “Term Loan B Note” is defined in Section 2.2.2.

                  “Term Loan C” is defined in Section 2.3.1.

                  “Term Loan C Lender” means each Lender owning a Percentage Interest in
Term Loan C and its Assignees permitted by Section 12.1.

                  “Term Loan C Note” is defined in Section 2.3.2.

                  “Term Notes” means the Term Loan B Notes and the Term Loan C Notes,
collectively.

                  “Threshold Management Fee Date” means any date on which, both before and
after giving pro forma effect to the payment of any previously deferred
management fees pursuant to Section 7.17 (including any Indebtedness incurred
in connection therewith), the Consolidated Interest Coverage Ratio, determined
in respect of the most recent fiscal quarter for which the relevant financial
information is available, is greater than 225%.

 

25

                  “Threshold Transaction Date” means any date on which, both before and
after giving pro forma effect to a particular transaction (including any
Indebtedness incurred in connection therewith), the Consolidated Interest
Coverage Ratio, determined in respect of the most recent fiscal quarter for
which the relevant financial information is available, is greater than 175%.

                  “Toronto Dominion” means Toronto Dominion (Texas), Inc.

                  “Tranche” means each of the Revolving Loan, New Revolving Loan, Term Loan
B, Term Loan C and the Supplemental Loan, each considered as a separate credit
facility.

                  “United States Funds” means such coin or currency of the United States of
America as at the time shall be legal tender therein for the payment of public
and private debts.

                  “Weighted Average Life to Maturity” of any Indebtedness means, at any
date, the number of years obtained by dividing the Remaining Dollar-Years of
such Indebtedness by the outstanding principal amount of the Indebtedness (or,
in the case of a revolving credit facility, the maximum amount of revolving
credit commitment, regardless of the amount of revolving loans then
outstanding).

                  “Wholly Owned Guarantor” means any Guarantor that is a Wholly Owned
Subsidiary of the Borrower.

                  “Wholly Owned Subsidiary” means any Subsidiary of which all of the
outstanding Equity Interests entitled to vote generally (other than directors’
qualifying shares) is owned by the Borrower (or other specified Person)
directly, or indirectly through one or more Wholly Owned Subsidiaries.

                  2. The Credits.

                  2.1. Revolving Credit.

                  2.1.1. Revolving Loan. Subject to all of the terms and conditions of this
Agreement and so long as no Default exists and is continuing, each Revolving
Lender severally agrees to make revolving loans to the Borrower in an aggregate
principal amount for all Revolving Lenders equal to the amount requested in
accordance with Section 2.1.2 from time to time prior to the Final Revolving
Maturity Date, but not to exceed at any time outstanding the Maximum Amount of
Revolving Credit. In no event will the principal amount of the loans at any
one time outstanding made by any Revolving Lender under this Section 2.1 exceed
an amount equal to such Revolving Lender’s Percentage Interest in the Maximum
Amount of Revolving Credit.

                  “Maximum Amount of Revolving Credit” means, on any date, the amount set
forth for such date in the table below, reduced as provided further below:

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Percentage
	Date	 	Stated Amount	 	Reduction
	
	 	
	 	

	Prior to September 30, 2001
	 	$	79,699,264	 	 	 	0.000	%
	
	
	
	

	September 30, 2001 through

December 30, 2001
	 	$	77,706,782	 	 	 	2.500	%

 

26

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Percentage
	Date	 	Stated Amount	 	Reduction
	
	 	
	 	

	
	
	
	

	December 31, 2001 through

March 30, 2002
	 	$	75,714,301	 	 	 	2.500	%
	
	
	
	

	March 31, 2002 through

June 29, 2002
	 	$	73,721,819	 	 	 	2.500	%
	
	
	
	

	June 30, 2002 through

September 29, 2002
	 	$	71,729,338	 	 	 	2.500	%
	
	
	
	

	September 30, 2002 through

December 30, 2002
	 	$	69,736,856	 	 	 	2.500	%
	
	
	
	

	December 31, 2002 through

March 30, 2003
	 	$	67,744,374	 	 	 	2.500	%
	
	
	
	

	March 31, 2003 through

June 29, 2003
	 	$	65,751,893	 	 	 	2.500	%
	
	
	
	

	June 30, 2003 through

September 29, 2003
	 	$	63,759,411	 	 	 	2.500	%
	
	
	
	

	September 30, 2003 through

December 30, 2003
	 	$	61,766,930	 	 	 	2.500	%
	
	
	
	

	December 31, 2003 through

March 30, 2004
	 	$	59,774,448	 	 	 	2.500	%
	
	
	
	

	March 31, 2004 through

June 29, 2004
	 	$	55,789,485	 	 	 	5.000	%
	
	
	
	

	June 30, 2004 through

September 29, 2004
	 	$	51,804,522	 	 	 	5.000	%
	
	
	
	

	September 30, 2004 through

December 30, 2004
	 	$	47,819,558	 	 	 	5.000	%
	
	
	
	

	December 31, 2004 through

March 30, 2005
	 	 	43,834,595	 	 	 	5.000	%
	
	
	
	

	March 31, 2005 through

June 29, 2005
	 	$	38,853,391	 	 	 	6.250	%
	
	
	
	

	June 30, 2005 through

September 29, 2005
	 	$	33,872,187	 	 	 	6.250	%

 

27

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Percentage
	Date	 	Stated Amount	 	Reduction
	
	 	
	 	

	
	
	
	

	September 30, 2005 through

December 30, 2005
	 	$	28,890,983	 	 	 	6.250	%
	
	
	
	

	December 31, 2005 through

March 30, 2006
	 	$	23,909,779	 	 	 	6.250	%
	
	
	
	

	March 31, 2006 through

June 29, 2006
	 	$	17,932,334	 	 	 	7.500	%
	
	
	
	

	June 30, 2006 through

September 29, 2006
	 	$	11,954,890	 	 	 	7.500	%
	
	
	
	

	September 30, 2006 up to the

Final Revolving Maturity

Date
	 	$	5,977,445	 	 	 	7.500	%
	
	
	
	

	Final Revolving Maturity Date
	 	$	0	 	 	 	7.500	%

                  Each amount in the foregoing table shall be further permanently reduced by
the following amounts:

		
	 	     (a) The sum of the Pro Rata Revolver Prepayment Portions applicable
to the reduction date for such amount set forth in such table of the
respective amounts of Net Cash Proceeds from Operating Asset Sales to the
extent that such Net Cash Proceeds are not applied to repay the New
Restatement Revolving Loan, the Term Loans or the Supplemental Loan
pursuant to Section 4.4 or allocated to an effective Asset Reinvestment
Reserve Amount.

		
	 	     (b) The amount of Net Debt Proceeds to the extent that such amount
is allocated to the permanent reduction of the Maximum Amount of
Revolving Credit by Section 4.5.

		
	 	     (c) Such amount (in an integral multiple of $1,000,000 and in a
minimum amount of $1,000,000) specified by three Banking Days’ notice
from the Borrower to the Administrative Agent.

                  The aggregate principal amount of the loans made pursuant to this Section
2.1.1 at any time outstanding is referred to as the “Revolving Loan”.

                  2.1.2. Borrowing Requests. Revolving Loans will be made to the Borrower
by the Revolving Lenders under Section 2.1.1 on any Banking Day prior to the
Final Revolving Maturity Date. Not later than noon (New York time) on the
first Banking Day (third Banking Day if any portion of such loan will be
subject to a Eurodollar Pricing Option on the requested Closing Date) prior to
the requested Closing Date for any such loan, a Financial Officer for the
Borrower will give the Administrative Agent notice of its request (which may be
given by a telephone call received by a Lending Officer and promptly
confirmed in writing), specifying (a) the amount of the requested loan
(not less than $1,000,000 and an integral multiple of $100,000) (except to the
extent a greater amount may be required in the case of a Eurodollar Pricing
Option) and (b) the requested Closing Date therefor. Upon receipt of such
notice by

 

28

the Administrative Agent, the Administrative Agent shall give prompt
telephonic or written notice to each Lender. Each such loan will be made at
the Houston Office by wire deposit to the Administrative Agent as specified in
writing from time to time. In connection with each such loan, the Borrower
shall furnish to the Administrative Agent a certificate in substantially the
form of Exhibit 5.2.1.

                  2.1.3. Revolving Notes. The Administrative Agent shall keep a record of
the Revolving Loan and the respective interests of the Lenders therein as part
of the Register, which shall evidence the Revolving Loan. The Revolving Loan
shall be deemed owed to each Lender having a Commitment therein severally in
accordance with such Lender’s Percentage Interest therein, and all payments
thereon shall be for the account of each Lender in accordance with its
Percentage Interest therein. Upon written request of any Lender, the
Borrower’s obligations to pay such Lender’s Percentage Interest in the
Revolving Loan shall be evidenced by a separate note of the Borrower in
substantially the form of Exhibit 2.1.3 (the “Revolving Notes”), payable to
such Lender in accordance with such Lender’s Percentage Interest in the
Revolving Loan.

                  2.2. Term Loan B.

                  2.2.1. Term Loan B. On June 30, 1998, certain Lenders made term loans to
the Borrower in an aggregate amount equal to $125,794,117.75 and on September
30, 1998 certain Lenders made term loans to the Borrower in an aggregate amount
equal to $74,205,882.25. The aggregate principal amount of the loans made
pursuant to this Section 2.2.1 at any one time outstanding is collectively
referred to as “Term Loan B”.

                  2.2.2. Term Loan B Notes. Term Loan B is evidenced by term notes of the
Borrower (the “Term Loan B Notes”) payable to the respective Term Loan B
Lenders. The Term Loan B Note issued to each Lender shall be in substantially
the form of Exhibit 2.2.2.

                  2.3. Term Loan C.

                  2.3.1. Term Loan C. On June 30, 1998, certain Lenders made term loans to
the Borrower in an aggregate amount equal to $300,000,000. The aggregate
principal amount of the loans made pursuant to this Section 2.3.1 at any one
time outstanding is collectively referred to as “Term Loan C”.

                  2.3.2. Term Loan C Notes. Term Loan C is evidenced by term notes of the
Borrower (the “Term Loan C Notes”) payable to the respective Term Loan C
Lenders. The Term Loan C Note issued to each Term Loan C Lender shall be in
substantially the form of Exhibit 2.3.2.

                  2.4. Supplemental Credit.

                  2.4.1. Request for Supplemental Facilities. Subject to all the terms of
this Agreement and so long as no Default exists and is continuing, from time to
time the Borrower may request, by written notice to the Administrative Agent, a
revolving credit and/or term loan facility (a “Supplemental Facility”) in a
specified aggregate amount (in the case of a revolving credit facility
requested under this Section 2.4.1, the “Maximum Amount of Relevant
Supplemental Revolving Credit”) that, when added to the sum of then effective
Supplemental Facilities (including the Supplemental Restatement Revolving
Facility), does not exceed (a) $700,000,000 minus (b) the amount, if any, by
which (i) the sum of the
Commitment in respect of the Revolving Loan and the Commitment in respect
of the New Restatement Revolving Loan (in each case as of the Second
Restatement Effective Date) exceeds (ii) the Commitment in respect of the
Revolving Loan immediately prior to the Second Restatement Effective Date (the

 

29

“Maximum Amount of Supplemental Credit”). The interest rate, commitment fee
rate, amortization schedule, maturity date and other terms and conditions for
each Supplemental Facility shall be proposed by the Borrower at the time the
Borrower requests such Supplemental Facility; provided, however, that (a) the
final maturity of such Supplemental Facility shall in no event occur prior to
the Final Term Loan C Maturity Date, (b) the Weighted Average Life to Maturity
of such Supplemental Facility shall in no event be shorter than, if the
Supplemental Facility is a revolving credit loan, the Weighted Average Life to
Maturity of the Revolving Loan and, if the Supplemental Facility is a term
loan, the Weighted Average Life to Maturity of Term Loan C and (c) the terms
and conditions of such Supplemental Facility shall be materially no more
restrictive on the Restricted Companies than the provisions of this Agreement
applicable to the Loan. It is understood that no portion of the New
Restatement Revolving Facility constitutes a Supplemental Facility.

                  Upon receipt of such request and proposed terms, the Administrative Agent
will promptly notify, and deliver a copy of such request and related materials
to, each other Lender (by telephone or otherwise). Within 10 Banking Days
after receipt by the Lenders of such request, each Lender interested in
participating in the requested Supplemental Facility shall notify the
Administrative Agent and the Borrower of its desire to participate and the
maximum amount of its proposed Commitment with respect to such Supplemental
Facility (a “Commitment Notice”); provided, however, that each Lender may
participate in such Supplemental Facility in its sole discretion, and, except
as otherwise provided in Section 2.4.5, no Lender shall have any obligation to
participate in any Supplemental Facility unless and until it commits to do so
as provided in this Section 2.4.1. Following receipt of such Commitment
Notices, the Borrower (i) shall allocate the Commitments with respect to such
Supplemental Facility, which allocations may be made, at the Borrower’s option,
in whole or in part to one or more of the Lenders or other lenders selected by
the Borrower (such Lenders or other lenders, the “Supplemental Lenders”), (ii)
shall select one or more financial institutions (which financial institutions
may, but need not, include one or more of the Agents or Lenders) to serve as
the agent or agents for the Supplemental Facility (such agent or agents, the
“Supplemental Agent”) and (iii) shall advise each Lender of the amount of such
Lender’s Commitment with respect to the Supplemental Facility; provided,
however, that the existing Lenders providing a Commitment Notice with respect
to such Supplemental Facility shall be entitled to participate in such
Supplemental Facility on terms and conditions generally applicable to all
Supplemental Lenders with respect to such Supplemental Facility, subject,
however, to the allocations made by the Borrower pursuant to clause (i) above.
Supplemental Lenders and Supplemental Agents not otherwise Lenders hereunder
shall become Lenders hereunder pursuant to a joinder agreement reasonably
satisfactory to the Specified Agents and the Borrower. The Specified Agents
and the Borrower will agree on amendments to this Agreement, if any, necessary
to implement any Supplemental Facility and a form of Supplemental Note to be
issued by the Borrower in connection with such Supplemental Facility.

                  2.4.2. Supplemental Facilities. Subject to all the terms and conditions
of this Agreement and so long as no Default exists and is continuing, from time
to time prior to the final maturity of the Supplemental Facility determined in
accordance with Section 2.4.1, the Supplemental Lenders will, severally in
accordance with their respective Commitments therein, make loans to the
Borrower with respect to such Supplemental Facility as may be requested by the
Borrower in accordance with Section 2.4.3. The aggregate principal amount of
outstanding revolving loans under any Supplemental Facility shall in no event
exceed the Maximum Amount of Relevant Supplemental Revolving Credit for such
Supplemental Facility. The sum of the aggregate principal amount of
outstanding loans under all Supplemental Facilities shall in no event exceed
the Maximum Amount of Supplemental Credit.

                  2.4.3. Borrowing Requests. After a Supplemental Facility has been
established as provided in this Section 2.4, the Borrower may from time to time
request a loan under this Section 2.4 by providing to the Supplemental Agent
and the Administrative Agent a written notice in accordance with

 

30

Section 2.4.1.
Such notice must be not later than noon (Houston time) on the first Banking
Day (third Banking Day if any portion of such loan will be subject to a
Eurodollar Pricing Option on the requested Closing Date) prior to the requested
Closing Date for such loan. The notice must specify (a) the amount of the
requested loan (which shall be not less than $500,000 and an integral multiple
of $100,000) and (b) the requested Closing Date therefor (which shall be a
Banking Day). Upon receipt of such notice, the Supplemental Agent will
promptly inform each Supplemental Lender participating in such Supplemental
Facility (by telephone or otherwise). Each such loan will be made at the
office of the Supplemental Agent specified by such Supplemental Agent by
depositing the amount thereof to the general account of the Borrower with the
Supplemental Agent or by wire transfer as the Borrower may direct in writing to
the Supplemental Agent. In connection with each such loan, the Borrower shall
furnish to the Supplemental Agent and the Administrative Agent a certificate in
substantially the form of Exhibit 5.2.1 and any additional information the
Supplemental Agent, Administrative Agent or any Lender shall reasonably
request. For the purposes of this Section 2.4.3, the Supplemental Agent in
respect of the Supplemental Restatement Revolving Facility shall be the
Administrative Agent.

                  2.4.4. Supplemental Notes. The aggregate principal amount of the loans
outstanding from time to time under this Section 2.4 (including the
Supplemental Restatement Revolving Loan) is referred to as the “Supplemental
Loan”. The Administrative Agent shall keep a record of the Supplemental Loan
and the interests of the respective Lenders therein as part of the Register,
which shall evidence the Supplemental Loan. The Supplemental Loan shall be
deemed owed to each Lender having a Commitment therein severally in accordance
with such Lender’s Percentage Interest therein, and all payments thereon shall
be for the account of each Lender in accordance with its Percentage Interest
therein. Upon request of any Lender, the Borrower’s obligations to pay such
Lender’s Percentage Interest in the Supplemental Loan shall be evidenced by a
separate note of the Borrower (the “Supplemental Note”), payable to such Lender
in accordance with such Lender’s Percentage Interest in the Supplemental Loan.

                  2.4.5. Supplemental Restatement Revolving Facility. Effective on the
First Restatement Effective Date, certain Lenders (the “Supplemental
Restatement Revolving Lenders”) agreed to provide a Supplemental Facility (the
“Supplemental Restatement Revolving Facility”) having the terms and conditions
set forth in this Agreement. Subject to all of the terms and conditions of
this Agreement and so long as no Default exists and is continuing, each
Supplemental Restatement Revolving Lender severally agrees to make revolving
loans to the Borrower in an aggregate principal amount for all Supplemental
Restatement Revolving Lenders equal to the amount requested in accordance with
this Section 2.4.5 from time to time prior to the Final Supplemental
Restatement Revolving Maturity Date, but not to exceed at any time outstanding
the Maximum Amount of Supplemental Restatement Revolving Credit. In no event
will the principal amount of the loans at any one time outstanding made by any
Supplemental Restatement Revolving Lender under this Section 2.4.5 exceed an
amount equal to such Revolving Lender’s Percentage Interest in the Maximum
Amount of Supplemental Restatement Revolving Credit.

                  “Maximum Amount of Supplemental Restatement Revolving Credit” means, on
any date, the amount set forth for such date in the table below, reduced as
provided further below:

 

31

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Percentage
	Date	 	Stated Amount	 	Reduction
	
	 	
	 	

	Prior to March 31, 2003
	 	$	110,000,000	 	 	 	0.000	%
	
	
	
	

	March 31, 2003 through

June 29, 2003
	 	$	108,625,000	 	 	 	1.250	%
	
	
	
	

	June 30, 2003 through

September 29, 2003
	 	$	107,250,000	 	 	 	1.250	%
	
	
	
	

	September 30, 2003 through

December 30, 2003
	 	$	105,875,000	 	 	 	1.250	%
	
	
	
	

	December 31, 2003 through

March 30, 2004
	 	$	104,500,000	 	 	 	1.250	%
	
	
	
	

	March 31, 2004 through

June 29, 2004
	 	$	102,437,500	 	 	 	1.875	%
	
	
	
	

	June 30, 2004 through

September 29, 2004
	 	$	100,375,000	 	 	 	1.875	%
	
	
	
	

	September 30, 2004 through

December 30, 2004
	 	$	98,312,500	 	 	 	1.875	%
	
	
	
	

	December 31, 2004 through

March 30, 2005
	 	$	96,250,000	 	 	 	1.875	%
	
	
	
	

	March 31, 2005 through

June 29, 2005
	 	$	93,500,000	 	 	 	2.500	%
	
	
	
	

	June 30, 2005 through

September 29, 2005
	 	$	90,750,000	 	 	 	2.500	%
	
	
	
	

	September 30, 2005 through

December 30, 2005
	 	$	88,000,000	 	 	 	2.500	%
	
	
	
	

	December 31, 2005 through

March 30, 2006
	 	$	85,250,000	 	 	 	2.500	%
	
	
	
	

	March 31, 2006 through

June 29, 2006
	 	$	79,750,000	 	 	 	5.000	%
	
	
	
	

	June 30, 2006 through

September 29, 2006
	 	$	74,250,000	 	 	 	5.000	%

 

32

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Percentage
	Date	 	Stated Amount	 	Reduction
	
	 	
	 	

	
	
	
	

	September 30, 2006 through

December 30, 2006
	 	$	68,750,000	 	 	 	5.000	%
	
	
	
	

	December 31, 2006 through

March 30, 2007
	 	$	63,250,000	 	 	 	5.000	%
	
	
	
	

	March 31, 2007 through

June 29, 2007
	 	$	47,437,500	 	 	 	14.375	%
	
	
	
	

	June 30, 2007 through

September 29, 2007
	 	$	31,625,000	 	 	 	14.375	%
	
	
	
	

	September 30, 2007 up to

the Final Supplemental

statement Revolving

Maturity Date
	 	$	15,812,500	 	 	 	14.375	%
	
	
	
	

	Final Supplemental

Restatement Revolving

Maturity Date
	 	$	0	 	 	 	14.375	%

                  In addition, each amount in the foregoing table shall be further
permanently reduced by the following amounts:

		
	 	     (a) The sum of the Pro Rata Supplemental Restatement Revolver
Prepayment Portions applicable to the reduction date for such amount set
forth in such table of the respective amounts of Net Cash Proceeds from
Operating Asset Sales to the extent that such Net Cash Proceeds are not
applied to repay the Revolving Loan, the New Restatement Revolving Loan,
the Term Loans or any other Supplemental Loan pursuant to Section 4.4 or
allocated to an effective Asset Reinvestment Reserve Amount.

		
	 	     (b) The amount of Net Debt Proceeds to the extent that such amount
is allocated to the permanent reduction of the Maximum Amount of
Supplemental Restatement Revolving Credit by Section 4.5.

		
	 	     (c) Such amount (in an integral multiple of $1,000,000 and in a
minimum amount of $1,000,000) specified by three Banking Days’ notice
from the Borrower to the Administrative Agent.

                  The aggregate principal amount of the loans made pursuant to this Section
2.4.5 at any time outstanding is referred to as the “Supplemental Restatement
Revolving Loan”.

                  2.5. New Restatement Revolving Facility.

 

33

                  2.5.1. New Restatement Revolving Loan. Effective on the Second
Restatement Effective Date, the Lenders (the “New Restatement Revolving
Lenders”) listed as “New Restatement Revolving Lenders” on Exhibit 11.1 shall
provide a revolving credit facility (the “New Restatement Revolving Facility”)
having the terms and conditions set forth in this Agreement. Subject to all of
the terms and conditions of this Agreement and so long as no Default exists and
is continuing, each New Restatement Revolving Lender severally agrees to make
revolving loans to the Borrower in an aggregate principal amount for all New
Restatement Revolving Lenders equal to the amount requested in accordance with
this Section 2.5.2 from time to time prior to the Final New Restatement
Revolving Maturity Date, but not to exceed at any time outstanding the Maximum
Amount of New Restatement Revolving Credit. In no event will the principal
amount of the loans at any one time outstanding made by any New Restatement
Revolving Lender under this Section 2.5 exceed an amount equal to such
Revolving Lender’s Percentage Interest in the Maximum Amount of New Restatement
Revolving Credit.

                  “Maximum Amount of New Restatement Revolving Credit” means, on any date,
the amount set forth for such date in the table below, reduced as provided
further below:

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Percentage
	Date	 	Stated Amount	 	Reduction
	
	 	
	 	

	Prior to March 31, 2005
	 	$	670,000,000	 	 	 	0.000	%
	
	
	
	

	March 31, 2005 through

June 29, 2005
	 	$	636,500,000	 	 	 	5.000	%
	
	
	
	

	June 30, 2005 through

September 29, 2005
	 	$	603,000,000	 	 	 	5.000	%
	
	
	
	

	September 30, 2005 through

December 30, 2005
	 	$	569,500,000	 	 	 	5.000	%
	
	
	
	

	December 31, 2005 through

March 30, 2006
	 	$	536,000,000	 	 	 	5.000	%
	
	
	
	

	March 31, 2006 through

June 29, 2006
	 	$	452,250,000	 	 	 	12.500	%
	
	
	
	

	June 30, 2006 through

September 29, 2006
	 	$	368,500,000	 	 	 	12.500	%
	
	
	
	

	September 30, 2006 through

December 30, 2006
	 	$	284,750,000	 	 	 	12.500	%
	
	
	
	

	December 31, 2006 through

March 30, 2007
	 	$	201,000,000	 	 	 	12.500	%

 

34

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Percentage
	Date	 	Stated Amount	 	Reduction
	
	 	
	 	

	
	
	
	

	March 31, 2007 up to the

Final New Restatement

Revolving Maturity Date
	 	$	100,500,000	 	 	 	15.000	%
	
	
	
	

	Final New Restatement

Revolving Maturity Date
	 	$	0	 	 	 	15.000	%

                  In addition, each amount in the foregoing table shall be further
permanently reduced by the following amounts:

		
	 	     (a) The sum of the Pro Rata New Restatement Revolver Prepayment
Portions applicable to the reduction date for such amount set forth in
such table of the respective amounts of Net Cash Proceeds from Operating
Asset Sales to the extent that such Net Cash Proceeds are not applied to
repay the Revolving Loan, the Term Loans or any Supplemental Loan
pursuant to Section 4.4 or allocated to an effective Asset Reinvestment
Reserve Amount.

		
	 	     (b) The amount of Net Debt Proceeds to the extent that such amount
is allocated to the permanent reduction of the Maximum Amount of New
Restatement Revolving Credit by Section 4.5.

		
	 	     (c) Such amount (in an integral multiple of $1,000,000 and in a
minimum amount of $1,000,000) specified by three Banking Days’ notice
from the Borrower to the Administrative Agent.

                  The aggregate principal amount of the loans made pursuant to this Section
2.5.1 at any time outstanding is referred to as the “New Restatement Revolving
Loan”.

                  2.5.2. Borrowing Requests. New Restatement Revolving Loans will be made
to the Borrower by the New Restatement Revolving Lenders under Section 2.5.1 on
any Banking Day on or after the Second Restatement Effective Date and prior to
the Final New Restatement Revolving Maturity Date. Not later than noon (New
York time) on the first Banking Day (third Banking Day if any portion of such
loan will be subject to a Eurodollar Pricing Option on the requested Closing
Date) prior to the requested Closing Date for any such loan, a Financial
Officer for the Borrower will give the Administrative Agent notice of its
request (which may be given by a telephone call received by a Lending Officer
and promptly confirmed in writing), specifying (a) the amount of the requested
loan (not less than $1,000,000 and an integral multiple of $100,000) (except to
the extent a greater amount may be required in the case of a Eurodollar Pricing
Option) and (b) the requested Closing Date therefor. Upon receipt of such
notice by the Administrative Agent, the Administrative Agent shall give prompt
telephonic or written notice to each Lender. Each such loan will be made at
the Houston Office by wire deposit to the Administrative Agent as specified in
writing from time to time. In connection with each such loan, the Borrower
shall furnish to the Administrative Agent a certificate in substantially the
form of Exhibit 5.2.1.

                  2.5.3. New Restatement Revolving Notes. The Administrative Agent shall
keep a record of the New Restatement Revolving Loan and the respective
interests of the Lenders therein as part of the Register, which shall evidence
the New Restatement Revolving Loan. The New Restatement Revolving Loan shall
be deemed owed to each Lender having a Commitment therein severally in
accordance with such Lender’s Percentage Interest therein, and all payments
thereon shall be for the

 

35

account of each Lender in accordance with its
Percentage Interest therein. Upon written request of any Lender, the
Borrower’s obligations to pay such Lender’s Percentage Interest in the New
Restatement Revolving Loan shall be evidenced by a separate note of the
Borrower in substantially the form of Exhibit 2.1.3 (with appropriate
modifications) (the “New Restatement Revolving Notes”), payable to such Lender
in accordance with such Lender’s Percentage Interest in the New Restatement
Revolving Loan.

                  2.6. Application of Proceeds.

                  2.6.1. Loan. Subject to Section 2.6.2, the Borrower will apply the
proceeds of the Loan (to the extent made on or after the First Restatement
Effective Date) for general purposes, including to finance permitted
Investments.

                  2.6.2. Specifically Prohibited Applications. The Borrower will not,
directly or indirectly, apply any part of the proceeds of any extension of
credit made pursuant to the Credit Documents to purchase or to carry Margin
Stock or to any transaction prohibited by the Credit Documents or by Legal
Requirements applicable to the Lenders.

                  2.7. Nature of Obligations of Lenders to Extend Credit. The Lenders’
obligations under this Agreement to make the Loan are several and are not joint
or joint and several. If any Lender shall fail to perform its obligations to
extend any such credit, the amount of the commitment of the Lender so failing
to perform may be assumed by the other Lenders, in their sole discretion, in
such proportions as such Lenders may agree among themselves and the Percentage
Interests of each other Lender shall be appropriately adjusted, but such
assumption and adjustment shall not relieve the Lenders from any of their
obligations to make any such extension of credit or to repay any Delinquent
Payment required by Section 11.4.

                  3. Interest; Eurodollar Pricing Options; Fees.

                  3.1. Interest. The Loan shall accrue and bear interest at a rate per
annum which shall at all times equal the Applicable Rate. Prior to any stated
or accelerated maturity of the Revolving Loan, the New Restatement Revolving
Loan, either Term Loan or the Supplemental Loan, as the case may be, the
Borrower will, on each Payment Date, pay the accrued and unpaid interest on the
portion of the Loan which was not subject to a Eurodollar Pricing Option. On
the last day of each Interest Period or on any earlier termination of any
Eurodollar Pricing Option, the Borrower will pay the accrued and unpaid
interest on the portion of the Loan which was subject to the Eurodollar Pricing
Option which expired or terminated on such date; provided, however, that in the
case of any Interest Period longer than three months, the Borrower will also
pay the accrued and unpaid interest on the Loan subject to the Eurodollar
Pricing Option having such Interest Period every 90 days, beginning on the 90th
day after the commencement of such Interest Period (or if any such day is not a
Banking Day, the Banking Day immediately preceding such 90th day). On any
stated or accelerated maturity of the Revolving Loan, the New Restatement
Revolving Loan, either Term Loan or the Supplemental Loan, as the case may be,
the Borrower will pay all accrued and unpaid interest on the Revolving Loan,
the New Restatement Revolving Loan, the Term Loans or the Supplemental Loan, as
the case may be, including any accrued
and unpaid interest on the portion of the Loan which is subject to a
Eurodollar Pricing Option. All payments of interest hereunder shall be made to
the Administrative Agent for the account of each Lender in accordance with the
Lenders’ respective Percentage Interests.

                  3.2. Eurodollar Pricing Options.

                  3.2.1. Election of Eurodollar Pricing Options. Subject to any of the
terms and conditions hereof and so long as no Default under Sections 9.1.1,
9.1.5 (except clause (b) thereof) or

 

36

9.1.11 exists and is continuing, the
Borrower may from time to time, by irrevocable notice from a Financial Officer
to the Administrative Agent received no later than noon (New York time) three
Banking Days prior to the commencement of the Interest Period selected in such
notice, elect to have such portion of the Loan as the Borrower may specify in
such notice accrue and bear daily interest during the Interest Period so
selected at the Applicable Rate computed on the basis of the Eurodollar Rate.
In the event the Borrower, at any time, fails to elect a Eurodollar Pricing
Option under this Section 3.2.1 for any portion of the Loan, then such portion
of the Loan will accrue and bear interest at the Applicable Rate based on the
Base Rate. Simultaneous elections by the Borrower for the same Interest Period
of a portion of the Revolving Loan, the New Restatement Revolving Loan, either
Term Loan, the Supplemental Loan or all of such Tranches on a combined basis
shall be deemed to be the election of a single Eurodollar Pricing Option.

                  No election under this Section 3.2.1 shall become effective if, prior to
the commencement of any such Interest Period, the Administrative Agent
determines, in the manner provided below, that (a) the electing or granting of
the Eurodollar Pricing Option in question would violate a Legal Requirement or
(b) Eurodollar deposits in an amount comparable to the principal amount of the
Loan as to which such Eurodollar Pricing Option has been elected and which have
a term corresponding to the proposed Interest Period are not readily available
in the inter-bank Eurodollar market for delivery at any Eurodollar Office or,
by reason of circumstances affecting such market, adequate and reasonable
methods do not exist for ascertaining the interest rate applicable to such
deposits for the proposed Interest Period.

                  For purposes of determining ready availability of Eurodollar deposits with
respect to a proposed Interest Period, such Eurodollar deposits shall be deemed
not readily available if the Required Lenders shall have advised the
Administrative Agent by telephone, confirmed in writing or by facsimile, at or
prior to noon (New York time) on the second Banking Day prior to the
commencement of such proposed Interest Period that, based upon the knowledge of
such Lenders of the Eurodollar market and after reasonable efforts to determine
the availability of such Eurodollar deposits, such Lenders reasonably determine
that Eurodollar deposits in an amount equal to the respective Percentage
Interest of such Lenders in the portion of the Loan as to which such Eurodollar
Pricing Option has been elected and which have a term corresponding to the
Interest Period in question will not be offered in the Eurodollar market to
such Lender at a rate of interest that does not exceed the Basic Eurodollar
Rate, and the Administrative Agent and the Borrower reasonably concurs in such
determination (unless the foregoing results from the creditworthiness of such
Lenders or a change in the availability of Eurodollar markets to such Lenders
resulting from the failure of such Lenders to comply with legal or regulatory
requirements).

                  3.2.2. Notice to Lenders and Borrower. The Administrative Agent will
promptly inform each Lender (by telephone or otherwise and promptly confirmed
in writing) of each notice received by it from the Borrower pursuant to Section
3.2.1 and of the Interest Period specified in such notice. Upon determination
by the Administrative Agent of the Eurodollar Rate for such Interest Period or
in the event no such election shall become effective, the Administrative Agent
will promptly notify the Borrower and each Lender (by telephone or otherwise
and promptly confirmed in writing) of the Eurodollar Rate so determined or why
such election did not become effective.

                  3.2.3. Selection of Interest Periods. Interest Periods shall be selected
so that:

		
	 	     (a) the minimum portion of the Loan subject to any Eurodollar
Pricing Option shall be $5,000,000 and an integral multiple of
$1,000,000;

		
	 	     (b) no more than 20 Eurodollar Pricing Options shall be outstanding
at any one time;

 

37

		
	 	     (c) a portion of Term Loan B equal to the amount of the next
mandatory prepayment required by Section 4.2.1 shall not be subject to a
Eurodollar Pricing Option on the date such mandatory prepayment is
required to be made;

		
	 	     (d) a portion of Term Loan C equal to the amount of the next
mandatory prepayment required by Section 4.2.2 shall not be subject to a
Eurodollar Pricing Option on the date such mandatory prepayment is
required to be made;

		
	 	     (e) an aggregate principal amount of the Revolving Loan equal to the
amount of the next mandatory prepayment required by Section 4.3 shall not
be subject to a Eurodollar Pricing Option on the date such mandatory
prepayment is required to be made;

		
	 	     (f) an aggregate principal amount of the New Restatement Revolving
Loan equal to the amount of the next mandatory prepayment required by
Section 4.3 shall not be subject to a Eurodollar Pricing Option on the
date such mandatory prepayment is required to be made;

		
	 	     (g) an aggregate principal amount of the Supplemental Restatement
Revolving Loan equal to the amount of the next mandatory prepayment
required by Section 4.3 shall not be subject to a Eurodollar Pricing
Option on the date such mandatory prepayment is required to be made; and

		
	 	     (h) no Interest Period with respect to any part of the Loan subject
to a Eurodollar Pricing Option shall expire later than the Applicable
Maturity Date.

                  3.2.4. Additional Interest. If any portion of the Loan which is subject
to a Eurodollar Pricing Option is repaid, or any Eurodollar Pricing Option is
terminated for any reason (other than (a) a Legal Requirement not having the
force of law or (b) the payment in full of the Credit Obligations as a result
of the failure of any Lender to perform its obligations hereunder), on a date
which is prior to the last Banking Day of the Interest Period applicable to
such Eurodollar Pricing Option, the Borrower will pay to the Administrative
Agent for the account of each Lender in accordance with the Lenders’ respective
Percentage Interests, in addition to any amounts of interest otherwise payable
hereunder, an amount equal to daily interest for the unexpired portion of such
Interest Period on the portion of the Loan so repaid, or as to which a
Eurodollar Pricing Option was so terminated, at a per annum rate equal to the
excess, if any, of (i) the Eurodollar Rate calculated on the basis of the rate
applicable to such Eurodollar Pricing Option minus (ii) the lowest rate of
interest obtainable by the Lenders with respect to Eurodollar deposits which
have a maturity date approximating the last Banking Day of such Interest
Period. For purposes of this Section 3.2.4, if any portion of the Loan which
was to have been subject to a Eurodollar Pricing Option is not outstanding on
the first day of the Interest Period applicable to such Eurodollar Pricing
Option other than for reasons described in Section 3.2,1, the Borrower shall be
deemed to have terminated such Eurodollar Pricing Option. A certificate of an
officer of the Administrative Agent setting forth in reasonable detail the
basis of calculation of such amount of interest shall, in the absence of
manifest error, be conclusive. Except to the extent set forth in Section 12.3,
the assignment by any Lender of all or a
portion of such Lender’s interests, rights and obligations under this
Agreement and the other Credit Documents shall not constitute a termination of
a Eurodollar Pricing Option.

                  3.2.5. Change in Applicable Laws, Regulations, etc. If any Legal
Requirement having the force of law shall prevent any Lender from funding
through the purchase of deposits, or maintaining, any portion of the Loan
subject to a Eurodollar Pricing Option or otherwise from giving effect to such
Lender’s obligations as contemplated hereby (unless the foregoing results from
the creditworthiness of such Lender or a change in the availability of
Eurodollar markets to such Lender resulting from the failure

 

38

of such Lender to
comply with legal or regulatory requirements), (a) the Administrative Agent may
by notice to the Borrower terminate all of the affected Eurodollar Pricing
Options, (b) the portion of the Loan subject to such terminated Eurodollar
Pricing Options shall immediately bear interest thereafter at the Applicable
Rate computed on the basis of the Base Rate and (c) the Borrower shall make any
payment required by Section 3.2.4 to the extent the Applicable Rate based on
the Eurodollar Rates for the affected Eurodollar Pricing Options exceeds the
Applicable Rate based on the Base Rate. A certificate of an officer of the
Administrative Agent describing in reasonable detail such mandatory Legal
Requirement and setting forth in reasonable detail a calculation of the payment
required by Section 3.2.4 shall, in the absence of manifest error, be
conclusive.

                  3.2.6. Funding Procedure. The Lenders may fund any portion of the Loan
subject to a Eurodollar Pricing Option out of any funds available to the
Lenders. Regardless of the source of the funds actually used by any of the
Lenders to fund any portion of the Loan subject to a Eurodollar Pricing Option,
however, all amounts payable hereunder, including the interest rate applicable
to any such portion of the Loan and the amounts payable under Sections 3.2.4
and 3.4, shall be computed as if each Lender had actually funded such Lender’s
Percentage Interest in such portion of the Loan through the purchase of
deposits in such amount with a maturity the same as the applicable Interest
Period relating thereto and through the transfer of such deposits from an
office of the Lender having the same location as the applicable Eurodollar
Office to one of such Lender’s offices in the United States of America.

                  3.3. Commitment Fees. In consideration of the Revolving Lenders’, the New
Restatement Revolving Lenders’ and the Supplemental Restatement Revolving
Lenders’ commitments to make the extensions of credit provided for in Section
2.1, 2.4.5 or 2.5, as the case may be, while such commitments are outstanding,
the Borrower will pay to the Administrative Agent for the account of such
Lenders, on each Payment Date and on the Final Revolving Maturity Date, the
Final New Restatement Revolving Maturity Date or the Final Supplemental
Restatement Revolving Maturity Date, as the case may be, commitment fees in an
amount equal to the product of:

		
	 	     (a) annual interest at a rate equal to the commitment fee percentage
in the table below set opposite the Reference Leverage Ratio as of such
date;

		
	 	           multiplied by (b) the amount by which (i) the average daily Maximum
Amount of Revolving Credit, Maximum Amount of New Restatement Revolving
Credit or Maximum Amount of Supplemental Restatement Revolving Credit, as
the case may be, during the three-month period or portion thereof ending
on such date exceeded (ii) the average daily Revolving Loan, New
Restatement Revolving Loan or Supplemental Restatement Revolving Loan, as
the case may be, during such period or portion thereof:

	 	 	 	 	 
	 	 	Commitment Fee
	Reference Leverage Ratio	 	Percentage
	
	 	

	Greater than or equal to 4.00
	 	 	0.375	%
	
	
	
	

	Less than 4.00
	 	 	0.250	%

Any adjustment in the commitment fee percentage shall take effect on the third
Banking Day following the receipt by the Administrative Agent of the financial
statements required to be furnished by Sections 7.4.1 or 7.4.2; provided,
however, that if for any reason the Restricted Companies shall not have
furnished the financial statements required by Sections 7.4.1 or 7.4.2 for any
fiscal quarter by the time required by such Sections, the commitment fee
percentage during the period from the date which is three Banking

 

39

Days after
such financial statements were due until the third Banking Day following
receipt by the Administrative Agent of such financial statements shall be
0.375%.

                  3.4. Taxes. If (a) any Lender shall be subject to any Tax or (b) the
Borrower shall be required to withhold or deduct any Tax, the Borrower will on
demand by the Administrative Agent or such Lender, accompanied by the
certificate referred to below, pay to the Administrative Agent for such
Lender’s account such additional amount as is necessary to enable such Lender
to receive net of any Tax the full amount of all payments of principal,
interest, fees, expenses, indemnities and other amounts payable by the Borrower
to such Lender under any Credit Document. Each Lender agrees that if, after
the payment by the Borrower of any such additional amount, any amount
identifiable as a part of any Tax related thereto is subsequently recovered or
used as a credit by such Lender, such Lender shall reimburse the Borrower to
the extent of the amount so recovered or used. A certificate of an officer of
such Lender setting forth the amount of such Tax or recovery or use and the
basis therefor shall, in the absence of manifest error, be conclusive. In
determining such amount, such Lender may use any reasonable averaging and
attribution methods.

                  3.5. Capital Adequacy. Except as provided in Section 3.6, if any Lender
shall have determined that compliance by such Lender with any change after the
date hereof in any applicable law, governmental rule, regulation or order
regarding capital adequacy of banks or bank holding companies, or any
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by such Lender with any request or directive regarding
capital adequacy if such Lender reasonably believes that compliance therewith
is in accordance with customary commercial practice (whether or not having the
force of law and whether or not failure to comply therewith would be unlawful)
of any such authority, central bank or comparable agency, has or would have the
effect of reducing the rate of return on such Lender’s capital as a consequence
of such Lender’s obligations hereunder to a level below that which such Lender
could have achieved but for such compliance (taking into consideration such
Lender’s policies with respect to capital adequacy immediately before such
compliance and assuming that such Lender’s capital was fully utilized prior to
such compliance) by an amount deemed by such Lender to be material, then the
Borrower will on demand by the Administrative Agent, accompanied by the
certificate referred to below, pay to the Administrative Agent from time to
time as specified by such Lenders as are so affected such additional amounts as
shall be sufficient to compensate such Lenders for such reduced return,
together with interest on each such amount from 15 Banking Days after the date
demanded until payment in full thereof at the rate of interest on overdue
installments of principal provided in Section 3.1. A certificate of an officer
of any such Lender setting forth the amount to be paid to it and the basis for
computation thereof hereunder shall, in the absence of manifest error, be
conclusive. In determining such amount, such Lender may use any reasonable
averaging and attribution methods.

                  3.6. Regulatory Changes. If any Lender shall have determined that (a) any
change in any Legal Requirement after the date hereof shall directly or
indirectly (i) reduce the amount of any sum received or receivable by such
Lender with respect to the Loan or the return to be earned by such Lender on
the Loan, (ii) impose a cost on such Lender or any Affiliate of such Lender
that is attributable to the making or maintaining of, or such Lender’s
commitment to make, its portion of the Loans, (iii) require such Lender or any
Affiliate of such Lender to make any payment on or calculated by reference to
the gross amount of any amount received by such Lender under any Credit
Document, or (iv) reduce, or have the effect of reducing, the rate of return on
any capital of such Lender or any Affiliate of such Lender that such Lender or
such Affiliate is required to maintain on account of the Loan or such Lender’s
Commitment and (b) such reduction, increased cost or payment shall not be fully
compensated for by an adjustment in the Applicable Rate, then the Borrower
shall pay to such Lender (without duplication of payments to other Lenders)
such additional amounts as such Lender determines will, together with any
adjustment in the Applicable Rate, fully compensate for such reduction,
increased cost or payment,

 

40

together with interest on each such amount from 15
Banking Days after the date demanded until payment in full thereof at the then
highest Applicable Rate. A certificate of an officer of such Lender setting
forth in reasonable detail the amount to be paid to it and the basis for
computation thereof hereunder shall, in the absence of manifest error, be
conclusive. In determining such amount, such Lender may use any reasonable
averaging and attribution methods.

                  3.7. Computations of Interest and Fees. For purposes of this Agreement,
interest and commitment fees (and any amount expressed as interest) shall be
computed on a daily basis and (a) with respect to any portion of the Loan
subject to a Eurodollar Pricing Option, on the basis of a 360-day year and (b)
with respect to commitment fees and any other portion of the Loan, on the basis
of a 365- or 366-day year, as the case may be.

                  3.8. Interest Limitation. Notwithstanding any other provision of this
Agreement or any other Credit Document, the maximum amount of interest that may
be charged to or collected from the Borrower by any Lender under this Agreement
or any other Credit Document shall in no event exceed the maximum amount of
interest that could lawfully be charged or collected under applicable law. Any
provision of this Agreement or any other Credit Document that could be
construed as providing for interest in excess of such lawful maximum shall be
expressly subject to this Section 3.8. Any part of the Credit Obligations
consisting of amounts to be paid to any Lender for the use, forbearance or
retention of the Credit Obligations shall, to the extent permitted by
applicable law, be allocated throughout the full term of the Credit Obligations
until payment in full of the Credit Obligations (including any renewal or
extension thereof) so that interest on account of the Credit Obligations shall
not exceed the maximum amount permitted by applicable law.

                  4. Payment.

                  4.1. Payment at Maturity. On the Applicable Maturity Date or any
accelerated maturity of any portion of the Loan, the Borrower will pay to the
Administrative Agent for the account of each Lender for credit to the Revolving
Loan, New Restatement Revolving Loan, Term Loan B, Term Loan C or the
Supplemental Loan, as the case may be, an amount equal to the Revolving Loan,
New Restatement Revolving Loan, Term Loan B Term Loan C or the Supplemental
Loan, as the case may be, then due, together with all
accrued and unpaid interest and any fees thereon, and on the latest
Applicable Maturity Date or any earlier accelerated maturity of the Loan, all
other Credit Obligations then outstanding under the Credit Documents.

                  4.2. Fixed Required Prepayments.

                  4.2.1. Term Loan B. On the last Banking Day of March, June, September and
December, beginning March 31, 1999, the Borrower will pay to the Administrative
Agent, for the account of the Lenders as a prepayment of Term Loan B the lesser
of (a) $500,000, as adjusted after the date hereof in accordance with this
Section 4, or (b) the amount of Term Loan B then outstanding, in each case,
together with accrued interest on such amount prepaid, and a final payment of
the balance of Term Loan B on the Final Term Loan B Maturity Date.

                  4.2.2. Term Loan C. On the last Banking Day of each March, June,
September and December, beginning March 31, 1999, the Borrower will pay to the
Administrative Agent, for the account of the Lenders as a prepayment of Term
Loan C, the lesser of (a) $750,000, as adjusted after the date hereof in
accordance with this Section 4, or (b) the amount of Term Loan C then
outstanding, in each case together with accrued interest on such prepaid
amount, and a final payment of the balance of Term Loan C on the Final Term
Loan C Maturity Date.

 

41

                  4.2.3.  Supplemental Loan. The schedule for prepayments of each
Supplemental Facility shall be determined in accordance with Section 2.4.

                  4.3.  Maximum Amount of Revolving Credit, etc. If at any time the
Revolving Loan exceeds the Maximum Amount of Revolving Credit, the Borrower
will immediately pay the amount of such excess to the Administrative Agent for
the account of the Revolving Lenders as a mandatory prepayment of the Revolving
Loan. If at any time the New Restatement Revolving Loan exceeds the Maximum
Amount of New Restatement Revolving Credit, the Borrower will immediately pay
the amount of such excess to the Administrative Agent for the account of the
New Restatement Revolving Lenders as a mandatory prepayment of the New
Restatement Revolving Loan. If at any time a revolving portion of the
Supplemental Loan exceeds the applicable Maximum Amount of Relevant
Supplemental Revolving Credit, the Borrower will immediately pay the amount of
such excess to the Administrative Agent for the account of the Lenders
participating therein as a mandatory prepayment of such Supplemental Loan.

                  4.4.  Asset Sales.

                  4.4.1.  Operating Asset Sale Notice. In the event that the Restricted
Companies sell, exchange or dispose of Operating Assets in a transaction
(excluding a transaction permitted by Section 7.11.1 or Section 7.11.2, but
including a Permitted Asset Swap to the extent of the amount of cash received
by the Restricted Companies) (each, an “Operating Asset Sale”), the Borrower
shall, within five days after such Operating Asset Sale, provide written notice
to the Administrative Agent of (a) the closing date for such Operating Asset
Sale, (b) the amount of Net Cash Proceeds (if any, in the case of an exchange)
therefrom, (c) whether any portion of the Net Cash Proceeds will be reserved as
an Asset Reinvestment Reserve Amount in accordance with Section 4.4.3, (d) how
much of the Revolving Loan, the New Restatement Revolving Loan, the Term Loan
and the Supplemental Loan will be prepaid with the Net Cash Proceeds in
accordance with Section 4.4.2, (e) a revised schedule of reductions in the
Maximum Amount of Revolving Credit, Maximum Amount of New Restatement Revolving
Credit and any Maximum Amount of Relevant Supplemental Revolving Credit giving
effect to such prepayment, (f) a revised schedule of mandatory prepayments of
each of Term Loan B and Term Loan C giving effect to
such prepayment and (g) a revised schedule of mandatory prepayments of the
Supplemental Loan giving effect to such prepayment.

                  4.4.2.  Prepayment on Sale. The Loan shall be repaid in accordance with
this Section 4.4 to the extent that (a) the Net Cash Proceeds of the Operating
Asset Sale described in such written notice exceeds 15% of Consolidated
Operating Cash Flow for the period of four fiscal quarters of the Restricted
Companies ending on the last day of the fiscal quarter ending immediately prior
to the date of the Operating Asset Sale and (b) such excess Net Cash Proceeds
are not subject to an effective Asset Reinvestment Reserve Amount in accordance
with Section 4.4.3.

                  4.4.3.  Asset Reinvestment Reserve Amount. The Borrower may elect to
reserve Net Cash Proceeds described in Section 4.4.2(a) for reinvestment
(directly or by stock purchase, merger or otherwise, provided any entity so
acquired becomes a Restricted Company) in replacement Operating Assets. The
amount so reserved (the “Asset Reinvestment Reserve Amount”) must be so applied
within 540 days after the Operating Asset Sale creating the Asset Reinvestment
Reserve Amount. In the event the Asset Reinvestment Reserve Amount is not
reinvested within such 540-day period (or if the Borrower abandons its plans
for the reinvestment of the Asset Reinvestment Reserve Amount), the Borrower
shall notify the Administrative Agent within three Banking Days and specify (a)
how much of the Revolving Loan, the New Restatement Revolving Loan, the Term
Loan and the Supplemental Loan will be prepaid with the Asset Reinvestment
Reserve Amount in accordance with Section 4.4.4, (b) a revised schedule of

 

42

reductions in the Maximum Amount of Revolving Credit, Maximum Amount of New
Restatement Revolving Credit and any Maximum Amount of Relevant Supplemental
Revolving Credit giving effect to such prepayment, (c) a revised schedule of
mandatory prepayments of each of Term Loan B and Term Loan C giving effect to
such prepayment and (d) a revised schedule of mandatory prepayments of the
Supplemental Loan giving effect to such prepayment.

                  4.4.4.  Allocations of Prepayment. Prepayments of the Loan (and reductions
in the Maximum Amount of Revolving Credit, Maximum Amount of New Restatement
Revolving Credit and any Maximum Amount of Relevant Supplemental Revolving
Credit) made pursuant to this Section 4.4 will be allocated to the Revolving
Loan, New Restatement Revolving Loan, Term Loan B, Term Loan C and the
Supplemental Loan, pro rata in proportion to the relative size of the Maximum
Amount of Revolving Credit, Maximum Amount of New Restatement Revolving Credit,
any Maximum Amount of Relevant Supplemental Revolving Credit, Term Loan B, Term
Loan C and the term portions of the Supplemental Loan, and prepayments of Term
Loan B, Term Loan C and the term portions of the Supplemental Loan under this
Section 4.4 shall be applied to the prepayments required under Section 4.2 pro
rata over the remaining payments in accordance with the Pro Rata Term
Prepayment Portions. All such prepayments (and reductions in the Maximum
Amount of Revolving Credit, Maximum Amount of New Restatement Revolving Credit
and any Maximum Amount of Relevant Supplemental Revolving Credit) must be made
within five Banking Days after the Operating Asset Sale or the termination of
effectiveness of an Asset Reinvestment Reserve Amount, as the case may be.

                  4.5.  Designated Financing Debt. Upon, or within five days prior to, the
incurrence by any of the Restricted Companies of Designated Financing Debt, the
Borrower shall provide written notice to the Lenders of the closing date for
such incurrence and the amount of Net Debt Proceeds. Such Net Debt Proceeds
shall be applied to the prepayment of the Revolving Loan, New Restatement
Revolving Loan, Term Loan B, Term Loan C and the Supplemental Loan, pro rata in
proportion to the relative size of the Maximum Amount of Revolving Credit,
Maximum Amount of New Restatement Revolving Credit, any Maximum Amount of
Relevant Supplemental Revolving Credit, Term Loan B, Term Loan C and the term
portions of the
Supplemental Loan, and prepayments of Term Loan B, Term Loan C and term
portions of the Supplemental Loan under this Section 4.5 shall be applied to
the prepayments required under Section 4.2 pro rata over the remaining payments
in accordance with the Pro Rata Term Prepayment Portions. All such payments
(and reductions in the Maximum Amount of Revolving Credit, Maximum Amount of
New Restatement Revolving Credit and any Maximum Amount of Relevant
Supplemental Revolving Credit) must be made within five Banking Days after the
incurrence of the Designated Financing Debt.

                  4.6.  Voluntary Prepayments. In addition to the prepayments required by
Sections 4.2, 4.3, 4.4 and 4.5, the Borrower may from time to time prepay all
or any portion of the Loan (in a minimum amount of $1,000,000 and an integral
multiple of $100,000), without premium (except as provided in Section 3.2.4
with respect to early termination of Eurodollar Pricing Options). The Borrower
shall give the Administrative Agent at least one Banking Day prior notice in
the case of a Revolving Loan, New Restatement Revolving Loan or revolving
portion of the Supplemental Loan prepayment (three Banking Days’ prior notice
if any portion of the Revolving Loan, New Restatement Revolving Loan or
revolving portion of the Supplemental Loan to be repaid is subject to a
Eurodollar Pricing Option) and at least five Banking Days’ prior notice in the
case of a Term Loan or term portion of the Supplemental Loan prepayment,
specifying the date of payment, the total principal amount of the Revolving
Loan, New Restatement Revolving Loan, Term Loan or Supplemental Loan to be paid
on such date and the amount of interest to be paid with such prepayment (and
any amounts due with respect to early termination of Eurodollar Pricing Options
under Section 3.2.4). Any prepayment of the Revolving Loan, New Restatement
Revolving Loan or revolving portion of the Supplemental Loan made pursuant to
this Section 4.6 may, at the Borrower’s option as indicated in the notice
delivered pursuant to the preceding

 

43

sentence, permanently reduce the Maximum
Amount of Revolving Credit, Maximum Amount of New Restatement Revolving Credit
or Maximum Amount of Relevant Supplemental Revolving Credit, as the case may
be. The effectiveness of such notice may, at the Borrower’s option, be
conditioned on the closing of a credit facility the proceeds of which will be
used to prepay the Loan, or the effectiveness of Investments or acquisitions
permitted by Section 7.9 or mergers, consolidations or dispositions of assets
permitted by Section 7.11, in which case such notice may be revoked by the
Borrower (by notice delivered in accordance with this Section 4.6) if such
condition is not satisfied without any liability to the Lenders. If such
condition is satisfied, such notice shall be deemed to have been effective as
of the date of the giving of such notice. All prepayments of Term Loan B, Term
Loan C or the term portions of the Supplemental Loan under this Section 4.6
shall be applied to the prepayments required under Section 4.2 pro rata over
the remaining payments. With respect to the amount of such prepayment
allocated to the Term Loan in accordance with the previous sentence, the
Borrower may allocate the first $80,000,000 of such prepayment either pro rata
in proportion to the relative size of Term Loan B and Term Loan C or
disproportionately to Term Loan C, as the Borrower may elect. To the extent of
aggregate prepayments over $80,000,000, such excess amounts shall be allocated
pro rata in proportion to the relative size of Term Loan B and Term Loan C.

                  4.7.  Application of Payments. Any prepayment of the Revolving Loan, New
Restatement Revolving Loan, Term Loan or the Supplemental Loan, as the case may
be, shall be applied first to the portion of the Revolving Loan, New
Restatement Revolving Loan, Term Loan or the Supplemental Loan, as the case may
be, not then subject to Eurodollar Pricing Options, then the balance of any
such prepayment shall be applied to the portion of the Revolving Loan, New
Restatement Revolving Loan, Term Loan or Supplemental Loan, as the case may be,
then subject to Eurodollar Pricing Options, in the chronological order of the
respective maturities thereof (or as the Restricted Companies may otherwise
specify), together with any payments required by Section 3.2.4 with respect to
early termination of Eurodollar Pricing Options. All payments of principal
hereunder shall be made to the Administrative Agent for the account of each
Lender in
accordance with the Lenders’ respective Percentage Interests. The amounts
of the Term Loan or term portion of the Supplemental Loan prepaid pursuant to
Sections 4.2, 4.4, 4.5 or 4.6 may not be reborrowed.

                  5.  Conditions to Extending Credit.

                  5.1.  Conditions to Effectiveness of Amendment and Restatement. The
amendment and restatement of the Existing Credit Agreement pursuant to this
Agreement shall become effective on the date (the “Second Restatement Effective
Date”) on which the following conditions shall have been satisfied:

                  5.1.1.  Consents. The Administrative Agent shall have received Lender
Consent Letters from the Required Lenders (including, in any event, each New
Restatement Revolving Lender, except as described in the last two sentences of
the first paragraph of Section 1) authorizing it to enter into this Agreement.

                  5.1.2.  Agreement. This Agreement shall have been executed and delivered
by the Borrower, the Guarantors and the Administrative Agent.

                  5.1.3.  Officer’s Certificate; Proper Proceedings. After giving effect to
this Agreement, each of the conditions specified in Section 5.2.1 (other than
clause (c) thereof) and 5.2.2 shall have been satisfied as if the Second
Restatement Effective Date were a “Closing Date”.

 

44

                  5.1.4.  Payment of Fees. The Borrower shall have paid to the
Administrative Agent the fees due on the Second Restatement Effective Date in
the amounts agreed separately by the Borrower and the Administrative Agent,
including (a) an upfront fee payable to each Lender providing a Commitment in
respect of the New Restatement Revolving Loan effective on the Second
Restatement Effective Date in an amount separately agreed upon and (b) an
amendment fee payable to each consenting Lender in an amount equal to 0.125% of
the sum of its Term Loan, its Commitment in respect of the Revolving Loan
(other than any portion thereof that is converted into a Commitment in respect
of the New Restatement Revolving Loan pursuant to this Agreement) and its
Commitment in respect of the Supplemental Restatement Revolving Loan.

                  5.1.5.  Legal Opinions. On the Second Restatement Effective Date, the
Lenders shall have received the legal opinion of Irell & Manella LLP, counsel
to the Restricted Companies and Charter Communications VII, with respect to the
amendment and restatement of the Existing Credit Agreement pursuant to this
Agreement, which opinion shall be in form and substance reasonably satisfactory
to the Administrative Agent. The Restricted Companies authorize and direct
their counsel to furnish such opinion.

                  5.2.  Conditions to Each Extension of Credit. The obligations of the
Lenders to make any extension of credit pursuant to Section 2 shall be subject
to the satisfaction, on or before the Closing Date for such extension of
credit, of the following conditions:

                  5.2.1.  Officer’s Certificate. (a) The representations and warranties
contained in Sections 6.6 and 8 and in sections 2.2 and 4 of the Pledge and
Subordination Agreement shall be true and correct on and as of the Closing Date
with the same force and effect as though originally made on and as of such date
(except for those representations and warranties as of a specified earlier
date, which shall
have been true and correct as of such date); (b) no Default shall exist
and be continuing on such Closing Date prior to or immediately after giving
effect to the requested extension of credit; (c) as of the Closing Date, no
Material Adverse Change shall have occurred; and (d) the Borrower shall have
furnished to the Administrative Agent on such Closing Date a certificate to
such effect in substantially the form of Exhibit 5.2.1, signed by a Financial
Officer.

                  5.2.2.  Proper Proceedings. This Agreement, each other Credit Document and
the extensions of credit and the granting of the security interests
contemplated hereby and thereby shall have been authorized by all necessary
proceedings of each Obligor and any of their respective Affiliates party
thereto. All necessary consents, approvals and authorizations of any
governmental or administrative agency or any other Person with respect to the
foregoing shall have been obtained and shall be in full force and effect. The
Administrative Agent shall have received copies of all documents, including
certificates, records of corporate, partnership and limited liability company
proceedings and opinions of counsel, which the Administrative Agent may have
reasonably requested in connection therewith, such documents where appropriate
to be certified by proper corporate or governmental authorities.

                  5.2.3.  Legality, etc. The making of the requested extension of credit
shall not (a) subject any Lender to any penalty or special tax (other than a
Tax for which the Borrower has reimbursed the Lenders under Section 3.4), (b)
be prohibited by any law or governmental order or regulation applicable to any
Lender or any Obligor or (c) violate any mandatory credit restraint program of
the executive branch of the government of the United States of America, the
Board of Governors of the Federal Reserve System or any other governmental or
administrative agency.

                  5.3.  Conditions on Supplemental Facility Closing Dates. The obligations
of the Supplemental Lenders to make any extension of credit pursuant to a
Supplemental Facility pursuant to

 

45

Section 2.4 (to the extent the Supplemental
Lenders agreed to become so obligated) shall be subject to the satisfaction, on
or before the initial Closing Date for such Supplemental Facility, of the
conditions set forth in this Section 5.3, as well as the further conditions of
Section 5.2.

                  5.3.1.  Supplemental Notes. The Borrower shall have duly executed and
delivered to the Administrative Agent any Supplemental Note requested by any
Supplemental Lender having a Commitment therein.

                  5.3.2.  Joinder Agreement. Any new Lenders participating in such
Supplemental Facility shall have executed and delivered a joinder agreement
reasonably satisfactory to the Administrative Agent and the Borrower pursuant
to which each such new Lender agrees to become a party to and be bound by this
Agreement.

                  5.3.3.  Legal Opinions. On such Closing Date, the Lenders shall have
received legal opinions satisfactory to the Supplemental Lenders and the
Administrative Agent from counsel to the Borrower.

                  5.3.4.  General. All legal, corporate, limited liability company and
partnership proceedings in connection with the transactions contemplated by
this Agreement shall be reasonably satisfactory in form and substance to the
Administrative Agent and the Administrative Agent shall have received copies of
all documents which the Administrative Agent may have reasonably requested in
connection with such Supplemental Facility. All other conditions as may be
reasonably determined by the Administrative Agent and set forth in the written
commitments with respect to such Supplemental
Facility, including the payment of any syndication or closing fees which
are so set forth, shall be reasonably satisfactory in form and substance to the
Administrative Agent.

                  6.  Guarantees.

                  6.1.  Guarantees of Credit Obligations. Each Guarantor unconditionally
jointly and severally guarantees that the Credit Obligations incurred by the
Borrower or any other Obligor will be performed and will be paid in full in
cash when due and payable, whether at the stated or accelerated maturity
thereof or otherwise, this guarantee being a guarantee of payment and not of
collectability and being absolute and in no way conditional or contingent. In
the event any part of such Credit Obligations shall not have been so paid in
full when due and payable, such Guarantor will, immediately upon written notice
by the Administrative Agent or, without notice, immediately upon the occurrence
of a Bankruptcy Default, pay or cause to be paid to the Administrative Agent
for the Lenders’ account the amount of such Credit Obligations which are then
due and payable and unpaid. The obligations of each Guarantor hereunder shall
not be affected by the invalidity, unenforceability or irrecoverability of any
of the Credit Obligations as against any Obligor, any other guarantor thereof
or any other Person. For purposes hereof, the Credit Obligations shall be due
and payable when and as the same shall be due and payable under the terms of
this Agreement or any other Credit Document notwithstanding the fact that the
collection or enforcement thereof may be stayed or enjoined under the
Bankruptcy Code, as from time to time in effect, or other applicable law.
Anything herein or in any other Credit Document to the contrary
notwithstanding, the maximum liability of each Guarantor hereunder and under
the other Credit Documents shall in no event exceed the amount which can be
guaranteed by such Guarantor under applicable federal and state laws relating
to the insolvency of debtors (after giving effect to the right of contribution
established in Section 6.9).

                  6.2.  Continuing Obligation. Each Guarantor acknowledges that the Lenders
have entered into this Agreement (and, to the extent that the Lenders may enter
into any future Credit

 

46

Document, will have entered into such agreement) in
reliance on this Section 6 being a continuing irrevocable agreement, and such
Guarantor agrees that its guarantee may not be revoked in whole or in part.
The obligations of the Guarantors hereunder shall terminate when the commitment
of the Lenders to extend credit under this Agreement shall have terminated and
all of the Credit Obligations have been indefeasibly paid in full in cash and
discharged; provided, however, that:

		
	 	     (a)  if a claim is made upon the Lenders at any time for repayment or
recovery of any amounts or any property received by the Lenders from any
source on account of any of the Credit Obligations and the Lenders repay
or return any amounts or property so received (including interest thereon
to the extent required to be paid by the Lenders) or
	 
	 	     (b)  if the Lenders become liable for any part of such claim by
reason of (i) any judgment or order of any court or administrative
authority having competent jurisdiction, or (ii) any settlement or
compromise of any such claim,

then the Guarantors shall remain liable under this Agreement for the amounts so
repaid or returned or the amounts for which the Lenders become liable (such
amounts being deemed part of the Credit Obligations) to the same extent as if
such amounts had never been received by the Lenders, notwithstanding any
termination hereof or the cancellation of any instrument or agreement
evidencing any of the Credit Obligations. The Guarantors shall, not later than
five days after receipt of notice from the Administrative
Agent, jointly and severally pay to the Administrative Agent an amount equal to
the amount of such repayment or return for which the Lenders have so become
liable. Payments hereunder by a Guarantor may be required by the
Administrative Agent on any number of occasions.

                  6.3.  Waivers with Respect to Credit Obligations. Except to the extent
expressly required by this Agreement or any other Credit Document, each
Guarantor waives, except to the extent prohibited by the provisions of
applicable law that may not be waived, all of the following (including all
defenses, counterclaims and other rights of any nature based upon any of the
following):

		
	 	     (a)  presentment, demand for payment and protest of nonpayment of any
of the Credit Obligations, and notice of protest, dishonor or
nonperformance;
	 
	 	     (b)  notice of acceptance of this guarantee and notice that credit
has been extended in reliance on the Guarantor’s guarantee of the Credit
Obligations;
	 
	 	     (c)  notice of any Default or of any inability to enforce performance
of the obligations of any Obligor or any other Person thereunder;
	 
	 	     (d)  demand for performance or observance of, and any enforcement of
any provision of, the Credit Obligations, this Agreement or any other
Credit Document or any pursuit or exhaustion of rights or remedies with
respect to any Credit Security or against any Obligor or any other Person
in respect of the Credit Obligations or any requirement of diligence or
promptness on the part of the Lenders in connection with any of the
foregoing;
	 
	 	     (e)  any act or omission on the part of the Lenders which may impair
or prejudice the rights of the Guarantor, including subrogation rights or
rights to obtain exoneration, contribution, indemnification or any other
reimbursement from any Obligor or any other Person;
	 
	 	     (f)  failure or delay to perfect or continue the perfection of any
security interest in any Credit Security;

 

47

		
	 	     (g)  any action which harms or impairs the value of, or any failure
to preserve or protect the value of, any Credit Security;
	 
	 	     (h)  any act or omission which might vary the risk of the Guarantor
or otherwise operate as a deemed release or discharge;
	 
	 	     (i)  any statute or rule of law which provides that the obligation of
a surety must be neither larger in amount nor in other respects more
burdensome than the obligation of the principal;
	 
	 	     (j)  the provisions of any “one action” or “anti-deficiency” law
which would otherwise prevent the Lenders from bringing any action,
including any claim for a deficiency, against the Guarantor before or
after the Lenders’ commencement or completion of any foreclosure action,
whether judicially, by exercise of power of sale or otherwise, or any
other law which would otherwise require any election of remedies by the
Lenders;
	 
	 	     (k)  all demands and notices of every kind with respect to the
foregoing; and
	 
	 	     (l)  to the extent not referred to above, all defenses (other than
disputed facts) which any Obligor may now or hereafter have to the
payment of the Credit Obligations, together with all suretyship defenses,
which could otherwise be asserted by such Guarantor.

                  No delay or omission on the part of the Lenders in exercising any right
under this Agreement or any other Credit Document or under any guarantee of the
Credit Obligations or with respect to any Credit Security shall operate as a
waiver or relinquishment of such right. No action which the Lenders or any
Obligor may take or refrain from taking with respect to the Credit Obligations,
including any amendments thereto or modifications thereof or waivers with
respect thereto, shall affect the provisions of this Agreement or the
obligations of the Guarantor hereunder. None of the Lenders’ rights shall at
any time in any way be prejudiced or impaired by any act or failure to act on
the part of any Obligor, or by any noncompliance by any Obligor with the terms,
provisions and covenants of this Agreement, regardless of any knowledge thereof
which the Lenders may have or otherwise be charged with.

                  6.4.  Lenders’ Power to Waive, etc. Each Guarantor grants to the Lenders
full power in their discretion, without notice to or consent of such Guarantor,
such notice and consent being hereby expressly waived to the fullest extent
permitted by applicable law, and without in any way affecting the liability of
the Guarantor under its guarantee hereunder:

		
	 	     (a)  to waive compliance with, and any Default under, and to consent
to any amendment to or modification or termination of any terms or
provisions of, or to give any waiver in respect of, this Agreement, any
other Credit Document, any Credit Security, the Credit Obligations or any
guarantee thereof (each as from time to time in effect);
	 
	 	     (b)  to grant any extensions of the Credit Obligations (for any
duration), and any other indulgence with respect thereto, and to effect
any total or partial release (by operation of law or otherwise),
discharge, compromise or settlement with respect to the obligations of
the Obligors or any other Person in respect of the Credit Obligations,
whether or not rights against the Guarantor under this Agreement are
reserved in connection therewith;

 

48

		
	 	     (c)  to take security from the Restricted Companies or other Obligors
in any form for the Credit Obligations, and to consent to the addition to
or the substitution, exchange, release or other disposition of, or to
deal in any other manner with, any part of any property contained in any
Credit Security whether or not the property, if any, received upon the
exercise of such power shall be of a character or value the same as or
different from the character or value of any property disposed of, and to
obtain, modify or release any present or future guarantees of the Credit
Obligations and to proceed against any of the Credit Security or such
guarantees in any order;
	 
	 	     (d)  to collect or liquidate or realize upon any of the Credit
Obligations or any Credit Security in any manner or to refrain from
collecting or liquidating or realizing upon any of the Credit Obligations
or the Credit Security; and
	 
	 	     (e)  to extend credit under this Agreement, any other Credit Document
or otherwise in such amount as the Lenders may determine, even though the
condition of the Obligors (financial or otherwise on an individual or
Consolidated basis) may have deteriorated since the date hereof.

                  6.5.  Information Regarding Obligors, etc.
Each Guarantor acknowledges and agrees that it has made such investigation
as it deems desirable of the risks undertaken by it in entering into this
Agreement and is fully satisfied that it understands all such risks. Each
Guarantor waives any obligation which may now or hereafter exist on the part of
the Lenders to inform it of the risks being undertaken by entering into this
Agreement or of any changes in such risks and each Guarantor undertakes to keep
itself informed of such risks and any changes therein. Each Guarantor
expressly waives any duty which may now or hereafter exist on the part of the
Lenders to disclose to the Guarantor any matter related to the business,
operations, character, collateral, credit, condition (financial or otherwise),
income or prospects of the Obligors or their Affiliates or their properties or
management, whether now or hereafter known by the Lenders. Each Guarantor
represents, warrants and agrees that it assumes sole responsibility for
obtaining from the Obligors all information concerning this Agreement and all
other Credit Documents and all other information as to the Obligors and their
Affiliates or their properties or management as such Guarantor deems necessary
or desirable.

                  6.6.  Certain Guarantor Representations. Each Guarantor represents that:

		
	 	     (a)  it is in its best interest and in pursuit of its partnership,
limited liability company or corporate purposes as an integral part of
the business conducted and proposed to be conducted by the Restricted
Companies (including such Guarantor), and reasonably necessary and
convenient in connection with the conduct of the business conducted and
proposed to be conducted by it, to induce the Lenders to enter into this
Agreement and to extend credit to the Borrower by making the Guarantees
contemplated by this Section 6;
	 
	 	     (b)  the credit available hereunder will directly or indirectly inure
to its benefit; and
	 
	 	     (c)  by virtue of the foregoing it is receiving at least reasonably
equivalent consideration from the Lenders for its Guarantee.

Each Guarantor acknowledges that it has been advised by the Administrative
Agent that the Lenders are unwilling to enter into this Agreement unless the
Guarantees contemplated by this Section 6 are given by it. Each Guarantor
represents that:

		
	 	     (i)  it will not be rendered insolvent as a result of entering into
this Agreement,

 

49

		
	 	     (ii)  after giving effect to the transactions contemplated by this
Agreement it will have assets having a fair saleable value in excess of
the amount required to pay its probable liability on its existing debts
as they have become absolute and matured,
	 
	 	     (iii)  it has, and will have, access to adequate capital for the
conduct of its business and
	 
	 	     (iv)  it has the ability to pay its debts from time to time incurred
in connection therewith as such debts mature.

                  6.7.  No Subrogation. Until the Credit Obligations have been indefeasibly
paid in full and all commitments to extend further credit under the Credit
Documents have been irrevocably terminated, each Guarantor waives all rights of
reimbursement, subrogation, contribution, offset and other claims against the
Borrower arising by contract or operation of law in connection with any
payment made or required to be made by such Guarantor under this Agreement,
except for contribution rights provided in Section 6.9.

                  6.8.  Subordination. Each Guarantor covenants and agrees that all
Indebtedness claims and liabilities now or hereafter owing by the Borrower to
such Guarantor are hereby subordinated to the prior payment in full of the
Credit Obligations and are so subordinated as a claim against the Borrower or
any of its assets whether such claim be in the ordinary course of business or
in the event of voluntary or involuntary liquidation, dissolution, insolvency
or bankruptcy so that no payment with respect to any such Indebtedness, claim
or liability will be made or received while any of the Credit Obligations are
outstanding; provided, however, that the Borrower may make payments permitted
by Section 7.10 and the relevant Guarantor may retain such payments.

                  6.9.  Contribution Among Guarantors. The Guarantors agree that, as among
themselves in their capacity as guarantors of the Credit Obligations, the
ultimate responsibility for repayment of the Credit Obligations, in the event
that the Borrower fails to pay when due their Credit Obligations, shall be
equitably apportioned, to the extent consistent with the Credit Documents,
among the respective Guarantors (a) in the proportion that each, in its
capacity as a guarantor, has benefitted from the extensions of credit to the
Borrower by the Lenders under the Credit Agreement, or (b) if such equitable
apportionment cannot reasonably be determined or agreed upon among the affected
Guarantors, in proportion to their respective net worths determined on or about
the date hereof (or such later date as such Guarantor becomes party hereto).
In the event that any Guarantor, in its capacity as a guarantor, pays an amount
with respect to the Credit Obligations in excess of its proportionate share as
set forth in this Section 6.9, each other Guarantor shall, to the extent
consistent with the Credit Documents, make a contribution payment to such
Guarantor in an amount such that the aggregate amount paid by each Guarantor
reflects its proportionate share of the Credit Obligations. In the event of
any default by any Guarantor under this Section 6.9, each other Guarantor will
bear, to the extent consistent with the Credit Documents, its proportionate
share of the defaulting Guarantor’s obligation under this Section 6.9. This
Section 6.9 is intended to set forth only the rights and obligations of the
Guarantors among themselves and shall not in any way affect the obligations of
any Guarantor to the Lenders under the Credit Documents (which obligations
shall at all times constitute the joint and several obligations of all the
Guarantors).

                  6.10.  Future Subsidiaries; Further Assurances. The Borrower and each
Guarantor shall from time to time cause any present or future Subsidiary not
designated as an Excluded Company to join this Agreement as a Restricted
Company and a Guarantor pursuant to a joinder agreement in form and substance
reasonably satisfactory to the Administrative Agent. Each Guarantor will,
promptly upon the request of the Administrative Agent from time to time,
execute, acknowledge and deliver, and file and

 

50

record, all such instruments,
and take all such action, as the Administrative Agent reasonably deems
necessary or advisable to carry out the intent and purposes of this Section 6.

                  6.11.  Release of Guarantor. If any Guarantor is the subject of a merger
or a sale or disposition of its stock or of substantially all of its assets in
a transaction permitted under Section 7.11, the Guarantee of such Person under
this Section 6 shall be automatically terminated as of the closing of such
merger, sale or disposition and the application of any proceeds thereof as
required by this Agreement. The Guarantee under this
Section 6  of any Person that is subsequently designated as an Excluded
Company in accordance with this Agreement shall be automatically terminated as
of the effectiveness of such designation.

                  7.  General Covenants. Each of the Restricted Companies covenants that,
until all of the Credit Obligations shall have been paid in full and until the
Lenders’ commitments to extend credit under this Agreement and any other Credit
Document shall have been irrevocably terminated (except for indemnification and
other customary provisions that survive termination), it will comply with such
of the following provisions as are applicable to it:

                  7.1.  Taxes and Other Charges; Accounts Payable.

                  7.1.1.  Taxes and Other Charges. Each of the Restricted Companies will
duly pay and discharge, or cause to be paid and discharged, before the same
shall become in arrears, all material taxes, assessments and other governmental
charges imposed upon such Person and its properties, sales or activities, or
upon the income or profits therefrom, as well as all material claims for labor,
materials or supplies which if unpaid might by law become a Lien upon any of
its property; provided, however, that any such tax, assessment, charge or claim
need not be paid if the validity or amount thereof shall at the time be
contested in good faith by appropriate proceedings (or if all such unpaid
taxes, assessments, charges or claims do not exceed $500,000 in the aggregate)
and if such Person shall, in accordance with GAAP, have set aside on its books
adequate reserves with respect thereto; and provided further, that each of the
Restricted Companies will pay or bond, or cause to be paid or bonded, all such
taxes, assessments, charges or other governmental claims immediately upon the
commencement of proceedings to foreclose any Lien which may have attached as
security therefor (except to the extent such proceedings have been dismissed or
stayed).

                  7.1.2.  Accounts Payable. Each of the Restricted Companies will promptly
pay when due, or in conformity with customary trade terms, all other material
Indebtedness incident to the operations of such Person; provided, however, that
any such Indebtedness need not be paid if the validity or amount thereof shall
at the time be contested in good faith and if such Person shall, in accordance
with GAAP, have set aside on its books adequate reserves with respect thereto.

                  7.2.  Conduct of Business, etc.

                  7.2.1.  Types of Business. The Restricted Companies will engage only in
(a) those businesses in which the Restricted Companies are significantly
engaged on the Second Restatement Effective Date and (b) businesses which are
reasonably similar or related thereto or reasonable extensions thereof but not,
in the case of this clause (b), in the aggregate, material to the overall
business of the Restricted Companies, provided, that, in any event, the
Restricted Companies will continue to be primarily engaged in the businesses in
which they are primarily engaged on the Second Restatement Effective Date; and
provided, further, that Investments permitted by Section 7.9.8 will not be
prohibited by this Section 7.2.1.

 

51

                  7.2.2.  Maintenance of Properties. Each Restricted Company:

		
	 	     (a)  will keep its properties in such repair, working order and
condition, and will from time to time make such repairs, replacements,
additions and improvements thereto for the efficient operation of its
businesses in management’s reasonable business judgment and will comply
at all times in all material respects with all Franchises, FCC Licenses
and leases to which
it is party so as to prevent any loss or forfeiture thereof or
thereunder, unless (i) compliance is at the time being contested in good
faith by appropriate proceedings or (ii) the management of the Restricted
Company reasonably determines that compliance is not in the best
interests of the Restricted Company and that such loss or forfeiture will
not result in a Material Adverse Change; and
	 
	 	     (b)  except to the extent permitted under Section 7.11, will do all
things necessary to preserve, renew and keep in full force and effect and
in good standing its legal existence and authority necessary to continue
its business (other than in the case of an inactive subsidiary that does
not own material assets).

                  7.2.3.  Compliance with Material Agreements; Amendments of Material
Agreements. Each of the Restricted Companies will comply with the provisions
of the Material Agreements to which they are a party or bound (to the extent
not inconsistent with this Agreement or any other Credit Document), except to
the extent that failure to comply therewith could not, in the aggregate,
reasonably be expected to result in a Material Adverse Change. Without the
prior written consent of the Required Lenders, which may not be unreasonably
withheld, no Material Agreement shall be amended, modified, waived or
terminated in any manner that would have in any material respect an adverse
effect on the interests of the Lenders.

                  7.2.4.  Statutory Compliance. Each of the Restricted Companies will comply
in all material respects with the Communications Act, including the rules and
regulations of the FCC relating to the carriage of television signals, and all
other valid and applicable statutes, laws, ordinances, zoning and building
codes and other rules and regulations of the United States of America, of the
states and territories thereof and their counties, municipalities and other
subdivisions and of any foreign country or other jurisdictions applicable to
such Person, except where compliance therewith shall at the time be contested
in good faith by appropriate proceedings or the failure so to comply is not
reasonably likely to result in a Material Adverse Change.

                  7.3.  Insurance. Each of the Restricted Companies will maintain with
financially sound and reputable insurers insurance in such amounts and against
such risks as are customarily maintained by companies engaged in the same or
similar businesses operating in the same general locations as the Restricted
Companies. The Restricted Companies will from time to time provide such
information regarding such insurance arrangements as the Administrative Agent
may reasonably request. The Agents and the Lenders acknowledge that the
existing self-insurance programs of the Restricted Companies, as they may be
modified from time to time in a manner that does not materially change the
nature and relative scale of such programs, comply with the requirements of
this Section 7.3.

                  7.4.  Financial Statements and Reports. Each of the Restricted Companies
will maintain a system of accounting in which entries will be made in their
books and records of all transactions in relation to their business and affairs
in accordance with GAAP. The fiscal year of the Restricted Companies will end
on December 31 in each year.

 

52

                  7.4.1.  Annual Reports. The Restricted Companies will furnish to the
Administrative Agent (with sufficient copies for each Lender) as soon as
available, and in any event within 105 days after the end of each fiscal year,
the Consolidated and Consolidating balance sheet of the Borrower and its
Subsidiaries as at the end of such fiscal year, the Consolidated and
Consolidating statements of earnings,
changes in equity and cash flows of the Borrower and its Subsidiaries for
such fiscal year (all in reasonable detail and, in such Consolidating financial
statements, showing the financial condition and performance of the Restricted
Companies as a group), and together with comparative figures for the preceding
fiscal year, all accompanied by:

		
	 	     (a)  Unqualified reports of Arthur Andersen LLP (or, if they cease to
be auditors of the Restricted Companies, independent certified public
accountants of recognized national standing reasonably satisfactory to
the Administrative Agent), to the effect that they have audited such
Consolidated financial statements in accordance with generally accepted
auditing standards and that such Consolidated financial statements
present fairly, in all material respects, the financial position of the
Restricted Companies at the dates thereof and the results of their
operations for the periods covered thereby in conformity with GAAP.
	 
	 	     (b)  The statement of such accountants that they have caused Section
7.5 to be reviewed and that in the course of their audit of the
Restricted Companies no facts have come to their attention that cause
them to believe that any Default under such Section exists or, if such is
not the case, specifying such Default and the nature thereof. This
statement is furnished by such accountants with the understanding that
the examination of such accountants cannot be relied upon to give such
accountants knowledge of any such Default except as it relates to
accounting or auditing matters within the scope of their audit.
	 
	 	     (c)  A certificate of a Financial Officer to the effect that such
officer has caused this Agreement to be reviewed and has no knowledge of
any Default, or if such officer has such knowledge, specifying such
Default and the nature thereof, and what action the Restricted Companies
have taken, are taking or propose to take with respect thereto.
	 
	 	     (d)  In the event of a material change in GAAP after the Second
Restatement Effective Date, computations, certified by a Financial
Officer, reconciling the financial statements referred to above with
financial statements prepared in accordance with GAAP as applied to the
other covenants in Section 7 and related definitions.
	 
	 	     (e)  Computations demonstrating, as of the end of such fiscal year,
compliance with the Computation Covenants.
	 
	 	     (f)  A supplement to Exhibit 8.1 showing any changes in the
information set forth in such Exhibit during the last quarter of such
fiscal year.

                  7.4.2.  Quarterly Reports. The Restricted Companies will furnish to the
Administrative Agent (with sufficient copies for each Lender) as soon as
available and, in any event, within 60 days after the end of each of the first
three calendar quarters of each fiscal year, the internally prepared
Consolidated balance sheet as of the end of such quarter and the Consolidated
statements of income, changes in equity and cash flows of the Borrower and its
Subsidiaries for such quarter and for the portion of the fiscal year then
ending (all in reasonable detail and, in such Consolidating financial
statements, showing the financial condition and performance of the Restricted
Companies as a group), together with comparative figures for the same period in
the preceding fiscal year, all accompanied by:

 

53

		
	 	     (a)  A certificate signed by a Financial Officer to the effect that
such financial statements have been prepared in accordance with GAAP and
present fairly, in all material respects, the financial position of the
Restricted Companies covered thereby at the dates thereof and the results
of their operations for the periods covered thereby, subject only to
normal year-end audit adjustments and the addition of footnotes.
	 
	 	     (b)  Computations demonstrating, as of the end of such quarter,
compliance with the Computation Covenants.
	 
	 	     (c)  For each quarter, a supplement to Exhibit 8.1 showing any
changes in the information set forth in such Exhibit during such fiscal
quarter.
	 
	 	     (d)  A certificate signed by a Financial Officer to the effect that
such officer has caused this Agreement to be reviewed and has no
knowledge of any Default, or if such officer has such knowledge,
specifying such Default and the nature thereof and what action the
Restricted Companies have taken, are taking or propose to take with
respect thereto.

                  7.4.3.  Other Reports. Upon request by the Administrative Agent, the
Restricted Companies will promptly furnish to the Administrative Agent (with
sufficient copies for each Lender) such registration statements, proxy
statements and reports, including Forms S-1, S-2, S-3, S-4, 10-K, 10-Q and 8-K,
as may be filed for Charter Communications VII or any Restricted Company with
the Securities and Exchange Commission. In addition, the Borrower shall notify
the Administrative Agent promptly after any of the foregoing become available.

                  7.4.4.  Notice of Litigation; Notice of Defaults. The Restricted Companies
will promptly furnish to the Administrative Agent notice of any litigation or
any administrative or arbitration proceeding to which any Restricted Company
may hereafter become a party which involves the risk of any judgment which
resulted, or poses a material risk of resulting, after giving effect to any
applicable insurance, of the payment by the Restricted Companies of at least
$10,000,000. Promptly upon acquiring knowledge thereof, the Restricted
Companies will notify the Lenders of the existence of any Default, specifying
the nature thereof and what action the Restricted Companies have taken, are
taking or propose to take with respect thereto.

                  7.4.5.  Franchise Matters. The Restricted Companies will promptly furnish
to the Administrative Agent notice of any action by any federal, state or local
governmental authority of the institution of proceedings to revoke, terminate
or suspend any Franchise now or hereafter held by any Restricted Company, and
any abandonment or expiration (without renewal) of a Franchise now or hereafter
held by any Restricted Company, in either case, which would result, or be
reasonably likely to result, in a Material Adverse Change.

                  7.4.6.  ERISA Reports. Furnish to the Administrative Agent as soon as
available to the Borrower the following items with respect to any Plan:

		
	 	     (a)  any request for a waiver of the funding standards or an
extension of the amortization period;
	 
	 	     (b)  any reportable event (as defined in Section 4043 of ERISA),
unless the notice requirement with respect thereto has been waived by
regulation;

 

54

		
	 	     (c)  any notice received by any Commonly Controlled Entity that the
PBGC has instituted or intends to institute proceedings to terminate any
Plan, or that any Multiemployer Plan is Insolvent or in Reorganization;
	 
	 	     (d)  notice of the possibility of the termination of any Plan by its
administrator pursuant to Section 4041 of ERISA; and
	 
	 	     (e)  notice of the intention of any Commonly Controlled Entity to
withdraw, in whole or in part, from any Multiemployer Plan.

                  7.4.7.  Other Information. From time to time upon request of any
authorized officer of any Agent, each of the Restricted Companies will furnish
to the Administrative Agent (with sufficient copies for each Lender) such other
information regarding the business, assets, financial condition, income or
prospects of the Restricted Companies as such officer may reasonably request,
including copies of all tax returns, licenses, agreements, contracts, leases
and instruments to which any of the Restricted Companies is party. The
authorized officers and representatives of any Agent or, after the occurrence
and during the continuation of an Event of Default, of any Lender (coordinated
through the Administrative Agent) shall have the right during normal business
hours upon reasonable notice and at reasonable intervals to examine the books
and records of the Restricted Companies, to make copies, notes and abstracts
therefrom and to make an independent examination of its books and records, for
the purpose of verifying the accuracy of the reports delivered by any of the
Restricted Companies pursuant to this Section 7.4 or otherwise and ascertaining
compliance with or obtaining enforcement of this Agreement or any other Credit
Document.

                  7.5.  Certain Financial Tests.

                  7.5.1.  Consolidated Total Debt to Consolidated Annualized Operating Cash
Flow. Consolidated Total Debt shall not as of the end of any fiscal quarter
exceed the percentage indicated in the table below of Consolidated Annualized
Operating Cash Flow for such fiscal quarter:

	 	 	 	 	 
	Date	 	Percentage
	
	 	

	Through December 30, 2001	 	 	
575	%
	
	
	
	

	 	 	 	 	 
	
	
	
	

	December 31, 2001 through
June 29, 2002	 	 	
550	%
	
	
	
	

	 	 	 	 	 
	
	
	
	

	June 30, 2002 through
June 29, 2003	 	 	
500	%
	
	
	
	

	 	 	 	 	 
	
	
	
	

	June 30, 2003 through
June 29, 2004	 	 	
450	%
	
	
	
	

	 	 	 	 	 
	
	
	
	

	June 30, 2004 through
June 29, 2005	 	 	
350	%
	
	
	
	

	 	 	 	 	 
	
	
	
	

	June 30, 2005 and thereafter	 	 	
300	%

 

55

                  7.5.2.  Consolidated Interest Coverage Ratio. For each fiscal
quarter of the Restricted Companies, the Consolidated
Interest Coverage Ratio shall exceed the percentage indicated below: (a)
through December 31, 2002, 150% and (b) thereafter, 200%.

                  7.5.3.  Consolidated Annualized Operating Cash Flow to Consolidated Pro
Forma Debt Service. On the last day of each fiscal quarter of the Restricted
Companies, Consolidated Annualized Operating Cash Flow for the three-month
period then ending shall exceed 110% of Consolidated Pro Forma Debt Service for
the 12-month period beginning immediately after such date.

                  7.6.  Indebtedness. The Restricted Companies shall not create, incur,
assume or otherwise become or remain liable with respect to any Indebtedness
other than the following:

                  7.6.1.  The Credit Obligations.

                  7.6.2.  Guarantees permitted by Section 7.7.

                  7.6.3.  Current liabilities existing from time to time, other than for
Financing Debt, incurred in the ordinary course of business.

                  7.6.4.  To the extent that payment thereof shall not at the time be
required by Section 7.1, Indebtedness in respect of taxes, assessments,
governmental charges and claims for labor, materials and supplies.

                  7.6.5.  Indebtedness secured by Liens of carriers, warehousemen, mechanics
and landlords permitted by Sections 7.8.5 and 7.8.6.

                  7.6.6.  Indebtedness in respect of judgments or awards not in excess of
$10,000,000 in the aggregate at any time outstanding (a) which have been in
force for less than the applicable appeal period, so long as execution is not
levied, or (b) in respect of which any Restricted Company shall at the time in
good faith be prosecuting an appeal or proceedings for review, so long as
execution thereof shall have been stayed pending such appeal or review and the
Restricted Companies shall have taken appropriate reserves therefor consistent
with GAAP.

                  7.6.7.  Indebtedness in respect of Capitalized Lease Obligations or secured
by purchase money security interests to the extent Liens securing such
Indebtedness are permitted by Section 7.8.10; provided, however, that the
aggregate principal amount of all Indebtedness permitted by this Section 7.6.7
at any one time outstanding shall not exceed $25,000,000.

                  7.6.8.  Indebtedness in respect deferred taxes arising in the ordinary
course of business.

                  7.6.9.  Indebtedness in respect of inter-company loans and advances among
the Restricted Companies which are not prohibited by Section 7.9.

                  7.6.10.  Indebtedness outstanding on the Initial Closing Date and described
in Exhibit 7.6.10, except that only the Indebtedness under the heading
“Post-Closing Financing Debt” on Exhibit
7.6.10 is permitted by this Section 7.6.10 to remain outstanding after the
First Restatement Effective Date.

 

56

                  7.6.11.  Indebtedness on account of security deposits of Subscribers held
by the Restricted Companies to secure the return of equipment placed by the
Restricted Companies with Subscribers in the ordinary course of its business.

                  7.6.12.  Binding obligations of the Restricted Companies to make
acquisitions and Investments permitted by Section 7.9.

                  7.6.13.  Minority interests in Subsidiaries and equity in losses of
affiliated partnerships in excess of investment.

                  7.6.14.  Indebtedness of the Borrower (but not any Subsidiary of the
Borrower) incurred on any Threshold Transaction Date so long as (a) no Default
shall have occurred and be continuing or would result therefrom, (b) such
Indebtedness shall have no scheduled amortization prior to the date that is one
year after the final maturity of the latest-maturing Loan outstanding on the
date such Indebtedness is incurred and (c) the covenants and default provisions
applicable to such Indebtedness shall be no more restrictive than those
contained in this Agreement, provided that the requirement that such
Indebtedness be incurred on a Threshold Transaction Date shall not apply in the
case of any refinancing of Indebtedness previously incurred pursuant to this
Section 7.6.14 so long as the interest rate and cash-pay characteristics
applicable to such refinancing Indebtedness are no more onerous than those
applicable to such refinanced Indebtedness.

                  7.6.15.  Indebtedness of any Person that becomes a Subsidiary pursuant to
an Investment permitted by Section 7.9, so long as (a) no Default shall have
occurred and be continuing or would result therefrom, (b) such Indebtedness
existed at the time of such Investment and was not created in anticipation
thereof, (c) the Borrower shall use its best efforts to cause such Indebtedness
to be repaid no later than 120 days after the date of such Investment, (d) if
such Indebtedness is not repaid within such period then, until such
Indebtedness is repaid, the operating cash flow of the relevant Subsidiary
shall be excluded for the purposes of calculating Consolidated Operating Cash
Flow (whether or not distributed to the Borrower or any other Restricted
Company) and (e) the aggregate outstanding principal amount of Indebtedness
incurred pursuant to this Section 7.6.15 shall not exceed $150,000,000.

                  7.6.16.  Other Indebtedness of the Restricted Companies not in excess of
$50,000,000 in the aggregate at any one time outstanding.

                  7.7.  Guarantees; Letters of Credit. The Restricted Companies shall not
become or remain liable with respect to any Guarantee, including reimbursement
obligations under letters of credit and other financial guarantees by third
parties, except the following:

                  7.7.1.  Guarantees of the Credit Obligations.

                  7.7.2.  Guarantees by the Restricted Companies of Indebtedness incurred by
any other Restricted Company and permitted by Section 7.6.

                  7.7.3.  Guarantees to governmental authorities in respect of performance
under Franchises and to Obligors upon indemnity, performance or similar bonds
or letters of credit made in the
ordinary course of business, not involving Guarantees of Financing Debt,
and not exceeding $50,000,000 in aggregate principal amount at any one time
outstanding.

                  7.8. Liens.  The Restricted Companies shall not create, incur or enter
into, or suffer to be created or incurred or to exist, any Lien, except the
following:

 

57

                  7.8.1.  Liens on any Credit Security which secure the Credit Obligations
and restrictions on transfer contained in the Credit Documents.

                  7.8.2.  Liens to secure taxes, assessments and other governmental charges,
to the extent that payment thereof shall not at the time be required by Section
7.1.

                  7.8.3.  Deposits or pledges made (a) in connection with, or to secure
payment of, workers’ compensation, unemployment insurance, old age pensions or
other social security, (b) in connection with casualty insurance maintained in
accordance with Section 7.3, (c) to secure the performance of bids, tenders,
contracts (other than contracts relating to Financing Debt) or leases, (d) to
secure statutory obligations or surety or appeal bonds, (e) to secure
indemnity, performance or other similar bonds in the ordinary course of
business, (f) in connection with claims contested to the extent that payment
thereof shall not at that time be required by Section 7.1 or (g) as acquisition
or sale contract escrows in connection with transactions permitted under
Sections 7.9 or 7.11.

                  7.8.4.  Liens in respect of judgments or awards, to the extent that such
judgments or awards are permitted by Section 7.6.6.

                  7.8.5.  Liens of carriers, warehousemen, mechanics and similar Liens, in
each case (a) in existence less than 90 days from the date of creation thereof
or (b) being contested in good faith by any Restricted Company in appropriate
proceedings (so long as the Restricted Company shall, in accordance with GAAP,
have set aside on its books adequate reserves with respect thereto).

                  7.8.6.  Encumbrances in the nature of (a) zoning restrictions, (b)
easements, (c) restrictions of record on the use of real property, (d)
landlords’ and lessors’ Liens on rented premises and (e) restrictions on
transfers or assignment of leases, which in each case do not materially detract
from the value of the encumbered property or impair the use thereof in the
business of any Restricted Company.

                  7.8.7.  Restrictions under federal and state securities laws on the
transfer of securities.

                  7.8.8.  Restrictions under the Communications Act, specific Franchises,
pole agreements, leases and other documents entered into in the ordinary course
of business on the transfer or licensing of certain assets of the Restricted
Companies.

                  7.8.9.  Set-off rights of depository institutions with which any Restricted
Company maintains deposit accounts.

                  7.8.10.  Liens constituting (a) purchase money security interests
(including mortgages, conditional sales, Capitalized Leases and any other title
retention or deferred purchase devices) in real property, interests in leases
or tangible personal property existing or created on the date on which such
property is acquired, and (b) the renewal, extension or refunding of any
security interest referred to in the foregoing clause (a) in an amount not to
exceed the amount thereof remaining unpaid immediately prior
to such renewal, extension or refunding; provided, however, that each such
security interest shall attach solely to the particular item of property so
acquired, and the principal amount of Indebtedness (including Indebtedness in
respect of Capitalized Lease Obligations) secured thereby shall not exceed the
cost (including all such Indebtedness secured thereby, whether or not assumed)
of such item of property; and provided, further, that the aggregate principal
amount of all Indebtedness secured by Liens permitted by this Section 7.8.10
shall not exceed the amount permitted by Section 7.6.7.

                  7.8.11.  Liens as of the Initial Closing Date described in Exhibit 7.6.10.

 

58

                  7.8.12.  Arrangements constituting a qualified escrow account, qualified
trust or qualified intermediary for funds included in an Asset Reinvestment
Reserve Amount to facilitate a deferred like-kind exchange exempt from taxation
under the Code.

                  7.8.13.  Liens on the Equity Interests of any Person that is not a
Restricted Company to secure loans from banks and other institutional lenders
to such Person or Affiliates of such Person that are not Restricted Companies.

                  7.8.14.  Liens not otherwise permitted by this Section 7.8 so long as
neither (a) the aggregate outstanding principal amount of the obligations
secured thereby nor (b) the aggregate fair market value (determined as of the
date such Lien is incurred) of the assets subject thereto exceeds (as to all
Restricted Companies) $10,000,000 at any one time.

                  7.9.  Investments and Acquisitions. The Restricted Companies shall not
have outstanding, acquire, commit to acquire under a binding contract or a
contract not conditioned on the receipt of customary Lenders’ consents or hold
any Investment (including any Investment consisting of the acquisition of any
business) except for the following:

                  7.9.1.  Investments of the Restricted Companies in other Restricted
Companies.

                  7.9.2.  Investments in Cash Equivalents.

                  7.9.3.  Loans and other advances to employees, officers and directors in an
aggregate principal amount at any one time outstanding not to exceed
$10,000,000.

                  7.9.4.  Prepaid royalties and fees paid in the ordinary course of business.

                  7.9.5.  Guarantees permitted by Section 7.7.

                  7.9.6.  Investments as of the Second Restatement Effective Date described
in Exhibit 7.6.10.

                  7.9.7.  Investments consisting of loans from the Restricted Companies to
any Qualified Parent Company or Charter Communications VII that constitute
Distributions permitted by Section 7.10.

                  7.9.8.  Contributions by any Restricted Company of cable systems to any
Permitted Joint Venture so long as (a) such Disposition is permitted pursuant
to Section 7.11.3, (b) no Default shall have occurred and be continuing or
would result therefrom, (c) after giving effect thereto, the Reference Leverage
Ratio shall be equal to or lower than the Reference Leverage Ratio in effect
immediately prior
thereto and (d) the Equity Interests received by any Restricted Company in
connection therewith shall be pledged as Credit Security (either directly or
through a holding company parent of such Permitted Joint Venture so long as
such parent is a Wholly Owned Guarantor).

                  7.9.9.  Investments not otherwise permitted by this Section 7.9 at any one
time outstanding not exceeding $100,000,000, except with the prior written
consent of the Required Lenders; provided, however, that in no event will the
book value of Margin Stock owned by the Restricted Companies exceed 20% of the
Consolidated assets of the Restricted Companies determined in accordance with
GAAP.

 

59

                  7.9.10.  Investments consisting of the acquisition of Systems or assets in
exchange transactions permitted by Section 7.11.5.

                  7.9.11.  Acquisitions by the Borrower or any Wholly Owned Guarantor of
Operating Assets (substantially all of which consist of Systems), directly
through an asset acquisition or indirectly through the acquisition of 100% of
the Equity Interests of a Person substantially all of whose assets consist of
Systems, provided, that (a) no Default shall have occurred and be continuing or
would result therefrom and (b) the aggregate Consideration (excluding
Consideration paid with the proceeds of contributions described in Section
7.9.12) paid in connection with such acquisitions, other than acquisitions
consummated on a Threshold Transaction Date, shall not exceed $200,000,000
since the First Restatement Effective Date.

                  7.9.12.  So long as immediately before and after giving effect thereto no
Default exists and is continuing, acquisitions or Investments (other than
acquisitions and Investments of the type described in Section 7.9.8) by the
Restricted Companies with the proceeds of cash equity contributions specified
by written notice to the Administrative Agent at the time of receipt of such
proceeds for the purpose of effecting such acquisition or Investment.

                  7.9.13.  Acquisition deposits and deposits with a qualified intermediary in
connection with transactions permitted by this Section 7.9.

                  7.10.  Distributions. The Restricted Companies shall not make any
Distribution except for the following:

                  7.10.1.  The Restricted Companies may make Distributions to other
Restricted Companies.

                  7.10.2.  Any Restricted Company may declare and pay dividends payable in
common stock (or similar common equity) of such Restricted Company.

                  7.10.3.  So long as immediately before and after giving effect thereto no
Event of Default exists and is continuing, the Restricted Companies may make:

		
	 	     (a)  Distributions to any Qualified Parent Company or Charter
Communications VII in an amount necessary for it to make mandatory,
scheduled payments of principal and interest on Indebtedness (including
Indebtedness owed to the Restricted Companies) of any Qualified Parent
Company or Charter Communications VII, as the case may be, not elsewhere
described in this Section 7.10; provided, however, that (i) at least
three Banking Days prior to such Distribution the Administrative Agent
shall receive a certificate signed by a Financial Officer demonstrating
pro forma compliance as of the end of the most recent fiscal quarter
of the Restricted Companies with Sections 7.5.2 and 7.5.3 after giving
effect to such Distribution, and (ii) the proceeds of such Indebtedness
are or were used to (A) prepay the Loan pursuant to Section 4.6 or (B)
make equity Investments or subordinated debt Investments (in the form of
Specified Subordinated Debt) in any Restricted Company for its own
business purposes (other than Investments in Excluded Companies).
	 
	 	     (b)  Distributions to any Qualified Parent Company or Charter
Communications VII in an amount necessary for it to make mandatory,
scheduled payments of interest on Indebtedness (including Indebtedness
owed to the Restricted Companies) of any Qualified Parent Company or
Charter Communications VII, as the case may be; provided, however, that
(i) at least three 

 

60

		
	 	Banking Days prior to such Distribution the
Administrative Agent shall receive a certificate signed by a Financial
Officer demonstrating that such Distribution shall be made on a Threshold
Transaction Date and (ii) each such Distribution shall be made no earlier
than three Banking Days prior to the date the relevant interest payment
is due.

                  7.10.4.  The Restricted Companies may make Distributions on account of
management services to the extent permitted by Section 7.17.

                  7.10.5.  So long as immediately before and after giving effect thereto no
Event of Default exists and is continuing, the Restricted Companies that are
partnerships or limited liability companies may, in any calendar year, pay
Distributions to all the holders of the Equity Interests of such Restricted
Companies, in proportion to their ownership interests, sufficient to permit
each such holder to pay income taxes that may be required to be paid by it with
respect to its equity in the Restricted Companies for the prior calendar year,
as estimated by such Restricted Company in good faith.

                  7.10.6.  Investments permitted by Sections 7.9.7 and 7.9.9 and Affiliate
transactions permitted by Section 7.14 or described in the second sentence of
Section 7.14.

                  7.10.7.  So long as immediately before and after giving effect thereto no
Event of Default exists and is continuing, the Borrower may make Distributions
for any purpose; provided, however, that, after giving effect to any such
Distribution on a pro forma basis, the Reference Leverage Ratio shall not
exceed 400%.

                  7.10.8.  So long as immediately before and after giving effect thereto no
Event of Default exists and is continuing, the Borrower may make Distributions
for any purpose; provided, however, that if, after giving effect to any such
Distribution on a pro forma basis, the Reference Leverage Ratio exceeds 400%,
the cumulative, aggregate amount of all Distributions under this Section 7.10.8
(excluding any such Distributions made for the purpose of paying fees approved
by the Agents in connection with the Indenture Modifications (as defined in the
Existing Credit Agreement)) made since the First Restatement Effective Date
shall not exceed the sum of (a) $25,000,000, plus (b) the net proceeds of cash
equity contributions (and, with the written consent of the Specified Agents,
which consent shall not be unreasonably withheld, the net equity value of
non-cash equity contributions) made to the Borrower after the First Restatement
Effective Date (to the extent not specified for acquisitions pursuant to
Section 7.9.12) plus (c) 25% of Consolidated Excess Cash Flow for the most
recently completed fiscal year for which financial statements have been
furnished to the Lenders in accordance with Section 7.4.1 (commencing with the
fiscal year ended December 31, 1999).

                  7.10.9.  So long as immediately before and after giving effect thereto no
Event of Default exists and is continuing, the Restricted Companies may make
Distributions constituting the
purchase, redemption, acquisition, cancellation or other retirement for
value of Equity Interests in any Qualified Parent Company, options on any such
interests or related equity appreciation rights or similar securities held by
officers or employees or former officers or employees of such Qualified Parent
Company (or their estates or beneficiaries under their estates), upon death,
disability, retirement or termination of employment; provided, however, that
the aggregate consideration paid for such purchase, redemption, acquisition,
cancellation or other retirement (excluding any such consideration paid prior
to the First Restatement Effective Date) does not in any one fiscal year of the
Restricted Companies exceed $7,500,000 in the aggregate.

 

61

                  7.10.10.  So long as immediately before and after giving effect thereto no
Event of Default exists and is continuing, the Restricted Companies may make
Distributions in respect of loans and other advances to employees, officers and
directors permitted by Section 7.9.3.

                  7.11.  Merger, Consolidation and Dispositions of Assets. The Restricted
Companies shall not merge or enter into a consolidation or sell, lease, sell
and lease back, sublease or otherwise dispose of any of its assets (each,
“Fundamental Transaction”), except the following:

                  7.11.1.  Any Restricted Company may sell or otherwise dispose of (a)
inventory in the ordinary course of business, (b) tangible assets to be
replaced in the ordinary course of business by other tangible assets of equal
or greater value, (c) tangible assets that are no longer used or useful in the
business of the Restricted Companies, the fair market value (or book value if
greater) of which shall not be material in any fiscal year and (d) cash and
Cash Equivalents.

                  7.11.2.  Any Restricted Company may (i) merge or be liquidated into, or
transfer or make dispositions of assets to, any other Restricted Company or
(ii) enter into a transaction solely for the purpose of changing its
organizational form so long as any Fundamental Transaction related thereto does
not involve any third party other than another Restricted Company.

                  7.11.3.  Subject to Section 4.4, so long as no Event of Default exists and
is continuing on the date a binding contract with respect to such sale is
entered into and the Restricted Companies have furnished prior written notice
of such sale to the Administrative Agent, the Restricted Companies may sell
Systems or other assets for fair market value in transactions not constituting
Permitted Asset Swaps (it being understood that Swap Excess Amounts (other than
Excluded Swap Excess Amounts) shall be deemed to constitute usage of
availability in respect of sales pursuant to this Section 7.11.3); provided,
however, that the sum of the aggregate percentages of Consolidated Annualized
Operating Cash Flow for the period of three consecutive months most recently
ended prior to each such sale for which financial statements have been (or are
required to have been) furnished in accordance with Section 7.4.2 properly
allocable to all such Systems or other assets so sold on or after the First
Restatement Effective Date shall not exceed 30%.

                  7.11.4.  So long as immediately before and after giving effect thereto no
Event of Default exists and is continuing, the Restricted Companies may
contribute Systems and other assets to Permitted Joint Ventures as Investments
permitted by Section 7.9.8.

                  7.11.5.  The Restricted Companies may consummate Permitted Asset Swaps;
provided that (a) on the date of such Permitted Asset Swap, no Default shall
have occurred and be continuing or would result therefrom, (b) in the event
that the Annualized Asset Cash Flow Amount attributable to the assets being
transferred exceeds the annualized asset cash flow amount (determined in a
manner
comparable to the manner in which Annualized Asset Cash Flow Amounts are
determined hereunder) of the assets received in connection with such Permitted
Asset Swap (such excess amount, a “Swap Excess Amount”), then, unless such Swap
Excess Amount is an Excluded Swap Excess Amount, the Disposition of such Swap
Excess Amount is permitted by Section 7.11.3 and (c) the Net Cash Proceeds of
such Permitted Asset Swap, if any, shall be applied in the manner contemplated
by Section 4.4.

                  7.11.6.  The Restricted Companies may consummate mergers or consolidations
necessary to effect acquisitions and Investments permitted by Section 7.9.

                  7.11.7.  The Restricted Companies may sell property acquired after the
First Restatement Effective Date (other than property acquired in connection
with Permitted Asset Swaps

 

62

involving property owned on the First Restatement
Effective Date), so long as (a) no Default shall have occurred and be
continuing or would result therefrom, (b) a definitive agreement to consummate
such sale is executed no later than twelve months after the date on which
relevant property is acquired and (c) such sale is consummated within eighteen
months after the date on which the relevant property is acquired.

                  7.12.  Issuance of Stock by Subsidiaries; Subsidiary Distributions.

                  7.12.1.  Issuance of Stock by Subsidiaries. No Subsidiary (other than an
Excluded Company) of a Restricted Company shall issue or sell any of its Equity
Interests to any Person other than a Restricted Company unless (a) in the case
of a stock dividend or other distribution of Equity Interests, such dividend or
distribution is pro rata among existing equity owners or (b) in the case of
purchased equity, the sale of such equity is on an arm’s length basis.

                  7.12.2.  No Restrictions on Subsidiary Distributions. Except for
restrictions contained in the Credit Documents, the Restricted Companies shall
not enter into or be bound by any agreement (including covenants requiring the
maintenance of specified amounts of net worth or working capital) restricting
the right of any Subsidiary to make Distributions or extensions of credit to
the Borrower (directly or indirectly through another Subsidiary).

                  7.13.  ERISA, etc. The Restricted Companies shall comply in all material
respects with the provisions of ERISA and the Code applicable to each Plan.
Each Restricted Company will meet all minimum funding requirements applicable
to them with respect to any Plan pursuant to Section 302 of ERISA or Section
412 of the Code, without giving effect to any waivers of such requirements or
extensions of the related amortization periods which may be granted. At no
time shall the Accumulated Benefit Obligations under any Plan that is not a
Multiemployer Plan exceed the fair market value of the assets of such Plan
allocable to such benefits by more than $10,000,000. After the Second
Restatement Effective Date, the Restricted Companies will not withdraw, in
whole or in part, from any Multiemployer Plan so as to give rise to withdrawal
liability exceeding $10,000,000 in the aggregate. At no time shall the
actuarial present value of unfunded liabilities for post-employment health care
benefits, whether or not provided under a Plan, calculated in a manner
consistent with Statement No. 106 of the Financial Accounting Standards Board,
exceed $10,000,000.

                  7.14.  Transactions with Affiliates. Other than the Material Agreements,
none of the Restricted Companies shall effect any transaction with any of their
respective Affiliates on a basis less favorable to the Restricted Companies
than would be the case if such transaction had been effected with a
non-Affiliate. This Section 7.14 shall not apply to: (a) customary directors’
fees, indemnification and similar arrangements and payments in
respect thereof, consulting fees, employee salaries, bonuses or employment
agreements, compensation or employee benefit arrangements and incentive
arrangements with any officer, or employee of a Restricted Company entered into
in the ordinary course of business (including customary benefits thereunder),
(b) the organizational agreements of Charter Communications VII, including any
amendments or extensions thereof that do not otherwise violate any other
covenant set forth in this Agreement, and any transactions undertaken or to be
undertaken pursuant to any of such agreements or pursuant to any other
contractual obligations in the ordinary course of business in existence on the
First Restatement Effective Date (as in effect on the First Restatement
Effective Date) or as set forth on Exhibit 7.14, (c) the issuance and sale by
any Restricted Company to its partners, members or stockholders of Equity
Interests (other than Redeemable Capital Stock), (d) loans and advances to
officers, directors and employees of the Restricted Companies in the ordinary
course of business, (e) customary commercial banking, investment banking,
underwriting, placement agent, financial advisory, legal, accounting or
regulatory fees paid in connection with services rendered to the Restricted
Companies in the ordinary course of business, (f) so long as no Default shall
have occurred and be continuing, the payment (either directly or by way of a
distribution to any Qualified Parent Company) of

 

63

amounts not in excess of 1.0%
of the aggregate enterprise value of Investments permitted hereby to certain
Affiliates of the Restricted Companies, (g) the incurrence of intercompany
indebtedness that does not otherwise violate any other provision of this
Agreement, (h) repayments of Specified Subordinated Debt with the proceeds of
Loans or Specified Long-Term Indebtedness, (i) the pledge of Equity Interests
of Excluded Companies to support the Indebtedness thereof, (j) the payment of
management fees permitted by Section 7.17, and (k) programming agreements,
marketing and promotional agreements and other billing services, equipment
agreements and agreements for other goods and services related to the business
of the Restricted Companies entered into between members of the Charter Group
and the Restricted Companies.

                  7.15.  Interest Rate Protection. The Borrower will keep in effect one or
more Interest Rate Protection Agreements conforming to International Securities
Dealers Association standards with any Lender or Affiliate of a Lender or other
financial institution reasonably satisfactory to the Administrative Agent
protecting against increases in interest rates, each in form and substance
reasonably satisfactory to the Administrative Agent, covering a notional amount
of at least 50% of the Financing Debt of Charter Communications VII and the
Restricted Companies for a two year period at rates reasonably satisfactory to
the Administrative Agent; provided, however, that Financing Debt with a fixed
interest rate for a period of at least two years shall be deemed to be covered
by an Interest Rate Protection Agreement for purposes of this Section 7.15.

                  7.16.  Compliance with Environmental Laws. Each of the Restricted
Companies will:

                  7.16.1.  Use and operate all of its facilities and properties in compliance
with all Environmental Laws, keep all necessary permits, approvals,
certificates, licenses and other authorizations relating to environmental
matters in effect and remain in compliance therewith, and handle all Hazardous
Materials in compliance with all applicable Environmental Laws, except where
the failure to comply with, or keep in effect, as applicable, such laws,
permits, approvals, certificates, licenses and authorizations would not
reasonably be expected to result in a Material Adverse Change.

                  7.16.2.  Immediately notify the Administrative Agent, and provide copies
upon receipt, of all written claims or complaints from governmental authorities
relating to the condition of its facilities and properties or compliance with
Environmental Laws, and in the case of potential liability in excess of
$10,000,000 shall promptly cure and have dismissed with prejudice to the
satisfaction of the Administrative Agent any actions and proceedings relating
to compliance with Environmental Laws, except where contested in good faith by
appropriate proceedings and sufficient reserves with respect thereto as
required by GAAP have been established.

                  7.16.3.  Provide such information and certifications which the
Administrative Agent may reasonably request from time to time to evidence
compliance with this Section 7.16.

                  7.17.  No Outside Management Fees. The Restricted Companies shall not pay
in cash any management fees or other amounts in respect of management services
to any Person other than another Restricted Company, except that the Borrower
may pay management fees to its Affiliates (either directly or by way of a
Distribution to any Qualified Parent Company) so long as (a) no Default shall
have occurred and be continuing or would result therefrom, (b) the aggregate
amount of such payments expensed during any fiscal year of the Borrower shall
not exceed 3.50% of Consolidated Revenues for the immediately preceding fiscal
year (provided that, in addition, payments of management fees may be made in
respect of amounts that have been accrued, but were not paid, during any
preceding fiscal year of the Borrower ending on or after December 31, 1999, so
long as the aggregate amount of payments made pursuant to this parenthetical
during any fiscal year of the Borrower (other than any such payments made on a
Threshold Management Fee Date), when added to the aggregate amount of
non-deferred

 

64

management fees otherwise paid pursuant to this clause (b) during
such fiscal year, shall not exceed 5.0% of Consolidated Revenues for the
immediately preceding fiscal year ) and (c) each such payment shall be made no
earlier than three Banking Days prior to the date such payment is due for
Distributions; provided, however, that this Section 7.17 shall not prohibit the
payment of fees to non-Affiliates for services rendered to the Restricted
Companies on an arm’s length basis in the ordinary course of business.

                  7.18.  Derivative Contracts. None of the Restricted Companies nor any of
their Subsidiaries shall enter into any Interest Rate Protection Agreement,
foreign currency exchange contract or other financial or commodity derivative
contracts except to provide hedge protection for an underlying economic
transaction in the ordinary course of business.

                  7.19.  Negative Pledge Clauses. None of the Restricted Companies nor any
of their Subsidiaries shall enter into any agreement, instrument, deed or lease
which prohibits or limits the ability of the Restricted Companies or any of
their Subsidiaries to create, incur, assume or suffer to exist any Lien upon
any of their respective properties, assets or revenues, whether now owned or
hereafter acquired, or which requires the grant of any collateral for such
obligation if collateral is granted for another obligation, except the
following:

                  7.19.1.  This Agreement and the other Credit Documents.

                  7.19.2.  Covenants in documents creating Liens permitted by Section 7.8
prohibiting further Liens on the assets encumbered thereby.

                  7.19.3.  Restrictions on transfer and pledges imposed in the ordinary
course of business pursuant to Franchises, pole agreements, leases and other
operating agreements.

                  8.  Representations and Warranties. In order to induce the Lenders to
extend credit to the Borrower hereunder, each of the Restricted Companies
jointly and severally represents and warrants to each Lender that:

                  8.1.  Organization and Business.

                  8.1.1.  The Borrower. The Borrower is a duly organized and validly
existing limited liability company, in good standing under the laws of the
jurisdiction in which it is organized, with all limited liability company power
and authority necessary to (a) enter into and perform this Agreement and each
other Credit Document to which it is party, (b) borrow and guarantee the Credit
Obligations, (c) grant the Lenders security interests in any Credit Security
owned by it to secure the Credit Obligations and (d) own its properties and
carry on the business now conducted or proposed to be conducted by it.
Certified copies of the Charter and By-laws of the Borrower have been
previously delivered to the Administrative Agent and are correct and complete.
Exhibit 8.1, as from time to time hereafter supplemented in accordance with
Sections 7.4.1 and 7.4.2, sets forth (i) the jurisdiction of organization of
the Borrower, (ii) the address of the Borrower’s principal executive office and
chief place of business and (iii) the number of authorized and issued shares
and ownership of the Borrower.

                  8.1.2.  Other Guarantors. Each Restricted Company (other than the
Borrower) is duly organized, validly existing and in good standing under the
laws of the jurisdiction in which it is organized, with all organizational
power and authority necessary to (a) enter into and perform this Agreement and
each other Credit Document to which it is party, (b) guarantee the Credit
Obligations, (c) grant the Lenders a security interest in Credit Security owned
by such Restricted Company to secure the Credit Obligations and (d) own its
properties and carry on the business now conducted or proposed to be

 

65

conducted
by it. Certified copies of the Charter and By-laws of each such Restricted
Company have been previously delivered to the Administrative Agent and are
correct and complete. Exhibit 8.1, as from time to time hereafter supplemented
in accordance with Sections 7.4.1 and 7.4.2, sets forth (i) the name and
jurisdiction of organization of each Holding Company, (ii) the address of the
chief executive office and principal place of business of each Holding Company,
and (iii) the number of authorized and issued Equity Interests and ownership of
each Restricted Company. As of the Second Restatement Effective Date, no
Minority Interest HoldCo (other than Charter Communications VII and the
Restricted Companies) is in existence.

                  8.1.3.  Qualification. Except as set forth on Exhibit 8.1 as from time to
time supplemented in accordance with Sections 7.4.1 and 7.4.2, each Restricted
Company is duly and legally qualified to do business as a foreign limited
partnership or other entity and is in good standing in each state or
jurisdiction in which such qualification is required and is duly authorized,
qualified and licensed under all laws, regulations, ordinances or orders of
public authorities, or otherwise, to carry on its business in the places and in
the manner in which it is conducted, except for failures to be so qualified,
authorized or licensed which would not in the aggregate result, or pose a
material risk of resulting, in any Material Adverse Change.

                  8.1.4.  Capitalization. Except as set forth in Exhibit 8.1, as from time
to time supplemented in accordance with Sections 7.4.1 and 7.4.2, no options,
warrants, conversion rights, preemptive rights or other statutory or
contractual rights to purchase Equity Interests of any Restricted Company now
exist, nor has any Restricted Company authorized any such right, nor is any
Restricted Company obligated in any other manner to issue its Equity Interests.

                  8.2.  Financial Statements and Other Information; Material Agreements.

                  8.2.1.  Financial Statements and Other Information. The Restricted
Companies have previously furnished to the Lenders copies of the unaudited
Consolidated balance sheet of the Borrower and its Subsidiaries, and the
audited Consolidated balance sheet of Charter Communications VII as at December
31, 2000 and the unaudited Consolidated statements of income and changes in
equity and cash flows of the Borrower and its Subsidiaries, and the audited
Consolidated statements of income and changes in equity and cash flows of
Charter Communications VII, for the fiscal year then ended.

                  The audited Consolidated financial statements (including the notes
thereto) referred to above were prepared in accordance with GAAP and fairly
present the financial position of the Restricted Companies covered thereby on a
Consolidated basis at the respective dates thereof and the results of their
operations for the periods covered thereby. No Restricted Company has any
known contingent liability material to the Restricted Companies on a
Consolidated basis that is required to be reflected by GAAP which is not
reflected in the sheet referred to above (or delivered pursuant to Sections
7.4.1 or 7.4.2) or the notes thereto.

                  8.2.2.  Material Agreements. The Restricted Companies have previously
furnished to the Administrative Agent correct and complete copies, including
all exhibits, schedules and amendments thereto, of the Material Agreements as
set forth in Exhibit 8.2.2, each as in effect on the Second Restatement
Effective Date.

                  8.3.  Changes in Condition. No Material Adverse Change has occurred.

                  8.4.  Title to Assets. The Restricted Companies have good and valid title
to all material assets necessary for the operations of their business as now
conducted by them and reflected in the most recent balance sheet referred to in
Section 8.2.1(a) (or the balance sheet most recently furnished to the

 

66

Lenders
pursuant to Sections 7.4.1 or 7.4.2), and to all material assets necessary for
the operations of such business acquired subsequent to the date of such balance
sheet, subject to no Liens except for those permitted by Section 7.8 and except
for assets disposed of as permitted by Section 7.11.

                  8.5.  Licenses, etc. The Restricted Companies have all patents, patent
applications, patent licenses, patent rights, trademarks, trademark rights,
trade names, trade name rights, copyrights, licenses, FCC Licenses, Franchises,
permits, authorizations and other rights including agreements with public
utilities and microwave transmission companies, pole use, access or rental
agreements and utility easements the lack, loss or termination of which would
result, or is reasonably likely to result, in a Material Adverse Change. All
of the foregoing are in full force and effect except as would not result in, or
be reasonably likely to result in, a Material Adverse Change, and each of the
Restricted Companies is in substantial compliance with the foregoing without
any known conflict with the valid rights of others which has resulted, or poses
a material risk of resulting, in any Material Adverse Change. No event has
occurred which permits, or after notice or lapse of time or both would permit,
the revocation or termination of any such license, Franchise or other right or
affect the rights of any of the Restricted Companies thereunder so as to result
in any Material Adverse Change. Except as would not result, or create a
material risk of resulting, in a Material Adverse Change:

                  8.5.1.  Franchises; FCC Licenses. Each Franchise and FCC License held by
any Restricted Company is validly issued, and no Restricted Company is in
violation of the terms of any of its Franchises or FCC Licenses.

                  8.5.2.  FCC and Other Matters. Each Restricted Company has filed all cable
television registration statements and other filings which are required to be
filed by it under the Communications Act. Each Restricted Company is in all
material respects in compliance with the Communications Act, including the
rules and regulations of the FCC relating to the carriage of television
signals. The execution, delivery and performance by the Restricted Companies
of this Agreement does not require the
approval of the FCC and will not result in any violation of the
Communications Act. Each Restricted Company has recorded or deposited with and
paid to the federal Copyright Office and the Register of Copyright all notices,
statements of account, royalty fees and other documents and instruments
required under Title 17 of the United States Code and all rules and regulations
thereunder (collectively and as from time to time in effect, the “Copyright
Act”), including such of the foregoing required by section 111(d) of the
Copyright Act by virtue of such Restricted Company having made any secondary
transmission subject to compulsory licensing pursuant to section 111(c) of the
Copyright Act.

                  8.6.  Litigation. No litigation, at law or in equity, or any proceeding
before any court, board or other governmental or administrative agency or any
arbitrator is pending or, to the knowledge of the Restricted Companies,
threatened which, in either case, involves any material risk of any final
judgment, order or liability which, after giving effect to any applicable
insurance, has resulted, or poses a material risk of resulting, in any Material
Adverse Change or which seeks to enjoin (and poses a material risk of
enjoining) the consummation, or which (except for litigation which does not
pose a material risk of impairing the validity or effectiveness of the
transactions contemplated by this Agreement or any other Credit Document)
questions the validity, of any of the transactions contemplated by this
Agreement or any other Credit Document. No judgment, decree or order of any
court, board or other governmental or administrative agency or any arbitrator
has been issued against or binds any Restricted Company which has resulted, or
poses a material risk of resulting, in any Material Adverse Change.

                  8.7.  Tax Returns. Except as would not result, or create a material risk
of resulting, in a Material Adverse Change, each of the Restricted Companies
has filed all material tax and information returns which are required to be
filed by it and has paid, or made adequate provision for the payment of, all
taxes which have or may become due pursuant to such returns or to any
assessment received by it

 

67

(except for taxes being disputed in good faith and
for which sufficient reserves have been established) and no Restricted Company
knows of any material additional assessments or any basis therefor and the
Restricted Companies reasonably believe that the charges, accruals and reserves
on the books of the Restricted Companies in respect of taxes or other
governmental charges are adequate.

                  8.8.  Authorization and Enforceability. The Borrower and each Guarantor
has taken all organizational action required to execute, deliver and perform
this Agreement and each other Credit Document to which it is party. Each of
this Agreement and each other Credit Document constitutes the legal, valid and
binding obligation of each Restricted Company party thereto and is enforceable
against such Person in accordance with its terms.

                  8.9.  No Legal Obstacle to Agreements. Neither the execution and delivery
of this Agreement or any other Credit Document, nor the making of any
borrowings hereunder, nor the guaranteeing of the Credit Obligations, nor the
securing of the Credit Obligations with any Credit Security, has constituted or
resulted in or will constitute or result in:

		
	 	     (a)  any breach or termination of the provisions of any material
agreement, instrument, deed or lease to which any Holding Company is a
party or by which it is bound, or of the Charter or By-laws of any
Holding Company;
	 
	 	     (b)  the violation of any law, statute, judgment, decree or
governmental order, rule or regulation applicable to any Holding Company;
	 
	 	     (c)  the creation under any agreement, instrument, deed or lease of
any Lien (other than Liens on Credit Security which secure the Credit
Obligations) upon any of the assets of any Holding Company; or
	 
	 	     (d)  any redemption, retirement or other repurchase obligation of any
Holding Company under any Charter or By-law or of any material agreement,
instrument, deed or lease.

No approval, authorization or other action by, or declaration to or filing
with, any governmental or administrative authority or any other Person that has
not been obtained or made is required to be obtained or made by any Holding
Company in connection with the execution, delivery and performance of this
Agreement, the Notes or any other Credit Document, the making of any borrowing
hereunder, the guaranteeing of the Credit Obligations or the securing of the
Credit Obligations with the Credit Security.

                  8.10.  Defaults. No Restricted Company is in default under any provision
of its Charter or By-laws or of this Agreement or any other Credit Document.
No Restricted Company is in default under any provision of any agreement,
instrument, deed or lease to which it is party or by which it or its property
is bound, or has violated any law, judgment, decree or governmental order, rule
or regulation, in each case so as to result, or creates a material risk of
resulting, in any Material Adverse Change.

                  8.11.  Certain Business Representations.

                  8.11.1.  Labor Relations. No dispute or controversy between any Restricted
Company and any of its employees has resulted, or is reasonably likely to
result, in any Material Adverse Change, and no Restricted Company anticipates
that its relationships with its unions or employees will result, or are
reasonably likely to result, in any Material Adverse Change. Each Restricted
Company is in compliance in all material respects with all federal and state
laws with respect to (a) non-discrimination in employment with which the
failure to comply, in the aggregate, has resulted in, or poses a material risk
of

 

68

resulting in, a Material Adverse Change and (b) the payment of wages, the
failure of which to pay, in the aggregate, has resulted in, or creates a
material risk of resulting in, a Material Adverse Change.

                  8.11.2.  Antitrust. Each of the Restricted Companies is in compliance in
all material respects with all federal and state antitrust laws relating to its
business and the geographic concentration of its business.

                  8.11.3.  Consumer Protection. No Restricted Company is in violation of any
rule, regulation, order, or interpretation of any rule, regulation or order of
the Federal Trade Commission (including truth-in-lending), with which the
failure to comply, in the aggregate, has resulted in, or poses a material risk
of resulting in, a Material Adverse Change.

                  8.12.  Environmental Regulations.

                  8.12.1.  Environmental Compliance. Each of the Restricted Companies is in
compliance in all material respects with the Clean Air Act, the Federal Water
Pollution Control Act, the Marine Protection Research and Sanctuaries Act, the
Resource Conservation and Recovery Act, CERCLA and any similar state or local
statute or regulation in effect in any jurisdiction in which any
properties of any Restricted Company are located or where any of them
conducts its business, and with all applicable published rules and regulations
(and applicable standards and requirements) of the federal Environmental
Protection Agency and of any similar agencies in states or foreign countries in
which any Restricted Company conducts its business, other than any
noncompliance which in the aggregate has not resulted in, and could not
reasonably be expected to result in, a Material Adverse Change.

                  8.12.2.  Environmental Litigation. Except as would not result in, or could
not reasonably be expected to result in, a Material Adverse Change, no suit,
claim, action or proceeding of which any Restricted Company has been given
notice or otherwise to its knowledge is now pending before any court,
governmental agency or board or other forum, or to any Restricted Company’s
knowledge, threatened by any Person (nor to any Restricted Company’s knowledge,
does any factual basis exist therefor) for, and the Restricted Companies have
received no written correspondence from any federal, state or local
governmental authority with respect to any of the following that has resulted
in, or creates a material risk of resulting in, a Material Adverse Change:

		
	 	     (a)  noncompliance in any material respect by any Restricted Company
with any such environmental law, rule or regulation;
	 
	 	     (b)  material liabilities for personal injury, wrongful death or
other tortious conduct relating to materials, commodities or products
used, generated, sold, transferred or manufactured by any Restricted
Company (including products made of, containing or incorporating
asbestos, lead or other hazardous materials, commodities or toxic
substances); or
	 
	 	     (c)  the release into the environment by any Restricted Company of
any material amount of Hazardous Material generated by any Restricted
Company whether or not occurring at or on a site owned, leased or
operated by any Restricted Company.

                  8.12.3.  Hazardous Material. The Restricted Companies have provided to the
Lenders a written list as of the Initial Closing Date of all waste disposal or
dump sites at which a material amount of Hazardous Material generated by any
Restricted Company has been disposed of directly by the Restricted Companies
and all independent contractors to whom the Restricted Companies have delivered
Hazardous Material, or to any Restricted Company’s knowledge, finally came to
be located, and indicates all such

 

69

sites which are or have been included
(including as a potential or suspect site) in any published federal, state or
local “superfund” or other list of hazardous or toxic waste sites. Any waste
disposal or dump sites at which Hazardous Material generated by any Restricted
Company has been disposed of directly by the Restricted Companies and all
independent contractors to whom the Restricted Companies have delivered
Hazardous Material, or to any Restricted Company’s knowledge, finally came to
be located, has not resulted in, and could not reasonably be expected to result
in, a Material Adverse Change.

                  8.12.4.  Environmental Condition of Properties. Except as would not result
in, or could not reasonably be expected to result in, a Material Adverse
Change, none of the properties owned or, to its knowledge, leased by any
Restricted Company has been used as a treatment, storage or disposal site. No
Hazardous Material is present in any real property currently or formerly owned
or operated by any Restricted Company except that which would not reasonably be
expected to result in a Material Adverse Change.

                  8.13.  Pension Plans. Each Plan is in material compliance with the
applicable provisions of ERISA and the Code. No Plan is a Multiemployer Plan
or a “defined benefit plan” (as defined in ERISA). Each
Commonly Controlled Entity has met all of the funding standards applicable
to all Plans, and no condition exists which would permit the institution of
proceedings to terminate any Plan under Section 4042 of ERISA.

                  8.14.  Government Regulation; Margin Stock.

                  8.14.1.  Government Regulation. No Restricted Company, nor any Person
controlling any Restricted Company or under common control with any Restricted
Company is subject to regulation under the Public Utility Holding Company Act
of 1935, the Federal Power Act, the Investment Company Act, the Interstate
Commerce Act or any similar federal or state statutes. Each Lender is aware
that various aspects of the business conducted by Restricted Companies,
including the nature of the services required to be furnished and the rates
which may be charged therefor, are subject to regulation by federal, state and
local governmental authorities.

                  8.14.2.  Margin Stock. The Restricted Companies do not own Margin Stock
having a book value exceeding 20% of the Consolidated assets of the Restricted
Companies determined in accordance with GAAP.

                  8.15.  Disclosure. Neither this Agreement nor any other Credit Document to
be furnished to the Lenders by or on behalf of any Restricted Company in
connection with the transactions contemplated hereby or by such Credit Document
contains any untrue statement of material fact or omits to state a material
fact necessary in order to make the statements contained herein or therein not
misleading in light of the circumstances under which they were made.

                  9.  Defaults.

                  9.1.  Events of Default. The following events are referred to as “Events
of Default”:

                  9.1.1.  Non-Payment. The Borrower shall fail to make any payment in
respect of: (a) interest or any fee on or in respect of any of the Credit
Obligations owed by it as the same shall become due and payable, and such
failure shall continue for a period of five days, or (b) principal of any of
the Credit Obligations owed by it as the same shall become due, whether at
maturity or by acceleration or otherwise.

 

70

                  9.1.2.  Breach of Designated Covenants. Any Restricted Company shall fail
to perform or observe any of the provisions of Sections 7.5 through 7.12, 7.14,
7.17, 7.18 or 7.19.

                  9.1.3.  Breach of Other Covenants. Any Restricted Company or any of its
Affiliates party to any Credit Document shall fail to perform or observe any
other covenant, agreement or provision to be performed or observed by it under
this Agreement or any other Credit Document, and such failure shall not be
rectified or cured to the reasonable satisfaction of the Required Lenders
within 30 days after notice thereof by the Administrative Agent to the Company.

                  9.1.4.  Misrepresentation. Any representation or warranty of or with
respect to any Restricted Company or any of its Affiliates party to any Credit
Document made to the Lenders in, pursuant to or in connection with this
Agreement or any other Credit Document or in any financial statement, report,
notice, mortgage, assignment or certificate delivered to the Agent or any of
the Lenders
by any Restricted Company or any other Obligor in connection herewith or
therewith, shall be materially false or misleading on the date as of which it
was made.

                  9.1.5.  Cross-Default, etc.

		
	 	     (a)  Charter Communications VII or any Restricted Company shall fail
to make any payment when due (after giving effect to any applicable grace
periods) in respect of any Material Financing Debt;
	 
	 	     (b)  Charter Communications VII or any Restricted Company shall fail
to perform or observe the terms of any agreement relating to any Material
Financing Debt, and such failure shall continue, without having been duly
cured, waived or consented to, beyond the period of grace, if any,
specified in such agreement, and such failure shall permit the
acceleration of such Material Financing Debt;
	 
	 	     (c)  all or any part of any Material Financing Debt of Charter
Communications VII or any Restricted Company shall be accelerated or
become due or payable prior to its stated maturity for any reason
whatsoever (other than voluntary prepayments or any mandatory prepayment
not resulting from a Default thereof);
	 
	 	     (d)  any Lien on any property of Charter Communications VII or any
Restricted Company securing any Material Financing Debt shall be enforced
by foreclosure or similar action; or
	 
	 	     (e)  any holder of any Material Financing Debt shall exercise any
right of rescission with respect to the issuance thereof, or put or
repurchase rights against any Obligor with respect to such Material
Financing Debt (other than any such rights that may be satisfied with
“payment in kind” notes or other similar securities).

                  9.1.6.  Change of Control, etc. Any of the following events shall occur:

		
	 	     (a)  the Paul Allen Group shall cease to have the power, directly or
indirectly, to vote or direct the voting of Equity Interests having at
least 51% (determined on a fully diluted basis) of the ordinary voting
power for the management of the Borrower;

 

71

		
	 	     (b)  the Paul Allen Group shall cease to own of record and
beneficially, directly or indirectly, Equity Interests of the Borrower
representing at least 25% (determined on a fully diluted basis) of the
economic interests therein;
	 
	 	     (c)  a Specified Change of Control shall occur; or
	 
	 	     (d)  less than 100% of the outstanding Equity Interests of the
Borrower shall be pledged to the Administrative Agent pursuant to the
Pledge and Subordination Agreement or otherwise as security for the
Credit Obligations.

                  9.1.7.  Enforceability, etc. Any Credit Document shall cease, for any
reason (other than the scheduled or other agreed termination thereof in
accordance with its terms), to be in full force and effect; or any Restricted
Company or any of its Affiliates party thereto shall so assert in a judicial or
similar proceeding; or the security interests created by this Agreement and the
other Credit Documents
shall cease to be enforceable and of the same effect and priority
purported to be created hereby, except to the extent expressly agreed by the
Required Lenders.

                  9.1.8.  Judgments, etc. A final judgment (a) which with other outstanding
final judgments against the Restricted Companies, exceeds an aggregate of
$10,000,000 (in excess of applicable insurance coverage) shall be rendered
against any Restricted Company or its Affiliates party to any Credit Document,
or (b) which grants injunctive relief that results in, or poses a material risk
of resulting in, a Material Adverse Change, and if, within 30 days after entry
thereof, such judgment shall not have been discharged or execution thereof
stayed pending appeal, or if, within 30 days after the expiration of any such
stay, such judgment shall not have been discharged.

                  9.1.9.  Franchise Revocation, etc. Except as would not result in, or be
reasonably likely to result in, a Material Adverse Change, Franchises covering
a number of Subscribers greater than 25% of the Subscriber Measurement Base
shall have been revoked, or terminated with a notice from the applicable
franchising authority that such Franchises will not be renewed. As used in
this Section 9.1.9, “Subscriber Measurement Base” refers to, at any date of
determination, the total number of Subscribers of the Restricted Companies on
the Second Restatement Effective Date adjusted upwards or downwards, as
applicable, to reflect any additions to or subtractions from such number after
the Second Restatement Effective Date and prior to such date of determination,
other than as a result of the circumstances described in this Section.

                  9.1.10.  ERISA.  (a)  Commonly Controlled Entities shall fail to pay when
due amounts (other than amounts being contested in good faith through
appropriate proceedings) for which they shall have become liable under Title IV
of ERISA to pay to the PBGC or to a Plan, (b) the PBGC shall institute
proceedings under Title IV of ERISA to terminate or to cause a trustee to be
appointed to administer any Plan or a proceeding shall be instituted by a
fiduciary of any Plan against any Commonly Controlled Entity to enforce
Sections 515 or 4219(c)(5) of ERISA and such proceeding shall not have been
dismissed within 30 days thereafter, or (c) a condition shall exist which would
require the PBGC to obtain a decree adjudicating that any Plan must be
terminated; and in each case in clauses (a) through (b) above, such event or
condition, together with all other such events or conditions, if any, could, in
the sole judgment of the Required Lenders, reasonably be expected to result in
a Material Adverse Change.

 

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                  9.1.11.  Bankruptcy, etc. Any Restricted Company, Charter Communications
VII, any Minority Interest HoldCo or any other Obligor shall:

		
	 	     (a)  commence a voluntary case under the Bankruptcy Code or
authorize, by appropriate proceedings of its board of directors or other
governing body, the commencement of such a voluntary case;
	 
	 	     (b)  have filed against it a petition commencing an involuntary case
under the Bankruptcy Code which shall not have been dismissed within 60
days after the date on which such petition is filed; or file an answer or
other pleading within such 60-day period admitting or failing to deny the
material allegations of such a petition or seeking, consenting to or
acquiescing in the relief therein provided;
	 
	 	     (c)  have entered against it an order for relief in any involuntary
case commenced under the Bankruptcy Code;
	 
	 	     (d)  seek relief as a debtor under any applicable law, other than the
Bankruptcy Code of any jurisdiction relating to the liquidation or
reorganization of debtors or to the modification or alteration of the
rights of creditors, or consent to or acquiesce in such relief;
	 
	 	     (e)  have altered against it an order by a court of competent
jurisdiction (i) finding it to be bankrupt or insolvent, (ii) ordering or
approving its liquidation, reorganization or ally modification or
alteration of the rights of its creditors or (iii) assuming custody of,
or appointing a receiver or other custodian for, all or a substantial
portion of its property; or
	 
	 	     (f)  make an assignment for the benefit of, or enter into a
composition with, its creditors, or appoint, or consent to the
appointment of, or suffer to exist a receiver or other custodian for, all
or a substantial portion of its property.

                  9.1.12.  Charter Communications VII. Charter Communications VII shall (a)
conduct, transact or otherwise engage in, or commit to conduct, transact or
otherwise engage in, any business or operations other than those incidental to
its ownership of Equity Interests in any Restricted Company, (b) incur, create,
assume or suffer to exist any Indebtedness or other liabilities or financial
obligations, except (i) nonconsensual obligations imposed by operation of law,
(ii) pursuant to the Credit Documents to which it is a party and (iii)
Indebtedness owing to any Affiliate of Charter Communications VII the net cash
proceeds of which are contributed or loaned to the Borrower (it being
understood that the Borrower may in turn use such proceeds to make Investments
permitted by Section 7.9) or (c) own, lease, manage or otherwise operate any
properties or assets other than Equity Interests in the Borrower.

                  9.1.13.  Minority Interest HoldCo. Any Minority Interest HoldCo shall fail
to be a party to the Pledge and Subordination Agreement.

                  9.2.  Certain Actions Following an Event of Default. If any one or more
Events of Default shall occur and be continuing, then in each and every such
case:

                  9.2.1.  No Obligation to Extend Credit. The Administrative Agent may (and
upon written request of such Lenders as own a majority of the Percentage
Interests in the Revolving Loan shall) suspend or terminate the obligations of
the Revolving Lenders to make any further extensions of credit under the Credit
Documents by furnishing notice thereof to the Borrower. The Administrative
Agent may (and upon written request of such Lenders as own a majority of the
Percentage Interests in the New

 

73

Restatement Revolving Loan shall) suspend or
terminate the obligations of the New Restatement Revolving Lenders to make any
further extensions of credit under the Credit Documents by furnishing notice
thereof to the Borrower. The Administrative Agent may (and upon written
request of such Lenders as own a majority of the Percentage Interests in the
Supplemental Restatement Revolving Loan shall) suspend or terminate the
obligations of the Supplemental Restatement Revolving Lenders to make any
further extensions of credit under the Credit Documents by furnishing notice
thereof to the Borrower.

                  9.2.2.  Specific Performance; Exercise of Rights. The Administrative Agent
may (and upon written request of the Required Lenders shall) proceed to protect
and enforce the Lenders’ rights by suit in equity, action at law and/or other
appropriate proceeding, either for specific performance of any covenant or
condition contained in this Agreement or any other Credit Document or in any
instrument or assignment delivered to the Lenders pursuant to this Agreement or
any other Credit Document, or in aid of the exercise of any power granted in
this Agreement or any other Credit Document or any such instrument or
assignment.

                  9.2.3.  Acceleration. The Administrative Agent on behalf of the Lenders
may (and upon written request of the Required Lenders shall) by notice in
writing to the Borrower declare all or any part of the unpaid balance of the
Credit Obligations then outstanding to be immediately due and payable, and
thereupon such unpaid balance or part thereof shall become so due and payable
without presentation, protest or further demand or notice of any kind, all of
which are hereby expressly waived; provided, however, that if a Bankruptcy
Default shall have occurred, the unpaid balance of the Credit Obligations shall
automatically become immediately due and payable.

                  9.2.4.  Enforcement of Payment; Credit Security; Setoff. The
Administrative Agent may (and upon written request of the Required Lenders
shall) proceed to enforce payment of the Credit Obligations in such manner as
it may elect (or have been instructed by the Required Lenders) and to realize
upon any and all rights in any Credit Security. The Lenders may offset and
apply toward the payment of the Credit Obligations (and/or toward the curing of
any Event of Default) any Indebtedness from the Lenders to the respective
Obligors, including any Indebtedness represented by deposits in any account
maintained with the Lenders, regardless of the adequacy of any security for the
Credit Obligations. The Lenders shall have no duty to determine the adequacy
of any such security in connection with any such offset.

                  9.2.5.  Cumulative Remedies. To the extent not prohibited by applicable
law which cannot be waived, all of the Lenders’ rights hereunder and under each
other Credit Document shall be cumulative.

                  9.3.  Annulment of Defaults. Any Default or Event of Default shall be
deemed to exist and to be continuing for any purpose of this Agreement until
the Required Lenders or the Administrative Agent (with the consent of the
Required Lenders) shall have waived such Default or Event of Default in
writing, stated in writing that the same has been cured to such Lenders’
reasonable satisfaction or entered into an amendment to this Agreement which by
its express terms cures such Default or Event of Default or until such Default
or Event of Default is actually cured. No such action by the Lenders or the
Administrative Agent shall extend to or affect any subsequent Default or Event
of Default or impair any rights of the Lenders upon the occurrence thereof.
The making of any extension of credit during the existence of any Default or
Event of Default shall not constitute a waiver thereof.

                  9.4.  Waivers. Each of the Restricted Companies waives to the extent not
prohibited by the provisions of applicable law that cannot be waived:

 

74

		
	 	     (a)  all presentments, demands for performance, notices of
nonperformance (except to the extent required by the provisions of this
Agreement or any other Credit Document), protests, notices of protest and
notices of dishonor;
	 
	 	     (b)  any requirement of diligence or promptness on the part of any
Lender in the enforcement of its rights under this Agreement, the Notes
or any other Credit Document;
	 
	 	     (c)  any and all notices (other than notices required by any other
provision of this Agreement) of every kind and description which may be
required to be given by any statute or rule of law; and
	 
	 	     (d)  any defense (other than indefeasible payment in full or dispute
of facts) which it may now or hereafter have with respect to its
liability under this Agreement, the Notes or any other Credit Document or
with respect to the Credit Obligations.

                  10.  Expenses; Indemnity.

                  10.1.  Expenses. Whether or not the transactions contemplated hereby shall
be consummated, the Obligors jointly and severally will pay:

		
	 	     (a)  all reasonable out-of-pocket expenses of the Administrative
Agent (including reasonable fees and disbursements of the special counsel
to the Administrative Agent) in connection with the preparation and
duplication of this Agreement, each other Credit Document, examinations
by, and reports of, commercial financial examiners selected by the
Administrative Agent, the transactions contemplated hereby and thereby
and operations and amendments hereunder and thereunder, subject to the
acceptance of the Obligors, which acceptance shall not be unreasonably
withheld;
	 
	 	     (b)  all recording and filing fees and transfer and documentary stamp
and similar taxes at any time payable in respect of this Agreement, any
other Credit Document, any Credit Security or the incurrence of the
Credit Obligations; and
	 
	 	     (c)  to the extent not prohibited by applicable law that cannot be
waived, all other reasonable out-of-pocket costs and expenses (including
a reasonable allowance for the hourly cost of attorneys employed by any
of the Lenders on a salaried basis and any special counsel to the
Lenders) incurred by the Lenders or the holder of any Credit Obligation
in connection with the enforcement of any rights hereunder or under any
other Credit Document, including such reasonable costs and expenses
incurred after the occurrence of an Event of Default (i) in enforcing any
Credit Obligation or in foreclosing against the Credit Security, or
exercising or enforcing any other right or remedy available by reason of
such Event of Default; (ii) in connection with any refinancing or
restructuring of the credit arrangements provided under this Agreement or
any other Credit Document in the nature of a workout or in any insolvency
or bankruptcy proceeding; (iii) in commencing, defending or intervening
in any litigation or in filing a petition, complaint, answer, motion or
other pleadings in any legal proceeding; (iv) in taking any other action
in or with respect to any suit or proceeding (bankruptcy or otherwise);
and (v) in protecting, preserving, collecting, leasing, selling, taking
possession of or liquidating any of the Credit Security; provided,
however, that the foregoing indemnity in this paragraph (c) shall not
apply (A) to litigation commenced by the Borrower against the Lenders
which seeks enforcement of any of the rights of the Borrower hereunder or
under any other Credit Document and is determined adversely to the
Lenders in a final nonappealable judgment and (B) to the extent such

 

75

		
	 	claims, damages, liabilities and expenses result from a Lender’s gross
negligence or willful misconduct.

                  10.2.  General Indemnity. The Obligors will, jointly and severally,
indemnify the Lenders and hold them harmless from any claims, damages,
liabilities, losses and reasonable expenses (including reasonable fees and
disbursements of counsel with whom any Indemnified Party may consult in
connection therewith and all reasonable expenses of litigation or preparation
therefor) resulting from the violation by the Borrower of
Section 2.6.  The Obligors will also, jointly and severally, indemnify
each Lender, each of the Lenders’ directors, officers and employees, and each
Person, if any, who controls any Lender (each Lender and each of such
directors, officers, employees and control Persons is referred to as an
“Indemnified Party”) and hold each of them harmless from and against any and
all claims, damages, liabilities, losses and reasonable expenses (including
reasonable fees and disbursements of counsel with whom any Indemnified Party
may consult in connection therewith and all reasonable expenses of litigation
or preparation therefor) which any Indemnified Party may incur or which may be
asserted against any Indemnified Party in connection with (a) the Indemnified
Party’s compliance with or contest of any subpoena or other process issued
against it in any proceeding involving any Restricted Company or Affiliates,
(b) any litigation or investigation involving the Restricted Companies or their
Affiliates, or any officer, director or employee thereof, (c) the existence or
exercise of any security rights with respect to the Credit Security in
accordance with the Credit Documents or (d) this Agreement, any other Credit
Document or any transactions contemplated hereby or thereby, other than (i)
litigation commenced by the Borrower against the Lenders which seeks
enforcement of any of the rights of the Borrower hereunder or under any other
Credit Document and is determined adversely to the Lenders in a final
nonappealable judgment and (ii) to the extent such claims, damages,
liabilities, losses and expenses result from a Lender’s gross negligence or
willful misconduct.

                  11.  Operations.

                  11.1.  Interests in Credits. The Percentage Interest of each Lender in the
Loan and each Lender’s related Commitments shall be computed based on the
maximum principal amount for each Lender as set forth in the Register, as from
time to time in effect. The respective amounts of each relevant Lender’s
Commitment in respect of the Revolving Loan and the New Restatement Revolving
Loan, as of the Second Restatement Effective Date, are set forth in Exhibit
11.1.

                  11.2.  Agents’ Authority to Act, etc. Each of the Lenders appoints and
authorizes the Specified Agents to act for the Lenders as the Lenders’ Agents
in connection with the transactions contemplated by this Agreement and the
other Credit Documents or the terms set forth herein. In acting hereunder,
each Specified Agent is acting for its own account to the extent of its
Percentage Interest and for the account of each other Lender to the extent of
the Lenders’ respective Percentage Interests, and all action in connection with
the enforcement of, or the exercise of any remedies (other than the Lenders’
rights of set-off as provided in Section 9.2.4 or in any Credit Document) in
respect of the Credit Obligations and Credit Documents shall be taken by the
Administrative Agent. The Agents (other than the Specified Agents) shall have
no duties or responsibilities under this Agreement or the other Credit
Documents.

                  11.3.  Borrower to Pay Agent, etc. The Borrower and each Guarantor shall
be fully protected in making all payments in respect of the Credit Obligations
to the Administrative Agent, in relying upon consents, modifications and
amendments executed by the Administrative Agent purportedly on the Lenders’
behalf, and in dealing with the Agents as herein provided. The Administrative
Agent shall charge the account of the Borrower, on the dates when the amounts
thereof become due and payable, with the amounts of the principal of and
interest on the Loan, commitment fees and all other fees and

 

76

amounts owing
under any Credit Document. All payments of any Credit Obligation shall be made
in United States Funds.

                  11.4.  Lender Operations for Advances, etc.

                  11.4.1.  Advances. On each Closing Date, each Lender shall advance to the
Administrative Agent in immediately available funds such Lender’s Percentage
Interest in the portion of the Loan advanced on such Closing Date prior to noon
(New York time). If such funds are not received at such time, but all the
conditions set forth in Section 5 have been satisfied, each Lender authorizes
and requests the Administrative Agent to advance for the Lender’s account,
pursuant to the terms hereof, the Lender’s respective Percentage Interest in
such portion of the Loan and agrees to reimburse the Administrative Agent in
immediately available funds for the amount thereof prior to 2:00 p.m. (New York
time) on the day any portion of the Loan is advanced hereunder; provided,
however, that the Administrative Agent is not authorized to make any such
advance for the account of any Lender who has previously notified the
Administrative Agent in writing that such Lender will not be performing its
obligations to make further advances hereunder.

                  11.4.2.  Administrative Agent to Allocate Payments, etc. All payments of
principal and interest in respect of the extensions of credit made pursuant to
this Agreement, commitment fees and other fees under this Agreement shall, as a
matter of convenience, be made by the Borrower and the Guarantors to the
Administrative Agent in immediately available funds. The share of each Lender
shall be credited to such Lender by the Administrative Agent in immediately
available funds in such manner that the principal amount of the Credit
Obligations to be paid shall be paid proportionately in accordance with the
Lenders’ respective Percentage Interests in such Credit Obligations. Under no
circumstances shall any Lender be required to produce or present its Notes as
evidence of its interests in the Credit Obligations in any action or proceeding
relating to the Credit Obligations.

                  11.4.3.  Delinquent Lenders; Nonperforming Lenders. In the event that any
Lender fails to reimburse the Administrative Agent pursuant to Section 11.4.1
for the Percentage Interest of such Lender (a “Delinquent Lender”) in any
credit advanced by the Administrative Agent pursuant hereto, overdue amounts
(the “Delinquent Payment”) due from the Delinquent Lender to the Administrative
Agent shall bear interest, payable by the Delinquent Lender on demand, at a per
annum rate equal to (a) the Federal Funds Rate for the first three days overdue
and (b) the sum of 2% plus the Federal Funds Rate for any longer period. Such
interest shall be payable to the Administrative Agent for its own account for
the period commending on the date the Delinquent Payment was due and ending on
the date the Delinquent Lender reimburses the Administrative Agent on account
of the Delinquent Payment (to the extent not paid by a Restricted Company as
provided below) and the accrued interest thereon (the “Delinquency Period”),
whether pursuant to the assignments referred to below or otherwise. Within
five Banking Days after the request by the Administrative Agent, the Borrower
will pay to the Administrative Agent the principal (but not the interest)
portion of the Delinquent Payment. During the Delinquency Period, in order to
make reimbursements for the Delinquent Payment and accrued interest thereon,
the Delinquent Lender shall be deemed to have assigned to the Administrative
Agent all payments made by the Borrower under Section 4 which would have
thereafter otherwise been payable under the Credit Documents to the Delinquent
Lender. During any other period in which any Lender is not performing its
obligations to extend credit under Section 2 (a “Nonperforming Lender”), the
Nonperforming Lender shall be deemed to have assigned to each Lender that is
not a Nonperforming Lender (a “Performing Lender”) all payments made by the
Borrower under Section 4 which would have thereafter otherwise been payable
under the Credit Documents to the Nonperforming Lender, and the Administrative
Agent shall credit a portion of such payments to each Performing Lender in an
amount equal to the Percentage Interest of such Performing Lender divided by
one minus the Percentage Interest of the Nonperforming

 

77

Lender until the
respective portions of the Loan owed to all the Lenders are the same as the
Percentage Interests of the Lenders immediately prior to the failure of the
Nonperforming Lender to perform its obligations under Section 2. The foregoing
provisions shall be in addition to any other remedies the Administrative Agent,
the Performing Lenders or the Borrower may have under law or equity against the
Delinquent Lender as a result of the Delinquent Payment or against the
Nonperforming Lender as a result of its failure to perform its obligations
under Section 2.

                  11.5.  Sharing of Payments, etc. Each Lender agrees that (a) if by
exercising any right of set-off or counterclaim or otherwise, it shall receive
payment of a proportion of the aggregate amount of principal and interest due
with respect to its Percentage Interest in the Loan which is greater than the
proportion received by any other Lender in respect of the aggregate amount of
principal and interest due with respect to the Percentage Interest in the Loan
of such other Lender and (b) if such inequality shall continue for more than 10
days, the Lender receiving such proportionately greater payment shall purchase
participations in the Percentage Interests in the Loan held by the other
Lenders, and such other adjustments shall be made from time to time (including
rescission of such purchases of participations in the event the unequal payment
originally received is recovered from such Lender through bankruptcy
proceedings or otherwise), as may be required so that all such payments of
principal and interest with respect to the Loan held by the Lenders shall be
shared by the Lenders pro rata in accordance with their respective Percentage
Interests, provided, however, that this Section 11.5 shall not impair the right
of any Lender to exercise any right of set-off or counterclaim it may have and
to apply the amount subject to such exercise to the payment of Indebtedness of
any Obligor other than such Obligor’s Indebtedness with respect to the Loan.
Each Obligor agrees, to the fullest extent permitted by applicable law, that
any Credit Participant and any Lender purchasing a participation from another
Lender pursuant to this Section 11.5 may exercise all rights of payment
(including the right of set-off), and shall be obligated to share payments
under this Section 11.5, with respect to its participation as fully as if such
Credit Participant or such Lender were the direct creditor of the Obligors and
a Lender hereunder in the amount of such participation.

                  11.6.  Agent’s Resignation or Removal. Any Agent may resign at any time by
giving at least 60 days’ prior written notice of its intention to do so to each
of the other Lenders and the Borrower pending the appointment by the Borrower
of a successor Agent reasonably satisfactory to the Required Lenders. If in
the event of the resignation of any Agent, no successor Agent shall have been
so appointed and shall have accepted such appointment within 45 days after the
retiring Agent’s giving of such notice of resignation, then the retiring Agent
may with the consent of the Borrower, which shall not be unreasonably withheld,
appoint a successor Agent which shall be a bank or a trust company organized,
or having a branch that is licensed, under the laws of the United States of
America or any state thereof and having a combined capital, surplus and
undivided profit of at least $100,000,000; provided, however, that any
successor Agent appointed under this sentence may be removed upon the written
request of the Required Lenders, which request shall also appoint a successor
Agent reasonably satisfactory to the Borrower. Any Agent may be removed upon
the written request of such Lenders as own at least two thirds of the
Percentage Interests, which request shall also appoint a successor Agent
reasonably satisfactory to the Borrower. Upon the appointment of a new Agent
hereunder, the term “Agent” shall for all purposes of this Agreement thereafter
include such applicable successor Agent. In the event of the resignation or
removal of any Agent that is not the Administrative Agent, no successor need be
appointed. After any retiring Agent’s resignation hereunder as Agent, or the
removal hereunder of any Agent, the provisions of this Agreement shall continue
to inure to the benefit of such Agent as to any actions taken or omitted to be
taken by it while it was an Agent under this Agreement.

                  11.7.  Concerning the Agents.

 

78

                  11.7.1.  Action in Good Faith, etc. Each Agent and its officers,
directors, employees and agents shall be under no liability to any of the
Lenders or to any future holder of any interest in the
Credit Obligations for any action or failure to act taken or suffered in
good faith, and any action or failure to act in accordance with an opinion of
its counsel shall conclusively be deemed to be in good faith; provided,
however, that the foregoing shall not extend to actions or omissions which are
taken by an Agent with gross negligence or willful misconduct. Each Agent
shall in all cases be entitled to rely, and shall be fully protected in
relying, on instructions given to the Agent by the required holders of Credit
Obligations as provided in this Agreement.

                  11.7.2.  No Implied Duties, etc. Each Agent shall have and may exercise
such powers as are specifically delegated to the Agent under this Agreement or
any other Credit Document together with all other powers incidental thereto.
Each Agent shall have no implied duties to any Person or any obligation to take
any action under this Agreement or any other Credit Document except for action
specifically provided for in this Agreement or any other Credit Document to be
taken by such Agent. Before taking any action under this Agreement or any
other Credit Document, each Agent may request an appropriate specific indemnity
satisfactory to it from each Lender in addition to the general indemnity
provided for in Section 11.10. Until the relevant Agent has received such
specific indemnity, such Agent shall not be obligated to take (although it may
in its sole discretion take) any such action under this Agreement or any other
Credit Document. Each Lender confirms that the Agents do not have a fiduciary
relationship to it under the Credit Documents. Each of the Restricted
Companies confirms that neither of the Agents nor any other Lender has a
fiduciary relationship to it under the Credit Documents.

                  11.7.3.  Validity, etc. Subject to Section 11.7.1, the Agents shall not be
responsible to any Lender or any future holder of any interest in the Credit
Obligations (a) for the legality, validity, enforceability or effectiveness of
this Agreement or any other Credit Document, (b) for any recitals, reports,
representations, warranties or statements contained in or made in connection
with this Agreement or any other Credit Document, (c) for the existence or
value of any assets included in any security for the Credit Obligations, (d)
for the perfection or effectiveness of any Lien purported to be included in
such security or (e) for the specification or failure to specify any particular
assets to be included in such security.

                  11.7.4.  Compliance. The Agents shall not be obligated to ascertain or
inquire as to the performance or observance of any of the terms of this
Agreement or any other Credit Document; and in connection with any extension of
credit under this Agreement or any other Credit Document, the Agents shall be
fully protected in relying on a certificate of the Borrower or any Guarantor as
to the fulfillment by the Borrower of any conditions to such extension of
credit.

                  11.7.5.  Employment of Agents and Counsel. The Agents may execute any of
their duties as Agent under this Agreement or any other Credit Document by or
through employees, agents and attorney-in-fact and shall not be responsible to
any of the Lenders, any Restricted Company or any other Obligor (except as to
money or securities received by the Agent or the Agent’s authorized agents) for
the default or misconduct of any such agents or attorneys-in-fact selected by
the Agent with reasonable care. The Agents shall be entitled to advice of
counsel concerning all matters pertaining to the agency hereby created and its
duties hereunder or under any other Credit Document.

                  11.7.6.  Reliance on Documents and Counsel. Each Agent shall be entitled
to rely, and shall be fully protected in relying, upon any affidavit,
certificate, cablegram, consent, instrument, letter, notice, order, document,
statement, telecopy, telegram, telex or teletype message or writing reasonably
believed in good faith by the Agent to be genuine and correct and to have been
signed, sent or made by

 

79

the Person in question, including any telephonic or
oral statement made by such Person, and, with respect to legal matters, upon
the opinion of counsel selected by the Agent.

                  11.7.7.  Agent’s Reimbursement. Each of the Lenders severally agrees to
reimburse the Agents in the amount of such Lender’s Percentage Interest, for
any reasonable expenses not reimbursed by the Borrower or the other Guarantors
(without limiting the obligation of the Borrower or the other Guarantors to
make such reimbursement): (a) for which the Agents are entitled to
reimbursement by the Borrower or the other Guarantors under this Agreement or
any other Credit Document, and (b) after the occurrence of a Default, for any
other reasonable expenses incurred by the Agents on the Lenders’ behalf in
connection with the enforcement of the Lenders’ rights under this Agreement or
any other Credit Document; provided that the Agents shall not be reimbursed for
any such expenses arising as a result of their gross negligence or willful
misconduct.

                  11.8.  Rights as a Lender. With respect to any credit extended by it
hereunder, each financial institution serving as an Agent hereunder shall have
the same rights, obligations and powers hereunder as any other Lender and may
exercise such rights and powers as though it were not an Agent, and unless the
context otherwise specifies, each such financial institution shall be treated
in its individual capacity as though it were not an Agent hereunder. Without
limiting the generality of the foregoing, the Percentage Interest of each such
financial institution shall be included in any computations of Percentage
Interests. Each such financial institution and its Affiliates may accept
deposits from, lend money to, act as trustee for and generally engage in any
kind of banking or trust business with the Restricted Companies or any
Affiliate of any of them and any Person who may do business with or own an
Equity Interest in the Restricted Companies or any Affiliate of any of them,
all as if such financial institution was not an Agent and without any duty to
account therefor to the other Lenders.

                  11.9.  Independent Credit Decision. Each of the Lenders acknowledges that
it has independently and without reliance upon the Agents, based on the
financial statements and other documents referred to in Section 8.2, on the
other representations and warranties contained herein and on such other
information with respect to the Restricted Companies as such Lender deemed
appropriate, made such Lender’s own credit analysis and decision to enter into
this Agreement and to make the extensions of credit provided for hereunder.
Each Lender represents to the Agents that such Lender will continue to make its
own independent credit and other decisions in taking or not taking action under
this Agreement or any other Credit Document. Each Lender expressly
acknowledges that neither the Agents nor any of their officers, directors,
employees, agents, attorneys-in-fact or Affiliates has made any representations
or warranties to such Lender, and no act by the Agents taken under this
Agreement or any other Credit Document; including any review of the affairs of
the Restricted Companies, shall be deemed to constitute any representation or
warranty by the Agents. Except for notices, reports and other documents
expressly required to be furnished to each Lender by the Agents under this
Agreement or any other Credit Document, the Agents shall not have any duty or
responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, condition, financial or
otherwise, or credit worthiness of any Restricted Company which may come into
the possession of the Agents or any of their officers, directors, employees,
agents, attorneys-in-fact or Affiliates.

                  11.10.  Indemnification. The holders of the Credit Obligations agree to
indemnify the Agents (to the extent not reimbursed by the Obligors and without
limiting the obligation of any of the Obligors to do so), pro rata according to
their respective aggregate Percentage Interests, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits
and reasonable costs, expenses or disbursements of any kind whatsoever which
may at any time be imposed on, incurred by or asserted
against the Agents in their capacity as Agents hereunder relating to or
arising out of this Agreement, any other Credit Document, the transactions
contemplated hereby or thereby, or any action taken or omitted by the Agents in
connection with any of the foregoing; provided, however, that the

 

80

foregoing
shall not extend to (a) litigation commenced by the holders of the Credit
Obligations against the Agents which seeks enforcement of any of the rights of
such holders hereunder or under any other Credit Document and is determined
adversely to the Agents in a final nonappealable judgment or (b) actions or
omissions which are taken by the Agents with gross negligence or willful
misconduct.

                  12.  Successors and Assigns; Lender Assignments and Participations. Any
reference in this Agreement to any of the parties hereto shall be deemed to
include the successors and assigns of such party, and all covenants and
agreements by or on behalf of the Borrower, the other Guarantors, the Agents or
the Lenders that are contained in this Agreement or any other Credit Document
shall bind and inure to the benefit of their respective successors and assigns;
provided, however, that (a) the Restricted Companies may not assign their
rights or obligations under this Agreement except for mergers or liquidations
permitted by Section 7.11.2, and (b) the Lenders shall be not entitled to
assign their respective Percentage Interests in the Loan hereunder except as
set forth below in this Section 12.

                  12.1.  Assignments by Lenders.

                  12.1.1.  Assignees and Assignment Procedures. Each Lender may (a) without
the consent of the Administrative Agent or the Borrower if the proposed
assignee is already a Lender hereunder, a Related Fund, Affiliate or a
Subsidiary of the same corporate parent of which the assigning Lender or any
other Lender is a Subsidiary, or (b) otherwise with the consents of the
Administrative Agent and (so long as no Event of Default has occurred and is
continuing) the Borrower (which consents will not be unreasonably withheld) in
compliance with applicable laws in connection with such assignment, assign to
one or more commercial banks or other financial institutions or other entity
reasonably acceptable to the Borrower (each, an “Assignee”) all or a portion of
its interests, rights and obligations under this Agreement and the other Credit
Documents, including all or a portion of its Commitment, the portion of the
Loan at the time owing to it and the Notes held by it; provided, however, that:

		
	 	     (i)  the aggregate amount of the Commitment or Loan of the assigning
Lender subject to each assignment described in clause (b) above
(determined as of the date the Assignment and Acceptance with respect to
such assignment is delivered to the Administrative Agents shall be not
less than (x) except in the case of any Term Loan or term Supplemental
Facility, $5,000,000 and in increments of $1,000,000 and (y) in the case
of any Term Loan or term Supplemental Facility, $2,000,000 and in
increments of $500,000 (or, in each case, if smaller, the entire
Commitment or Loans of such assigning Lender), provided that the amounts
described above shall be aggregated in respect of each Lender and its
Related Funds, if any (except that in no event shall any sub-allocation
pursuant to this proviso be in an amount of less than $500,000); and
	 
	 	     (ii)  the parties to each such assignment shall execute and deliver
to the Administrative Agent an Assignment and Acceptance (the “Assignment
and Acceptance”) substantially in the form of Exhibit 12.1.1, together
with the Note or Notes subject to such assignment and, in the case of an
assignment described in clause (b) above, a processing and recordation
fee of $3,500 (with only one such fee payable in the case of simultaneous
assignments by or to a group of Related Funds).

Upon acceptance and recording pursuant to Section 12.1.4, from and after the
effective date specified in each Assignment and Acceptance (which effective
date shall be at least five Banking Days after the execution thereof unless
waived by the Administrative Agent):

 

81

	 	 	 	(1)  the Assignee shall be a party hereto and, to the extent provided in
such Assignment and Acceptance, have the rights and obligations of a
Lender under this Agreement and
	 
	 	 	 	(2)  the assigning Lender shall, to the extent provided in such
assignment, be released from its obligations under this Agreement (and,
in the case of an Assignment and Acceptance covering all or the remaining
portion of an assigning Lender’s rights and obligations under this
Agreement, such Lender shall cease to be a party hereto but shall
continue to be entitled to the benefits of Sections 3.2.4, 3.4, 3.5, 3.6
and 10, as well as to any fees accrued for its account hereunder and not
yet paid).

                  12.1.2.  Terms of Assignment and Acceptance. By executing and delivering
an Assignment and Acceptance, the assigning Lender and Assignee shall be deemed
to confirm to and agree with each other and the other parties hereto as
follows:

		
	 	     (a)  other than the representation and warranty that it is the legal
and beneficial owner of the interest being assigned thereby free and
clear of any adverse claim, such assigning Lender makes no representation
or warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this
Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Agreement, any other Credit
Document or any other instrument or document furnished pursuant hereto;
	 
	 	     (b)  such assigning Lender makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Restricted Companies or the performance or observance by the Borrower or
any Guarantor of any of its obligations under this Agreement, any other
Credit Document or any other instrument or document furnished pursuant
hereto;
	 
	 	     (c)  such Assignee confirms that it has received a copy of this
Agreement, together with copies of the most recent financial statements
delivered pursuant to Section 8.2 and such other documents and
information as it has deemed appropriate to make its own credit analysis
and decision to enter into such Assignment and Acceptance;
	 
	 	     (d)  such Assignee will independently and without reliance upon the
Agents, such assigning Lender or any other Lender, and based on such
documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action
under this Agreement;
	 
	 	     (e)  such Assignee appoints and authorizes the Agents to take such
action as agent on its behalf and to exercise such powers under this
Agreement as are delegated to the Agents by the terms hereof, together
with such powers as are reasonably incidental thereto; and
	 
	 	     (f)  such Assignee agrees that it will perform in accordance with the
terns of this Agreement all the obligations which are required to be
performed by it as a Lender.

                  12.1.3.  Register. The Administrative Agent shall maintain at the Houston
Office a register (the “Register”) for the recordation of (a) the names and
addresses of the Lenders and the Assignees which assume rights and obligations
pursuant to an assignment under Section 12.1.1, (b) the Percentage Interest of
each such Lender as set forth in Section 11.1 and (c) the amount of the Loan
owing to each Lender from time to time. The entries in the Register shall be
conclusive, in the absence of manifest error, and the Borrower, the Agents and
the Lenders may treat each Person whose name is

 

82

registered therein for the
purposes as a party to this Agreement. The Register shall be available for
inspection by the Borrower or any Lender at any reasonable time and from time
to time upon reasonable prior notice.

                  12.1.4.  Acceptance of Assignment and Assumption. Upon its receipt of a
completed Assignment and Acceptance executed by an assigning Lender and an
Assignee together with the Note or Notes subject to such assignment, and the
processing and recordation fee referred to in Section 12.1.1, the
Administrative Agent shall (a) accept such Assignment and Acceptance, (b)
record the information contained therein in the Register and (c) give prompt
notice thereof to the Borrower. Within five Banking Days after receipt of
notice, the Borrower, at its own expense, shall execute and deliver to the
Administrative Agent, in exchange for the surrendered Note or Notes, a new Note
or Notes to the order of such Assignee in a principal amount equal to the
applicable Commitment and Loan assumed by it pursuant to such Assignment and
Acceptance and, if the assigning Lender has retained a Commitment and Loan, a
new Note to the order of such assigning Lender in a principal amount equal to
the applicable Commitment and Loan retained by it. Such new Note or Notes
shall be in an aggregate principal amount equal to the aggregate principal
amount of such surrendered Note or Notes, and shall be dated the date of the
surrendered Notes which they replace.

                  12.1.5.  Pledges. Notwithstanding the foregoing provisions of this Section
12, any Lender may at any time pledge or assign all or any portion of such
Lender’s rights under this Agreement and the other Credit Documents to any
representative of its creditors (including a Federal Reserve Bank); provided,
however, that no such pledge or assignment shall release such Lender from such
Lender’s obligations hereunder or under any other Credit Document.

                  12.1.6.  Further Assurances. The Restricted Companies shall sign such
documents and take such other actions from time to time reasonably requested by
an Assignee to enable it to share in the benefits of the rights created by the
Credit Documents.

                  12.2.  Credit Participants. Each Lender may, without the consent of the
Borrower or any Agent, in compliance with applicable laws in connection with
such participation, sell to one or more Qualified Institutional Buyers (each a
“Credit Participant”) participations in all or a portion of its interests,
rights and obligations under this Agreement and the other Credit Documents
(including all or a portion of its Commitment and the Loan owing to it and the
Notes held by it); provided, however, that:

		
	 	     (a)  such Lender’s obligations under this Agreement shall remain
unchanged;
	 
	 	     (b)  such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations;
	 
	 	     (c)  the Credit Participant shall be entitled to the benefit of the
cost protection provisions contained in Sections 3.2.4, 3.4, 3.5, 3.6 and
10, but shall not be entitled to receive any greater
payment thereunder than the selling Lender would have been entitled
to receive with respect to the interest so sold if such interest had not
been sold; and
	 
	 	     (d)  the Borrower, the Agents and the other Lenders shall continue to
deal solely and directly with such Lender in connection with such
Lender’s rights and obligations under this Agreement, and such Lender
shall retain the sole right to enforce the obligations of the Borrower
relating to the Loan and to approve any amendment, modification or waiver
of any provision of this Agreement (other than amendments, modifications
or waivers with respect to any fees 

 

83

		
	 	payable hereunder or the amount of
principal of or the rate at which interest is payable on the Loan, or the
final maturity date of any portion of the Loan).

                  12.3.  Replacement of Lender. In the event that any Lender or, to the
extent applicable, any Credit Participant (the “Affected Lender”):

		
	 	     (a)  fails to perform its obligations to fund any portion of the Loan
on any Closing Date when required to do so by the terms of the Credit
Documents, or fails to provide its portion of any Eurodollar Pricing
Option on account of a Legal Requirement as contemplated by Section 3.2.5
or the unavailability of Eurodollar deposits as contemplated by the last
sentence of Section 3.2.1;
	 
	 	     (b)  demands payment under the Tax provisions of Section 3.4, the
capital adequacy provisions of Section 3.5 or the regulatory change
provisions in Section 3.6 in an amount the Restricted Companies deem
materially in excess of the amounts with respect thereto demanded by the
other Lenders; or
	 
	 	     (c)  refuses to consent to a proposed amendment, modification, waiver
or other action that is consented to by Lenders holding at least 80% of
the Percentage Interests the consent of which is requested in connection
with the proposed amendment, modification, waiver or other action;

then, so long as no Event of Default exists, the Restricted Companies shall
have the right to seek a replacement lender or lenders reasonably satisfactory
to the Administrative Agent (the “Replacement Lender”). The Replacement Lender
shall purchase the interests of the Affected Lender in the Loan and its
Commitment and shall assume the obligations of the Affected Lender hereunder
and under the other Credit Documents upon execution by the Replacement Lender
of an Assignment and Acceptance and the tender by it to the Affected Lender of
a purchase price agreed between it and the Affected Lender (or, if they are
unable to agree, a purchase price in the amount of the Affected Lender’s
Percentage Interest in the Loan and all other outstanding Credit Obligations
then owed to the Affected Lender). Such assignment by the Affected Lender
shall be deemed an early termination of any Eurodollar Pricing Option to the
extent of the Affected Lender’s portion thereof, and the Restricted Companies
will pay to the Affected Lender any resulting amounts due under Section 3.2.4.
Upon consummation of such assignment, the Replacement Lender shall become party
to this Agreement as a signatory hereto and shall have all the rights and
obligations of the Affected Lender under this Agreement and the other Credit
Documents with a Percentage Interest equal to the Percentage Interest of the
Affected Lender, the Affected Lender shall be released from its obligations
hereunder and under the other Credit Documents, and no further consent or
action by any party shall be required. Upon the consummation of such
assignment, the Restricted Companies, the Agent and the Affected Lender shall
make appropriate arrangements so that new Notes are issued to the Replacement
Lender. The Restricted Companies shall sign such documents and take such other
actions reasonably requested by the Replacement Lender to enable it to share in
the benefits of the rights created by the Credit Documents. Until the
consummation
of an assignment in accordance with the foregoing provisions of this Section
12.3, the Restricted Companies shall continue to pay to the Affected Lender (or
to the Administrative Agent for the account of the Affected Lender, as
applicable) any Credit Obligations as they become due and payable.

                  13.  Confidentiality. Each Lender agrees that it will make no disclosure
of confidential information furnished to it by any Restricted Company unless
such information shall have become public, except:

 

84

		
	 	     (a)  in connection with operations under or the enforcement of this
Agreement or any other Credit Document;
	 
	 	     (b)  pursuant to any statutory or regulatory requirement or any
mandatory court order, subpoena or other legal process;
	 
	 	     (c)  to any parent or corporate Affiliate of such Lender or to any
Credit Participant, proposed Credit Participant or proposed Assignee;
provided, however, that any such Person shall agree to comply with the
restrictions set forth in this Section 13 with respect to such
information;
	 
	 	     (d)  to its independent counsel, auditors and other professional
advisors with an instruction to such Person to keep such information
confidential; and
	 
	 	     (e)  to any direct or indirect contractual counterparty in swap
agreements with the same professional advisor as the Lender or such
contractual counterparty’s professional advisor (so long as such
contractual counterparty or professional advisor agrees to be bound by
the provisions of this Section 13); and
	 
	 	     (f)  with the prior written consent of the Borrower, to any other
Person.

                  14.  Foreign Lenders. If any Lender is not created or organized in, or
under the laws of, the United States of America or any state thereof, such
Lender, to the extent it may legally do so, shall deliver to the Borrower and
the Administrative Agent the forms described in one of the following two
clauses:

		
	 	     (a)  two fully completed and duly executed United States Internal
Revenue Service Forms 1001 or 4224 or any successor forms, as the case
may be, certifying that such Lender is entitled to receive payments of
the Credit Obligations payable to it without deduction or withholding of
any United States federal income taxes; or
	 
	 	     (b)  a statement, executed by such Lender under penalty of perjury,
certifying that such Lender is not a “bank” within the meaning of section
881(c)(3)(A) of the Code and two fully completed and duly executed United
States Internal Revenue Service Forms W-8 or any successor forms
certifying that such Lender is not a “United States person” within the
meaning of section 7701(a)(30) of the Code.

Each Lender that delivers any form or statement pursuant to this Section 14
further undertakes to renew such forms and statements by delivering to the
Borrower and the Administrative Agent any updated forms, successor forms or
other certification, as the case may be, on or before the date that any form or
statement previously delivered pursuant to this Section 14 expires or becomes
obsolete or after the
occurrence of any event requiring a change in such most recent form or
statement. If at any time the Borrower and the Administrative Agent have not
received all forms and statements (including any renewals thereof) required to
be provided by any Lender pursuant to this Section 14, Section 3.4 shall not
apply with respect to any amount of United States federal income taxes required
to be withheld from payments of the Credit Obligations to such Lender.

                  15.  Notices. Except as otherwise specified in this Agreement, any notice
required to be given pursuant to this Agreement shall be given in writing. Any
notice, demand or other communication in connection with this Agreement shall
be deemed to be given if given in writing (including telecopy or similar
teletransmission) addressed as provided below (or to the addressee at such
other address as the

 

85

addressee shall have specified by notice actually received
by the addressor), and if either (a) actually delivered in fully legible form
to such address or (b) in the case of a letter, five days shall have elapsed
after the same shall have been deposited in the United States mails, with
first-class postage prepaid and registered or certified.

                  If to any Restricted Company, to it at its address set forth in Exhibit
8.1 (as supplemented pursuant to Sections 7.4.1 and 7.4.2), to the attention of
the chief financial officer.

                  If to any Lender, to it at its address as notified to the Administrative
Agent, with copies to the Administrative Agent.

                  16.  Limited Recourse Against Partners. The remedies of the holders of the
Credit Obligations, including any remedy which could be exercised upon the
occurrence of an Event of Default, shall be limited to the extent that none of
the partners, members or shareholders of any Obligor shall have any personal
liability as a general partner or limited partner of any Obligor with respect
to the Credit Obligations, and in no event shall any such partner be personally
liable as a general partner or limited partner for any deficiency judgment for
any Credit Obligation; provided, however, that the provisions of this Section
16 shall not impair the ability of any holder of any Credit Obligation (a) to
realize on the assets of any Obligor or any of its Subsidiaries or on any other
security, including any personal property or Capital Stock pledged to secure
the Credit Obligations or (b) to pursue any remedy against any guarantor of the
Credit Obligations or (c) to recover any Distribution made in violation of
Section 7.10.

                  17.  Amendments, Consents, Waivers, etc.

                  17.1.  Lender Consents for Amendments. Except as otherwise set forth
herein, the Administrative Agent may (and upon the written request of the
Required Lenders the Administrative Agent shall) take or refrain from taking
any action under this Agreement or any other Credit Document, including giving
its written consent to any modification of or amendment to and waiving in
writing compliance with any covenant or condition in this Agreement or any
other Credit Document (other than an Interest Rate Protection Agreement) or any
Default or Event of Default, all of which actions shall be binding upon all of
the Lenders; provided, however, that:

		
	 	     (a)  Except as provided below, without the written consent of the
Lenders owning at least a majority of the Aggregate Percentage Interests
(disregarding the Percentage Interest of any Delinquent Lender during the
existence of a Delinquency Period or of any Nonperforming Lender
so long as such Lender is treated equally with the other Lenders
with respect to any actions enumerated below), no written modification
of, amendment to, consent with respect to, waiver of compliance with or
waiver of a Default under, any of the Credit Documents (other than an
Interest Rate Protection Agreement) shall be made.
	 
	 	     (b)  Without the written consent of such Lenders as own 100% of the
Percentage Interests (disregarding the Percentage Interest of any
Delinquent Lender during the existence of a Delinquency Period or of any
Nonperforming Lender so long as such Lender is treated equally with the
other Lenders with respect to any actions enumerated below):

		
	 	     (i)  No release of all or substantially all of the Credit
Security or release of the Borrower or any material Guarantor
shall be made (in any event, without the written consent of
the Lenders, the Administrative Agent may release particular
items of Credit Security or particular Guarantors whose
equity has been sold in dispositions permitted by Section
7.11, as modified by amendments 

 

86

		
	 	thereto approved by the
Required Lenders, and may release all Credit Security
pursuant to Section 18.1 upon payment in full of the Credit
Obligations and termination of the Commitments).
	 
	 	     (ii)  No alteration shall be made of the Lenders’ rights
of set-off contained in Section 9.2.4.
	 
	 	     (iii)  No amendment to or modification of this Section
17.1 or the definition of “Required Lenders” shall be made.

		
	 	     (c)  Without the written consent of each Lender that is directly
affected thereby and of such Lenders as own at least a majority of the
Percentage Interests (disregarding the Percentage Interest of any
Delinquent Lender during the existence of a Delinquency Period of or any
Nonperforming Lender so long as such Lender is treated equally with the
other Lenders with respect to any actions enumerated below):

		
	 	     (i)  No reduction shall be made in (A) the amount of
principal of the Loan owing to such Lender or (B) the
interest rate on or fees with respect to the portion of the
Loan owing to such Lender (other than amendments and waivers
approved by the Required Lenders that modify defined terms
used in calculating the Applicable Margin or Consolidated
Excess Cash Flow or that waive an increase in the Applicable
Rate as a result of an Event of Default).
	 
	 	     (ii)  No change shall be made in the stated, scheduled
time of payment of any portion of the Loan owing to such
Lender under Sections 4.1 or 4.2 or interest thereon or fees
relating to any of the foregoing payable to such Lender, and
no waiver shall be made of any Default under Section 9.1.1
with respect to such Lender (other than amendments and
waivers approved by the Required Lenders that modify defined
terms used in calculating the Applicable Margin or
Consolidated Excess Cash Flow).
	 
	 	     (iii)  No increase shall be made in the amount, or
extension of the term, of the stated Commitments of such
Lender beyond that provided for under Section 2.

		
	 	     (d)  Without the written consent of such Lenders owning at least a
majority of the Percentage Interests in a particular Tranche
(disregarding the Percentage Interest of any Delinquent Lender during the
existence of a Delinquency Period or of any Nonperforming Lender so long
as such Lender is treated equally with the other Lenders with respect to
any actions enumerated below) voting as a separate class, no change may
be made in the time of payment of any portion of such Tranche under
Sections 4.3, 4.4 or 4.5 or in the allocation of mandatory prepayments
under Sections 4.3, 4.4 or 4.5 between the respective Tranches.
	 
	 	     (e)  Without the written consent of the Administrative Agent or any
other relevant Agent, as the case may be, no amendment or modification of
any Credit Document shall affect the rights or duties of the
Administrative Agent or such other Agent, as the case may be, under the
Credit Documents.

It is understood that, with respect to any voting required by this Section
17.1, each Lender and its Related Funds, if any, shall vote as a single unit.

 

87

                  17.2.  Course of Dealing; No Implied Waivers. No course of dealing between
any Lender, on the one hand, and any Restricted Company or its Affiliates, on
the other hand, shall operate as a waiver of any of the Lenders’ rights under
this Agreement or any other Credit Document or with respect to the Credit
Obligations. In particular, no delay or omission on the part of any Lender or
any Agent in exercising any right under this Agreement or any other Credit
Document or with respect to the Credit Obligations shall operate as a waiver of
such right or any other right hereunder or thereunder. A waiver on any one
occasion shall not be construed as a bar to or waiver of any right or remedy on
any future occasion. No waiver, consent or amendment with respect to this
Agreement or any other Credit Document shall be binding unless it is in writing
and signed by the Administrative Agent or the Required Lenders, as appropriate.

                  18.  General Provisions.

                  18.1.  Defeasance. When all Credit Obligations have been paid, performed
and reasonably determined by the Agent to have been indefeasibly discharged in
full, and if at the time no Lender continues to be committed to extend any
credit to the Company hereunder or under any other Credit Document, this
Agreement and the other Credit Documents shall terminate and, at the Company’s
written request, accompanied by such certificates and other items as the Agent
shall reasonably deem necessary, any Credit Security shall revert to the
Obligors and the right, title and interest of the Administrative Agent and the
Lenders therein shall terminate. Thereupon, on the Obligors’ demand and at
their cost and expense, the Agent shall execute proper instruments,
acknowledging satisfaction of and discharging this Agreement and the other
Credit Documents, and shall redeliver to the Obligors any Credit Security then
in its possession; provided, however, that Sections 3.2.4, 3.5, 10, 11.7.7,
11.10, 12 and 18 shall survive the termination of this Agreement.

                  18.2.  No Strict Construction. The parties have participated jointly in
the negotiation and drafting of this Agreement and the other Credit Documents
with counsel sophisticated in financing transactions. In the event an
ambiguity or question of intent or interpretation arises, this Agreement and
the other Credit Documents shall be construed as if drafted jointly by the
parties and no presumption or burden of proof shall arise
favoring or disfavoring any party by virtue of the authorship of any
provisions of this Agreement and the other Credit Documents.

                  18.3.  Certain Obligor Acknowledgments. Each of the Restricted Companies
and the other Obligors acknowledges that:

		
	 	     (a)  it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Credit Documents;
	 
	 	     (b)  neither the Agents nor any Lender has any fiduciary relationship
with or duty to the Obligors arising out of or in connection with this
Agreement or any other Credit Document, and the relationship between the
Agents and Lenders, on one hand, and the Restricted Companies and the
Obligors, on the other hand, in connection herewith or therewith is
solely that of debtor and creditor, and
	 
	 	     (c)  no joint venture is created hereby or by the other Credit
Documents or otherwise exists by virtue of the transactions contemplated
hereby or thereby among the Obligors, the Restricted Companies and the
Lenders.

                  18.4.  Venue; Service of Process; Certain Waivers. Each of the Restricted
Companies, the other Obligors, the Agents and the Lenders:

 

88

		
	 	     (a)  Irrevocably submits to the nonexclusive jurisdiction of the
state courts of the State of New York and to the nonexclusive
jurisdiction of the United States District Court for the Southern
District of New York for the purpose of any suit, action or other
proceeding arising out of or based upon this Agreement or any other
Credit Document or the subject matter hereof or thereof;
	 
	 	     (b)  Waives to the extent not prohibited by applicable law that
cannot be waived, and agrees not to assert, by way of motion, as a
defense or otherwise, in any such proceeding brought in any of the
above-named courts, any claim that it is not subject personally to the
jurisdiction of such court, that its property is exempt or immune from
attachment or execution, that such proceeding is brought in an
inconvenient forum, that the venue of such proceeding is improper, or
that this Agreement or any other Credit Document, or the subject matter
hereof or thereof, may not be enforced in or by such court;
	 
	 	     (c)  Agrees that service of process in any such action or proceeding
may be effected by mailing a copy thereof by registered or certified mail
(or any substantially similar form of mail), postage prepaid, to such
Restricted Company at its address referred to in Section 15; and
	 
	 	     (d)  Waives to the extent not prohibited by applicable law that
cannot be waived any right it may have to claim or recover in any such
proceeding any special, exemplary, punitive or consequential damages.

                  18.5.  WAIVER OF JURY TRIAL. TO THE EXTENT NOT PROHIBITED BY APPLICABLE
LAW THAT CANNOT BE WAIVED, EACH OF THE RESTRICTED COMPANIES, THE OTHER
OBLIGORS, THE AGENTS AND THE LENDERS WAIVES, AND COVENANTS THAT IT WILL NOT
ASSERT
(WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE), ANY RIGHT TO TRIAL BY JURY
IN ANY FORUM IN RESPECT OF ANY ISSUE, CLAIM OR PROCEEDING ARISING OUT OF THIS
AGREEMENT OR ANY OTHER CREDIT DOCUMENT OR THE SUBJECT MATTER HEREOF OR THEREOF
OR ANY CREDIT OBLIGATION OR IN ANY WAY CONNECTED WITH THE DEALINGS OF THE
LENDERS, THE AGENTS, THE RESTRICTED COMPANIES OR ANY OTHER OBLIGOR IN
CONNECTION WITH ANY OF TO ABOVE, IN EACH CASE WITHER NOW EXISTING OR HEREAFTER
ARISING AND WHETHER IN CONTRACT, TORT OR OTHERWISE. Each of the Restricted
Companies and the other Obligors acknowledges that it has been informed by the
Administrative Agent that the foregoing sentence constitutes a material
inducement upon which each of the Lenders has relied and will rely in entering
into this Agreement and any other Credit Document. Any Lender, the Agents, the
Borrower or any other Obligor may file an original counterpart or a copy of
this Agreement with any court as written evidence of the consent of the
Restricted Companies, the other Obligors, the Agents and the Lenders to the
waiver of their rights to trial by jury.

                  18.6.  Interpretation; Governing Law; etc. Time is (and shall be) of the
essence in this Agreement and the other Credit Documents. All covenants,
agreements, representations and warranties made in this Agreement or any other
Credit Document or in certificates delivered pursuant hereto or thereto shall
be deemed to have been relied on by each Lender, notwithstanding any
investigation made by any Lender on its behalf, and shall survive the execution
and delivery to the Lenders hereof and thereof. The invalidity or
unenforceability of any provision hereof shall not affect the validity or
enforceability of any other provision hereof, and any invalid or unenforceable
provision shall be modified so as to be enforced to the maximum extent of its
validity or enforceability. The headings in this Agreement are for convenience
of reference only and shall not limit or otherwise affect the meaning hereof.
This Agreement and the other Credit Documents constitute the entire
understanding of the parties

 

89

with respect to the subject matter hereof and
thereof and supersede all prior and contemporaneous understandings and
agreements, whether written or oral. This Agreement may be executed in any
number of counterparts which together shall constitute one instrument. This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York.

                  18.7.  Pledge and Subordination Agreement. Each Holding Company party
hereto acknowledges and agrees that the Pledge and Subordination Agreement
continues in full force and effect and each such Holding Company reaffirms its
obligations thereunder. The Lenders acknowledge that, as a result of certain
changes in the capital structure affecting Charter Communications VII and the
Restricted Companies, those Persons party to the Pledge and Subordination as of
the First Restatement Effective Date that are not a party to this Agreement as
of the Second Restatement Effective Date have, in each case, ceased to be a
party to the Pledge and Subordination Agreement.

[The rest of this page is intentionally blank.]

 

90

                  Each of the undersigned has caused this Agreement to be executed and
delivered by its duly authorized officer as an agreement under seal as of the
date first above written.

	 	 	 	 	 
	 	 	 	 	FALCON CABLE COMMUNICATIONS, LLC
	 
	 	 	 	 	 
	 
	 	 	
By
	 	/s/ Eloise E. Schmitz

Name: Eloise E. Schmitz

Title:   Vice President
	 
	 	 	 	 	 
	 
	 	 	 	 	CHARTER COMMUNICATIONS VII, LLC
	 
	 	 	 	 	 
	 
	 	 	
By
	 	/s/ Eloise E. Schmitz

Name:  Eloise E. Schmitz

Title:    Vice President
	 
	 	 	 	 	 
	 
	 	 	 	 	FALCON CABLE MEDIA, A

CALIFORNIA LIMITED PARTNERSHIP
	 
	 	 	 	 	 
	 
	 	 	 	 	FALCON COMMUNITY CABLE, L.P.
	 
	 	 	 	 	 
	 
	 	 	 	 	FALCON TELECABLE, A

CALIFORNIA LIMITED PARTNERSHIP
	 
	 	 	 	 	 
	 
	 	 	 	 	FALCON CABLEVISION, A

CALIFORNIA LIMITED PARTNERSHIP
	 
	 	 	 	 	 
	 
	 	 	 	 	FALCON CABLE SYSTEMS COMPANY II, L.P.
	 
	 	 	 	 	 
	 
	 	 	 	 	FALCON VIDEO COMMUNICATIONS, L.P.
	 
	 	 	 	 	 
	 
	 	 	
By:
	 	Charter Communications VII, LLC, as

general partner
	 
	 	 	 	 	 
	 
	 	 	
By
	 	/s/ Eloise E. Schmitz

Name:  Eloise E. Schmitz

Title:    Vice President

 

91

	 	 	 	 	 
	 
	 	 	 	 	FALCON COMMUNITY VENTURES I LIMITED

PARTNERSHIP
	 
	 	 	 	 	 
	 
	 	 	
By:
	 	Falcon Community Cable, L.P., as

general partner

	 	 	 	 	 
	 	 	
By:
	 	Falcon Cable Communications,

LLC, as general partner
	 
	 	 	 	 	 
	 
	 	 	
By
	 	/s/ Eloise E. Schmitz

Name:  Eloise E. Schmitz

Title:    Vice President

	 	 	 	 	 
	 	 	 	 	PACIFIC MICROWAVE JOINT VENTURE
	 
	 	 	 	 	 
	 
	 	 	
By:
	 	Falcon Community Ventures I Limited

Partnership, as a general partner
	 
	 	 	 	 	 
	 
	 	 	
By:
	 	Falcon Cable Communications, LLC, as

general partner

	 	 	 	 	 
	 	 	
By
	 	/s/ Eloise E. Schmitz

Name:  Eloise E. Schmitz

Title:    Vice President

	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	
By:
	 	Falcon Cable Systems Company II, L.P., as

a general partner
	 
	 	 	 	 	 
	 
	 	 	
By:
	 	Charter Communications VII, LLC, as

general partner

	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	
By
	 	/s/ Eloise E. Schmitz

Name:  Eloise E. Schmitz

Title:    Vice President

 

92

	 	 	 	 	 
	 	 	 	 	ATHENS CABLEVISION INC.

AUSABLE CABLE TV, INC.

DALTON CABLEVISION INC.

FALCON FIRST, INC.

FALCON FIRST CABLE OF NEW YORK, INC.

FALCON FIRST CABLE OF THE SOUTHEAST, INC.

PLATTSBURGH CABLEVISION INC.

CC VII LEASE, INC.

SCOTTSBORO TV CABLE, INC.

CC VII PURCHASING, LLC

CC VII LEASING, LLC
	 
	 	 	 	 	 
	 
	 	 	
By
	 	/s/ Eloise E. Schmitz

Name:  Eloise E. Schmitz

Title:    Vice President
	 
	 	 	 	 	 
	 
	 	 	 	 	TORONTO DOMINION (TEXAS), INC., as

Administrative Agent
	 
	 	 	 	 	 
	 
	 	 	
By	 	 
	 	 	 	 	

Title:
	 
	 	 	 	 	 
	 
	 	 	 	 	J.P. MORGAN SECURITIES INC., as Syndication

Agent
	 
	 	 	 	 	 
	 
	 	 	
By	 	 
	 	 	 	 	

Title:

 

Exhibit 1-A

BORROWER, RESTRICTED COMPANIES AND GUARANTORS

	 	 	 
	Borrower
	
	
	
	

	 	 	 
	
	
	
	

	 	 	
Falcon Cable Communications, LLC, a Delaware limited liability company
	
	
	
	

	 	 	 
	
	
	
	

	Restricted Companies
	
	
	
	

	 	 	 
	
	
	
	

	 	 	
Falcon Cable Communications, LLC, a Delaware limited liability company
	
	
	
	

	 	 	
Falcon Media Investors Group, a California Limited Partnership
	
	
	
	

	 	 	
Falcon Community Investors, L.P., a California Limited Partnership
	
	
	
	

	 	 	
Falcon Telecable Investors Group, a California Limited Partnership
	
	
	
	

	 	 	
Falcon Investors Group, Ltd., a California Limited Partnership
	
	
	
	

	 	 	
Falcon Cable Media, a California Limited Partnership
	
	
	
	

	 	 	
Falcon Cable Systems Company II, L.P.
	
	
	
	

	 	 	
Falcon Cablevision, a California Limited Partnership
	
	
	
	

	 	 	
Falcon Community Cable, L.P., a Delaware limited partnership
	
	
	
	

	 	 	
Falcon Community Ventures I Limited Partnership, a California limited

partnership
	
	
	
	

	 	 	
Falcon First, Inc., a Delaware corporation
	
	
	
	

	 	 	
Falcon Telecable, a California limited partnership
	
	
	
	

	 	 	
Falcon Telecom, L.P., a California Limited Partnership
	
	
	
	

	 	 	
Athens Cablevision, Inc.
	
	
	
	

	 	 	
Ausable Cable TV, Inc.
	
	
	
	

	 	 	
Dalton Cablevision, Inc.
	
	
	
	

	 	 	
Falcon First Cable of New York, Inc.
	
	
	
	

	 	 	
Falcon First Cable of the Southeast, Inc.
	
	
	
	

	 	 	
Falcon First Holdings, Inc.
	
	
	
	

	 	 	
FF Cable Holdings, Inc.
	
	
	
	

	 	 	
Plattsburg Cablevision, Inc.
	
	
	
	

	 	 	
Falcon Video Communications, L.P., a California limited partnership
	
	
	
	

	 	 	
Falcon Video Communications Investors, L.P.
	
	
	
	

	 	 	
Falcon Equipment Company, LLC
	
	
	
	

	 	 	
Pacific Microwave Joint Venture, a California general partnership
	
	
	
	

	Guarantors
	
	
	
	

	 	 	 
	
	
	
	

	 	 	
Falcon Cable Media, a California Limited Partnership
	
	
	
	

	 	 	
Falcon Cable Systems Company II, L.P.
	
	
	
	

	 	 	
Falcon Cablevision, a California Limited Partnership
	
	
	
	

	 	 	
Falcon Community Cable, L.P., a Delaware limited partnership
	
	
	
	

	 	 	
Falcon Community Ventures I Limited Partnership, a California limited

partnership
	
	
	
	

	 	 	
Falcon First, Inc., a Delaware corporation
	
	
	
	

	 	 	
Falcon Telecable, a California limited partnership
	
	
	
	

	 	 	
Falcon Telecom, L.P., a California Limited Partnership
	
	
	
	

	 	 	
Falcon Media Investors Group, a California Limited Partnership
	
	
	
	

	 	 	
Falcon Community Investors, L.P., a California Limited Partnership
	
	
	
	

	 	 	
Falcon Telecable Investors Group, a California Limited Partnership
	
	
	
	

	 	 	
Falcon Investors Group, Ltd., a California Limited Partnership
	
	
	
	

	 	 	
Athens Cablevision, Inc.
	
	
	
	

	 	 	
Ausable Cable TV, Inc.

 

 

  2

	 
	Dalton Cablevision, Inc.
	
	
	
	

	Falcon First Cable of New York, Inc.
	
	
	
	

	Falcon First Cable of the Southeast, Inc.
	
	
	
	

	Falcon First Holdings, Inc.
	
	
	
	

	FF Cable Holdings, Inc.
	
	
	
	

	Plattsburg Cablevision, Inc.
	
	
	
	

	Falcon Video Communications, L.P., a California limited partnership
	
	
	
	

	Falcon Video Communications Investors, L.P.
	
	
	
	

	Falcon Equipment Company, LLC
	
	
	
	

	Pacific Microwave Joint Venture, a California general partnership

 

 

Exhibit 1-B

         Example
of Pro Rata Revolver Prepayment upon Operating Asset Sale

(Assumes no Supplemental Loan)

	1.	 	Assume on January 5, 2003 a sale of Operating Assets resulting in
$75,000,000 of Net Cash Proceeds in an Operating Asset Sale. Section 4.4.
	 
	 	 	           $40 million allocated to Asset Reinvestment Reserve Amount. Section 4.3.
	 
	 	 	           $35 million left for application to the Loan. Section 4.4.1
	 
	2.	 	Allocate the $35 million
pro rata in proportion to Maximum Amount of Revolving Credit and the Term Loan (Section 4.4.5):

	 	 	 	 	 	 
	As
of January 5, 2003,

Maximum Amount of Revolving Credit
	 	$	552,500,000	 
	
	
	
	

	 	Term Loan Outstanding
	 	$	480,000,000	 
	 
	 	 	
	 
	 
	 	$	1,032,500,000	 

	 	 	 	 	 
	Percentage allocation to Revolving Loan
	 	
=

	 	$552,500,000/$1,032,500,000 = 54%

	
	
	
	

	Percentage allocation to Term Loan
	 	
=

	 	$480,000,000/$1,032,500,000 = 46%

	 
	Allocate Net Cash Proceeds according to weighted percentages:

	
	
	
	

	  $35 million x 54% = $18.7 million allocated to Revolving Loan

	
	
	
	

	   $35 million x 46% = $16.2 million allocated to Term Loan

	3.	 	Allocate the $18.7 million prepayment of the Revolving Loan according to
Pro Rata Revolver Prepayment Portion (see attached chart):

	 	(a)	 	Calculate sum of percentage reductions from sale date
(January 5, 2003) through the Final Revolving Maturity Date
(December 31, 2006) = 77.5% (see Column 2)
	 
	 	(b)	 	Divide previous percentage reductions by 77.5% to derive new
weighted percentage for remaining Payment Dates (see Column 3)
	 
	 	(c)	 	For each Payment Date, multiply new weighted percentage by
$18.7 million (see Column 4).
	 
	 	(d)	 	Add figure to previous aggregate reduction in the Stated Amount (see
Column 5).
	 
	 	(e)	 	For each Payment Date, subtract amount in Column 4 from
previous Stated Amount of Maximum Revolving Credit (see Columns 1
and 6).

 

 

  2

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Column 1	 	Column 2	 	Column 3	 	Column 4	 	Column 5	 	Column 6
	 	 	
	 	
	 	
	 	
	 	
	 	

	 	 	Previous	 	Previous Reduction	 	New Weighted	 	New Reduction	 	Aggregate Reduction	 	 	 	 
	Date	 	Stated Amount	 	Percentages	 	Percentages	 	to Stated Amount	 	to Stated Amount	 	New Stated Amount
	
	 	
	 	
	 	
	 	
	 	
	 	

	March 31, 2003 through
June 29, 2003
	 	$	536,250,000	 	 	 	2.500	%	 	 	3.23	%	 	$	604,010	 	 	$	604,010	 	 	$	535,645,990	 
	
	
	
	

	June 30, 2003 through
September 29, 2003
	 	$	520,000,000	 	 	 	2.500	%	 	 	3.23	%	 	$	604,010	 	 	$	1,208,020	 	 	$	519,395,990	 
	
	
	
	

	September 30, 2003 through
December 30, 2003
	 	$	503,750,000	 	 	 	2.500	%	 	 	3.23	%	 	$	604,010	 	 	$	1,812,030	 	 	$	503,145,990	 
	
	
	
	

	December 31, 2003 through
March 30, 2004
	 	$	487,500,000	 	 	 	2.500	%	 	 	3.23	%	 	$	604,010	 	 	$	2,416,040	 	 	$	486,895,990	 
	
	
	
	

	March 31, 2004 through
June 29, 2004
	 	$	455,000,000	 	 	 	5.000	%	 	 	6.45	%	 	$	1,206,150	 	 	$	3,622,190	 	 	$	453,793,850	 
	
	
	
	

	June 30, 2004 through
September 29, 2004
	 	$	422,500,000	 	 	 	5.000	%	 	 	6.45	%	 	$	1,206,150	 	 	$	4,828,340	 	 	$	421,293,850	 
	
	
	
	

	September 30, 2004 through
December 30, 2004
	 	$	390,000,000	 	 	 	5.000	%	 	 	6.45	%	 	$	1,206,150	 	 	$	6,034,490	 	 	$	388,793,850	 
	
	
	
	

	December 31, 2004 through
March 30, 2005
	 	$	357,500,000	 	 	 	5.000	%	 	 	6.45	%	 	$	1,206,150	 	 	$	7,240,640	 	 	$	356,293,850	 
	
	
	
	

	March 31, 2005 through
June 29, 2005
	 	$	316,875,000	 	 	 	6.250	%	 	 	8.06	%	 	$	1,507,220	 	 	$	8,747,860	 	 	$	315,367,780	 
	
	
	
	

	June 30, 2005 through
September 29, 2005
	 	$	276,250,000	 	 	 	6.250	%	 	 	8.06	%	 	$	1,507,220	 	 	$	10,255,080	 	 	$	274,742,780	 
	
	
	
	

	September 30, 2005 through
December 30, 2005
	 	$	235,625,000	 	 	 	6.250	%	 	 	8.06	%	 	$	1,507,220	 	 	$	11,762,300	 	 	$	234,117,780	 
	
	
	
	

	December 31, 2005 through
March 30, 2006
	 	$	195,000,000	 	 	 	6.250	%	 	 	8.06	%	 	$	1,507,220	 	 	$	13,269,520	 	 	$	193,492,780	 
	
	
	
	

	March 31, 2006 through
June 29, 2006
	 	$	146,250,000	 	 	 	7.500	%	 	 	9.68	%	 	$	1,810,160	 	 	$	15,079,680	 	 	$	144,439,840	 
	
	
	
	

	June 30, 2006 through
September 29, 2006
	 	$	97,500,000	 	 	 	7.500	%	 	 	9.68	%	 	$	1,810,160	 	 	$	16,889,840	 	 	$	95,689,840	 
	
	
	
	

	September 30, 2006 up to the
Final Revolving Maturity Date
	 	$	48,750,000	 	 	 	7.500	%	 	 	9.68	%	 	$	1,810,160	 	 	$	18,700,000	 	 	$	46,939,840	 
	
	
	
	

	Final Revolving Maturity Date*
	 	$	0	 	 	 	0.000	%	 	 	0.000	%	 	$	0	 	 	$	18,700,000	 	 	$	0	 
	 
	 	 	 	 	 	 	
	 	 	 	
	 	 	 	
	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	77.5	%	 	 	100.00	%	 	$	18,700,000	 	 	 	 	 	 	 	 	 

	 	 	• Pro Rata Term Loan Prepayment Portions are not calculated with reference
to payments on the Final Term Loan Maturity Date.

 

 

Exhibit 2.1.3

FORM OF REVOLVING NOTE

____________, 2001

         FOR VALUE RECEIVED, the undersigned, Falcon Cable Communications, LLC, a
Delaware limited liability company (the “Borrower”), hereby promises to pay
     (the “Lender”) or order, on the Final Revolving Maturity
Date (as defined in the Credit Agreement referred to below), the aggregate
unpaid principal amount of the Revolving Loans made by the Lender to the
Borrower pursuant to the Credit Agreement. The Borrower promises to pay daily
interest from the date hereof, computed as provided in such Credit Agreement,
on the aggregate principal amount of such Revolving Loans from time to time
unpaid at the per annum rate applicable to such unpaid principal amount as
provided in such Credit Agreement and to pay interest on overdue principal and,
to the extent not prohibited by applicable law, on overdue installments of
interest and fees at the rate specified in such Credit Agreement, all such
interest being payable at the times specified in such Credit Agreement, except
that all accrued interest shall be paid at the stated or accelerated maturity
hereof or upon the prepayment in full hereof.

         Payments hereunder shall be made to Toronto Dominion (Texas), Inc., as
administrative agent for the payee hereof, 909 Fannin Street, 17th Floor,
Houston, Texas 77010.

         All Revolving Loans made by the Lender pursuant to the Credit Agreement
referred to below and all repayments of the principal thereof shall be recorded
by the Lender and, prior to any transfer hereof, appropriate notations to
evidence the foregoing information with respect to each such Revolving Loans
then outstanding shall be endorsed by the Lender on the schedule attached
hereto or on a continuation of such schedule attached to and made a part
hereof; provided, however, that the failure of the Lender to make any such
recordation or endorsement shall not affect the obligations of the Borrower
under this Note, such Credit Agreement or under any other Credit Document.

         This Note evidences borrowings under, and is entitled to the benefits and
security of, and is subject to the provisions of, the Credit Agreement dated as
of June 30, 1998, as amended and restated as of November 12, 1999, as further
amended and restated as of September 26, 2001, as further amended, restated,
supplemented or otherwise modified from time to time (the “Credit Agreement”),
among the Borrower, the Guarantors party thereto, the payee hereof and certain
other lenders. The principal of this Note is prepayable in the amounts and
under the circumstances set forth in the Credit Agreement, and may be prepaid
in whole or from time to time in part, all as set forth in the Credit
Agreement. Terms defined in the Credit Agreement and not otherwise defined
herein are used herein with the meanings so defined.

 

 

 2

         In case an Event of Default shall occur, the entire principal of this Note
may become or be declared due and payable in the manner and with the effect
provided in the Credit Agreement.

         This Note shall be governed by and construed in accordance with the laws
of the State of New York.

         The obligations under this Note and the other Credit Obligations, and the
remedies of the holder hereof and the other Lenders pursuant to the Credit
Agreement, are non-recourse against certain partners, shareholders and members
of the Borrower as provided in the Credit Documents.

         The parties hereto, including the Borrower and all guarantors and
endorsers, hereby waive presentment, demand, notice, protest and all other
demands and notices in connection with the delivery, acceptance, performance
and enforcement of this Note, except as specifically otherwise provided in the
Credit Agreement, and assent to extensions of time of payment, or forbearance
or other indulgence without notice.

	 	 	 	 	 
	 	 	FALCON CABLE COMMUNICATIONS, LLC 
	
	
	
	

	 	 	 	 	 
	
	
	
	

	 	 	
By	 	 
	
	
	
	

	 	 	 	 	

Title:

 

 

  3

LOAN AND PAYMENTS PRINCIPAL

	 	 	 	 	 	 	 	 	 
	Date	 	
Amount

of Loan
	 	Amount of

Principal

Repaid
	 	Unpaid

Principal

Balance
	 	Notation

Made by

 

 

Exhibit 2.2.2

FORM OF TERM LOAN B NOTE

_____________, 2001

         FOR VALUE RECEIVED, the undersigned, Falcon Cable Communications, LLC, a
Delaware limited liability company (the “Borrower”), hereby promises to pay
     (the “Lender”) or order, on the Final Term Loan B Maturity Date (as
defined in the Credit Agreement referred to below), the aggregate unpaid
principal amount of Term Loan B made by the Lender to the Borrower pursuant to
the Credit Agreement. The Borrower promises to pay daily interest from the
date hereof, computed as provided in such Credit Agreement, on the aggregate
principal amount of Term Loan B from time to time unpaid at the per annum rate
applicable to such unpaid principal amount as provided in such Credit Agreement
and to pay interest on overdue principal and, to the extent not prohibited by
applicable law, on overdue installments of interest and fees at the rate
specified in such Credit Agreement, all such interest being payable at the
times specified in such Credit Agreement, except that all accrued interest
shall be paid at the stated or accelerated maturity hereof or upon the
prepayment in full hereof.

         Payments hereunder shall be made to Toronto Dominion (Texas) Inc., as
administrative agent for the payee hereof, 909 Fannin Street, 17th Floor,
Houston, Texas 77010.

         All Term Loans made by the Lender pursuant to the Credit Agreement
referred to below and all repayments of the principal thereof shall be recorded
by the Lender and, prior to any transfer hereof, appropriate notations to
evidence the foregoing information with respect to Term Loan B then outstanding
shall be endorsed by the Lender on the schedule attached hereto or on a
continuation of such schedule attached to and made a part hereof; provided,
however, that the failure of the Lender to make any such recordation or
endorsement shall not affect the obligations of the Borrower under this Note,
such Credit Agreement or under any other Credit Document.

         This Note evidences borrowings under, and is entitled to the benefits and
security of, and is subject to the provisions of, the Credit Agreement dated as
of June 30, 1998, as amended and restated as of November 12, 1999, as further
amended and restated as of September 26, 2001, as further amended, restated,
supplemented or otherwise modified from time to time (the “Credit Agreement”),
among the Borrower, the Guarantors party thereto, the payee hereof and certain
other lenders. The principal of this Note is prepayable in the amounts and
under the circumstances set forth in the Credit Agreement, and may be prepaid
in whole or from time to time in part, all as set forth in the Credit
Agreement. Terms defined in the Credit Agreement and not otherwise defined
herein are used herein with the meanings so defined.

         In case an Event of Default shall occur, the entire principal of this Note
may become or be declared due and payable in the manner and with the effect
provided in the Credit Agreement.

         This Note shall be governed by and construed in accordance with the laws
of the State of New York.

         The obligations under this Note and the other Credit Obligations, and the
remedies of the holder hereof and the other Lenders pursuant to the Credit
Agreement, are non-recourse against certain partners, shareholders and members
of the Borrower as provided in the Credit Documents.

         The parties hereto, including the Borrower and all guarantors and
endorsers, hereby waive presentment, demand, notice, protest and all other
demands and notices in connection with the delivery, acceptance, performance
and enforcement of this Note, except as specifically otherwise

 

 

  2

provided in the Credit Agreement, and assent to extensions of time of
payment, or forbearance or other indulgence without notice.

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	FALCON CABLE COMMUNICATIONS, LLC 
	
	
	
	

	 	 	 	 	 
	
	
	
	

	 	 	
By	 	 
	
	
	
	

	 	 	 	 	

Title:

 

 

  3

LOAN AND PAYMENTS OF PRINCIPAL

	 	 	 	 	 	 	 	 	 
	Date	 	
Amount

of Loan
	 	Amount of

Principal

Repaid
	 	Unpaid

Principal

Balance
	 	Notation

Made by

 

 

Exhibit 2.3.2

FORM OF TERM LOAN C NOTE

_____________, 2001

         FOR VALUE RECEIVED, the undersigned, Falcon Cable Communications, LLC, a
Delaware limited liability company (the “Borrower”), hereby promises to pay
     (the “Lender”) or order, on the Final Term Loan C Maturity Date (as
defined in the Credit Agreement referred to below), the aggregate unpaid
principal amount of Term Loan C made by the Lender to the Borrower pursuant to
the Credit Agreement. The Borrower promises to pay daily interest from the
date hereof, computed as provided in such Credit Agreement, on the aggregate
principal amount of Term Loan C from time to time unpaid at the per annum rate
applicable to such unpaid principal amount as provided in such Credit Agreement
and to pay interest on overdue principal and, to the extent not prohibited by
applicable law, on overdue installments of interest and fees at the rate
specified in such Credit Agreement, all such interest being payable at the
times specified in such Credit Agreement, except that all accrued interest
shall be paid at the stated or accelerated maturity hereof or upon the
prepayment in full hereof.

         Payments hereunder shall be made to Toronto Dominion (Texas) Inc., as
administrative agent for the payee hereof, 909 Fannin Street, 17th Floor,
Houston, Texas 77010.

         All Term Loans made by the Lender pursuant to the Credit Agreement
referred to below and all repayments of the principal thereof shall be recorded
by the Lender and, prior to any transfer hereof, appropriate notations to
evidence the foregoing information with respect to Term Loan C then outstanding
shall be endorsed by the Lender on the schedule attached hereto or on a
continuation of such schedule attached to and made a part hereof; provided,
however, that the failure of the Lender to make any such recordation or
endorsement shall not affect the obligations of the Borrower under this Note,
such Credit Agreement or under any other Credit Document.

         This Note evidences borrowings under, and is entitled to the benefits and
security of, and is subject to the provisions of, the Credit Agreement dated as
of June 30, 1998, as amended and restated as of November 12, 1999, as further
amended and restated as of September 26, 2001, as further amended, restated,
supplemented or otherwise modified from time to time (the “Credit Agreement”),
among the Borrower, the Guarantors party thereto, Falcon Cable Communications,
LLC, the payee hereof and certain other lenders. The principal of this Note is
prepayable in the amounts and under the circumstances set forth in the Credit
Agreement, and may be prepaid in whole or from time to time in part, all as set
forth in the Credit Agreement. Terms defined in the Credit Agreement and not
otherwise defined herein are used herein with the meanings so defined.

         In case an Event of Default shall occur, the entire principal of this Note
may become or be declared due and payable in the manner and with the effect
provided in the Credit Agreement.

         This Note shall be governed by and construed in accordance with the laws
of the State of New York.

         The obligations under this Note and the other Credit Obligations, and the
remedies of the holder hereof and the other Lenders pursuant to the Credit
Agreement, are non-recourse against certain partners, shareholders and members
of the Borrower as provided in the Credit Documents.

 

 

  2

         The parties hereto, including the Borrower and all guarantors and
endorsers, hereby waive presentment, demand, notice, protest and all other
demands and notices in connection with the delivery, acceptance, performance
and enforcement of this Note, except as specifically otherwise provided in the
Credit Agreement, and assent to extensions of time of payment, or forbearance
or other indulgence without notice.

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	FALCON CABLE COMMUNICATIONS, LLC 
	
	
	
	

	 	 	 	 	 
	
	
	
	

	 	 	
By	 	 
	
	
	
	

	 	 	 	 	

Title:

 

 

  3

LOAN AND PAYMENTS OF PRINCIPAL

	 	 	 	 	 	 	 	 	 
	Date	 	
Amount

of Loan
	 	Amount of

Principal

Repaid
	 	Unpaid

Principal

Balance
	 	Notation

Made by

 

 

Exhibit 5.2.1

OFFICER’S CERTIFICATE

         In connection with the Credit Agreement, dated as of June 30, 1998, as
amended and restated as of November 12, 1999, as further amended and restated
as of September 26, 2001, as further amended, restated, supplemented or
otherwise modified from time to time (the “Credit Agreement”), among Falcon
Cable Communications, LLC, the Guarantors party thereto, the Lenders party
thereto, BankBoston, N.A., as documentation agent, Toronto Dominion (Texas),
Inc., as administrative agent, Bank of America National Trust and Savings
Association, as syndication agent, and The Chase Manhattan Bank, as
co-syndication agent, the Borrower certifies as follows:

		
	 	     1. Representations and Warranties

         The representations and warranties contained in Sections 6.6 and 8 of the
Credit Agreement and in Sections 2.2 and 4 of the Pledge and Subordination
Agreement are true and correct on and as of the date hereof (except for those
representations and warranties made as of a specified earlier date, which shall
have been true and correct as of such date).

		
	 	     2. No Default

                  No Default exists or is continuing on the date hereof or will exist
immediately after giving effect to the extension of credit requested on the
date hereof pursuant to the Credit Agreement.

		
	 	     3. No Material Adverse Change

                  As of the date hereof, no Material Adverse Change has occurred.

         Terms defined in the Credit Agreement and not otherwise defined herein are
used herein with the meanings so defined.

	 	 	 	 	 
	 	 	FALCON CABLE COMMUNICATIONS, LLC 
	
	
	
	

	 	 	 	 	 
	
	
	
	

	 	 	
By	 	 
	
	
	
	

	 	 	 	 	

Name:
	
	
	
	

	 	 	 	 	Title:

 

 

Exhibit 7.14

AFFILIATE CONTRACTUAL OBLIGATIONS

	1.	 	Marc Nathanson — Leases with Charter Communications Holding Company, LLC
(“Charter HoldCo”) and Affiliates
	 
	 	 	Charter HoldCo, as assignee, leases certain office space (located in
Pasadena, California) from a partnership owned by Marc Nathanson and his
wife. The lease expires September 30, 2005. The base rent is currently
approximately $396,000 per year. This lease has been assigned to and
assumed by a Restricted Company, and such Restricted Company may continue
to perform all obligations of Charter HoldCo thereunder.
	 
	2.	 	Marc Nathanson — Office and Bookkeeping Services
	 
	 	 	The Borrower has historically provided certain accounting, bookkeeper,
clerical, and support services, including office space and other office
services, to Marc Nathanson. the Borrower may continue to provide such
services consistent with past practices, subject to the obligation of Marc
Nathanson and his affiliates to reimburse the Borrower for an appropriate
portion of the costs relating to these services, also determined consistent
with the Borrower’s past practices.
	 
	3.	 	Enstar
	 
	 	 	Certain of the Restricted Companies share office space, personnel and other
resources with Enstar and its subsidiaries and provide certain programming
services to Enstar and its subsidiaries.

 

 

Exhibit 8.1

RESTRICTED COMPANIES

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Chief Executive Office	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	and	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Jurisdiction of	 	Chief Place of	 	 	 	 	 	Business	 	Partners and
	Name	 	Organization	 	Business	 	Other Names	 	Jurisdictions	 	Percentage Ownership
	

	 Falcon
Cablevision, a	 	California	 	12444 Powerscourt Drive	 	Falcon Cable TV	 	Alabama	 	Falcon Investors Group,
	
	
	
	

	California limited	 	 	 	 	 	Suite 400	 	 	 	 	 	California	 	Ltd., a California
	
	
	
	

	partnership	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	Georgia	 	limited partnership -
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Missouri	 	25.8%	
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Oregon	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Virginia	 	Falcon Cable
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Communications, LLC (the
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	“Borrower”) - 74.2%
	

	Falcon Cable Systems	 	California	 	12444 Powerscourt Drive	 	Falcon Cable TV	 	California	 	Falcon Investors Group,
	
	
	
	

	Company II, L.P.	 	 	 	 	 	Suite 400	 	 	 	 	 	Missouri	 	Ltd., a California
	
	
	
	

	 	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	Oregon	 	limited partnership - 0.2%
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Borrower - 99.8%
	

	Falcon Telecable, a	 	California	 	12444 Powerscourt Drive	 	Falcon Cable TV	 	Arkansas	 	Falcon Telecable
	
	
	
	

	California limited	 	 	 	 	 	Suite 400	 	 	 	 	 	Arizona	 	Investors Group, a
	
	
	
	

	partnership	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	California	 	California limited
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Illinois	 	partnership - 8.1%
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Louisiana	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Kentucky	 	Borrower - 91.9%
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Michigan	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Missouri	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Nevada	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Oregon	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Texas	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Utah	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Washington	 	 	 	 
	

	Falcon Cable Media, a	 	California	 	12444 Powerscourt Drive	 	Falcon Cable TV	 	Arkansas	 	Falcon Media Investors
	
	
	
	

	California limited	 	 	 	 	 	Suite 400	 	 	 	 	 	Florida	 	Group, a California
	
	
	
	

	partnership	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	Georgia	 	limited partnership -14.6%
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Maryland	 	 	 	 

 

 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Chief Executive Office	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	and	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Jurisdiction of	 	Chief Place of	 	 	 	 	 	Business	 	Partners and
	Name	 	Organization	 	Business	 	Other Names	 	Jurisdictions	 	Percentage Ownership
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Missouri	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	North	 	Borrower - 85.4%
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Carolina	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Oklahoma	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Virginia	 	 	 	 
	

	Falcon Community Cable,	 	Delaware	 	12444 Powerscourt Drive	 	Falcon Cable TV	 	Kentucky	 	Falcon Community
	
	
	
	

	L.P.	 	 	 	 	 	Suite 400	 	 	 	 	 	Missouri	 	Investors, L.P. - 0.8%
	
	
	
	

	 	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	Oregon	 	 	 	 
	
	
	
	

	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Borrower - 99.2%
	

	Falcon Community	 	California	 	12444 Powerscourt Drive	 	Falcon Cable TV	 	Missouri	 	Falcon Community Cable,
	
	
	
	

	Ventures I Limited	 	 	 	 	 	Suite 400	 	 	 	 	 	Oregon	 	L.P. - 99.2%	
	
	
	
	

	Partnership	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	Washington	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Georgia	 	Falcon Community
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Investors, L.P. - 0.8%
	

	Falcon Telecom, L.P.	 	California	 	12444 Powerscourt Drive	 	Falcon Cable TV	 	Missouri	 	Borrower - 99%
	
	
	
	

	 	 	 	 	 	 	Suite 400	 	 	 	 	 	 	 	 	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	 	 	 	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Falcon Telecable Investors
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Group, a California
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	limited partnership - 1%
	

	 	 	 	 	 	 	12444 Powerscourt Drive	 	Falcon Cable TV	 	Missouri	 	Charter Communications
	
	
	
	

	Falcon Investors Group,	 	California	 	Suite 400	 	 	 	 	 	 	 	 	 	Holding Company, LLC
	
	
	
	

	Ltd., a California	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	 	 	 	 	(“Minority Interest
	
	
	
	

	limited partnership	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	HoldCo”) - 1%
	

	Falcon Telecable	 	California	 	12444 Powerscourt Drive	 	Falcon Cable TV	 	Missouri	 	Minority Interest HoldCo
	
	
	
	

	Investors Group, a	 	 	 	 	 	Suite 400	 	 	 	 	 	 	 	 	 	- 1%	
	
	
	
	

	California limited	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	 	 	 	 	 	 	 
	
	
	
	

	partnership
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Borrower - 99%
	

	Falcon Media Investors	 	California	 	12444 Powerscourt Drive	 	Falcon Cable TV	 	Arkansas	 	Minority Interest HoldCo
	
	
	
	

	Group, a California	 	 	 	 	 	Suite 400	 	 	 	 	 	Florida	 	- 1%	
	
	
	
	

	limited partnership	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	Georgia	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Maryland	 	Borrower - 99%
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Missouri	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	North	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Carolina	 	 	 	 

 

 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Chief Executive Office	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	and	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Jurisdiction of	 	Chief Place of	 	 	 	 	 	Business	 	Partners and
	Name	 	Organization	 	Business	 	Other Names	 	Jurisdictions	 	Percentage Ownership
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Oklahoma	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Virginia	 	 	 	 
	

	Falcon Community	 	California	 	12444 Powerscourt Drive	 	Falcon Cable TV	 	Georgia	 	Minority Interest HoldCo
	
	
	
	

	Investors, L.P.	 	 	 	 	 	Suite 400	 	 	 	 	 	Kentucky	 	 	- 1	%
	
	
	
	

	 	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	Missouri	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Oregon	 	Borrower - 99%
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Washington	 	 	 	 
	

	Falcon First, Inc.	 	Delaware	 	12444 Powerscourt Drive	 	 	 	 	 	Alabama	 	Borrower - 100%
	
	
	
	

	 	 	 	 	 	 	Suite 400	 	 	 	 	 	New York	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	Georgia	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Mississippi	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Missouri	 	 	 	 
	

	Athens Cablevision, Inc.	 	Delaware	 	12444 Powerscourt Drive	 	 	 	 	 	Alabama	 	FF Cable Holdings, Inc. -
	
	
	
	

	 	 	 	 	 	 	Suite 400	 	 	 	 	 	Missouri	 	 	100	%
	
	
	
	

	 	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	 	 	 	 	 	 	 
	

	Ausable Cable TV, Inc.	 	New York	 	12444 Powerscourt Drive	 	 	 	 	 	Missouri	 	Plattsburg Cablevision,
	
	
	
	

	 	 	 	 	 	 	Suite 400	 	 	 	 	 	New York	 	Inc. - 100%
	
	
	
	

	 	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	 	 	 	 	 	 	 
	

	Dalton Cablevision, Inc.	 	Delaware	 	12444 Powerscourt Drive	 	 	 	 	 	Georgia	 	FF Cable Holdings, Inc. -
	
	
	
	

	 	 	 	 	 	 	Suite 400	 	 	 	 	 	Missouri	 	 	100	%
	
	
	
	

	 	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	 	 	 	 	 	 	 
	

	Falcon First Cable of	 	Delaware	 	12444 Powerscourt Drive	 	 	 	 	 	Missouri	 	Falcon First, Inc. - 100%
	
	
	
	

	New York, Inc.	 	 	 	 	 	Suite 400	 	 	 	 	 	 	 	 	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	 	 	 	 	 	 	 
	

	Falcon First Cable of	 	Delaware	 	12444 Powerscourt Drive	 	 	 	 	 	Missouri	 	Falcon First, Inc. - 100%
	
	
	
	

	the Southeast, Inc.	 	 	 	 	 	Suite 400	 	 	 	 	 	 	 	 	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	 	 	 	 	 	 	 
	

	Falcon First Holdings,	 	Delaware	 	12444 Powerscourt Drive	 	 	 	 	 	Missouri	 	Falcon First Cable of the
	
	
	
	

	Inc.	 	 	 	 	 	Suite 400	 	 	 	 	 	 	 	 	 	Southeast, Inc. - 100%
	
	
	
	

	 	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	 	 	 	 	 	 	 

 

 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Chief Executive Office	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	and	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Jurisdiction of	 	Chief Place of	 	 	 	 	 	Business	 	Partners and
	Name	 	Organization	 	Business	 	Other Names	 	Jurisdictions	 	Percentage Ownership
	

	FF Cable Holdings, Inc.	 	Delaware	 	12444 Powerscourt Drive	 	 	 	 	 	Missouri	 	Falcon First Holdings,
	
	
	
	

	 	 	 	 	 	 	Suite 400	 	 	 	 	 	 	 	 	 	Inc. - 100%
	
	
	
	

	 	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	 	 	 	 	 	 	 
	

	Plattsburg Cablevision,	 	Delaware	 	12444 Powerscourt Drive	 	 	 	 	 	Missouri	 	Falcon First Cable of New
	
	
	
	

	Inc.	 	 	 	 	 	Suite 400	 	 	 	 	 	New York	 	York, Inc. - 100%
	
	
	
	

	 	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	 	 	 	 	 	 	 
	

	Falcon Video	 	California	 	12444 Powerscourt Drive	 	 	 	 	 	Idaho	 	Falcon Vide
	
	
	
	

	Communications, L.P.	 	 	 	 	 	Suite 400	 	 	 	 	 	Missouri	 	Communications Investors,
	
	
	
	

	 	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	North	 	 	L.P. - 0.5	%
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Carolina	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Oregon	 	Borrower 99.5%
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	South	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Carolina	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Texas	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Washington	 	 	 	 
	

	Falcon Video	 	California	 	12444 Powerscourt Drive	 	 	 	 	 	Missouri	 	Minority Interest HoldCo
	
	
	
	

	Communications	 	 	 	 	 	Suite 400	 	 	 	 	 	 	 	 	 	 	- 1.0	%
	
	
	
	

	Investors, L.P.	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	 	 	 	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Borrower - 99%
	

	Falcon Equipment	 	Delaware	 	12444 Powerscourt Drive	 	 	 	 	 	Missouri	 	Falcon Investors Group,
	
	
	
	

	Company, LLC	 	 	 	 	 	Suite 400	 	 	 	 	 	 	 	 	 	Ltd. - 1%
	
	
	
	

	 	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	 	 	 	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Borrower - 99%
	

	Pacific Microwave Joint	 	California	 	12444 Powerscourt Drive	 	 	 	 	 	Missouri	 	 	[                       ]	 
	
	
	
	

	Venture	 	 	 	 	 	Suite 400	 	 	 	 	 	 	 	 	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	 	 	 	 	 	 	 
	

	Falcon Cable	 	Delaware	 	12444 Powerscourt Drive	 	 	 	 	 	Missouri	 	Charter Communications
	
	
	
	

	Communications, LLC	 	 	 	 	 	Suite 400	 	 	 	 	 	 	 	 	 	VII, LLC - 100%
	
	
	
	

	 	 	 	 	 	 	St. Louis, MO 63131	 	 	 	 	 	 	 	 	 	 	 	 
	

 

 

Exhibit 7.6.10

FINANCING DEBT, CERTAIN INVESTMENTS, ETC.

A.     Financing Debt

         1.     Existing Financing Debt

	 	 	 	 	 
	a. 1996 Amended and Restated Credit Agreement
	 	$	328,500,000	 
	
	
	
	

	b. The Mutual Life Insurance Company of New York Note
Purchase and Exchange Agreement

 dated October 21, 1991
	 	$	15,000,000	 
	
	
	
	

	    11.56% Series B Subordinated Notes
	 	 	 	 
	
	
	
	

	c. Note payable for Directors and Officers Liability Insurance
	 	$	630,086	 

         2.     Post-Closing Financing Debt

	 	 	 	 	 
	a. Credit Agreement
	 	$	425,794,117.74	 
	
	
	
	

	b. Note payable for Directors and Officers Liability
Insurance
	 	$	630,086	 

B.     Liens and Guarantees

1.     Liens and guarantees pursuant to the Credit
Documents

C.     Investment Agreements

1.     Agreement of Limited Partnership of Falcon Lake Las Vegas Cablevision, L.P.,
dated September 7, 1993

 

 

Exhibit 12.1.1

ASSIGNMENT AND ACCEPTANCE

         This Agreement, dated as of      ,      , is between
     , a Lender under the Credit Agreement referred to below (the
“Assignor”), and      (the “Assignee”).

         For valuable consideration, the receipt of which is hereby acknowledged,
the Assignor agrees with the Assignee as follows:

                  1. Reference to Credit Agreement and Definitions. Reference is made to
the Credit Agreement dated as of June 30, 1998, as amended and restated as of
November 12, 1999, as further amended and restated as of September 26, 2001, as
further amended, restated, supplemented or otherwise modified from time to time
(the “Credit Agreement”), among Falcon Cable Communications, LLC (the
“Borrower”), the Guarantors party thereto, the Lenders party thereto, and
Toronto Dominion (Texas), Inc., as administrative agent for itself and the
other Lenders. Terms defined in the Credit Agreement and not otherwise defined
herein are used herein with the meanings so defined.

                  2. Assignment and Assumption. The Assignor hereby sells and assigns to
the Assignee, and the Assignee hereby purchases and assumes from the Assignor,
the interest set forth on Schedule A hereto in and to all the Assignor’s rights
and obligations under the Credit Agreement and the other Credit Documents
(other than Interest Rate Protection Agreements and Lender Letters of Credit)
as of the Assignment Date (as defined below), together with all unpaid interest
with respect to the portion of the Loan assigned hereby and commitment fees
relating thereto accrued to the Assignment Date.

                  3. Representations, Warranties, etc.

                  3.1 Assignor’s Representations and Warranties. The Assignor:

		
	 	     (a) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with the Credit Agreement or the
other Credit Documents or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Credit Agreement
or the other Credit Documents or any other instrument or document
furnished pursuant thereto, other than that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that
such interest is free and clear of any adverse claim;
	 
	 	     (b) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Borrower or
the Guarantors or the performance of any of their respective obligations
under the Credit Agreement, any of the Credit Documents or any other
instrument or document furnished pursuant hereto or thereto; and
	 
	 	     (c) represents and warrants that after giving effect to the
assignment hereunder on the Assignment Date, the Assignor has the
interests in the Credit Obligations and under the Credit Agreement as set
forth on Schedule B hereto.

                  3.2 Assignee’s Representations, Warranties and Agreements. The Assignee:

		
	 	     (a) represents and warrants that it is legally authorized to enter
into this Agreement;

 

 

  2

		
	 	     (b) confirms that it has received a copy of the Credit Agreement and
certain other Credit Documents it has requested, together with copies of
the most recent financial statements delivered pursuant to Section 7.4 of
the Credit Agreement and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter
into this Agreement;
	 
	 	     (c) agrees that it will, independently and without reliance upon the
Assignor or any other Person which has become a Lender, and based on such
documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action
under the Credit Agreement and the other Credit Documents;
	 
	 	     (d) agrees that it will be bound by the provisions of the Credit
Agreement and will perform in accordance with their terms all the
obligations which by the terms of the Credit Agreement and the other
Credit Documents are required to be performed by it as a Lender; and
	 
	 	     (e) represents and warrants that after giving effect to the
assignment hereunder on the Assignment Date, the Assignee has the
interests in the Credit Obligations and under the Credit Agreement as set
forth on Schedule C hereto.

		
	 	     3.3 US Withholding Tax. The Assignee represents and warrants that (a) it
is incorporated or organized under the laws of the United States of America or
a state thereof or (b) it will perform all of its obligations relating to
United States income tax withholding under Section 14 of the Credit Agreement.

                  4. Assignment Date. The effective date of this Agreement shall be
     ,      (the “Assignment Date”).

                  5. Assignee Party to Credit Agreement; Assignor Release of Obligations.
From and after the Assignment Date, (a) the Assignee shall be a party to the
Credit Agreement and, to the extent provided in this Agreement, have the rights
and obligations of a Lender thereunder and under the Credit Documents,
including without limitation, as set forth on Schedule A hereto, and (b) the
Assignor shall, to the extent provided in this Agreement, relinquish its rights
and be released from its obligations under the Credit Agreement and the other
Credit Documents.

                  6. Notices. All notices and other communications required to be given or
made to the Assignee under this Agreement, the Credit Agreement or any other
Credit Documents shall be given or made at the address of the Assignee set
forth on the signature page hereof or at such other address as the Assignee
shall have specified to the Assignor, the Administrative Agent and the
Restricted Companies in writing.

                  7. Further Assurances. The parties hereto agree to execute and deliver
such other instruments and documents and to take such other actions as any
party hereto may reasonably request in connection with the transactions
contemplated by this Agreement.

                  8. General. This Agreement, the Credit Agreement and the other Credit
Documents constitute the entire agreement of the parties hereto with respect to
the subject matter hereof and supersede all current and prior agreements and
understandings, whether written or oral. The headings in this Agreement are
for convenience of reference only and shall not limit or otherwise affect the
meaning hereof. The invalidity or unenforceability of any term or provision
hereof shall not affect the validity or enforceability of any other term or
provision hereof. This Agreement may be executed in any number of

 

 

 3

counterparts, which together shall constitute one instrument, and shall
bind and inure to the benefit of the parties hereto and their respective
successors and assigns, including as such successors and assigns all

                  9. holders of any Credit Obligation. This Agreement shall be governed by
and construed in accordance with the laws (other than the conflict of laws
rules) of the jurisdiction in which the principal office of the Assignor is
located.

 

 

  4

         Each of the Assignor and the Assignee has caused this Agreement to be
executed and delivered by its duly authorized officer under seal as of the date
first written above.

	 	 	 	 	 
	 	 	[ASSIGNOR]
	
	
	
	

	 	 	 	 	 
	
	
	
	

	 	 	
By
	 	

Title:
	
	
	
	

	 	 	[ASSIGNEE]
	
	
	
	

	 	 	 	 	 
	
	
	
	

	 	 	
By
	 	

Title:
	
	
	
	

	 	 	 	 	[Address]
	
	
	
	

	 	 	 	 	Telecopy:

The foregoing is hereby approved:

	 	 	 
	FALCOLE COMMUNICATIONS, LLC
	
	
	
	

	 	 	 	 	 
	
	
	
	

	
By	 

	 
	
	
	
	

	 	Title:	 
	
	
	
	

	 	 	 
	
	
	
	

	TORONTO DOMINION (TEXAS), INC., as Administrative Agent
	
	
	
	

	
By	 

	
	
	
	

	 	Title:	 

 

 

Schedule A

Portion Assigned Hereunder

         Assignee’s Percentage Interest and outstanding principal balance in the
Revolving Loan and Term Loan under the Credit Agreement on and after the
Assignment Date pursuant to the assignment being made hereunder on the
Assignment Date:

	 	 	 
	Revolving Loan
	
	
	
	

	 	 	 
	
	
	
	

	 	 	
Percentage Interest      %

Outstanding principal balance $     
	
	
	
	

	Term Loan B
	
	
	
	

	 	 	 
	
	
	
	

	 	 	
Percentage Interest      %

Outstanding principal balance $     
	
	
	
	

	Term Loan C
	
	
	
	

	 	 	 
	
	
	
	

	 	 	
Percentage Interest      %

Outstanding principal balance $     

 

 

Schedule B

Assignor’s Interest

         Assignor’s new Percentage Interest and outstanding principal balance in
the Revolving Loan and Term Loan under the Credit Agreement on and after the
Assignment Date after giving effect to the other assignments being made on the
Assignment Date:

	 	 	 
	Revolving Loan
	
	
	
	

	 	 	 
	
	
	
	

	 	 	
Percentage Interest      %

Outstanding principal balance $     
	
	
	
	

	Term Loan B
	
	
	
	

	 	 	 
	
	
	
	

	 	 	
Percentage Interest      %

Outstanding principal balance $     
	
	
	
	

	Term Loan C
	
	
	
	

	 	 	 
	
	
	
	

	 	 	
Percentage Interest      %

Outstanding principal balance $     

 

 

Schedule C

Assignee’s Interest

         Assignee’s new Percentage Interest and outstanding principal balance in
the Revolving Loan and Term Loan under the Credit Agreement on and after the
Assignment Date after giving effect to the other assignments being made on the
Assignment Date:

	 	 	 
	Revolving Loan
	
	
	
	

	 	 	 
	
	
	
	

	 	 	
Percentage Interest      %

Outstanding principal balance $     
	
	
	
	

	Term Loan B
	
	
	
	

	 	 	 
	
	
	
	

	 	 	
Percentage Interest      %

Outstanding principal balance $     
	
	
	
	

	Term Loan C
	
	
	
	

	 	 	 
	
	
	
	

	 	 	
Percentage Interest      %

Outstanding principal balance $EX-10.9: AMENDED AND RESTATED L.L.C. AGREEMENT

 

Exhibit 10.9

Conformed Copy

AMENDED AND RESTATED

LIMITED LIABILITY COMPANY AGREEMENT

FOR

CHARTER COMMUNICATIONS HOLDING COMPANY, LLC

A DELAWARE LIMITED LIABILITY COMPANY

THE MEMBERSHIP INTERESTS REPRESENTED BY THIS AGREEMENT HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, OR REGISTERED OR QUALIFIED UNDER ANY STATE
SECURITIES LAWS. SUCH MEMBERSHIP INTERESTS MAY NOT BE OFFERED FOR SALE, SOLD,
DELIVERED AFTER SALE, TRANSFERRED, PLEDGED, OR HYPOTHECATED UNLESS THEY ARE
QUALIFIED AND REGISTERED UNDER APPLICABLE STATE AND FEDERAL SECURITIES LAWS OR
UNLESS, IN THE OPINION OF COUNSEL SATISFACTORY TO THE COMPANY, SUCH
QUALIFICATION AND REGISTRATION IS NOT REQUIRED. ANY TRANSFER OF THE MEMBERSHIP
INTERESTS REPRESENTED BY THIS AGREEMENT IS FURTHER SUBJECT TO OTHER
RESTRICTIONS, TERMS, AND CONDITIONS WHICH ARE SET FORTH HEREIN.

 

 

AMENDED AND RESTATED

LIMITED LIABILITY COMPANY AGREEMENT

FOR

CHARTER COMMUNICATIONS HOLDING COMPANY, LLC

A DELAWARE LIMITED LIABILITY COMPANY

         This Amended and Restated Limited Liability Company Agreement for Charter
Communications Holding Company, LLC, a Delaware limited liability company
(“Company”), is made and entered into effective as of August 31, 2001
(“Effective Date”), by and among the individuals and entities listed on
Schedule A attached hereto, with reference to the following facts:

         A.     A Certificate of Formation of the Company was filed with the Delaware
Secretary of State on May 25, 1999. The Company was formed and has been
heretofore operated pursuant to the Limited Liability Company Agreement entered
into and made effective as of May 25, 1999 by Charter Investment, Inc.
(formerly known as Charter Communications, Inc.), a Delaware corporation
(“CII”), as amended and restated by (i) that certain Amended and Restated
Limited Liability Company Agreement entered into and made effective as of
August 10, 1999, by and between CII and Vulcan Cable III Inc., a Delaware
corporation (“Vulcan Cable”), (ii) that certain Amended and Restated Limited
Liability Company Agreement entered into and made effective as of September 14,
1999, by and among CII, Vulcan Cable, and certain other investors, (iii) that
certain Amended and Restated Limited Liability Company Agreement entered into
and made effective as of November 8, 1999, by and among CII, Vulcan Cable,
Charter Communications, Inc., a Delaware corporation (“PublicCo”), and certain
other investors, (iv) that certain Amended and Restated Limited Liability
Company Agreement entered into and made effective as of November 12, 1999, by
and among CII, Vulcan Cable, PublicCo, Falcon Holding Group, L.P., a Delaware
limited partnership (“FHGLP”), and certain other investors, (v) that certain
Amended and Restated Limited Liability Company Agreement entered into and made
effective as of February 14, 2000, by and among CII, Vulcan Cable, PublicCo,
and certain other investors, as amended by the First Amendment, Second
Amendment, and Third Amendment thereto made effective as of September 13, 2000,
October 24, 2000, and February 12, 2001, respectively, and (vi) that certain
Amended and Restated Limited Liability Company Agreement entered into and made
effective as of January 1, 2001, by and among CII, Vulcan Cable, PublicCo, and
certain other investors (the “Existing LLC Agreement”).

         B.     On May 25, 1999, CII contributed its entire one hundred percent (100%)
limited liability company interest in Charter Communications Holdings, LLC, a
Delaware limited liability company, to the Company and became the sole Member
of the Company. In August and September 1999, Vulcan Cable contributed to the
Company cash and assets valued in the aggregate, at the time of the
contributions, at One Billion Three Hundred Twenty-Five Million Dollars
($1,325,000,000) and became a Member of the Company.

         C.     On September 14, 1999, pursuant to (i) that certain Purchase and Sale
Agreement dated as of April 26, 1999 by and among the sellers listed on the
signature pages thereto, Rifkin Acquisition Partners, L.L.L.P., and CII, (ii)
that certain Purchase and Sale

 

 

 Agreement dated as of April 26, 1999 by and among the sellers listed on
the signature pages thereto, InterLink Communications Partners, LLLP, and CII
(the agreements described in clauses (i) and (ii) are collectively referred to
herein as the “Rifkin Purchase Agreement,” and all signatories to the Rifkin
Purchase Agreement other than CII, Rifkin Acquisition Partners, L.L.L.P., and
InterLink Communications Partners, LLLP are collectively referred to herein as
the “Rifkin Sellers”), and (iii) that certain Contribution Agreement dated as
of September 14, 1999, by and among Charter Communications Operating, LLC, the
Company, and the persons listed on the signature pages thereto (the “Rifkin
Contribution Agreement”), some of the Rifkin Sellers contributed certain assets
to the Company and became Members of the Company. On November 12, 1999, some
of these Rifkin Sellers contributed their Membership Interests to PublicCo.

         D.     On November 12, 1999, PublicCo effected an initial public offering of
its stock (the “IPO”) and contributed or agreed to contribute to the Company
(i) certain assets acquired utilizing certain proceeds of the IPO and (ii) the
remaining net proceeds of the IPO, and became a Member of the Company. In
connection with the IPO, Vulcan Cable contributed an additional Seven Hundred
Fifty Million Dollars ($750,000,000) in cash to the Company.

         E.     On November 12, 1999, pursuant to that certain Purchase and
Contribution Agreement dated as of May 26, 1999, by and among CII, Falcon
Communications, L.P., FHGLP, TCI Falcon Holdings, LLC, Falcon Cable Trust,
Falcon Holding Group, Inc., and DHN Inc., as amended (the “Falcon Purchase
Agreement”), FHGLP contributed certain assets to the Company and became a
Member of the Company. On the same day, FHGLP distributed all of its
Membership Interests in the Company to its partners, and (i) the FHGLP partners
(other than Belo Ventures, Inc.) contributed all of their Membership Interests
in the Company to PublicCo, and (ii) Belo Ventures, Inc., an FHGLP partner,
sold its entire Membership Interest in the Company to Vulcan Cable.

         F.     On February 14, 2000, pursuant to that certain Purchase and
Contribution Agreement dated as of June 29, 1999, by and among BCI (USA), LLC,
William J. Bresnan, Blackstone BC Capital Partners, L.P., Blackstone BC
Offshore Capital Partners, L.P., Blackstone Family Media Partnership III L.P.,
TCI Bresnan LLC, TCID of Michigan, Inc., and the Company, as amended (the
“Bresnan Purchase Agreement”) (all such signatories to the Bresnan Purchase
Agreement other than the Company are collectively referred to herein as the
“Bresnan Sellers”), some of the Bresnan Sellers contributed certain assets to
the Company and became Members of the Company.

         G.     Since February 14, 2000, the Company has issued additional Class B
Common Units to PublicCo in exchange for certain asset contributions and in
connection with certain employee equity option exercises.

         H.     On August 31, 2001, in connection with the closing of certain
transactions contemplated by that certain Agreement and Plan of Merger and
Asset Purchase Agreement dated as of March 14, 2001, by and among PublicCo,
Cable USA, Inc., Antilles Wireless, L.L.C., F&S Fiber Systems, L.L.C., American
Media Group, L.L.C., Internet USA, L.L.C., Thomsic, L.L.C., USA Paging, L.L.C.,
and certain other persons listed on the signature

 

 

 pages thereto, as amended (the “Cable USA Purchase Agreement”), the
Company has issued Class B Preferred Units to PublicCo in exchange for certain
asset contributions.

         I.     Section 10.11 of the Existing LLC Agreement provides that an amendment
to the Existing LLC Agreement to incorporate the changes made by this Agreement
shall be effective as an amendment only upon the approval of Members holding
more than fifty percent (50%) of the Class B Common Units. Immediately prior
to the Effective Date, PublicCo owned all outstanding Class B Common Units and
desires to approve the amendment to the Existing LLC Agreement made by this
Agreement.

         NOW, THEREFORE, the Existing LLC Agreement is hereby being amended and
restated in its entirety as follows:

ARTICLE I

DEFINITIONS

         When used in this Agreement, unless the context otherwise requires, the
following terms shall have the meanings set forth below (all terms used in this
Agreement that are not defined in this Article I shall have the meanings set
forth elsewhere in this Agreement):

         1.1 “Act” means the Delaware Limited Liability Company Act, 6 Del. C. §
18-01 et seq., as the same may be amended from time to time.

         1.2 “Adjusted Capital Account Deficit” means, with respect to any Member,
the deficit balance, if any, in such Member’s Capital Account as of the end of
the relevant Allocation Period, after giving effect to the following
adjustments:

         1.2.1 Credit to such Capital Account any amounts that such Member is
obligated to restore pursuant to any provision of this Agreement or is deemed
to be obligated to restore pursuant to the penultimate sentences of Regulations
Sections 1.704-2(g)(1) and 1.704-2(i)(5);

         1.2.2 Credit to such Capital Account the amount of the deductions and
losses referable to any outstanding recourse liabilities of the Company owed to
or guaranteed by such Member (or a related person within the meaning of
Regulations Section 1.752-4(b)) to the extent that no other Member bears any
economic risk of loss and the amount of the deductions and losses referable to
such Member’s share (determined in accordance with the Member’s Percentage
Interest) of outstanding recourse liabilities owed by the Company to
non-Members to the extent that no Member bears any economic risk of loss; and

         1.2.3 Debit to such Capital Account the items described in Regulations
Sections 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5), and
1.704-1(b)(2)(ii)(d)(6).

         The foregoing definition of Adjusted Capital Account Deficit is intended
to comply with the provisions of Regulations Section 1.704-1(b)(2)(ii)(d) and
shall be interpreted consistently therewith.

 

 

         1.3 “Affiliate” of any Person shall mean any other Person that, directly
or indirectly, controls, is under common control with or is controlled by that
Person. For purposes of this definition, “control” (including, with its
correlative meanings, the terms “controlled by” and “under common control
with”), as used with respect to any Person, shall mean the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of such Person, whether through the ownership of voting securities
or by contract or otherwise.

         1.4 “Agreement” means this Amended and Restated Limited Liability Company
Agreement, as originally executed and as amended and/or restated from time to
time.

         1.5 “Allocated Tax Deductions” has the meaning set forth in Section
6.5.2(c).

         1.6 “Allocation Period” means the Company’s fiscal year, which shall be
the calendar year, or any portion of such period for which the Company is
required to allocate Net Profits, Net Losses, or other items of Company income,
gain, loss, or deduction pursuant hereto.

         1.7 “Approval of the Class A Common Members” means the affirmative vote,
approval or consent of Members holding more than fifty percent (50%) of the
Class A Common Units.

         1.8 “Approval of the Members” means the affirmative vote, approval or
consent of Members holding more than fifty percent (50%) of the Class B Common
Units, provided that if at any time a court of competent jurisdiction shall
hold that the Class B Common Stock of PublicCo is not entitled to vote, or
shall enjoin the holders of the Class B Common Stock of PublicCo from
exercising voting rights, (a) to elect solely all but one of the directors of
PublicCo (except for any director(s) elected separately by the holders of one
or more series of preferred stock of PublicCo), (b) on any other matter subject
to a PublicCo shareholder vote, on the basis of (x) ten (10) votes for each
share of Class B Common Stock of PublicCo held by the holders of Class B Common
Stock, and for each share of Class B Common Stock for which any Units held
directly or indirectly by such Persons are exchangeable, divided by (y) the
number of shares of Class B Common Stock owned by such Persons, or (c) as a
separate class, as to certain specified matters in the PublicCo’s certificate
of incorporation, as amended from time to time, that adversely affect the Class
B Common Stock relating to issuance of Class B Common Stock and other equity
securities other than Class A Common Stock or affecting the voting power of the
Class B Common Stock, “Approval of the Members” means the affirmative vote,
approval or consent of Members holding more than fifty percent (50%) of the
Common Units. The conversion of all outstanding shares of Class B Common Stock
into shares of Class A Common Stock in accordance with Clause (b)(viii) of
Article Fourth of PublicCo’s certificate of incorporation as constituted as of
the Class B Common Measuring Date shall not constitute an event described in
the proviso of the preceding sentence.

         1.9 “Attribution Rules” has the meaning set forth in Section 4.7.1 of this
Agreement.

         1.10 “Baseline Tax Deductions” has the meaning set forth in Section
6.5.2(c).

         1.11 “Basis” means the adjusted basis of an asset for federal income tax
purposes.

 

 

         1.12 “Board” has the meaning set forth in Section 5.2.1 of this Agreement.

         1.13 “Bresnan Contributed Interest” has the meaning ascribed to the term
“Contributed Interest” in Section 2.1(b) of the Bresnan Purchase Agreement.

         1.14 “Bresnan Exchange Agreement” means the Exchange Agreement entered
into as of the Class C Common Measuring Date by and among PublicCo and Bresnan
Holders.

         1.15 “Bresnan Holder” means each of the Bresnan Sellers who receives Class
C Common Units on the Class C Common Measuring Date pursuant to the Bresnan
Purchase Agreement.

         1.16 “Bresnan Permitted Transferee” means (i) with respect to BCI (USA),
LLC and William J. Bresnan, (x) any affiliate of William J. Bresnan that is,
directly or indirectly, at least eighty percent (80%) owned or controlled by
William J. Bresnan, or (y) William J. Bresnan, William J. Bresnan’s spouse, or
William J. Bresnan’s descendants (including spouses of his descendants), any
trust established solely for the benefit of any of the foregoing individuals,
any private foundation of which only the foregoing individuals, Myles W.
Schumer, Jeffrey DeMond, and/or Priscilla O’Clock serve as trustees, or any
partnership or other entity at least eighty percent (80%) owned or controlled
directly or indirectly by any of the foregoing Persons, and (ii) with respect
to Blackstone BC Capital Partners L.P., Blackstone BC Offshore Capital
Partners, L.P., and Blackstone Family Media Partnership III L.P. (collectively,
the “Initial Blackstone Members”), as long as the proposed Transfer does not
result in more than five (5) Persons owning the Class C Common Units issued to
the Initial Blackstone Members under the Bresnan Purchase Agreement, Blackstone
Capital Partners III Merchant Banking Fund L.P., Blackstone Offshore Capital
Partners III Merchant Banking Fund L.P. and Blackstone Family Investment
Partnership III, L.P. (collectively, the “Blackstone Funds”) or any other
limited partnership the general partner of which is at least eighty percent
(80%) owned or controlled by the Persons that own or control the general
partner of each of the Blackstone Funds; provided, however, that “Bresnan
Permitted Transferee” shall not include the partners in such partnerships.

         1.17 “Bresnan Purchase Agreement” has the meaning set forth in the
recitals to this Agreement.

         1.18 “Bresnan Put Agreement” means the Put Agreement entered into as of
the Class C Common Measuring Date by and among Bresnan Holders and Paul G.
Allen.

         1.19 “Bresnan Sellers” has the meaning set forth in the recitals to this
Agreement.

         1.20 “Cable Sports” has the meaning set forth in Section 2.5.

         1.21 “Cable Transmission Business” has the meaning set forth in Section
2.5 of this Agreement.

         1.22 “Cable USA Purchase Agreement” has the meaning set forth in the
recitals to this Agreement.

 

 

         1.23 “Capital Account” means with respect to any Member the capital
account that the Company establishes and maintains for such Member pursuant to
Section 3.3 herein.

         1.24 “Capital Contribution” means, with respect to any Member, the amount
of money and the initial Gross Asset Value of any property (other than money)
contributed to the Company with respect to the interest in the Company held by
such Person. The principal amount of a promissory note which is not readily
traded on an established securities market and which is contributed to the
Company by the maker of the note (or a Person related to the maker of the note
within the meaning of Regulations Section 1.704-1(b)(2)(ii)(c)) shall not be
included in the Capital Account of any Person until the Company makes a taxable
disposition of the note or until (and to the extent) principal payments are
made on the note, all in accordance with Regulations Section
1.704-1(b)(2)(iv)(d)(2).

         1.25 “Certificate” means the Certificate of Formation of the Company
originally filed with the Delaware Secretary of State, as amended and/or
restated from time to time.

         1.26 “CII” has the meaning set forth in the recitals to this Agreement.

         1.27 “CII Exchange Agreement” means the Exchange Agreement dated as of the
Class B Common Measuring Date by and among PublicCo, CII, Vulcan Cable, and
Paul G. Allen, including, to the extent provided thereunder, the Tax Agreement
attached as Exhibit A thereto.

         1.28 “Class A Common Member” means any Member holding and to the extent it
holds Class A Common Units.

         1.29 “Class A Common Stock” means any common stock of PublicCo denominated
“Class A Common.”

         1.30 “Class A Common Units” means any Unit denominated “Class A Common

         1.31 “Class A Preferred Contributed Amount” means, with respect to each
Class A Preferred Member, the sum of the net values of all of the Class A
Preferred Contributed Properties contributed by such Class A Preferred Member
on the Class A Preferred Measuring Date, as set forth on Schedule A attached
hereto.

         1.32 “Class A Preferred Contributed Property” means each property (other
than cash) contributed to the Company by Class A Preferred Members, in exchange
for Class A Preferred Units.

         1.33 “Class A Preferred Measuring Date” means September 14, 1999.

         1.34 “Class A Preferred Member” means any Member holding and to the extent
it holds Class A Preferred Units.

         1.35 “Class A Preferred Return Amount” means with respect to any Class A
Preferred Unit the amount determined by applying an eight percent (8%) per
annum simple rate to the Class A Preferred Contributed Amount represented by
such Class A Preferred Unit set forth on Schedule A attached hereto for the
period beginning on the Class A

 

 

 Preferred Measuring Date and ending on the date (i) on which any such Unit
is redeemed by the Company, (ii) on which any such Unit is Transferred to
PublicCo or another Person pursuant to the Rifkin Put Agreement or this
Agreement, or (iii) on which liquidating distributions are made with respect to
such Unit pursuant to Article IX; provided, however, that the Class A Preferred
Return Amount shall not accrue for any days for which an interest payment
accrues under the Rifkin Put Agreement.

         1.36 “Class A Preferred Units” means any Unit denominated “Class A
Preferred.”

         1.37 “Class B Common Change Date” means January 1, 2004.

         1.38 “Class B Common Conversion Units” has the meaning set forth in
Section 3.6.6(c).

         1.39 “Class B Common Measuring Date” means November 12, 1999.

         1.40 “Class B Common Member” means any Member holding and to the extent it
holds Class B Common Units.

         1.41 “Class B Common Stock” means any common stock of PublicCo denominated
“Class B Common.”

         1.42 “Class B Common Units” means any Unit denominated “Class B Common.”

         1.43 “Class B Preferred Member” means any Member holding and to the extent
it holds Class B Preferred Units.

         1.44 “Class B Preferred Units” means any Unit denominated “Class B
Preferred.”

         1.45 “Class C Common Change Date” means January 1, 2005.

         1.46 “Class C Common Contributed Property” means each property (other than
cash) contributed by the Class C Common Members, in exchange for Class C Common
Units.

         1.47 “Class C Common Measuring Date” means February 14, 2000.

         1.48 “Class C Common Member” means any Member holding and to the extent it
holds Class C Common Units.

         1.49 “Class C Common Units” means any Unit denominated “Class C Common.”

         1.50 “Class D Common Units” means any Unit denominated “Class D Common,”
which was initially issued to FHGLP on the Class B Common Measuring Date and
was subsequently converted into a Class A Common Unit or a Class B Common Unit.

         1.51 “Code” means the Internal Revenue Code of 1986, as amended from time
to time, the provisions of succeeding law, and to the extent applicable, the
Regulations.

 

 

         1.52 “Combined Book Profits” and “Combined Book Losses” mean, for any
Allocation Period, an amount equal to the Company’s Net Profits or Net Losses
for such Allocation Period, with the following adjustment: all items of
Company deduction for Depreciation that are specially allocated pursuant to
Section 6.3.7 hereof shall be taken into account in computing Combined Book
Profits or Combined Book Losses.

         1.53 “Common Members” means Members holding and to the extent they hold
Common Units.

         1.54 “Common Units” means any Unit denominated “Common,” including Class A
Common Units, Class B Common Units, Class C Common Units, and any Units so
designated that may be hereafter issued by the Company.

         1.55 “Company” has the meaning set forth in the preamble to this
Agreement.

         1.56 “Company Minimum Gain” has the meaning ascribed to the term
“Partnership Minimum Gain” in Regulations Section 1.704-2(d).

         1.57 “Depreciation” means, for each Allocation Period, an amount equal to
the federal income tax depreciation, amortization, or other cost recovery
deduction allowable with respect to an asset for such Allocation Period, except
that if the Gross Asset Value of an asset differs from its Basis at the
beginning of such Allocation Period, Depreciation shall be an amount which
bears the same ratio to such beginning Gross Asset Value as the federal income
tax depreciation, amortization, or other cost recovery deduction for such
Allocation Period bears to such beginning Basis; provided, however, that if the
Basis of an asset at the beginning of such Allocation Period is zero,
Depreciation shall be determined with reference to such beginning Gross Asset
Value using any reasonable method selected by the Manager.

         1.58 “Depreciation Allocations” has the meaning set forth in Section 6.5.1
of this Agreement.

         1.59 “Effective Date” has the meaning set forth in the preamble to this
Agreement.

         1.60 “Existing LLC Agreement” has the meaning set forth in the recitals to
this Agreement.

         1.61 “Falcon Contributed Interest” has the meaning ascribed to the term
“Contributed Interest” in Section 2.1(b) of the Falcon Purchase Agreement.

         1.62 “Falcon Purchase Agreement” has the meaning set forth in the recitals
to this Agreement.

         1.63 “FHGLP” has the meaning set forth in the recitals to this Agreement.

         1.64 “Gross Asset Value” means, with respect to any asset, the asset’s
Basis, except as follows:

                  1.64.1 Except as otherwise provided in the Rifkin Contribution Agreement,
the Falcon Purchase Agreement, or Section 5.7(f) of the Bresnan Purchase
Agreement, the

 

 

initial Gross Asset Value of any asset contributed by a Member (or a
former member) to the Company shall be the gross fair market value of such
asset, as determined by the contributing Person and the Manager;

                  1.64.2 The Gross Asset Values of all Company assets shall be adjusted to
equal their respective gross fair market values, as determined by the Manager,
as of the following times: (a) the acquisition of an additional interest in
the Company by any new or existing Member in exchange for more than a de
minimis Capital Contribution; (b) the distribution by the Company to a Member
of more than a de minimis amount of Property as consideration for an interest
in the Company; and (c) the liquidation of the Company within the meaning of
Regulations Section 1.704-1(b)(2)(ii)(g); provided, however, that adjustments
pursuant to clauses (a) and (b) above shall be made only if the Manager
reasonably determines that such adjustments are necessary or appropriate to
reflect the relative economic interests of the Members in the Company;

                  1.64.3 The Gross Asset Value of any Company asset distributed to any
Member shall be adjusted to equal the gross fair market value of such asset on
the date of distribution as determined by the distributee and the Manager; and

                  1.64.4 The Gross Asset Values of Company assets shall be increased (or
decreased) to reflect any adjustments to the Basis of such assets pursuant to
Code Section 734(b) or Code Section 743(b), but only to the extent that such
adjustments are taken into account in determining Capital Accounts pursuant to
Regulation Section 1.704-1(b)(2)(iv)(m) and Section 1.76.6 hereof; provided,
however, that Gross Asset Values shall not be adjusted pursuant to this Section
1.64.4 to the extent the Manager determines that an adjustment pursuant to
Section 1.64.2 hereof is necessary or appropriate in connection with a
transaction that would otherwise result in an adjustment pursuant to this
Section 1.64.4.

                  If the Gross Asset Value of an asset has been determined or adjusted
pursuant to Section 1.64.1, Section 1.64.2, or Section 1.64.4 hereof, such
Gross Asset Value shall thereafter be adjusted by the Depreciation taken into
account with respect to such asset for purposes of computing Net Profits and
Net Losses

         1.65 “HSA” has the meaning set forth in Section 2.5 of this Agreement.

         1.66 “Incidental Business” has the meaning set forth in Section 2.5 of
this Agreement.

         1.67 “IPO” has the meaning set forth in the recitals to this Agreement.

         1.68 “Manager” has the meaning set forth in Section 5.1.1 of this
Agreement.

         1.69 “Member” means each Person who is listed on Schedule A attached
hereto as a Member and any additional or substitute Member admitted to the
Company as a member of the Company in accordance with the terms of this
Agreement (so long as such Person holds a Membership Interest in the Company).

         1.70 “Member Nonrecourse Debt” has the meaning ascribed to the term
“Partner Nonrecourse Debt” in Regulations Section 1.704-2(b)(4).

 

 

         1.71 “Member Nonrecourse Debt Minimum Gain” means an amount, with respect
to each Member Nonrecourse Debt, equal to the Company Minimum Gain that would
result if such Member Nonrecourse Debt were treated as a Nonrecourse Liability,
determined in accordance with Regulations Section 1.704-2(i)(3).

         1.72 “Member Nonrecourse Deductions” means items of Company loss,
deduction, or Code Section 705(a)(2)(B) expenditures that are attributable to
Member Nonrecourse Debt or to other liabilities of the Company owed to or
guaranteed by a Member (or a related person within the meaning of Regulations
Section 1.752-4(b)) to the extent that no other Member bears the economic risk
of loss.

         1.73 “Membership Interest” means a Member’s entire limited liability
company interest in the Company including the Member’s right to share in
income, gains, losses, deductions, credits, or similar items of, and to receive
distributions from, the Company pursuant to this Agreement and the Act.

         1.74 “Net Cash From Operations” means the gross cash proceeds from Company
operations (including sales and dispositions of Property in the ordinary course
of business) less the portion thereof used to pay or establish reasonable
reserves for all Company expenses, debt payments, capital improvements,
replacements, and contingencies, all as determined by the Manager. “Net Cash
From Operations” shall not be reduced by depreciation, amortization, cost
recovery deductions, or similar allowances, but shall be increased by any
reductions of reserves previously established pursuant to the first sentence of
this Section 1.74 and Section 1.75 hereof.

         1.75 “Net Cash From Sales or Refinancings” means the net cash proceeds
from all sales and other dispositions (other than in the ordinary course of
business) and all refinancings of Property, less any portion thereof used to
establish reasonable reserves, all as determined by the Manager. “Net Cash
From Sales or Refinancings” shall include all principal and interest payments
with respect to any note or other obligation received by the Company in
connection with sales and other dispositions (other than in the ordinary course
of business) of Property.

         1.76 “Net Profits” and “Net Losses” mean, for each Allocation Period, an
amount equal to the Company’s taxable income or loss for such Allocation
Period, determined in accordance with Code Section 703(a) (for this purpose,
all items of income, gain, loss, or deduction required to be stated separately
pursuant to Code Section 703(a)(1) shall be included in taxable income or
loss), with the following adjustments:

                  1.76.1 Any income of the Company that is exempt from federal income tax
and not otherwise taken into account in computing Net Profits or Net Losses
pursuant to this definition shall be added to such taxable income or loss;

                  1.76.2 Any expenditures of the Company described in Code Section
705(a)(2)(B) or treated as Code Section 705(a)(2)(B) expenditures pursuant to
Regulations Section 1.704-1(b)(2)(iv)(i), and not otherwise taken into account
in computing Net Profits or Net Losses pursuant to this definition shall be
subtracted from such taxable income or loss;

 

 

                  1.76.3 In the event the Gross Asset Value of any Company asset is adjusted
as a result of the application of Regulations Section 1.704-1(b)(2)(iv)(e) or
Regulations Section 1.704-1(b)(2)(iv)(f), the amount of such adjustment shall
be taken into account as gain or loss from the disposition of such asset for
purposes of computing Net Profits or Net Losses;

                  1.76.4 Gain or loss resulting from any disposition of Property with
respect to which gain or loss is recognized for federal income tax purposes
shall be computed by reference to the Gross Asset Value of the property
disposed of, notwithstanding that the Basis of such Property differs from its
Gross Asset Value;

                  1.76.5 In lieu of the depreciation, amortization, and other cost recovery
deductions taken into account in computing such taxable income or loss, there
shall be taken into account Depreciation in accordance with Section 1.57
hereof;

                  1.76.6 To the extent an adjustment to the Basis of any Company asset
pursuant to Code Section 734(b) or Code Section 743(b) is required pursuant to
Regulations Section 1.704-1(b)(2)(iv)(m)(4) to be taken into account in
determining Capital Accounts, the amount of such adjustment shall be treated as
an item of gain (if the adjustment increases the Basis of the asset) or loss
(if the adjustment decreases the Basis of the asset) from the disposition of
the asset and shall be taken into account for purposes of computing Net Profits
or Net Losses; and

                  1.76.7 Notwithstanding any other provision of this definition, any items
that are specially allocated pursuant to Section 6.3 or 6.5 hereof shall not be
taken into account in computing Net Profits or Net Losses (the amounts of the
items of Company income, gain, loss, or deduction available to be specially
allocated pursuant to any provision of this Agreement shall be determined by
applying rules analogous to those set forth in Sections 1.76.1 through 1.76.6
above).

                  The foregoing definition of Net Profits and Net Losses is intended to
comply with the provisions of Regulations Section 1.704-1(b) and shall be
interpreted consistently therewith. In the event the Manager determines that
it is prudent to modify the manner in which Net Profits and Net Losses are
computed in order to comply with such Regulations, the Manager may make such
modification.

         1.77 “Non-Attributable Status” has the meaning set forth in Section 4.7.1
of this Agreement.

         1.78 “Non-Operating Profits” and “Non-Operating Losses” mean, for any
Allocation Period, the following: (i) all items of gain or loss resulting from
any disposition of Property other than in the ordinary course of business (for
this purpose, an abandonment of Property shall be treated as occurring in the
ordinary course of business); and (ii) all items of gain or loss arising upon
the adjustment of the Gross Asset Value of any Company asset as a result of the
application of Regulations Section 1.704-1(b)(2)(iv)(e) or Regulations Section
1.704-1(b)(2)(iv)(f), to the extent that if such Company asset had been
disposed of on the date of such adjustment for its then fair market value
(i.e., its Gross Asset Value immediately following such adjustment), items of
gain or loss (determined without taking

 

 

 into account the effect of such adjustment on the asset’s book basis for
purposes of Code Section 704(b)) would have been included in the preceding
clause (i). If, for any Allocation Period, the aggregate amount of such gains
exceeds the aggregate amount of such losses, then such items shall be taken
into account as Non-Operating Profits. If, for any Allocation Period, the
aggregate amount of such losses exceeds the aggregate amount of such gains,
then such items shall be taken into account as Non-Operating Losses.
Notwithstanding the foregoing, any items that are specially allocated pursuant
to Sections 6.3.1 through 6.3.8, inclusive, Section 6.3.10, or Section 6.5
hereof shall not be taken into account for purposes of determining
Non-Operating Profits or Non-Operating Losses.

         1.79 “Nonrecourse Deductions” has the meaning set forth in Regulations
Section 1.704-2(b)(1).

         1.80 “Nonrecourse Liability” has the meaning set forth in Regulations
Section 1.704-2(b)(3).

         1.81 “Non-Recognition Transaction” means an exchange to which Code Section
351 applies or a transaction which qualifies as a “reorganization” under Code
Section 368(a), as described in Sections 2.1(a) and 2.1(b) of the CII Exchange
Agreement.

         1.82 “Ownership Rules” has the meaning set forth in Section 4.7.2 of this
Agreement.

         1.83 “Percentage Interest” means, with respect to each Common Member as of
any date, the percentage equal to the number of Common Units then held by such
Common Member divided by the total number of Common Units then held by all
Common Members.

         1.84 “Person” means any individual, general partnership, limited
partnership, limited liability company, limited liability partnership,
corporation, trust, estate, real estate investment trust, association, or other
entity.

         1.85 “Property” means all real and personal property acquired by the
Company and any improvements thereto, and shall include both tangible and
intangible property.

         1.86 “PublicCo” has the meaning set forth in the recitals to this
Agreement.

         1.87 “Regulations” means the regulations currently in force from time to
time as final or temporary that have been issued by the U.S. Department of the
Treasury pursuant to its authority under the Code. If a word or phrase is
defined in this Agreement by cross-referencing the Regulations, then to the
extent the context of this Agreement and the Regulations require, the term
“Member” shall be substituted in the Regulations for the term “partner”, the
term “Company” shall be substituted in the Regulations for the term
“partnership”, and other similar conforming changes shall be deemed to have
been made for purposes of applying the Regulations.

         1.88 “Regulatory Allocations” has the meaning set forth in Section 6.5.1.

         1.89 “Remedial Method” means the “remedial allocation method” described in
Regulations Section 1.704-3(d).

 

 

         1.90 “Rifkin Contributed Interest” has the meaning ascribed to the term
“Contributed Interest” in the recitals to the Rifkin Contribution Agreement.

         1.91 “Rifkin Contribution Agreement” has the meaning set forth in the
recitals to this Agreement.

         1.92 “Rifkin Holder” means each Rifkin Seller who elected to receive Class
A Preferred Units pursuant to the Rifkin Contribution Agreement.

         1.93 “Rifkin Purchase Agreement” has the meaning set forth in the recitals
to this Agreement.

         1.94 “Rifkin Put Agreement” means the Redemption and Put Agreement dated
as of September 14, 1999 by and among the Company, Paul G. Allen, and each
Rifkin Holder.

         1.95 “Securities Act” means the Securities Act of 1933, as amended, and
the rules and regulations of the U.S. Securities and Exchange Commission or any
successor agency thereto promulgated thereunder, as in effect from time to
time.

         1.96 “Special Allocation Amount” means an amount equal to (i) the
aggregate amount of the items previously allocated to the Class A Common
Members pursuant to Sections 6.3.7(a)(y) and 6.3.7(c)(y), plus (ii) the
aggregate amount of Net Losses previously allocated to the Class A Common
Members pursuant to Section 6.2.1(b), minus (iii) the aggregate amount of Net
Profits previously allocated to the Class A Common Members pursuant to Sections
6.1.1(b) and 6.1.3(b), minus (iv) the aggregate amount of Non-Operating Profits
previously allocated to the Class A Common Members pursuant to Section
6.3.9(a)(y) (i.e., the excess of the aggregate amount of the gains included in
such Non-Operating Profits over the aggregate amount of the losses included
therein).

         1.97 “Special Allocation Amount Ratio” means, for any Allocation Period,
an amount equal to (i) the Special Allocation Amount as of the beginning of
such Allocation Period, divided by (ii) Combined Book Profits for such
Allocation Period times the Class B Common Members’ aggregate Percentage
Interests; provided, however, that if the Special Allocation Amount Ratio is
greater than one (1), then it shall be deemed to be one (1) for purposes of
this Agreement.

         1.98 “Special Loss Allocations” has the meaning set forth in Section
6.4.1.

         1.99 “Special Profit Allocations” has the meaning set forth in Section
6.4.1.

         1.100 “Subsidiary” means, with respect to any Person, any corporation,
limited liability company, partnership, association, joint venture or other
business entity of which (i) if a corporation, (x) ten percent (10%) or more of
the total voting power of shares of stock entitled to vote in the election of
directors thereof or (y) ten percent (10%) or more of the value of the equity
interests is at the time owned or controlled, directly or indirectly, by the
Person or one or more of its Subsidiaries, or (ii) if a limited liability
company, partnership, association or other business entity, ten percent (10%)
or more of the partnership or other similar ownership interests thereof is at
the time owned or controlled, directly or indirectly, by the Person or one or
more of its subsidiaries. The Person shall be deemed to have a ten

 

 

 percent (10%) or greater ownership interest in a limited liability
company, partnership, association or other business entity if the Person is
allocated ten percent (10%) or more of the limited liability company,
partnership, association or other business entity gains or losses or shall be
or control the Person managing such limited liability company, partnership,
association or other business entity.

         1.101 “Target Capital Account” has the meaning set forth in Section 6.5.1.

         1.102 “Tax Loan” has the meaning set forth in Section 4.8.1.

         1.103 “Tax Loan Amount” has the meaning set forth in Section 4.8.1

         1.104 “Tentative Special Allocation Amount” has the meaning set forth in
Section 6.3.9(a).

         1.105 “Tentative Special Allocation Amount Ratio” means, for any
Allocation Period, an amount equal to (i) the Tentative Special Allocation
Amount as of the end of such Allocation Period, divided by (ii) the Class B
Common Members’ aggregate Percentage Interests times the excess of the
aggregate amount of the gains included in Non-Operating Profits for such
Allocation Period over the aggregate amount of the losses included therein;
provided, however, that if the Tentative Special Allocation Amount Ratio is
greater than one (1), then it shall be deemed to be one (1) for purposes of
this Agreement.

         1.106 “Tentative Taxable Income” and “Tentative Tax Loss” have the
meanings set forth in Section 6.3.7(e) of this Agreement.

         1.107 “Traditional Method” means the “traditional method” of making Code
Section 704(c) allocations described in Regulations Section 1.704-3(b).

         1.108 “Transaction Documents” has the meaning set forth in Section 10.1 of
this Agreement.

         1.109 “Transfer” means any direct or indirect sale, transfer, assignment,
hypothecation, encumbrance or other disposition, whether voluntary or
involuntary, whether by gift, bequest or otherwise. In the case of a
hypothecation, the Transfer shall be deemed to occur both at the time of the
initial pledge and at any pledgee’s sale or a sale by any secured creditor.

         1.110 “Transferring Member” means, with regard to any transaction, any
Member who attempts to Transfer any of its Membership Interest or with regard
to whose Membership Interest an option is exercised pursuant to this Agreement.

         1.111 “Units” means the units of Membership Interest issued by the Company
to its Members, which entitle the Members to certain rights as set forth in
this Agreement.

         1.112 “VCOC” means “Venture Capital Operating Company” as defined in
Section 2501.3-101(d) of the regulations promulgated by the United States
Department of Labor under the Employee Retirement Income Security Act of 1974,
as amended.

 

 

         1.113 “VCOC Exception” means the exception for which an entity qualifies
under Section 2510.3-101(a)(2)(i) of the regulations promulgated by the United
States Department of Labor under the Employee Retirement Income Security Act of
1974, as amended, by reason of being a VCOC so that the underlying assets of
that entity do not constitute “plan assets” within the meaning of Section
2510.3-101(a) of such regulations.

         1.114 “Vulcan Cable” has the meaning set forth in the recitals to this
Agreement.

ARTICLE II

ORGANIZATIONAL MATTERS

         2.1 Formation. Pursuant to the Act, the Company has been formed as a
Delaware limited liability company under the laws of the State of Delaware.
The rights and liabilities of the Members shall be determined pursuant to the
Act and this Agreement. To the extent that the rights or obligations of any
Member are different by reason of any provision of this Agreement than they
would be in the absence of such provision, this Agreement shall, to the extent
permitted by the Act, control.

         2.2 Name. The name of the Company shall be “Charter Communications
Holding Company, LLC.” The business and affairs of the Company may be
conducted under that name or, upon compliance with applicable laws, any other
name that the Manager may deem appropriate or advisable. The Manager shall
file any fictitious name certificates and similar filings, and any amendments
thereto, that may be appropriate or advisable.

         2.3 Term. The term of the Company shall commence on the date of the
filing of the Certificate with the Delaware Secretary of State and shall
continue until the Company is dissolved in accordance with the provisions of
this Agreement.

         2.4 Principal Office; Registered Agent. The principal office of the
Company shall be as determined by the Manager. The Company shall continuously
maintain a registered agent and office in the State of Delaware as required by
the Act. The registered agent and office shall be as stated in the Certificate
or as otherwise determined by the Manager.

         2.5 Purpose of Company. The Company may carry on any lawful business,
purpose, or activity that may be carried on by a limited liability company
under applicable law; (i) provided, however, that, until all outstanding shares
of Class B Common Stock have been converted into shares of Class A Common Stock
in accordance with Clause (b)(viii) of Article Fourth of PublicCo’s certificate
of incorporation as constituted as of the Class B Common Measuring Date,
without the Approval of the Class A Common Members, the Company shall not
engage directly or indirectly, including without limitation through any
Subsidiary, in any business other than (A) the Cable Transmission Business (as
defined below), (B) as a member or shareholder of, and subscriber to, the
portal joint venture with Broadband Partners, (C) as an owner and operator of
the business of Interactive Broadcaster Services Corporation, a California
corporation, which shall include solely the ownership of its assets and
continuation of its business substantially as owned and conducted as of
September 13, 2000, (D) as a member of and service provider to the joint
venture for the development of a licensable reference design for a cable
set-top box with functionalities of a

 

 

 video cassette recorder and a personal video recorder, (E) as a member of
Cable Sports Southeast, LLC, a Delaware limited liability company (“Cable
Sports”), so long as Cable Sports continues to conduct substantially the same
business conducted by it on October 24, 2000, (F) as a shareholder of High
Speed Access Corp., a Delaware corporation (“HSA”), so long as HSA continues to
conduct substantially the same business as conducted by it at the time of the
consummation of the transactions contemplated by the Stock Purchase Agreement
dated as of October 19, 2000 among Charter Communications Ventures, LLC, HSA
and Vulcan Ventures Incorporated, as it may be amended from time to time, and
(G) on and after February 12, 2001, as an equity investor in @Security
Broadband Corp., a Texas corporation, so long as @Security Broadband Corp.
continues to conduct substantially the same business conducted by it on
February 1, 2001; (ii) provided further, that to the extent that, as of the
Class B Common Measuring Date, the Company was directly or indirectly engaged
in or had agreed to acquire directly or indirectly any business other than the
Cable Transmission Business or as a member of, and subscriber to, the portal
joint venture with Broadband Partners (any such other business, an “Incidental
Business,” and collectively, “Incidental Businesses”), so long as (a) such
Incidental Businesses so engaged in by the Company on the Class B Common
Measuring Date in the aggregate on such date accounted for less than ten
percent (10%) of the consolidated revenues of the total business engaged in by
the Company or (b) such Incidental Businesses which on the Class B Common
Measuring Date the Company had agreed to acquire in the aggregate on such date
accounted for less than ten percent (10%) of the consolidated revenues of the
total businesses to be acquired, as applicable, the Company may, directly or
indirectly, including through any Subsidiary, continue to conduct any such
Incidental Business and the foregoing limitation on the business and purpose of
the Company shall not require that any such Incidental Business be divested by
the Company, but the Company shall not, directly or indirectly, expand any such
Incidental Business by means of any acquisition or any commitment of the
Company or its Subsidiaries’ resources or financial support. “Cable
Transmission Business” means the transmission of video, audio (including
telephony) and data over cable television systems owned, operated or managed by
the Company or its Subsidiaries; provided, that the businesses of RCN
Corporation and its Subsidiaries shall not be deemed to be a Cable Transmission
Business.

ARTICLE III

CAPITAL CONTRIBUTIONS AND UNITS

         3.1 Capital Contributions and Certain Transfers of Units

                  3.1.1 CII or an Affiliate of CII.

                           (a) On May 25, 1999, CII contributed its entire one hundred percent (100%)
limited liability company interest in Charter Communications Holdings, LLC, a
Delaware limited liability company, to the Company in exchange for Two Hundred
Seventeen Million Five Hundred Eighty-Five Thousand Two Hundred Forty-Six
(217,585,246) Class A Common Units.

                           (b) In August and September 1999, Vulcan Cable contributed cash and assets
valued in the aggregate (net of liabilities), at the time of the contributions,
at One

 

 

Billion Three Hundred Twenty-Five Million Dollars ($1,325,000,000) in
exchange for Sixty-Three Million Nine Hundred Seventeen Thousand Twenty-Eight
(63,917,028) Class A Common Units.

                           (c) On the Class B Common Measuring Date, Vulcan Cable contributed an
additional Seven Hundred Fifty Million Dollars ($750,000,000) in cash to the
Company in exchange for Forty-One Million One Hundred Eighteen Thousand Four
Hundred Twenty-One (41,118,421) additional Class A Common Units.

                           (d) Upon a Rifkin Holder’s exercise of its put right under the Rifkin Put
Agreement pursuant to which the Company is required to redeem Class A Preferred
Units from such Rifkin Holder, if requested by the Manager in a prompt written
notice to CII, CII or, at CII’s discretion, its Affiliate (other than PublicCo)
shall contribute to the Company, in exchange for additional Class A Common
Units, an amount of cash equal to the amount that the Company is required to
pay such Rifkin Holder for its Class A Preferred Units being redeemed and all
Common Units will be diluted on a proportional basis. In return for CII or its
Affiliate’s Capital Contribution under this Section 3.1.1(d), the Company is
authorized, without the need for additional act or consent of any Person, to
issue additional Class A Common Units to CII or its Affiliate pursuant to
Section 3.6.2(c).

                  3.1.2 Rifkin Holders. On the Class A Preferred Measuring Date, pursuant
to the Rifkin Contribution Agreement, Rifkin Holders contributed the Rifkin
Contributed Interest to the Company in exchange for One Hundred Thirty-Three
Million Three Hundred Twelve Thousand One Hundred Eighteen (133,312,118) Class
A Preferred Units. On the Class B Common Measuring Date, Rifkin Holders
contributed One Hundred Thirty Million Three Hundred Five Thousand Nine Hundred
Sixteen (130,305,916) Class A Preferred Units to PublicCo, and these Preferred
Units converted into Six Million Nine Hundred Forty-Six Thousand Eight Hundred
Ninety-Two (6,946,892) Class B Common Units.

                  3.1.3 PublicCo.

                           (a) On the Class B Common Measuring Date, PublicCo contributed the net
proceeds of the IPO and the net proceeds from the underwriters’ exercise of
their over-allotment option in connection with the IPO (less certain proceeds
retained to acquire certain assets) and agreed to contribute the assets
acquired with the retained proceeds to the Company (valued in the aggregate at
Three Billion Five Hundred Sixty-Six Million Eight Hundred Seventy Thousand
Dollars ($3,566,870,000)) in exchange for One Hundred Ninety-Five Million Five
Hundred Fifty Thousand (195,550,000) Class B Common Units.

                           (b) On September 7, 2000, in connection with the closing of the
transaction contemplated by the Agreement and Plan of Merger dated as of March
6, 2000, by and among Cablevision of Michigan, Inc., CSC Holdings, Inc., and
PublicCo, PublicCo contributed certain assets to the Company in exchange for
Eleven Million One Hundred Seventy-Three Thousand Three Hundred Seventy-Six
(11,173,376) Class B Common Units.

                           (c) On September 13, 2000, in connection with the closing of the
transaction contemplated by the Merger Agreement and Plan of Reorganization
dated as of August 11, 2000, by and among PublicCo, Craig T. Moncreiff, and
Interactive Broadcaster

 

 

Services Corporation, PublicCo contributed certain assets to the Company
in exchange for Four Hundred Seventy-Two Thousand Six Hundred Forty-Six
(472,646) Class B Common Units.

                           (d) On May 30, 2001, PublicCo contributed the net proceeds of a public
offering and the net proceeds from the underwriters’ exercise of their
over-allotment option in connection with such offering (in the aggregate,
approximately $1,221,000,000) in exchange for Sixty Million Two Hundred
Forty-Seven Thousand Three Hundred Fifty (60,247,350) Class B Common Units.

                           (e) The Company has issued through the Effective Date (and will continue
to issue in the future) Class B Common Units to PublicCo in connection with
employee equity option exercises.

                           (f) On the Effective Date, in connection with the closing of certain
transactions contemplated by the Cable USA Purchase Agreement, PublicCo is
contributing certain assets to the Company in exchange for 505,664 Class B
Preferred Units.

                           (g) Upon PublicCo’s issuance of shares of common stock other than in
exchange for Units, PublicCo shall contribute the net cash proceeds and assets
received in respect of such issuance to the Company in exchange for a number of
Class B Common Units equal to the number of shares of common stock so issued by
PublicCo.

                           (h) Upon PublicCo’s issuance of capital stock, other than common stock,
PublicCo shall contribute the net cash proceeds and assets received in respect
of any such issuance in exchange for Units that mirror to the extent
practicable the terms and conditions of such capital stock of PublicCo, as
reasonably determined by the Manager.

                  3.1.4 FHGLP. On the Class B Common Measuring Date, FHGLP contributed the
Falcon Contributed Interest to the Company in exchange for Twenty Million Eight
Hundred Ninety-Three Thousand Five Hundred Thirty-Nine (20,893,539) Class D
Common Units. On the same day, FHGLP distributed all such Class D Common Units
to its partners who, in turn, contributed Nineteen Million Two Hundred
Forty-Three Thousand Six Hundred Ninety-One (19,243,691) Class D Common Units
to PublicCo and sold One Million Six Hundred Forty-Nine Thousand Eight Hundred
Forty-Eight (1,649,848) Class D Common Units to Vulcan Cable. The Class D
Common Units contributed to PublicCo converted into Class B Common Units, and
the Class D Common Units sold to Vulcan Cable converted into Class A Common
Units. On the Class C Common Measuring Date, in connection with the closing of
the transaction contemplated by the Bresnan Purchase Agreement and pursuant to
the Falcon Purchase Agreement, the Company issued (i) Three Hundred Forty-Nine
Thousand One Hundred Sixty-Two (349,162) additional Class B Common Units to
PublicCo (as a successor in interest of FHGLP), and (ii) Twenty-Nine Thousand
Nine Hundred Thirty-Six (29,936) additional Class A Common Units to Vulcan
Cable (as a successor-in-interest of FHGLP).

                  3.1.5 Bresnan Holders. On the Class C Common Measuring Date, the Bresnan
Holders contributed the Bresnan Contributed Interest to the Company in exchange
for Fourteen Million Seven Hundred Ninety-Five Thousand Nine Hundred
Ninety-Five

 

 

(14,795,995) Class C Common Units pursuant to the Bresnan Purchase
Agreement. On June 1, 2001, pursuant to the Bresnan Purchase Agreement, the
Company issued 35,557 additional Class C Common Units to the Bresnan Holders.

                  3.1.6 Outstanding Units. Schedule A attached hereto describes all of the
outstanding Units as of the Effective Date.

         3.2 Additional Capital Contributions. No Member shall be required to make
any Capital Contributions other than the Capital Contributions required by
Section 3.1. Subject to the approval of the Manager, the Members may be
permitted from time to time to make additional Capital Contributions if it is
determined that such additional Capital Contributions are necessary or
appropriate for the conduct of the Company’s business and affairs, including
without limitation expansion or diversification. The Manager shall approve all
aspects of any such additional Capital Contribution, such as the amount and
nature of the consideration to be contributed to the Company, the resulting
increase in interest to be received by the contributing Member, the resulting
dilution of interest to be incurred by the other Members, and the extent to
which Members will participate in the allocations and distributions of the
Company as a result thereof.

         3.3 Capital Accounts. The Company shall establish an individual Capital
Account for each Member. The Company shall determine and maintain each Capital
Account in accordance with Regulations Section 1.704-1(b)(2)(iv) and, in
pursuance thereof, the following provisions shall apply:

                  3.3.1 To each Member’s Capital Account there shall be credited such
Member’s Capital Contributions, such Member’s allocated share of Net Profits
and any items in the nature of income or gain that are specially allocated
pursuant to Section 6.3, 6.4, or 6.5 hereof, and the amount of any Company
liabilities assumed by such Member or which are secured by any property
distributed to such Member;

                  3.3.2 To each Member’s Capital Account there shall be debited the amount
of cash and the Gross Asset Value of any property distributed to such Member
pursuant to any provision of this Agreement, such Member’s allocated share of
Net Losses and any items in the nature of expenses or losses that are specially
allocated pursuant to Section 6.3, 6.4, or 6.5 hereof, and the amount of any
liabilities of such Member assumed by the Company or which are secured by any
property contributed by such Member to the Company;

                  3.3.3 In the event all or a portion of a Membership Interest in the
Company is transferred in accordance with the terms of this Agreement, the
transferee shall succeed to the Capital Account of the transferor to the extent
it relates to the transferred Membership Interest; and

                  3.3.4 In determining the amount of any liability for purposes of Sections
3.3.1 and 3.3.2 hereof, there shall be taken into account Code Section 752(c)
and any other applicable provisions of the Code and Regulations.

                  The foregoing provisions and the other provisions of this Agreement
relating to the maintenance of Capital Accounts are intended to comply with
Regulations Section

 

 

1.704-1(b), and shall be interpreted and applied in a manner consistent
with such Regulations. In the event the Manager determines that it is prudent
to modify the manner in which the Capital Accounts, or any debits or credits
thereto, are computed in order to comply with such Regulations, the Manager may
make such modification.

         3.4 No Interest. No Member shall be entitled to receive any interest on
such Member’s Capital Contributions.

         3.5 Limited Withdrawal Rights of Members; Redemption Rights of the
Company.

                  3.5.1 No Withdrawal in General. No Member shall have the right to
withdraw such Member’s Capital Contributions or to demand and receive property
of the Company or any distribution in return for such Member’s Capital
Contributions, except as may be specifically provided in this Agreement or
required by law.

                  3.5.2 Redemption of Class A Preferred Units.

                           (a) Upon a Rifkin Holder’s exercise of its put right under the Rifkin Put
Agreement pursuant to which the Company is required to redeem Class A Preferred
Units, the Company shall redeem in cash from such Rifkin Holder the number of
Class A Preferred Units specified in the notice of exercise. The redemption
price for such Class A Preferred Units shall be the sum of (i) the Class A
Preferred Contributed Amount in respect of such Class A Preferred Units and
(ii) the Class A Preferred Return Amount in respect of such redeemed Class A
Preferred Units. The redemption of Class A Preferred Units shall be
effectuated as of the last day of the calendar quarter following the date of a
Rifkin Holder’s exercise of its put right. The Class A Preferred Units
redeemed pursuant to this Section 3.5.2(a) shall be deemed cancelled.

                           (b) All Class A Preferred Units outstanding on the fifteenth (15th)
anniversary of the Class A Preferred Measuring Date shall be redeemed by the
Company on such date at a redemption price equal to the sum of (i) the Class A
Preferred Contributed Amount in respect of such Class A Preferred Units and
(ii) the Class A Preferred Return Amount in respect of such redeemed Class A
Preferred Units. The Class A Preferred Units redeemed pursuant to this Section
3.5.2(b) shall be deemed cancelled.

                  3.5.3 Right to Redeem Class A Preferred Units. At any time after the
third anniversary of the Class A Preferred Measuring Date, the Company shall
have the right to redeem the Class A Preferred Units at a redemption price
equal to the sum of (i) the Class A Preferred Contributed Amount in respect of
such redeemed Class A Preferred Units and (ii) the Class A Preferred Return
Amount in respect of such redeemed Class A Preferred Units. The Class A
Preferred Units redeemed pursuant to this Section 3.5.3 shall be deemed
cancelled.

                  3.5.4 Redemption of Class B Common Units. Upon PublicCo’s request, the
Company is required and is hereby authorized to redeem Class B Common Units
held by PublicCo to the extent reasonably practicable as determined by the
Manager. The redemption price for such Class B Common Units shall be
determined in good faith by the Manager and PublicCo. The Class B Common Units
redeemed pursuant to this Section 3.5.4 shall be deemed cancelled.

 

 

         3.6 Units.

                  3.6.1 Classes and Number of Units. Units shall consist of the following:
(i) Class A Preferred Units, (ii) Class B Preferred Units, (iii) Class A Common
Units, (iv) Class B Common Units, (v) Class C Common Units, and (vi) any other
classes of common or preferred Units upon the Approval of the Members. Subject
to the terms of this Agreement, the Company may issue as many as one hundred
billion (100,000,000,000) units of each class of Units. Notwithstanding any
provision of this Agreement to the contrary, upon PublicCo’s request, the
Company is required and is hereby authorized to subdivide (by any split,
distribution, reclassification, recapitalization or otherwise) or combine (by
reverse split, reclassification, recapitalization or otherwise) the outstanding
Units so that the number of outstanding shares of PublicCo’s common stock will
equal on a one-for-one basis the number of Common Units owned by PublicCo. The
Manager is authorized to take any action necessary, desirable, or convenient to
effectuate the foregoing.

                  3.6.2 Class A Common Units.

                           (a) As of the Effective Date, the number of Class A Common Units issued to
CII is Two Hundred Seventeen Million Five Hundred Eighty-Five Thousand Two
Hundred Forty-Six (217,585,246), and the number of Class A Common Units issued
to Vulcan Cable is One Hundred Six Million Seven Hundred Fifteen Thousand Two
Hundred Thirty-Three (106,715,233).

                           (b) After the Effective Date, if CII or any Affiliate of CII (other than
PublicCo) contributes any assets to the Company, the Members’ Membership
Interests will be adjusted, additional Class A Common Units will be issued to
CII or such Affiliate, and Common Units will be diluted on a proportional basis
with Class B Common Units.

                           (c) Notwithstanding any other provision of this Section 3.6, upon
contribution of cash by CII or its Affiliate (other than PublicCo) to the
Company pursuant to Section 3.1.1(d), the number of Class A Common Units to be
issued to CII or such Affiliate will be (i) the amount of cash contributed by
CII or such Affiliate, divided by (ii) nineteen dollars ($19) (subject to an
appropriate adjustment if the Company’s Common Units are split, subdivided or
combined after the Effective Date).

                           (d) Upon the acquisition of Class A Preferred Units pursuant to the Rifkin
Put Agreement by CII or its Affiliate (other than PublicCo), such Class A
Preferred Units will be converted into Class A Common Units. CII or such
Affiliate will be deemed to have made a Capital Contribution of cash to the
Company in the amount paid to a Class A Preferred Member pursuant to the Rifkin
Put Agreement, and the Company will be deemed to have issued Class A Common
Units to CII or its Affiliate. The number of Class A Common Units acquired by
CII or such Affiliate pursuant to this Section 3.6.2(d) will be (i) the net
purchase price paid by CII or such Affiliate for the Class A Preferred Units,
divided by (ii) nineteen dollars ($19) (subject to an appropriate adjustment if
the Company’s Common Units are split, subdivided or combined after the
Effective Date).

 

 

                  3.6.3 Class A Preferred Units. As of the Effective Date, the aggregate
number of outstanding Class A Preferred Units is Three Million Six Thousand Two
Hundred Two (3,006,202).

                  3.6.4 Class B Common Units.

                           (a) As of the Effective Date, the aggregate number of Class B Common Units
issued to PublicCo was Two Hundred Ninety-Four Million Two Hundred Sixty-Seven
Thousand Five Hundred Forty (294,267,540).

                           (b) Upon PublicCo’s contribution of cash and/or assets to the Company
pursuant to Section 3.1.3(g), the Company will issue to PublicCo that number
of additional Class B Common Units equal to the number of shares of common
stock issued by PublicCo in such transaction.

                           (c) Upon PublicCo’s contribution of cash and/or assets to the Company
pursuant to Section 3.1.3(h), the Company will issue to PublicCo Units that
mirror to the extent practicable the terms and conditions of the capital stock
issued by PublicCo, as reasonably determined by the Manager.

                           (d) The Company may and is authorized to issue Class B Common Units to
certain Persons pursuant to the terms of the Company’s employee
option/compensatory plans and agreements (as adopted or entered into from time
to time).

                  3.6.5 Class C Common Units. As of the Effective Date, the aggregate
number of Class C Common Units issued to the Bresnan Holders is Fourteen
Million Eight Hundred Thirty-One Thousand Five Hundred Fifty-Two (14,831,552).

                  3.6.6 Class B Preferred Units.

                  As of the Effective Date, the Company shall issue to PublicCo 505,664
Class B Preferred Units. Without limiting the generality of Sections 3.1.3(h),
3.6.4(c), and 5.1.7, in the case of the Class B Preferred Units, the following
provisions shall apply, notwithstanding anything to the contrary contained in
Section 3.3 or Articles VI or IX:

                  (a) The Manager shall distribute cash from the Company to the Class B
Preferred Member (or, following a conversion described in Section 3.6.6(c), the
Class B Common Member) in the same amounts and at the same times as the
payments made by the Class B Preferred Member (or the Class B Common Member)
for (i) dividends (when, as, and if declared by its Board of Directors under
that certain Certificate of Designation of Series A Convertible Preferred Stock
of PublicCo) with respect to the shares of Series A Convertible Preferred Stock
issued by it pursuant to the Cable USA Purchase Agreement, and (ii) federal,
state, and local taxes attributable to the allocations made pursuant to Section
3.6.6(b) or to the distributions made pursuant to any provision of this Section
3.6.6; provided, however, that such distributions to the Class B Preferred
Member (or the Class B Common Member) shall not be made to the extent they
would (x) violate applicable law; (y) breach, or with the passage of time or
the giving of notice result in a breach of, any contractual covenants of the
Company or its Subsidiaries; or (z) following the occurrence of any event
specified in Section 9.1, create or increase a Capital Account deficit for the
Class

 

 

B Preferred Member (or the Class B Common Member) that exceeds its obligation
deemed and actual to restore such deficit, determined as follows:
distributions shall first be determined tentatively pursuant to this Section
3.6.6(a) without regard to the Class B Preferred Member’s (or the Class B
Common Member’s) Capital Account, and then the allocation provisions of this
Section 3.6.6 and Article VI shall be applied tentatively as if such tentative
distributions had been made; if the Class B Preferred Member (or the Class B
Common Member) shall thereby have a deficit Capital Account that exceeds its
obligation (deemed or actual) to restore such deficit, the actual distribution
to it pursuant to this Section 3.6.6(a) shall be equal to the tentative
distribution to it less the amount of such excess. The distributions by the
Company required by this Section 3.6.6(a) shall have priority over any
distributions to be made pursuant to Section 6.9 or Section 9.5.2.

                  (b) If the Company has Combined Book Profits for any Allocation Period,
then a uniform percentage of the Net Profits and of each item of Depreciation
for such Allocation Period shall be allocated to the Class B Preferred Member
or, following a conversion described in Section 3.6.6(c), the Class B Common
Member so as to cause an allocation pursuant to this Section 3.6.6(b) for such
Allocation Period of an aggregate amount of net book income to the extent of
the excess, if any, of (i) the cumulative amount of the distributions made
pursuant to Section 3.6.6(a) on or before a date thirty (30) days after the end
of such Allocation Period, over (ii) the cumulative amount of net book income
allocated pursuant to this Section 3.6.6(b) for all prior Allocation Periods.
The allocations required by this Section 3.6.6(b) shall have priority over any
allocations to be made pursuant to Section 6.1 or Section 6.3.7 (other than
subsections (e) and (f) thereof).

                  (c) Upon the conversion of any shares of Series A Convertible Preferred
Stock issued by PublicCo pursuant to the Cable USA Purchase Agreement into
shares of Class A Common Stock of PublicCo, a like number of Class B Preferred
Units shall be automatically converted into that number of Class B Common Units
(“Class B Common Conversion Units”) equal to the number of shares of Class A
Common Stock of PublicCo into which the shares of Series A Convertible
Preferred Stock of PublicCo converted. If the Company has Non-Operating
Profits or Non-Operating Losses for any Allocation Period ending after such a
conversion, then a uniform percentage of every item of gain and loss included
in such Non-Operating Profits or Non-Operating Losses either (i) shall be
allocated under this Section 3.6.6(c) to the Class B Common Member with respect
to the Class B Common Conversion Units or (ii) shall not be allocated under
Section 6.3.9 to the Class B Common Member with respect to the Class B Common
Conversion Units (in which case the items not so allocated with respect to the
Class B Common Conversion Units shall be allocated with respect to other Units
as provided under Section 6.3.9), and such allocations and limitations on
allocations under clauses (i) and (ii) shall continue until the average
per-unit Capital Account balance then traceable with respect to the Class B
Common Conversion Units is equal to the average per-unit Capital Account
balance then traceable with respect to all other Class B Common Units. In
determining the amount of such average per-unit Capital Account balances for
purposes of this Section 3.6.6(c), the effect of the distributions and
allocations made pursuant to Sections 3.6.6(a) and 3.6.6(b) shall be
disregarded. The allocations required by this Section 3.6.6(c) shall have
priority over any allocations to be made pursuant to Section 6.3.9.

 

 

                  (d) An allocation under Article VI shall not be made to the extent it
would cause the Adjusted Capital Account Balance of the Class B Common Member
to be less than the amount of the Liquidation Preference. For purposes of this
Section 3.6.6(d), “Adjusted Capital Account Balance” means, with respect to the
Class B Common Member, its Capital Account balance as adjusted by the items
described in Sections 1.2.1, 1.2.2, and 1.2.3, and “Liquidation Preference”
means, as of any date, an amount equal to the amount that, in the event of a
liquidation of PublicCo, would be required to be distributed by PublicCo in
respect of the then outstanding shares of its Series A Convertible Preferred
Stock that are attributable to the Cable USA Purchase Agreement. Any
allocations not made to the Class B Common Member as a result of the limitation
set forth in this Section 3.6.6(d) shall be subject to a curative allocation
mechanism similar to that provided in Section 6.5.1 with respect to Section
6.2.3.

                  (e) The Capital Account of the Class B Preferred Member or, following a
conversion described in Section 3.6.6(c), the Class B Common Member shall be
credited or debited, as appropriate, to reflect the allocations made pursuant
to this Section 3.6.6. No offsetting special allocations shall be made
pursuant to Section 6.5.1 in respect of the allocations made pursuant to this
Section 3.6.6.

                  (f) In connection with PublicCo’s redemption of any of its Series A
Convertible Preferred Stock, upon PublicCo’s request, the Manager shall
distribute cash from the Company to PublicCo in redemption of that number of
Class B Preferred Units equal to the number of shares of Series A Convertible
Preferred Stock redeemed by PublicCo. The amount of cash distributed in
redemption of such Class B Preferred Units shall be equal to the aggregate
redemption price paid by PublicCo in connection with its redemption of Series A
Convertible Preferred Stock. The Class B Preferred Units redeemed pursuant to
this Section 3.6.6(f) shall be deemed cancelled.

                  (g) In implementing the foregoing provisions, the Manager may, so long as
substantially the same economic result is achieved, make such modifications and
take such other actions as it deems appropriate (i) to carry out the provisions
of this Section 3.6.6 in a manner that is as consistent as practicable with the
other provisions of this Agreement and (ii) to take into account legal
developments concerning the tax consequences of owning preferred interests in
limited liability companies, including the consequences of converting such
interests into common interests.

                  3.6.7 Dilution of Common Units. Upon the issuance of Common Units to an
entity that is not an Affiliate of CII, and upon the issuance of Common Units
to employees of the Company in their capacity as employees, all Common Units
will be diluted on a proportional basis with the existing Class A Common Units.

         3.7 Equal Treatment. In any transaction involving issuance, redemption,
or Transfer of Units (except as set forth in Section 3.1.1(d), 3.6.2(c),
3.6.2(d), 7.1, or 7.2) between (i) the Company and (ii) any Member that is an
Affiliate of Paul G. Allen (other than PublicCo) with respect to such Member’s
Common Units, such Members and the Class C Common Members will be treated in a
nondiscriminatory manner. For instance, any proposed redemption from CII (as
long as it is an Affiliate of Paul G. Allen) of its Common Units shall be
offered to the Class C Common Members with respect to their Class C

 

 

 Common Units on the same proportionate terms and conditions.
Notwithstanding anything to the contrary in this Agreement, if an Affiliate of
Paul G. Allen contributes cash or assets to the Company and the Company issues
Units to such Person, the Class C Common Members shall not have any preemptive
right to purchase any of the newly-issued Units.

         3.8 Limited Liability Company Certificates. The Manager may, in its sole
discretion, provide that certain Units are to be evidenced by certificates of
limited liability company interest executed by the Manager or any officers of
the Company in such form as the Manager may approve.

ARTICLE IV

MEMBERS

         4.1 Limited Liability. Except as required under the Act or as expressly
set forth in this Agreement, no Member shall be personally liable for any debt,
obligation, or liability of the Company, whether that debt, obligation, or
liability arises in contract, tort or otherwise.

         4.2 Admission of Members. Without the need for any additional act or
consent of any Person, CII, Vulcan Cable, the Rifkin Holders listed on Schedule
A, the Bresnan Holders, and PublicCo shall continue to be members of the
Company. Except as set forth in Article VII, no Person shall be admitted as an
additional Member unless approved by the Manager and the Approval of the
Members. No Person shall be admitted as an additional Member until such
additional Member has made any required Capital Contribution and has become a
party to this Agreement. Substitute Members may be admitted only in accordance
with Article VII. The Members acknowledge that the admission of such new
Members or the issuance of additional Membership Interests to pre-existing
Members may dilute the Percentage Interests of the Members.

         4.3 Meetings of Members.

                  4.3.1 No annual or regular meetings of the Members as such shall be
required; if convened, however, meetings of the Members may be held at such
date, time, and place as the Manager or as the Member or Members who properly
noticed such meeting, as the case may be, may fix from time to time. At any
meeting of the Members, the Chairman of the Board (or, if there is no Chairman
or the Chairman so elects, a person appointed by the Manager) shall preside at
the meeting and shall appoint another person to act as secretary of the
meeting. The secretary of the meeting shall prepare written minutes of the
meeting, which shall be maintained in the books and records of the Company.

                  4.3.2 A meeting of the Members for the purpose of addressing any matter on
which the vote, consent, or approval of the Members is required or permitted
under this Agreement may be called at any time by the Manager, or by any Member
or Members holding more than twenty percent (20%) of all issued and outstanding
Units entitled to vote on, consent to or approve such matter.

                  4.3.3 Notice of any meeting of the Members shall be sent or otherwise
given by the Manager to the Members in accordance with this Agreement not less
than ten (10) nor more than sixty (60) days before the date of the meeting.
The notice shall specify

 

 

the place, date, and hour of the meeting and the general nature of the
business to be transacted. Except as the Members may otherwise agree, no
business other than that described in the notice may be transacted at the
meeting.

                  4.3.4 Attendance in person of a Member at a meeting shall constitute a
waiver of notice of that meeting, except when the Member objects, at the
beginning of the meeting, to the transaction of any business because the
meeting is not duly called or convened, and except that attendance at a meeting
is not a waiver of any right to object to the consideration of matters not
included in the notice of the meeting if that objection is expressly made at
the meeting. Neither the business to be transacted nor the purpose of any
meeting of Members need be specified in any written waiver of notice. The
Members may participate in any meeting of the Members by means of conference
telephone or similar means as long as all Members can hear one another. A
Member so participating shall be deemed to be present in person at the meeting.

                  4.3.5 Any action that can be taken at a meeting of the Members may be
taken without a meeting and without prior notice if a consent in writing
setting forth the action so taken is signed and delivered to the Company by
Members representing not less than the minimum number of Units necessary under
this Agreement or the Act to approve the action. The Manager shall notify
Members holding Units entitled to vote on, consent to or approve such actions
of all actions taken by such consents, and all such consents shall be
maintained in the books and records of the Company.

         4.4 Voting by Members. The Members, acting solely in their capacities as
Members, shall have the right to vote on, consent to, or otherwise approve only
those matters as to which this Agreement or the Act specifically requires such
approval. A Member may vote in person or by proxy executed in writing by the
Member or by a duly authorized attorney-in-fact. Except as otherwise
specifically provided in this Agreement, the Approval of the Members shall be
all that is required as to all matters, including merger, consolidation, and
conversion, as to which the vote, consent, or approval of the Members is
required or permitted under this Agreement or the Act.

         4.5 Members Are Not Agents. No Member acting solely in the capacity of a
Member is an agent of the Company, nor can any Member acting solely in the
capacity of a Member bind the Company or execute any instrument on behalf of
the Company.

         4.6 No Withdrawal. Except as provided in Articles III, VII and IX hereof,
no Member may withdraw, retire, or resign from the Company without the prior
Approval of the Members.

         4.7 FCC Regulations.

                  4.7.1 Notwithstanding any other provision of this Agreement to the
contrary, no Class C Common Member, including any officer, director, partner,
Affiliate or equivalent non-corporate official of such Class C Common Member,
shall:

                           (a) act as an employee of the Company if his or her functions, directly or
indirectly, relate to the media enterprises of the Company;

 

 

                           (b) serve, in any material capacity, as an independent contractor or agent
with respect to the Company’s media enterprises;

                           (c) communicate with the Manager or any management committee of the
Company on matters pertaining to the day-to-day operations of the Company’s
business;

                           (d) perform any services for the Company materially relating to its media
activities; provided, however, that such Class C Common Member may make loans
to, or act as a surety for, the Company;

                           (e) become actively involved in the management or operation of the media
business of the Company;

                           (f) vote on the admission of additional Members, unless such admission is
subject to the veto of the Manager; or

                           (g) vote on the removal of a Member, except where such Member is (A)
subject to bankruptcy proceedings, as described in Section 402(4)-(5) of the
Revised Uniform Limited Partnership Act; (B) is adjudicated incompetent by a
court of competent jurisdiction; or (C) is removed for cause, as determined by
an independent party.

                           The foregoing language is designed to ensure that the Class C Common
Members’ ownership of Class C Common Units in the Company will be deemed
non-attributable for purposes of those FCC rules and regulations (as amended
and any successor laws thereto, the “Attribution Rules”) that require members
of a limited liability company to certify that they are not materially involved
in the Company in order to obtain non-attributable status (“Non-Attributable
Status”). (Notwithstanding, anything to the contrary contained herein, in the
event of any amendment of the Attribution Rules (or the promulgation of any
successor rules or regulations), the Manager shall have the authority to amend
this Section 4.7.1 as necessary for the Class C Common Members to maintain, or
obtain, Non-Attributable Status.) Although the foregoing language should be
read to preclude a Class C Common Member from taking any actions with respect
to the Company or any entity in which the Company holds an attributable
interest that would prevent the Company from certifying that such Class C
Common Member is “insulated” from material involvement in the Company under
applicable FCC rules, it is not intended to preclude any Class C Common Member
from engaging in any activities that are consistent with such FCC rules and
would not cause the Class C Common Member to be deemed to hold an attributable
interest in the Company. The Company’s sole remedy for a breach of this
Section 4.7.1, except in the event of an intentional breach by a Class C Common
Member, is the exercise of its rights set forth in Section 4.7.2 below.

                  4.7.2 In the event that (i) the ownership by any Class C Common Member of
Class C Common Units is reasonably deemed by the Manager to be attributable for
purposes of the Attribution Rules, including without limitation either as a
result of (A) any breach by a Class C Common Member of Section 4.7.1 or (B) a
determination by the Federal Communications Commission (“FCC”) that would
reasonably be considered to result in such Class C Common Member’s ownership of
Class C Common Units being deemed attributable notwithstanding the provisions
of Section 4.7.1 and (ii) such attribution

 

 

(A)  results in a violation of any cross or multiple-ownership rule or
regulation promulgated by the FCC (the “Ownership Rules”), including without
limitation the Cable/Broadcast Television Ownership Rules (§ 47 C.F.R.
76.501(a)), the Cable Television Horizontal Ownership Rules, if applicable (§
47 C.F.R. 76.503), or the Cable/MMDS Cross Ownership Rules (§ 47 C.F.R. 21.912)
or (B) would prevent the Company from engaging in the Cable Transmission
Business in any area within the United States as a result of a potential
violation of the Ownership Rules, whether by acquisition of an existing system
or original construction, if, at the time of the determination, the Company is
actively pursuing (including making internal evaluations) engaging in the Cable
Transmission Business in such area, such Class C Common Member and the Manager
shall cooperate in good faith to remedy any violation of the Ownership Rules by
seeking appropriate relief from the FCC with respect to such Class C Common
Member’s ownership of the Class C Common Units or at such Class C Common
Member’s option through the divestment by the Class C Common Member of the
interest or property (with the exception of the Class C Member Units) that
causes, or would cause, the violation of the Ownership Rules; provided that in
no event shall the Company, any of its Subsidiaries, or such Class C Common
Member be required to divest any of its properties or assets or to cease any of
its business activities or to forego any opportunity to acquire or expand any
properties, assets or business activities or take any action that would
otherwise adversely affect the Company’s or such Class C Common Member’s
business, operations or financial condition in any way or result in any
significant financial expense or tax disadvantage to the Company, PublicCo or
the Class C Common Member, respectively, except as specifically provided for
herein. The Company and Class C Common Member shall attempt to remedy any
Ownership Rule violation or potential violation as soon as practicable. In the
event that such Ownership Rule violation (in the case of clause (A) above) or
potential violation (in the case of clause (B) above) is not remedied within
the shorter of either (i) six (6) months or such longer period of time as
agreed to by mutual consent of the Company and the Class C Common Member; or
(ii) such period as may be mandated by the FCC, such Class C Common Member
shall exercise its right to exchange its Class C Common Units for shares of
Publicly Traded Stock (as defined in the Bresnan Exchange Agreement) of
PublicCo pursuant to the terms of the Bresnan Exchange Agreement. In the event
the Company becomes aware of a violation of the Ownership Rules (in the case of
clause (A) above) or potential violation (in the case of clause (B) above) the
Company shall provide such Class C Common Member with prompt written notice.
If such an exchange would result in a violation of the ownership restrictions
of the Communications Act of 1934, as amended, or Ownership Rules, such
violation shall be remedied, as determined by the Company in its sole
discretion, by (i) the Class C Common Member selling a sufficient number of
shares of Publicly Traded Stock to cure the violation; (ii) the Company taking
such actions with respect to its business or operations as are necessary to
cure the violation, provided that in no event shall the Company be obligated to
take such actions; or (iii) if proposed by a Class C Common Member, such Class
C Common Member taking actions with respect to its business or operations as
are necessary to cure the violation; provided, however, that the Company shall
not unreasonably withhold its consent to any remedy proposed by a Class C
Common Member that would adequately and promptly address the violation and
would not require the Company or any of its Subsidiaries to divest any of its
properties or assets or to cease any of its business activities or to forego
any opportunity to acquire or expand any properties, assets or business
activities or otherwise adversely affect the Company’s business, operations or
financial condition in any way or result in any significant financial expense
or tax disadvantage to the Company or

 

 

PublicCo. In the event that the FCC lowers the permissible attribution
percentages under its Ownership Rules, if requested by the Class C Common
Member, PublicCo will reasonably cooperate in good faith to assist the Class C
Common Members in taking appropriate and timely action to seek to insulate the
Class C Common Member’s interest in PublicCo to the extent required (including,
subject to the qualification set forth below, issuing preferred non-voting
stock on substantially the same terms as the Class A Common Stock to the Class
C Common Member in exchange for its Class A Common Stock or permitting the
Class C Common Member to form a special purpose corporation), or the Class C
Common Member, at its option, may take any other actions with respect to its
business necessary to comply with the new rules; provided that in no event
shall PublicCo or any of its Subsidiaries be required to divest any of its
properties or assets or to cease any of its business activities or to forego
any opportunity to acquire or expand any properties, assets or business
activities or otherwise adversely affect PublicCo’s or the Company’s business,
operations or financial condition in any way or result in any significant
financial expense or tax disadvantage to PublicCo or the Company in order to
achieve such insulation; provided that if such insulation is not achieved, the
Class C Common Member shall divest the number of shares of Publicly Traded
Stock (as defined in the Bresnan Exchange Agreement) as is necessary to remedy
the applicable FCC rule or regulation at issue.

         4.8 Loans to Members.

                  4.8.1 General. If a Common Member is, or reasonably expects to be,
allocated taxable income described in Section 4.8.2 or 4.8.3, then upon such
Member’s request, the Company, subject to the provisions of this Section 4.8,
shall make a loan (“Tax Loan”) to such Member in an amount (“Tax Loan Amount”)
no greater than the amount reasonably sufficient to enable such Member to fund
its tax liability, or estimated tax payments, resulting from the allocation of
such taxable income on the later of (i) five days before each of April 15, June
15, September 15 and January 15 for estimated tax payments and April 15 for
final tax payments, and (ii) the date such Member requests the funding of such
Tax Loan, which date shall be no later than one hundred fifty (150) days after
the end of the taxable year in which the taxable income arises; provided,
however, that in the case of Tax Loans made with respect to estimated income
tax payments, the Tax Loan Amount shall be no greater than the amount of
estimated taxes actually paid by the Common Member receiving the loan and that
such Member shall provide to the Company reasonable documentation of the
portion of its actual estimated tax payment attributable to the taxable income
described above. The Tax Loan shall be secured by a first priority security
interest in all of such Member-creditor’s Common Units and may be prepaid at
any time prior to the due date. The Members acknowledge (i) that many of the
partners in Blackstone BC Capital Partners, L.P., Blackstone BC Offshore
Capital Partners, L.P., and Blackstone Family Media Partnership III L.P. are
residents of New York City and that tax liability for such Blackstone entities
must be calculated using the highest nominal, marginal federal, state, and
local income tax rates then imposed on such income of individual taxpayers
residing in New York City, with appropriate adjustments for the federal tax
benefits from the deduction for state and local taxes and (ii) that for each
year, the Blackstone entities’ tax liability shall be equal to the greater of
the regular or alternative minimum tax liability taking into account
alternative minimum tax adjustments and carryfoward items arising from such
entities’ Membership Interests in the Company. With respect to a Tax Loan to
BCI (USA), LLC, the Tax Loan Amount shall be determined as follows: based upon
the certification of the tax

 

 

return preparer(s) of beneficial holders of membership interests in BCI
(USA), LLC to whom BCI (USA), LLC allocates at least seventy-five percent (75%)
of the taxable income allocated to it by the Company, BCI (USA), LLC shall
certify to the Company (i) the tax liability (estimated or actual) of such
beneficial holders attributable to the taxable income described in Section
4.8.2 or 4.8.3 that is allocated to such beneficial holders, and (ii) the
percentage of the taxable income allocated to BCI (USA), LLC by the Company
that is allocated by BCI (USA), LLC to such beneficial holders. The Tax Loan
Amount shall be equal to the amount of such certified tax liability, increased
proportionately to account for the beneficial holders of membership interests
in BCI (USA), LLC whose allocable shares of taxable income are not reflected in
such certified amount. For example, if BCI (USA), LLC certifies to the Company
that the applicable tax liability is Nine Million Dollars ($9,000,000) with
respect to beneficial holders to whom BCI (USA), LLC allocates ninety percent
(90%) of the taxable income allocated to it by the Company, then the Tax Loan
Amount shall be Ten Million Dollars ($10,000,000).

                  4.8.2 Interest-Free Loan. With respect to any taxable year ending prior
to the second (2nd) anniversary of the Class C Common Measuring Date, if a
Common Member is allocated any taxable income arising from a sale or other
disposition (other than in the ordinary course of business) of the Property
contributed by such Member pursuant to Code Section 704(c) other than taxable
income arising from a fully taxable sale or disposition for which such Member
has elected to receive an interest-bearing Tax Loan under Section 4.8.3, then
(i) the Tax Loan for such tax liability shall be due and payable to the Company
no later than ninety (90) days after the second (2nd) anniversary of the Class
C Common Measuring Date (or if a Common Member exercises its put option
pursuant to the Bresnan Put Agreement, then the date of closing thereunder) and
shall be interest-free, and (ii) the Tax Loan Amount due shall be reduced by
the amount of income taxes paid by the Member attributable to its recognition
of imputed income under the interest-free Tax Loan.

                  4.8.3 Interest-Bearing Loan. With respect to any taxable year ending
prior to the tenth (10th) anniversary of the Class C Common Measuring Date, if
a Common Member is allocated (i) any taxable income other than, in the case of
a Class C Common Member, an amount of taxable income equal to the amount of the
hypothetical remedial item of taxable income required to be taken into account
in determining the allocation of items of Depreciation to such Member under
Section 6.3.7(f), or (ii) any taxable income arising from a fully taxable sale
or disposition (other than in the ordinary course of business) of the Property
contributed by such Member pursuant to Section 704(c) other than an amount for
which the Member has elected to receive an interest-free Tax Loan pursuant to
Section 4.8.2, then the Tax Loan for such tax liability shall be due and
payable to the Company no later than the tenth (10th) anniversary of the Class
C Common Measuring Date and shall bear interest, compounded annually at a rate
per annum equal to the applicable federal rate under Code Section 1274(d) for a
loan due on the tenth (10th) anniversary of the Class C Common Measuring Date
plus 100 basis points.

                  4.8.4 Acceleration of Repayment. Notwithstanding anything to the contrary
in this Section 4.8, (i) if the Company makes any distributions to the Common
Members pursuant to Section 6.9 or otherwise, the amount of each Common
Member’s outstanding Tax Loan Amount equal to the amount of distributions made
to such Member pursuant to Section 6.9 or otherwise shall become due and
payable to the Company

 

 

immediately, and (ii) if any Class C Common Member sells, transfers, or
exchanges any of its Class C Common Units (other than pursuant to Section
7.2.3), the amount of such Member’s outstanding Tax Loan Amount up to the fair
market value of the Units sold, transferred, or exchanged shall become due and
payable to the Company immediately; provided, however, that in the event that a
Class C Common Member exchanges its Class C Common Units for PublicCo common
stock pursuant to the Bresnan Exchange Agreement and not all shares of PublicCo
common stock received in such exchange are permitted by PublicCo to be sold
pursuant to a securities registration, only the amount of such Member’s
outstanding Tax Loan Amount up to the excess, if any, of (i) the fair market
value of PublicCo common stock received by such Member that are permitted to be
sold, over (ii) forty-six percent (46%) of the fair market value of all
PublicCo common stock received by such Member in the exchange shall become due
and payable immediately. In the case described in the proviso of the preceding
sentence, the Company shall receive a security interest in the unsold PublicCo
common stock held by the Member, and as soon as any shares of PublicCo common
stock not permitted to be sold at the time of the exchange become eligible for
sale pursuant to a securities registration, such Member’s outstanding Tax Loan
Amount equal to the fair market value of such shares shall become immediately
due and payable to the Company.

         4.8.5 Loan Documentation; Miscellaneous. A Member receiving a Tax Loan
shall cooperate with the Company to document the respective parties’ rights and
obligations under the Tax Loan including, without limitation, loan
documentation providing for and perfecting a security interest as contemplated
by Section 4.8.1. Notwithstanding any provision to the contrary in Section
4.8, (i) the Company shall not make a Tax Loan to any Member if the loan would
breach, or with the passage of time or the giving of notice result in a breach
of, any contractual covenants of the Company or its Subsidiaries, and (ii) a
Common Member entitled to receive a Tax Loan from the Company may waive its
right to receive the loan.

ARTICLE V

MANAGEMENT AND CONTROL OF THE COMPANY

         5.1 Management of the Company by Manager.

                  5.1.1 The Members hereby unanimously confirm the election of PublicCo, or
its successor-in-interest which acquires directly or indirectly substantially
all of the assets or businesses of PublicCo, as the manager of the Company (the
“Manager”) for the period on and after November 8, 1999. At such time as the
Approval of the Members means the affirmative vote, approval or consent of
Members holding more than fifty percent (50%) of the Common Units, CII, or its
successor-in-interest which acquires directly or indirectly substantially all
of the assets or businesses of CII, shall be the Manager in place of PublicCo
without further action of the Members and each of the Members hereby consents
to such election of CII. No Person may be elected as Manager in addition to or
in substitution of CII or PublicCo, other than an Affiliate of CII or PublicCo
or any of their successors-in-interest which acquire directly or indirectly
substantially all of the assets or businesses of any Affiliate of CII or
PublicCo, without the approval of the Common Members owning a majority of each
class of Common Units; provided, however, that no approval of the Class C

 

 

Common Members shall be required if there are fewer than Two Million
(2,000,000) Class C Common Units outstanding. Except as otherwise required by
applicable law and as provided in Section 5.2 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.

                  5.1.2 The Manager shall be authorized to elect, remove or replace
directors and officers of the Company, who, subject to the direction of the
Manager, 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 a resolution or resolutions of the Manager.

                  5.1.3 Except as otherwise required by 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. The Manager may delegate its
authority under this Section 5.1.3 to the officers of the Company.

                  5.1.4 No annual or regular meetings of the Manager are required. The
Manager may, by written consent and without prior notice (provided that prompt
subsequent notice is given to the Members), take any action which it is
otherwise required to take at a meeting. Such written consent may be
conclusively evidenced by any reasonable means, including without limitation
(i) any resolution of the board of the directors of the Manager authorizing,
approving or ratifying the Company’s taking of any action or (ii) any written
approval or consent of any authorized officer of the Manager on behalf of the
Manager in its capacity as such authorizing, approving or ratifying such
action.

                  5.1.5 Except as provided in this Agreement, 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 good faith, with the care
a corporate director of like position would exercise under similar
circumstances, in the manner it reasonably believes to be in the best interests
of the Company. In discharging its duties, the Manager shall not be liable to
the Company or to any Member for any act or omission performed or omitted by
such Person in good faith on behalf of, or in connection with the business and
affairs of, the Company and in a manner reasonably believed to be within the
scope of authority conferred on such Person by this Agreement, except that such
Person shall be liable in respect of any loss, damage, or claim incurred by
such Person by reason of such Person’s fraud, deceit, reckless or intentional
misconduct, gross negligence, or a knowing violation of law with respect to
such acts or omissions.

                  5.1.6 Notwithstanding the other provisions of this Section 5.1 but subject
to the provisions of Section 4.7, the Manager shall provide the Bresnan Holders
that are Affiliates of Blackstone Group L.P. consultative rights reasonably
acceptable to the Manager so that such Bresnan Holders may maintain their VCOC
status as long as they hold Class C Common Units and qualify under the VCOC
Exception.

                  5.1.7 Notwithstanding the other provisions of this Section 5.1, in
connection with PublicCo’s contribution to the Company of the net cash proceeds
and assets

 

 

received in respect of (i) the issuance of securities or incurrence of
indebtedness for borrowed money or for acquisition of assets by PublicCo or
(ii) the incurrence of any obligation by PublicCo under a capital lease, the
Manager shall issue securities or indebtedness of the Company to PublicCo that
mirrors to the extent practicable the terms and conditions of such securities,
indebtedness or capital lease obligation of PublicCo, as reasonably determined
by the Manager.

         5.2 Board of Directors.

                  5.2.1 Notwithstanding Section 5.1, the Manager may delegate its power to
manage the business of the Company to a Board of Directors (the “Board”) which,
subject to the resolutions adopted by the Manager from time to time, 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 the Manager and as are not by statute or by
this Agreement required to be exercised or done only by the Manager. The
rights and duties of the members of the Board may not be assigned or delegated
to any Person; provided that the officers specified in Section 5.4 shall act in
accordance with the directions and authorizations of the Board; provided
further that the Board may create committees, having such powers and performing
such duties as may be assigned to it by the Board, to assist the Board and the
officers in the governance of areas of importance to the Company.

                  5.2.2 Except as otherwise provided herein and to the extent that there has
been a delegation of authority under Section 5.1.2, members of the Board 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.

                  5.2.3 The number of directors shall be determined by the Manager and may
be changed from time to time by the Manager. Each director shall be appointed
by the Manager and shall serve in such capacity until the earlier of his or her
resignation or removal (with or without cause) or replacement by the Manager.

                  5.2.4 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 or any other Person, the action of the
Manager shall control.

         5.3 Board of Director Meetings.

                  5.3.1 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.

                  5.3.2 Special Meetings. Special meetings of the Board may be called by
the Chief Executive Officer or any member of the Board on twenty-four (24)
hours’ notice to each director. Notice of a special meeting may be given by
facsimile.

                  5.3.3 Telephonic Meetings. Members of the Board may participate in any
regular or special meetings 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 5.3.3 will constitute presence in person at such meeting.

                  5.3.4 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 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.

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

                  5.3.6 Board’s Duty of Care. Except as provided in this Agreement, the
director’s duty of care in the discharge of his duties to the Company and the
Members is limited to discharging his duties pursuant to this Agreement in good
faith, with the care a corporate director of like position would exercise under
similar circumstances, in the manner he reasonably believes to be in the best
interests of the Company. In discharging his duties, the director shall not be
liable to the Company or to any Member for any act or omission performed or
omitted by such director in good faith on behalf of, or in connection with the
business and affairs of, the Company and in a manner reasonably believed to be
within the scope of authority conferred on such director by this Agreement,
except that such director shall be liable in respect of any loss, damage, or
claim incurred by such director by reason of such Person’s fraud, deceit,
reckless or intentional misconduct, gross negligence, or a knowing violation of
law with respect to such acts or omissions.

         5.4 Officers.

                  5.4.1 Number, Titles, and Qualification. The Company shall have such
officers as may be necessary or desirable for the business of the Company. The
officers of the Company may include a Chairman of the Board, a Chief Executive
Officer, a President, one or more Vice Presidents, a Chief Financial Officer, a
Secretary, one or more Assistant Secretaries, a Treasurer, and one or more
Assistant Treasurers. The Chairman of the Board, Chief Executive Officer,
President, Executive Vice Presidents, Senior Vice Presidents, and Chief
Financial Officer shall be elected by the Manager or the Board. The Company
shall have such other officers as may from time to time be appointed by the
Manager, the Board, or the Chief Executive Officer. Each officer shall hold
office until his or her successor is elected or appointed, as the case may be,
and qualified or until his or her resignation or removal. Any number of
offices may be held by the same person.

                  5.4.2 Removal. Any officer of the Company may be removed at any time,
with or without cause, by the Manager, by the Chairman of the Board, by the
Board, or, except as to the Chairman of the Board, President, Executive Vice
Presidents, Senior Vice Presidents, and Chief Financial Officer, by the Chief
Executive Officer.

 

 

                  5.4.3 Resignations. Any officer may resign at any time by giving written
notice to the Company; provided, however, that notice to the Chairman of the
Board, the Chief Executive Officer or the Secretary shall be deemed to
constitute notice to the Company. Such resignation shall take effect upon
receipt of such notice or at any later time specified therein; and, unless
otherwise specified therein, the acceptance of such resignation shall not be
necessary to make it effective.

                  5.4.4 Vacancies. Any vacancy among the officers, whether caused by death,
resignation, removal or any other cause, shall be filled in the manner
prescribed for election or appointment to such office.

                  5.4.5 Action with Respect to Securities of Other Entities. Unless
otherwise directed by the Manager, the Board, the Chairman of the Board, the
Chief Executive Officer or any other officer of the Company authorized by the
Manager, the Chairman of the Board, or the Chief Executive Officer shall have
power to vote and otherwise act on behalf of the Company, in person or by
proxy, at any meeting of stockholders or equity holders of or with respect to
any action of stockholders or equity holders of any Person in which the Company
may hold securities and otherwise to exercise any and all rights and powers
which this Company may possess by reason of its ownership of securities in such
Person.

                  5.4.6 Bonds of Officers. If required by the Manager, the Chairman of the
Board, the Board, or the Chief Executive Officer, any officer of the Company
shall give a bond for the faithful discharge of his or her duties in such
amount and with such surety or sureties as the Manager, the Chairman of the
Board, the Board, or the Chief Executive Officer may require.

                  5.4.7 Compensation. The salaries of the officers shall be fixed from time
to time by the Board, unless and until the Board appoints a Compensation
Committee.

                  5.4.8 Officers of Operating Companies, Regions or Divisions. The Chief
Executive Officer shall have the power to appoint, remove and prescribe the
terms of office, responsibilities and duties of the officers of the operating
companies, regions or divisions of the Company, other than those who are
officers of the Company appointed by the Manager or the Board.

                  5.4.9 Duties and Authority of Officers.

                           (a) Chairman of the Board. The Chairman of the Board shall have general
and active responsibility for the management of the business of the Company and
shall be responsible for implementing all orders and resolutions of the Manager
or the Board. The Chairman of the Board shall be elected from among the
directors, and the Chairman of the Board or, at the election of the Chairman of
the Board, the Chief Executive Officer shall preside at all meetings of the
Members and directors. The Chief Executive Officer shall report to the
Chairman of the Board.

                           (b) Chief Executive Officer. The Chief Executive Officer shall supervise
the daily operations of the business of the Company, and shall report to the
Chairman of the Board. Subject to the provisions of this Agreement and to the
direction of the Manager, the Chairman of the Board, or the Board, he or she
shall perform all duties

 

 

which are commonly incident to the office of chief executive officer of a
corporation organized under the laws of the State of Delaware or which are
delegated to him or her by the Manager, the Chairman of the Board, or the
Board. To the fullest extent permitted by law, he or she shall have power to
sign all contracts and other instruments of the Company which are authorized
and shall have general supervision and direction of all of the other officers,
employees and agents of the Company. The Chief Executive Officer shall perform
the duties and exercise the powers of the Chairman of the Board in the event of
the Chairman of the Board’s absence or disability.

                           (c) President. The President shall have such powers and duties as may be
delegated to him or her by the Manager, the Chairman of the Board, the Board,
or the Chief Executive Officer. The President shall perform the duties and
exercise the powers of the Chief Executive Officer in the event of the Chief
Executive Officer’s absence or disability.

                           (d) Vice President. Each Vice President shall have such powers and duties
as may be delegated to him or her by the Manager, the Chairman of the Board,
the Board, or the Chief Executive Officer.

                           (e) Chief Financial Officer. The Chief Financial Officer shall have
responsibility for maintaining the financial records of the Company. He or she
shall render from time to time an account of all such transactions and of the
financial condition of the Company. The Chief Financial Officer shall also
perform such other duties as the Manager, the Board, or the Chief Executive
Officer may from time to time prescribe.

                           (f) Treasurer. The Treasurer shall have the responsibility for
investments and disbursements of the funds of the Company as are authorized and
shall render from time to time an account of all such transactions. The
Treasurer shall also perform such other duties as the Manager, the Board, or
the Chief Executive Officer may from time to time prescribe.

                           (g) The Secretary. The Secretary shall issue all authorized notices for,
and shall keep minutes of, all meetings of the Members and the Board. He or
she shall have charge of the corporate books and shall perform such other
duties as the Manager, the Board, or the Chief Executive Officer may from time
to time prescribe.

                           (h) Delegation of Authority. The Manager, the Chairman of the Board, the
Board, or the Chief Executive Officer may from time to time delegate the powers
or duties of any officer to any other officers or agents, notwithstanding any
provision hereof.

         5.5 Indemnification.

                  5.5.1 Indemnification. To the extent permitted by applicable law, a
Member (and its respective officers, directors, agents, shareholders, members,
partners, and Affiliates), Manager (and its respective officers, directors,
agents, shareholders, members, partners, and Affiliates), director of the
Company, or officer of the Company shall be entitled to indemnification from
the Company for any loss, damage, or claim incurred by such Person by reason of
any act or omission performed or omitted by such Person in good faith on behalf
of, or in connection with the business and affairs of, the Company and in a

 

 

manner reasonably believed to be within the scope of authority conferred
on such Person by this Agreement and, if applicable, the Approval of the
Members or authorizations of the Manager or the Board, except that no such
Person shall be entitled to be indemnified in respect of any loss, damage, or
claim incurred by such Person by reason of such Person’s fraud, deceit,
reckless or intentional misconduct, gross negligence, or a knowing violation of
law with respect to such acts or omissions; provided, however, that any
indemnity under this Section 5.5.1 shall be provided out of and to the extent
of Company assets only, no debt shall be incurred by the Members in order to
provide a source of funds for any indemnity, and no Member shall have any
personal liability (or any liability to make any additional Capital
Contributions) on account thereof.

                  5.5.2 Expenses. To the extent permitted by applicable law, expenses
(including reasonable legal fees) incurred by a Member (and its respective
officers, directors, agents, shareholders, members, partners or Affiliates),
Manager (and its respective officers, directors, agents, shareholders, members,
partners or Affiliates), director of the Company, or officer of the Company in
such Person’s capacity as such in defending any claim, demand, action, suit, or
proceeding shall, from time to time, be advanced by the Company prior to the
final disposition of such claim, demand, action, suit, or proceeding upon
receipt by the Company of an undertaking by or on behalf of the Member (or its
respective officers, directors, agents, shareholders, members, partners or
Affiliates, as applicable), Manager (or its respective officers, directors,
agents, shareholders, members, partners or Affiliates, as applicable), director
or officer to repay such amount if it shall be determined that such Person is
not entitled to be indemnified as authorized in Section 5.5.1 hereof.

         5.6 Devotion of Time. Except as required by any individual contract and
notwithstanding any provision to the contrary in this Agreement, no Manager,
director of the Company, or officer of the Company is obligated to devote all
of such Person’s time or business efforts to the affairs of the Company, but
shall devote such time, effort, and skill as such Person deems appropriate for
the operation of the Company.

         5.7 Competing Activities. Except as provided by any individual contract:
(i) any Manager or Member (and their respective officers, directors, agents,
shareholders, members, partners or Affiliates) may engage or invest in,
independently or with others, any business activity of any type or description,
including without limitation those that might be the same as or similar to the
Company’s business or the business of any Subsidiary and that might be in
direct or indirect competition with the Company or any Subsidiary; (ii) neither
the Company or any Subsidiary nor any Member shall have any right in or to such
other ventures or activities or to the income or proceeds derived therefrom;
(iii) no Manager or Member (and their respective officers, directors, agents,
shareholders, members, partners or Affiliates) shall be obligated to present
any investment opportunity or prospective economic advantage to the Company or
any Subsidiary, even if the opportunity is of the character that, if presented
to the Company or any Subsidiary, could be taken by the Company or any
Subsidiary; and (iv) any Manager or Member (and their respective officers,
directors, agents, shareholders, members, partners or Affiliates) shall have
the right to hold any investment opportunity or prospective economic advantage
for such Manager’s or Member’s (and their respective officers’, directors’,
agents’, shareholders’, members’, partners’ or Affiliates’) own account or to
recommend such opportunity to Persons other than the Company or any

 

 

 Subsidiary; (i) provided that as a condition to election as Manager and
receiving a Membership Interest in the Company upon consummation of the IPO,
PublicCo agrees that until all outstanding shares of Class B Common Stock have
been converted into shares of Class A Common Stock in accordance with Clause
(b)(viii) of Article Fourth of PublicCo’s certificate of incorporation as
constituted as of the Class B Common Measuring Date, it shall not engage
directly or indirectly, including without limitation through any Subsidiary, in
any business other than (A) the Cable Transmission Business, (B) as a member or
shareholder of, and subscriber to, the portal joint venture with Broadband
Partners, (C) as an owner and operator of the business of Interactive
Broadcaster Services Corporation, a California corporation, which shall include
solely the ownership of its assets and continuation of its business
substantially as owned and conducted as of September 13, 2000, (D) as a member
of and service provider to the joint venture for the development of a
licensable reference design for a cable set-top box with functionalities of a
video cassette recorder and a personal video recorder, (E) as a member of Cable
Sports, so long as Cable Sports continues to conduct substantially the same
business conducted by it on October 24, 2000, (F) as a shareholder of HSA, so
long as HSA continues to conduct substantially the same business as conducted
by it at the time of the consummation of the transactions contemplated by the
Stock Purchase Agreement dated as of October 19, 2000 among Charter
Communications Ventures, LLC, HSA and Vulcan Ventures Incorporated, as it may
be amended from time to time, and (G) on and after February 12, 2001, as an
equity investor in @Security Broadband Corp., a Texas corporation, so long as
@Security Broadband Corp. continues to conduct substantially the same business
conducted by it on February 1, 2001; (ii) provided further, that to the extent
that, as of the Class B Common Measuring Date, PublicCo was directly or
indirectly engaged in, or had agreed to acquire directly or indirectly, an
Incidental Business, so long as (a) such Incidental Businesses so engaged in by
PublicCo on the Class B Common Measuring Date in the aggregate on such date
accounted for less than ten percent (10%) of the consolidated revenues of the
total business engaged in by PublicCo, or (b) such Incidental Businesses which
on the Class B Common Measuring Date PublicCo had agreed to acquire in the
aggregate on such date accounted for less than ten percent (10%) of the
consolidated revenues of the total businesses to be acquired, as applicable,
PublicCo may, directly or indirectly, including through any Subsidiary,
continue to conduct any such Incidental Business and the foregoing limitation
on the business and purpose of PublicCo shall not require that any such
Incidental Business be divested by PublicCo, but PublicCo shall not, directly
or indirectly, expand any such Incidental Business by means of any acquisition
or any commitment of PublicCo or its Subsidiaries’ resources or financial
support. PublicCo also agrees that it shall not (i) hold any assets, other
than (a) working capital cash and cash equivalents held for the payment of
current obligations and receivables from the Company; (b) Common Units; (c)
back-to-back obligations and mirror equity interests of the Company, consisting
of obligations and equity securities (other than Common Units, but including
convertible securities), which are substantially equivalent to liabilities or
obligations or securities of PublicCo to third parties; (d) assets subject to
an existing obligation to contribute such assets (or successor assets) to the
Company in exchange for Units; (e) assets acquired as a result of the issuance
of (x) common stock of PublicCo and/or preferred stock of PublicCo and/or (y)
liabilities or obligations of PublicCo, subject to an existing obligation to
contribute such assets (or successor assets) to the Company in exchange for
Common Units (in respect of the common stock of PublicCo issued) and/or for
mirror equity securities (other than Common Units, but including convertible
securities, in respect of the mirror equity securities issued) of the Company

 

 

 and/or liabilities or obligations of the Company (in respect of the
liabilities or obligations incurred), which are substantially equivalent to the
equity securities and/or liabilities and obligations of PublicCo issued to
acquire such assets; or (f) goodwill or deferred tax assets, or (ii) incur any
liabilities or obligations for borrowed money, for acquisition of assets or
under any capital lease, other than (a) in connection with back-to-back
obligations of the Company to PublicCo consisting of liabilities or obligations
of the Company which are substantially equivalent to liabilities or obligations
of PublicCo to a third party; (b) liabilities or obligations incident to the
acquisition of Units in exchange for common stock of PublicCo; or (c)
liabilities or obligations as contemplated by Clauses (i)(d) and (e)
immediately above. PublicCo further agrees (x) that it shall not issue,
transfer from treasury stock or repurchase shares of its common stock unless in
connection with any such issuance, transfer, or repurchase PublicCo takes all
requisite action such that, after giving effect to all such issuances,
transfers or repurchases, the number of outstanding shares of common stock will
equal on a one-for-one basis the number of Common Units owned by PublicCo; (y)
that it shall not issue, transfer from treasury stock or repurchase shares of
preferred stock of PublicCo unless in connection with any such issuance,
transfer or repurchase PublicCo takes all requisite action such that, after
giving effect to all such issuances, transfers or repurchases, PublicCo holds
mirror equity interests of the Company which are in the aggregate substantially
equivalent to the outstanding preferred stock of PublicCo; and (z) upon any
reclassification of the Common Units, whether by combination, division or
otherwise, it shall take all requisite action so that the number of outstanding
shares of common stock will equal on a one-for-one basis the number of Common
Units owned by PublicCo.

         The Company agrees that, until all outstanding shares of Class B Common
Stock have been converted into shares of Class A Common Stock in accordance
with Clause (b)(viii) of Article Fourth of PublicCo’s certificate of
incorporation as constituted as of the Class B Common Measuring Date, without
the Approval of the Class A Common Members, (i) the Company shall not engage
directly or indirectly, including without limitation through any Subsidiary, in
any business other than (A) the Cable Transmission Business, (B) as a member or
shareholder of, and subscriber to, the portal joint venture with Broadband
Partners, (C) as an owner and operator of the business of Interactive
Broadcaster Services Corporation, a California corporation, which shall include
solely the ownership of its assets and continuation of its business
substantially as owned and conducted as of September 13, 2000, (D) as a member
of and service provider to the joint venture for the development of a
licensable reference design for a cable set-top box with functionalities of a
video cassette recorder and a personal video recorder, (E) as a member of Cable
Sports, so long as Cable Sports continues to conduct substantially the same
business conducted by it on October 24, 2000, (F) as a shareholder of HSA, so
long as HSA continues to conduct substantially the same business as conducted
by it at the time of the consummation of the transactions contemplated by the
Stock Purchase Agreement dated as of October 19, 2000 among Charter
Communications Ventures, LLC, HSA and Vulcan Ventures Incorporated, as it may
be amended from time to time, and (G) on and after February 12, 2001, as an
equity investor in @Security Broadband Corp., a Texas corporation, so long as
@Security Broadband Corp. continues to conduct substantially the same business
conducted by it on February 1, 2001; and (ii) to the extent that, as of the
Class B Common Measuring Date, the Company was directly or indirectly engaged
in, or had agreed to acquire directly or indirectly, an Incidental Business, so
long as (a) such Incidental Businesses so engaged in by the Company on the

 

 

 Class B Common Measuring Date in the aggregate on such date accounted for
less than ten percent (10%) of the consolidated revenues of the total business
engaged in by the Company or (b) such Incidental Businesses which on the Class
B Common Measuring Date the Company had agreed to acquire in the aggregate on
such date accounted for less than ten percent (10%) of the consolidated
revenues of the total businesses to be acquired, as applicable, the Company
may, directly or indirectly, including through any Subsidiary, continue to
conduct any such Incidental Business and the foregoing limitation on the
business and purpose of the Company shall not require that any such Incidental
Business be divested by the Company, but the Company shall not, directly or
indirectly, expand any such Incidental Business by means of any acquisition or
any commitment of the Company or its Subsidiaries’ resources or financial
support.

         The Company and each Member acknowledge that the other Members, the
Manager (and their respective officers, directors, agents, shareholders,
members, partners or Affiliates) and the officers or directors of the Company
(to the extent expressly permitted in their employment agreement) might own or
manage other businesses, including businesses that may compete with the Company
or any Subsidiary for the time of the Member or Manager. Without limiting the
generality of the foregoing, the Company and each Member acknowledge that
Vulcan Ventures Inc., an Affiliate of CII and Vulcan Cable, entered into an
agreement to purchase convertible preferred stock of RCN Corporation, which may
be deemed to be engaged in the cable transmission business. The Company and
each Member acknowledge that none of them shall have any interest in the
securities of RCN Corporation to be acquired by Vulcan Ventures Inc. or any RCN
Corporation common stock into which such securities are convertible, and that
Vulcan Ventures Inc. shall not have any obligation to them on account thereof.
To the extent that, at law or at equity, any Member or Manager (and their
respective officers, directors, agents, shareholders, members, partners or
Affiliates) or officers or directors of the Company have duties (including
fiduciary duties) and liabilities relating to the Company and the other
Members, such Person shall not be liable to the Company or the other Members
for its good faith reliance on the provisions of this Agreement including this
Section 5.7. The Company and each Member hereby waive any and all rights and
claims that the Company or such Member may otherwise have against the other
Members and the Manager (and their respective officers, directors, agents,
shareholders, members, partners or Affiliates) or officers or directors of the
Company as a result of any such permitted activities. The provisions of this
Agreement, and any agreement between the Company and any Member entered into in
reliance on this Section 5.7, to the extent that they restrict the duties and
liabilities of a Manager or Member (and their respective officers, directors,
agents, shareholders, members, partners or Affiliates) or officers or directors
of the Company otherwise existing at law or in equity, are agreed by the
Company and the Members to replace such other duties and liabilities of such
Person.

         5.8 Remuneration for Management or Other Services. The Manager,
directors, and officers of the Company shall be entitled to reasonable
remuneration for providing management or other services to the Company, all as
determined by the Manager.

         5.9 Reimbursement of Expenses. The Company shall reimburse the Manager,
directors of the Company, and officers of the Company for the actual and
reasonable costs, fees, and expenses paid or incurred by any Person for goods,
materials, services, and activities acquired or used by or for the benefit of
the Company, or performed or undertaken

 

 

 for the benefit of the Company. Without limiting the generality of the
foregoing, the Company shall reimburse PublicCo, for all costs, fees, and
expenses paid or incurred by PublicCo in connection with the IPO and its
compliance with the Securities Act, the Securities Exchange Act of 1934, as
amended, the Investment Company Act of 1940, as amended, and any other
applicable federal and state securities laws without duplication of any expense
paid.

ARTICLE VI

ALLOCATIONS OF NET PROFITS AND NET LOSSES

AND

DISTRIBUTIONS

         6.1 Allocations of Net Profits. After giving effect to the special
allocations set forth in Sections 6.3 and 6.5 herein (and any allocations
required by Section 3.6.6 herein), Net Profits for any Allocation Period shall
be allocated to the Members as follows:

                  6.1.1 For any Allocation Period ending prior to the Class B Common Change
Date, if the Company has Combined Book Losses for such Allocation Period, then:

                           (a) to each of the Common Members (including the Class A Common Members)
other than the Class B Common Members, in an amount equal to (i) the amount of
Net Profits, multiplied by (ii) such Common Member’s Percentage Interest; and

                           (b) in addition to the amount allocated to the Class A Common Members
pursuant to Section 6.1.1(a), to the Class A Common Members, to be allocated
among them in proportion to their Percentage Interests, in an amount equal to
(i) the amount of Net Profits, multiplied by (ii) the Class B Common Members’
aggregate Percentage Interests.

                  6.1.2 For any Allocation Period ending after the Class B Common Change
Date, if the Company has Combined Book Losses for such Allocation Period, then
to each of the Common Members in accordance with such Common Member’s
Percentage Interest.

                  6.1.3 For any Allocation Period ending after the Class B Common Measuring
Date, if the Company has Combined Book Profits for such Allocation Period and
if there is any Special Allocation Amount as of the beginning of such
Allocation Period, then:

                           (a) to each of the Common Members (including the Class A Common Members)
other than the Class B Common Members, in an amount equal to (i) the amount of
Net Profits, multiplied by (ii) such Common Member’s Percentage Interest;

                           (b) in addition to the amount allocated to the Class A Common Members
pursuant to Section 6.1.3(a), to the Class A Common Members, to be allocated
among them in proportion to their Percentage Interests, in an amount equal to
(i) the amount of Net Profits, multiplied by (ii) the product of the Class B
Common Members’ aggregate Percentage Interests and the Special Allocation
Amount Ratio; provided, however, that the allocation of Net Profits pursuant to
this Section 6.1.3(b) shall be subject to Section 6.4; and

 

 

                           (c) to the Class B Common Members, to be allocated among them in
proportion to their Percentage Interests, in an amount equal to (i) the amount
of Net Profits multiplied by the Class B Common Members’ aggregate Percentage
Interests, minus (ii) the amount of Net Profits allocated to the Class A Common
Members pursuant to Section 6.1.3(b) for such Allocation Period.

                  6.1.4 For any Allocation Period ending after the Class B Common Measuring
Date, if the Company has Combined Book Profits for such Allocation Period and
if there is no Special Allocation Amount as of the beginning of such Allocation
Period, then to each of the Common Members in accordance with such Common
Member’s Percentage Interest.

         6.2 Allocations of Net Losses. After giving effect to the special
allocations set forth in Sections 6.3 and 6.5 herein (and any allocations
required by Section 3.6.6 herein), Net Losses for any Allocation Period shall
be allocated to the Members as follows:

                  6.2.1 For any Allocation Period ending prior to the Class B Common Change
Date:

                           (a) to each of the Common Members (including the Class A Common Members)
other than the Class B Common Members, in an amount equal to (i) the amount of
Net Losses, multiplied by (ii) such Common Member’s Percentage Interest; and

                           (b) in addition to the amount allocated to the Class A Common Members
pursuant to Section 6.2.1(a), to the Class A Common Members, to be allocated
among them in proportion to their Percentage Interests, in an amount equal to
(i) the amount of Net Losses, multiplied by (ii) the Class B Common Members’
aggregate Percentage Interests.

                  6.2.2 For any Allocation Period ending after the Class B Common Change
Date, to each of the Common Members in accordance with such Common Member’s
Percentage Interest.

                  6.2.3 Notwithstanding Sections 6.2.1 and 6.2.2, an allocation of Net
Losses under Section 6.2.1 or 6.2.2 hereof shall not be made to the extent it
would create or increase an Adjusted Capital Account Deficit for a Member or
Members at the end of any Allocation Period. Any Net Losses not allocated
because of the preceding sentence shall be allocated to the other Member or
Members in proportion to such Member’s or Members’ respective Percentage
Interests; provided, however, that to the extent such allocation would create
or increase an Adjusted Capital Account Deficit for another Member or Members
at the end of any Allocation Period, such allocation shall be made to the
remaining Member or Members in proportion to the respective Percentage
Interests of such Member or Members.

         6.3 Special Allocations. The following special allocations shall be made
in the following order:

                  6.3.1 Minimum Gain Chargeback. Except as otherwise provided in
Regulations Section 1.704-2(f), notwithstanding any other provision of this
Article VI, if there is a net decrease in Company Minimum Gain during any
Allocation Period, each

 

 

Member shall be specially allocated items of Company income and gain for
such Allocation Period (and, if necessary, subsequent Allocation Periods) in an
amount equal to the portion of such Member’s share of the net decrease in
Company Minimum Gain which share of such net decrease shall be determined in
accordance with Regulations Section 1.704-2(g)(2). Allocations pursuant to the
previous sentence shall be made in proportion to the respective amounts
required to be allocated to each Member pursuant thereto. The items to be so
allocated shall be determined in accordance with Regulations Section
1.704-2(f)(6) and 1.704-2(j)(2). This Section 6.3.1 is intended to comply with
the minimum gain chargeback requirement contained in Regulations Section
1.704-2(f) and shall be interpreted consistently therewith.

                  6.3.2 Member Minimum Gain Chargeback. Except as otherwise provided in
Regulation Section 1.704-2(i)(4), notwithstanding any other provision of this
Article VI, if there is a net decrease in Member Nonrecourse Debt Minimum Gain
attributable to a Member Nonrecourse Debt during any Allocation Period, each
Member who has a share of the Member Nonrecourse Debt Minimum Gain attributable
to such Member Nonrecourse Debt (which share shall be determined in accordance
with Regulations Section 1.704-2(i)(5)) shall be specially allocated items of
Company income and gain for such Allocation Period (and, if necessary,
subsequent Allocation Periods) in an amount equal to that portion of such
Member’s share of the net decrease in Member Nonrecourse Debt Minimum Gain
attributable to such Member Nonrecourse Debt, determined in accordance with
Regulations Section 1.704-2(i)(4). Allocations pursuant to the previous
sentence shall be made in proportion to the amounts required to be allocated to
each Member pursuant thereto. The items to be so allocated shall be determined
in accordance with Regulations Section 1.704-2(i)(4) and 1.704-2(j)(2). This
Section 6.3.2 is intended to comply with the minimum gain chargeback
requirement contained in Regulations Section 1.704-2(i)(4) and shall be
interpreted consistently therewith.

                  6.3.3 Qualified Income Offset. In the event any Member unexpectedly
receives any adjustments, allocations, or distributions described in
Regulations Section 1.704-1(b)(2)(ii)(d)(4), (5), or (6) or any other event
creates an Adjusted Capital Account Deficit, items of Company income and gain
shall be specially allocated to each such Member in an amount and manner
sufficient to eliminate the Adjusted Capital Account Deficit of such Member as
quickly as possible, provided that an allocation pursuant to this Section 6.3.3
shall be made only if and to the extent that such Member would have an Adjusted
Capital Account Deficit after all other allocations provided for in this
Article VI have been tentatively made as if this Section 6.3.3 were not in the
Agreement.

                  6.3.4 Nonrecourse Deductions Referable to Liabilities Owed to Non-Members.
Any Nonrecourse Deductions for any Allocation Period and any other deductions
or losses for any Allocation Period referable to a liability owed by the
Company to a Person other than a Member to the extent that no Member bears the
economic risk of loss shall be specially allocated to the Members in accordance
with their Percentage Interests.

                  6.3.5 Member Nonrecourse Deductions. Any Member Nonrecourse Deductions
for any Allocation Period shall be specially allocated to the Member who bears
the economic risk of loss with respect to the Member Nonrecourse Debt or other
liability to

 

 

which such Member Nonrecourse Deductions are attributable in accordance
with Regulations Section 1.704-2(i) and Regulations Section 1.704-1(b).

                  6.3.6 Section 754 Adjustments. To the extent an adjustment to the Basis
of any Company asset pursuant to Code Section 734(b) or Code Section 743(b) is
required, pursuant to Regulations Section 1.704-1(b)(2)(iv)(m), to be taken
into account in determining Capital Accounts, the amount of such adjustment to
Capital Accounts shall be treated as an item of gain (if the adjustment
increases the Basis of the asset) or loss (if the adjustment decreases such
Basis) and such gain or loss shall be specially allocated to the Members in
accordance with Regulations Section 1.704-1(b)(2)(iv)(m).

                  6.3.7 Depreciation and Amortization. All of the remaining items of
Company deduction for Depreciation for any Allocation Period shall be specially
allocated to the Members as follows:

                           (a) For any Allocation Period ending prior to the Class B Common Change
Date, if the Company has Combined Book Losses for such Allocation Period, then:
(x) to each of the Common Members other than the Class A Common Members, the
Class B Common Members, and the Class C Common Members in an amount equal to
(i) the amount of the item to be allocated, multiplied by (ii) such Member’s
Percentage Interest; and (y) to the Class A Common Members, to be allocated
among them in proportion to their Percentage Interests, in an amount equal to
(i) the amount of the item to be allocated, multiplied by (ii) the Class B
Common Members’ aggregate Percentage Interests.

                           (b) For any Allocation Period ending after the Class B Common Change Date,
if the Company has Combined Book Losses for such Allocation Period, then to
each of the Common Members other than the Class A Common Members and the Class
C Common Members in an amount equal to (i) the amount of the item to be
allocated, multiplied by (ii) such Member’s Percentage Interest.

                           (c) For any Allocation Period ending after the Class B Common Measuring
Date, if the Company has Combined Book Profits for such Allocation Period and
if there is any Special Allocation Amount as of the beginning of such
Allocation Period, then: (x) to each of the Common Members other than the
Class A Common Members, the Class B Common Members, and the Class C Common
Members in an amount equal to (i) the amount of the item to be allocated,
multiplied by (ii) such Member’s Percentage Interest; (y) to the Class A Common
Members, to be allocated among them in proportion to their Percentage
Interests, in an amount equal to (i) the amount of the item to be allocated,
multiplied by (ii) the product of the Class B Common Members’ aggregate
Percentage Interests and the Special Allocation Amount Ratio; provided,
however, that the allocation of items pursuant to this Section 6.3.7(c)(y)
shall be subject to Section 6.4; and (z) to the Class B Common Members, to be
allocated among them in proportion to their Percentage Interests, in an amount
equal to (i) the amount of the item to be allocated multiplied by the Class B
Common Members’ aggregate Percentage Interests, minus (ii) the amount of such
item allocated to the Class A Common Members pursuant to Section 6.3.7(c)(y)
for such Allocation Period.

 

 

                           (d) For any Allocation Period ending after the Class B Common Measuring
Date, if the Company has Combined Book Profits for such Allocation Period and
if there is no Special Allocation Amount as of the beginning of such Allocation
Period, then to each of the Common Members other than the Class A Common
Members and the Class C Common Members in an amount equal to (i) the amount of
the item to be allocated, multiplied by (ii) such Member’s Percentage Interest.

                           (e) For any Allocation Period ending prior to the Class C Common Change
Date, to each of the Class C Common Members in an amount determined as follows:
The allocation provisions in this Article VI shall first be applied
tentatively without taking into account any items of Depreciation, other than
items of Depreciation allocated under Sections 6.3.4 and 6.3.5. Such tentative
application of the allocation provisions shall result in a calculation of the
amount of the taxable income or loss (“Tentative Taxable Income” or “Tentative
Tax Loss,” respectively) that would be allocated to each Class C Common Member
by the Company if such tentative application were final. Next, items of
Depreciation under this Section 6.3.7(e) shall be allocated to each Class C
Common Member with Tentative Taxable Income to the extent necessary to cause
the amount of the taxable income, excluding any taxable income arising from a
sale or other disposition (other than in the ordinary course of business) of
any Class C Common Contributed Property (to the extent that at the time of its
contribution to the Company its Gross Asset Value differs from its Basis),
allocated to such Member by the Company to be equal, or as nearly equal as
possible, to zero. In allocating items of Depreciation to each Class C Common
Member with Tentative Taxable Income pursuant to the preceding sentence, the
Company shall, to the extent possible, allocate to such Member a uniform
percentage of each item of Depreciation allocated under Section 6.3.7. If the
allocation of items of Depreciation under this Section 6.3.7(e) is insufficient
to reduce to zero such taxable income for each Class C Common Member, then such
items shall be allocated to the Class C Common Members in proportion to their
respective Tentative Taxable Incomes. No items of Deprecation under this
Section 6.3.7(e) shall be allocated to any Class C Common Member with a
Tentative Tax Loss. For purposes of this Section 6.3.7, the Company’s taxable
income or loss, as determined in accordance with Code Section 703(a), shall
include all items of income, gain, loss, or deduction required to be stated
separately pursuant to Code Section 703(a)(1). With respect to each of
Blackstone BC Capital Partners, L.P., Blackstone BC Offshore Capital Partners,
L.P., Blackstone Family Media Partnership III L.P., William J. Bresnan, and BCI
(USA), LLC, if the allocation of items of Depreciation to such Member under the
foregoing provisions of this Section 6.3.7(e), for any Allocation Period ending
prior to the Class C Common Change Date, is insufficient to cause the amount of
such Member’s Alternative Minimum Tax (as hereinafter defined) to be equal, or
as nearly equal as possible, to zero, then additional items of Depreciation
shall be allocated to such Member under this Section 6.3.7(e) to the extent
necessary to cause such result. To the extent practicable, such allocation of
additional items of Depreciation shall be made in a manner consistent with the
provisions governing the allocation of other items of Depreciation under this
Section 6.3.7(e). For purposes of this Section 6.3.7(e), “Alternative Minimum
Tax” means, with respect to such a Member, the amount of the tax imposed by
Code Section 55(a) (as determined in accordance with Code Sections 55 through
59, inclusive), excluding any such tax attributable to a sale or other
disposition (other than in the ordinary course of business) of any Class C
Common Contributed Property (to the extent that at the time of its contribution
to the Company its Gross Asset Value differs from its Basis), assuming that

 

 

such Member has no income, gain, loss, deduction, or other item to be
taken into account for federal income tax purposes other than such Member’s
allocations from the Company.

                           (f) For any Allocation Period ending after the Class C Common Change Date,
to each of the Class C Common Members in an amount determined as follows: The
allocation provisions in this Article VI, excluding the provisions of Section
6.5 calling for offsetting special allocations to be made as a result of the
operation of this Section 6.3.7(f), shall first be applied tentatively and with
two hypothetical modifications. First, all items of Depreciation, other than
items of Depreciation allocated under Section 6.3.5, shall be hypothetically
allocated to the Members in accordance with their Percentage Interests.
Second, tax allocations with respect to each Class C Common Contributed
Property and to each property (other than cash) contributed by CII in exchange
for Class A Common Units (in each case, to the extent that at the time of its
contribution to the Company its Gross Asset Value differs from its Basis) shall
be hypothetically made using the Remedial Method so as to eliminate distortions
caused by the ceiling rule described in Regulations Section 1.704-3(b)(1),
without changing the amount of the items of Depreciation (as determined under
the rules of Regulations Section 1.704-1(b)(2)(iv)(g)(3)) that are
hypothetically allocated pursuant to the preceding sentence and that are
attributable to such Class C Common Contributed Property or to such property
contributed by CII (in each case, to the extent that at the time of its
contribution to the Company its Gross Asset Value differs from its Basis).
Such tentative application of the allocation provisions shall result in a
calculation of the amount of the Tentative Taxable Income or Tentative Tax Loss
that would be allocated to each Class C Common Member by the Company if such
tentative application, with the two hypothetical modifications described above,
were final. Next, in lieu of the two hypothetical modifications described
above, items of Depreciation under this Section 6.3.7(f) shall be allocated to
each Class C Common Member so as to cause the amount of the taxable income or
loss allocated to such Member by the Company (using the Traditional Method with
respect to each Class C Common Contributed Property and to each property (other
than cash) contributed by CII in exchange for Class A Common Units, in each
case to the extent that at the time of its contribution to the Company its
Gross Asset Value differs from its Basis) to be equal, or as nearly equal as
possible, to that Member’s Tentative Taxable Income or Tentative Tax Loss,
whichever is applicable. For purposes of this Section 6.3.7, Class C Common
Contributed Property includes certain underlying assets held directly or
indirectly by the Company (e.g., the assets of CC VIII, LLC, a Delaware limited
liability company, or its successor) to the extent that, for purposes of the
application of Code Section 704(c) principles and Regulations Section 1.704-3,
a Class C Common Member is treated as a contributing partner or its equivalent
with respect to such assets.

         (g)  To the extent not allocated under (a), (b), (c), (d), (e) or (f)
above, to the Class A Common Members, to be allocated among them in proportion
to their Percentage Interests.

If the aggregate amount of the items of Depreciation available to be allocated
under this Section 6.3.7 for any Allocation Period is less than the sum of the
items of Depreciation provided for under Section 6.3.7(a), (b), (c), or (d), on
the one hand, and the items of Depreciation provided for under Section 6.3.7(e)
or (f), on the other, then the items of Depreciation available to be allocated
under this Section 6.3.7 for such Allocation Period shall be divided between
Section 6.3.7(a), (b), (c), or (d), on the one hand, and Section

 

 

6.3.7(e) or (f), on the other, in proportion to the respective amounts of the
items of Depreciation provided for under such Sections. Notwithstanding the
foregoing provisions of this Section 6.3.7, an allocation of items of
Depreciation under such provisions shall be subject to a limitation similar to
that set forth in Section 6.2.3 (including the related provisions of Section
6.5.1), and in the event that such a limitation precludes any allocation, the
Manager shall, to the extent possible, make appropriate adjustments in other
allocations hereunder to take into account the effect of such limitation.

                  6.3.8
Preferred Return Allocations. All or a portion of the remaining
items of Company income and, to the extent income is insufficient, gain shall
be specially allocated to each Class A Preferred Member in an amount equal to
the cumulative Class A Preferred Return Amount (with respect to which there has
been no allocation under this Section 6.3.8) for any Class A Preferred Units
(i) redeemed from such Member during the Allocation Period pursuant to Section
3.5.2 or 3.5.3, (ii) Transferred by such Member to PublicCo or any other Person
pursuant to the Rifkin Contribution Agreement, the Rifkin Put Agreement or this
Agreement, or (iii) with respect to which liquidating distributions are made
pursuant to Article IX. If, in addition to items of income, items of gain are
to be allocated pursuant to the foregoing sentence and the Company has items of
both short-term capital gain and long-term capital gain, all of the Company’s
items of short-term capital gain shall be allocated before any items of
long-term capital gain are allocated.

                  6.3.9 Non-Operating Profits and Non-Operating Losses. Non-Operating
Profits and Non-Operating Losses for any Allocation Period shall be specially
allocated to the Members as follows:

                           (a) If the Company has Non-Operating Profits for such Allocation Period
and if, disregarding any allocations that may be made pursuant to Section
6.3.9(a)(y) for the current Allocation Period, there would be any Special
Allocation Amount as of the end of such Allocation Period after all other
allocations provided for in this Article VI were made (the “Tentative Special
Allocation Amount”), then: (x) to each of the Common Members (including the
Class A Common Members) other than the Class B Common Members, in an amount
equal to (i) the amount of the item to be allocated, multiplied by (ii) such
Common Member’s Percentage Interest; (y) in addition to the amount allocated to
the Class A Common Members pursuant to Section 6.3.9(a)(x), to the Class A
Common Members, to be allocated among them in proportion to their Percentage
Interests, in an amount equal to (i) the amount of the item to be allocated,
multiplied by (ii) the product of the Class B Common Members’ aggregate
Percentage Interests and the Tentative Special Allocation Amount Ratio; and (z)
to the Class B Common Members, to be allocated among them in proportion to
their Percentage Interests, in an amount equal to (i) the amount of the item to
be allocated multiplied by the Class B Common Members’ aggregate Percentage
Interests, minus (ii) the amount of such item allocated to the Class A Common
Members pursuant to Section 6.3.9(a)(y) for such Allocation Period.

                           (b) If the Company has Non-Operating Profits for such Allocation Period
and if there is no Tentative Special Allocation Amount as of the end of such
Allocation Period, then to each of the Common Members in an amount equal to (i)
the amount of the item to be allocated, multiplied by (ii) such Common Member’s
Percentage Interest.

 

 

                           (c) If the Company has Non-Operating Losses for such Allocation Period,
then to each of the Common Members in an amount equal to (i) the amount of the
item to be allocated, multiplied by (ii) such Common Member’s Percentage
Interest.

                           (d) Notwithstanding Section 6.3.9(c), an allocation of Non-Operating
Losses under Section 6.3.9(c) hereof (i.e., a proportionate part of every item
of gain and loss that otherwise would be allocated under Section 6.3.9(c))
shall not be made to the extent it would create or increase an Adjusted Capital
Account Deficit for a Member or Members at the end of any Allocation Period.
Any Non-Operating Losses not allocated because of the preceding sentence shall
be allocated to the other Member or Members in proportion to such Member’s or
Members’ respective Percentage Interests; provided, however, that to the extent
such allocation would create or increase an Adjusted Capital Account Deficit
for another Member or Members at the end of any Allocation Period, such
allocation shall be made to the remaining Member or Members in proportion to
the respective Percentage Interests of such Member or Members.

                  6.3.10 Imputed Interest. If any Member or an Affiliate of any Member is
imputed any interest income from the Company, then (i) such Member shall be
deemed to have made a Capital Contribution in an amount equal to the amount of
the Company’s imputed interest expenditures related thereto, and (ii) the
Company’s deductions attributable to such expenditures shall be specially
allocated to such Member. If there are no such deductions, the Manager shall
make appropriate adjustments in other allocations hereunder to cause the effect
of any Code Section 704(b) book basis attributable to such expenditures to be
allocated to such Member. Consistent with the foregoing principles, the
Manager may, if appropriate, make similar allocations and adjustments in the
case of interest income imputed from an Affiliate of the Company.

         6.4 Certain Allocations to the Class A Common Members and the Class B
Common Members. Notwithstanding any other provision of this Article VI (other
than the Regulatory Allocations), the allocations to the Class A Common Members
and the Class B Common Members shall be subject to the following provisions:

                  6.4.1 The allocations to the Class A Common Members of Net Profits
pursuant to Section 6.1.3(b) and of items of Depreciation pursuant to Section
6.3.7(c)(y) shall be limited in amount and made in a manner such that the total
amount of the net taxable income allocated to the Class A Common Members in
respect of the aggregate allocations of Net Profits pursuant to Section
6.1.3(b), of items of Depreciation pursuant to Section 6.3.7(c)(y), and of
Non-Operating Profits pursuant to Section 6.3.9(a)(y) (collectively, the
“Special Profit Allocations”) is no greater than the total amount of the net
tax loss allocated to the Class A Common Members in respect of the aggregate
Net Profits, Net Losses, and items of Depreciation allocated to the Class A
Common Members pursuant to Sections 6.1.1(b), 6.2.1(b), and 6.3.7(a)(y),
respectively (collectively, the “Special Loss Allocations”).

                  6.4.2 In the event of the dissolution of the Company or the occurrence of
any other event with respect to which the distribution rights of the Class A
Common Members or the Class B Common Members are determined in whole or in part
by reference to their Capital Account balances, the Special Loss Allocations
(to the extent that they have

 

 

not previously been offset with Special Profit Allocations or special
allocations of other items pursuant to this Section 6.4) shall be offset either
with current Special Profit Allocations or, to the extent that such current
Special Profit Allocations are insufficient, with special allocations between
the Class A Common Members and the Class B Common Members, to the extent
possible, of other items of Company income, gain, loss, or deduction. Capital
Account adjustments shall be made to reflect such allocations before any
distributions in connection with such events are made. The Manager shall make
such offsetting special allocations of other items in whatever manner it
determines appropriate so that, after such offsetting allocations are made:
(i) the Capital Account balances of the Class A Common Members and the Class B
Common Members are, to the extent possible, equal to the Capital Account
balances such Members would have had if the Special Loss Allocations, the
Special Profit Allocations, Sections 6.1.3(c), 6.3.7(c)(z), and 6.3.9(a)(z),
and the exclusion of the Class B Common Members from Sections 6.1.1(a),
6.1.3(a), 6.2.1(a), 6.3.7(a)(x), 6.3.7(c)(x), and 6.3.9(a)(x) had not been part
of this Agreement; and (ii) to the maximum extent consistent with attaining the
Capital Account balances described in the preceding clause (i), the total
amount of the net taxable income allocated to the Class A Common Members in
respect of the aggregate Special Profit Allocations and special allocations of
other items pursuant to this Section 6.4 is no greater than the total amount of
the net tax loss allocated to the Class A Common Members in respect of the
aggregate Special Loss Allocations.

                  6.4.3 In the event that Class A Common Units are transferred, directly or
indirectly, to PublicCo as part of a Non-Recognition Transaction, if (i) the
Special Loss Allocations have not been fully offset with prior or current
Special Profit Allocations or special allocations of other items pursuant to
this Section 6.4 and (ii) CII or Vulcan Cable so elects with respect to its
Class A Common Units transferred as part of such Non-Recognition Transaction,
then the Special Loss Allocations with respect to such Class A Common Units (to
the extent that they have not been so offset) shall be offset with special
allocations between the Class A Common Members and the Class B Common Members,
to the extent possible, of other items of Company income, gain, loss, or
deduction. The Manager shall make such offsetting special allocations of other
items in whatever manner it determines appropriate so that, after such
offsetting allocations are made: (i) the Capital Account balances of the Class
A Common Members with respect to the Class A Common Units transferred as part
of such Non-Recognition Transaction are, to the extent possible, equal to the
Capital Account balances such Members would have had with respect to such Class
A Common Units if the Special Loss Allocations, the Special Profit Allocations,
Sections 6.1.3(c), 6.3.7(c)(z), and 6.3.9(a)(z), and the exclusion of the Class
B Common Members from Sections 6.1.1(a), 6.1.3(a), 6.2.1(a), 6.3.7(a)(x),
6.3.7(c)(x), and 6.3.9(a)(x) had not been part of this Agreement; and (ii) to
the maximum extent consistent with attaining the Capital Account balances
described in the preceding clause (i), the total amount of the net taxable
income allocated to the Class A Common Members with respect to such Class A
Common Units in respect of the aggregate Special Profit Allocations and special
allocations of items pursuant to this Section 6.4 is no greater than the total
amount of the net tax loss allocated to the Class A Common Members with respect
to such Class A Common Units in respect of the aggregate Special Loss
Allocations.

                  6.4.4 For purposes of this Section 6.4, net taxable income allocated in
respect of a Special Profit Allocation or a special allocation of another item
pursuant to

 

 

Section 6.4.2 or 6.4.3 refers to the net taxable income that is allocated
in respect thereof for the same Allocation Period for which such Special Profit
Allocation or other special allocation is made.

                  6.4.5 If any special allocations of other items are made pursuant to
Section 6.4.2 or 6.4.3, the Manager shall thereafter make appropriate
adjustments in the determination of the Special Allocation Amount and any
subsequent Special Profit Allocations so as to reflect that such special
allocations of other items have had the effect of offsetting certain Special
Loss Allocations.

                  6.4.6 If any Class A Common Units are redeemed by the Company or any
additional Class A Common Units are issued, the Manager shall thereafter make
appropriate adjustments in the determination of the Special Allocation Amount,
any subsequent Special Profit Allocations, and any special allocations of other
items pursuant to Section 6.4.2 or 6.4.3 so that (i) the Special Allocation
Amount excludes any amount with respect to redeemed Units, and (ii) the
proportion in which the Special Profit Allocations are allocated among the
Class A Common Members takes into account that, as a result of the issuance of
additional Class A Common Units, the Percentage Interest of the Member to which
such Units were issued may need to be reduced for purposes of determining such
Member’s proper share of the Special Profit Allocations.

         6.5 Curative Allocations.

                  6.5.1 The allocations set forth in Sections 6.2.3, 6.3.1, 6.3.2, 6.3.3,
6.3.4, 6.3.5, 6.3.6, and 6.3.9(d) (collectively, the “Regulatory Allocations”)
are intended to comply with certain requirements of the Regulations. The
allocations set forth in Section 6.3.7 are intended to effectuate certain
agreements of the Members (such allocations other than the allocations set
forth in Sections 6.3.7(a)(y) and 6.3.7(c)(y) are collectively referred to for
purposes of this Section 6.5.1 as the “Depreciation Allocations”). It is the
intent of the Members that, to the extent possible, the Regulatory Allocations
and the Depreciation Allocations shall be offset either with other Regulatory
Allocations or with special allocations of other items of Company income, gain,
loss, or deduction to the extent provided by this Section 6.5.1. Therefore,
subject to Section 6.5.2 but notwithstanding any other provision of this
Article VI (other than the Regulatory Allocations), the Manager shall make such
offsetting special allocations of Company income, gain, loss, or deduction in
whatever manner it determines appropriate so that, after such offsetting
allocations are made, a Member’s Capital Account balance is, to the extent
possible, equal to the Capital Account balance such Member would have had (the
“Target Capital Account”) if the Regulatory Allocations and the Depreciation
Allocations were not part of this Agreement and all Company items were
allocated pursuant to Sections 6.1, 6.2.1, 6.2.2, 6.3.7(a)(y), 6.3.7(c)(y),
6.3.8, 6.3.9 (other than subsection (d) thereof), 6.3.10, and 6.4. In
exercising its discretion under this Section 6.5.1, the Manager shall take into
account any future Regulatory Allocations under Sections 6.3.1 and 6.3.2 that,
although not yet made, are likely to offset other Regulatory Allocations
previously made under Sections 6.3.4 and 6.3.5.

                  6.5.2 The Manager shall implement the offsetting special allocations in
Section 6.5.1 in such a manner that:

 

 

                           (a) For any Allocation Period covered by Section 6.3.7(e), no special
allocations shall be made under Section 6.5.1 to either the Class A Common
Members or the Class C Common Members to offset the allocations made as a
result of the operation of Section 6.3.7(e), except in the event of the
dissolution of the Company or the occurrence of any other event with respect to
which the distribution rights of the Class A Common Members or the Class C
Common Members are determined in whole or in part by reference to their Capital
Account balances, in which case the special allocations to be made to the Class
A Common Members, the Class C Common Members, or both, to offset the
allocations arising as a result of the operation of Section 6.3.7(e) and the
corresponding Capital Account adjustments shall be made before any
distributions in connection with such events are made.

                           (b) For any Allocation Period covered by Section 6.3.7(f), the special
allocations to be made under Section 6.5.1 to the Class A Common Members, the
Class C Common Members, or both, to offset the allocations arising as a result
of the operation of Section 6.3.7(f) shall be limited in amount and made in a
manner such that the amount of the taxable income allocated to any Class C
Common Member shall be no less than, and the amount of the tax loss allocated
to any Class C Common Member shall be no greater than, that Member’s Tentative
Taxable Income or Tentative Tax Loss, respectively, for such Allocation Period;
provided, however, that in the event of the dissolution of the Company or the
occurrence of any other event with respect to which the distribution rights of
the Class A Common Members or the Class C Common Members are determined in
whole or in part by reference to their Capital Account balances, the foregoing
limitations shall apply only to the extent consistent with attaining the Target
Capital Accounts and such Capital Account adjustments shall be made before any
distributions in connection with such events are made.

                           (c) In the case of the offsetting special allocations to be made to the
Class A Common Members, the Class C Common Members, or both, arising as a
result of the operation of Section 6.3.7(e), (i) the total amount of the
increase in the taxable income allocated to the Class A Common Members as a
result of such offsetting special allocations shall be no greater than the
excess, if any, of the Allocated Tax Deductions over the Baseline Tax
Deductions, and (ii) the total amount of the decrease in the taxable income
allocated to the Class A Common Members as a result of such offsetting special
allocations shall be no less than the excess, if any, of the Baseline Tax
Deductions over the Allocated Tax Deductions; provided, however, that in the
event of the dissolution of the Company or the occurrence of any other event
with respect to which the distribution rights of the Class A Common Members or
the Class C Common Members are determined in whole or in part by reference to
their Capital Account balances, the foregoing limitations shall apply only to
the extent consistent with attaining the Target Capital Accounts and such
Capital Account adjustments shall be made before any distributions in
connection with such events are made. For purposes of this Section 6.5.2(c),
the “Allocated Tax Deductions” shall mean the total amount of the tax
deductions allocated to the Class A Common Members in respect of the items of
Depreciation allocated to the Class A Common Members pursuant to Section
6.3.7(g) for the Allocation Periods ending prior to the Class C Common Change
Date, and the “Baseline Tax Deductions” shall mean the total amount of the tax
deductions that would have been allocated to the Class A Common Members if
items of Depreciation allocated under Section 6.3.7 had been allocated to the
Class A Common Members in accordance with

 

 

their Percentage Interests for the Allocation Periods ending prior to the
Class C Common Change Date.

                           (d) For purposes of Sections 6.5.2(b) and 6.5.2(c), an increase or
decrease in taxable income or tax loss allocated in respect of an offsetting
special allocation refers to the increase or decrease in taxable income or tax
loss that is allocated in respect thereof for the same Allocation Period for
which such offsetting special allocation is made.

         6.6 Other Allocation Rules.

                  6.6.1 Allocation of Items Included in Net Profits and Net Losses.
Whenever a proportionate part of the Net Profits or Net Losses is allocated to
a Member, every item of income, gain, loss, or deduction entering into the
computation of such Net Profits or Net Losses shall be credited or charged, as
the case may be, to such Member in the same proportion.

                  6.6.2 Allocations in Respect of a Transferred Membership Interest. If any
Membership Interest is transferred, or is increased or decreased by reason of
the admission of a new Member or otherwise, during any Allocation Period of the
Company, (i) such transfer of or increase or decrease in Membership Interest
shall be deemed to have occurred as of the end of the day on which such
transfer or increase or decrease occurs, and (ii) each item of income, gain,
loss, deduction, or credit of the Company for such Allocation Period shall be
allocated among the Members, as determined by the Manager in accordance with
any method permitted by Code Section 706(d) and the Regulations promulgated
thereunder in order to take into account the Members’ varying interests in the
Company during such Allocation Period.

         6.7 Tax Allocations.

         6.7.1 Code Section 704(c). The allocations specified in this Agreement
shall govern the allocation of items to the Members for Code Section 704(b)
book purposes, and the allocation of items to the Members for tax purposes
shall be in accordance with such book allocations, except that solely for tax
purposes and notwithstanding any other provision of this Article VI:

                           (a) In accordance with Code Section 704(c) and the Regulations thereunder,
income, gain, loss, and deduction with respect to any property contributed to
the capital of the Company shall be allocated among the Members (including
Members who succeed to the Membership Interest of any other Members or former
members of the Company) so as to take account of any variation between the
Basis of such property to the Company and its initial Gross Asset Value.

                           (b) In the event the Gross Asset Value of any Company asset is adjusted
pursuant to Subsection 2 of the definition of Gross Asset Value, subsequent
allocations of income, gain, loss, and deduction with respect to such asset
shall take account of any variation between the Basis of such asset and its
Gross Asset Value in the same manner as under Code Section 704(c) and the
Regulations thereunder.

 

 

                           (c) The allocations described in (a) and (b) above shall be made in
accordance with Regulations Section 1.704-3 using the Traditional Method.

                  6.7.2 Tax Credits. Tax credits, if any, shall be allocated among the
Members in proportion to their Percentage Interests.

                  6.7.3 Excess Nonrecourse Liabilities. To the extent that the Company’s
“excess nonrecourse liabilities” within the meaning of Regulations Section
1.752-3(a)(3) are allocated among the Members in accordance with their
interests in Company profits, the Members’ interests in Company profits are,
solely for purposes of making such allocation, in proportion to their
Percentage Interests.

         6.8 Obligations of Members to Report Consistently. The Members are aware
of the income tax consequences of the allocations specifically set forth in
this Article VI and hereby agree to be bound by such allocations in reporting
their shares of Company income and loss for income tax purposes.

         6.9 Distributions by the Company to Members. Prior to the occurrence of
any event specified in Section 9.1, and subject to availability of funds,
applicable law, and any limitations contained elsewhere in this Agreement (and
after giving effect to any distributions required by Section 3.6.6 herein), Net
Cash From Operations and Net Cash From Sales or Refinancings may be distributed
at such times and in such amounts as may be approved by the Manager, to Common
Members in proportion to their respective Percentage Interests.

         6.10 Advances or Drawings. Distributions of money and property shall be
treated as advances or drawings of money or property against a Member’s
distributive share of income and as current distributions made on the last day
of the Company’s taxable year with respect to such Member.

         6.11 Distributees; Liability for Distributions. All distributions made
pursuant to Section 6.9 shall be made only to the Persons who, according to the
books and records of the Company, hold the Membership Interests in respect of
which such distributions are made on the actual date of distribution. Neither
the Company nor any Member, Manager, or officer shall incur any liability for
making distributions in accordance with Section 6.9.

         6.12 Form of Distributions. A Member, regardless of the nature of the
Member’s Capital Contributions, has no right to demand and receive any
distribution from the Company in any form other than money. No Member may be
compelled to accept from the Company a distribution of any asset in kind in
lieu of a proportionate distribution of money being made to other Members.

         6.13 Return of Distributions. Except for distributions made in violation
of the Act or this Agreement, or as otherwise required by law, no Member shall
be obligated to return any distribution to the Company or pay the amount of any
distribution for the account of the Company or to any creditor of the Company.
Notwithstanding any provision of this Agreement to the contrary, a Member who
receives a distribution from the Company shall have no liability to return any
portion of such distribution after the expiration of three (3) years from the
date of the distribution pursuant to Section 18-607(c) of the Act.

 

 

         6.14 Limitation on Distributions. Notwithstanding any provision to the
contrary in this Agreement, the Company shall not make a distribution to any
Member on account of such Member’s interest in the Company if such distribution
would (i) violate Section 18-607 of the Act or other applicable law or (ii)
breach, or with the passage of time or the giving of notice result in a breach
of, any contractual covenants of the Company or its Subsidiaries (provided that
the Company shall negotiate such covenants in good faith to permit
distributions under Section 6.9).

         6.15 Withholding. Any tax required to be withheld with respect to any
Member under Section 1446 or other provisions of the Code, or under the law of
any state or other jurisdiction, shall be treated for all purposes of this
Agreement (i) as a distribution of cash to be charged against current or future
distributions to which such Member would otherwise have been entitled, or (ii)
if determined by the Manager in writing, as a demand loan to such Member
bearing interest at a rate per annum equal to the rate of interest then
announced by The Bank of New York as its prime commercial lending rate plus two
hundred (200) basis points.

ARTICLE VII

TRANSFER OF INTERESTS

         7.1 Transfer of Interests In General.

                  7.1.1 Conditions to Transfer. No Member shall be entitled to Transfer all
or any part of such Member’s Membership Interest unless all of the following
conditions have been met: (a) the Company shall have received a written notice
of the proposed Transfer, setting forth the circumstances and details thereof;
(b) except for Transfers specifically authorized by Section 7.2.3, the Company
shall (at its option) have received a written opinion from counsel reasonably
satisfactory to the Company, which in the case of a permitted Transfer
contemplated by Section 7.2 shall be the Company’s counsel, in form and
substance reasonably satisfactory to the Company, specifying the nature and
circumstances of the proposed Transfer and any related transactions of which
the proposed Transfer is a part, and based on such facts stating that the
proposed Transfer and any related transactions will not be in violation of any
of the registration provisions of the Securities Act, or any applicable state
securities laws; (c) the Company shall have received from the transferee a
written consent to be bound by all of the terms and conditions of this
Agreement; (d) the Transfer will not result in the loss of any license or
regulatory approval or exemption that has been obtained by the Company and is
materially useful in the conduct of its business as then being conducted or
proposed to be conducted; (e) the Transfer will not result in a material and
adverse limitation or restriction on the operations of the Company taken as a
whole; (f) the Company is reimbursed upon request for its reasonable
out-of-pocket expenses, except in the case of a permitted Transfer contemplated
by Section 7.2, in connection with the Transfer; (g) if the Transfer to the
proposed transferee is not otherwise specifically authorized by Section 7.2,
the Transfer has been approved by the Manager, which consent may be given or
withheld, conditioned or delayed as the Manager may determine in its sole
discretion; (h) if the proposed transferee is not a Member or the Transfer to
the proposed transferee is not otherwise specifically authorized by Section
7.2, the Transfer receives the Approval of the Members; (i) the Transfer will
not cause the

 

 

Company to be treated as a “publicly traded partnership” within the
meaning of section 7704 of the Code, and (j) the Transfer will not cause the
Company to be treated as an “investment company” within the meaning of section
3 of the Investment Company Act of 1940, as amended.

                  7.1.2 Pledges. Notwithstanding anything to the contrary in Section 7.1, a
Member may pledge, grant a security interest in or otherwise encumber all or a
portion of its Membership Interest, without compliance with Sections 7.1.1(g)
and (h) but subject to the other provisions of Section 7.1, if prior thereto,
the pledgee or secured party delivers to the Company a written agreement
acknowledging receipt of a copy of this Agreement and unconditionally agreeing
that any foreclosure of the pledge or security interest shall be treated as a
Transfer of such Membership Interest to which all provisions of this Article
VII apply.

                  7.1.3 Invalid Transfers. To the fullest extent permitted by law,
Transfers in violation of this Section 7.1 or in violation of any other
provision of this Article VII or this Agreement shall be null and void ab
initio and of no effect whatsoever.

         7.2 Permitted Transfers. Subject to the provisions of Section 7.1 (except
with respect to the Transfers described in Sections 7.2.4 and 7.2.5), the Units
may be Transferred under the following circumstances:

                  7.2.1 Class A Common Units. Class A Common Units may be Transferred to
any Person, including without limitation, PublicCo or any Affiliate of CII or
Vulcan Cable.

                  7.2.2 Class B Common Units. Class B Common Units may be Transferred to
any Affiliate of PublicCo, CII, or Vulcan Cable.

                  7.2.3 Class C Common Units. Class C Common Units may be Transferred to
the Bresnan Permitted Transferees, and Class C Common Units with respect to
which any option pursuant to the Bresnan Put Agreement has been exercised and
Paul G. Allen or the Company has breached its purchase obligations under such
put agreements may be Transferred to any transferee; provided, however, that
(i) each such transferee must agree to be bound by the terms of this Agreement
and other applicable equity documents (including the Bresnan Exchange
Agreement), (ii) each such transferee must represent that it is an accredited
investor and give such other investment representations and other undertakings
as are customarily given by Persons acquiring securities in a private
placement, and (iii) the Transfer to such transferee must be effected pursuant
to an exemption from registration under applicable securities laws.

                  7.2.4 Class A Preferred Units. Class A Preferred Units may be Transferred
to any Person to which a Class A Preferred Member is permitted to assign its
rights under the Rifkin Put Agreement in accordance with Section 10.9 thereof;
provided, however, that (i) each such transferee agrees to be bound by the
terms of the Agreement, (ii) each such transferee (x) represents that it is an
accredited investor and gives such other investment representations and other
undertakings as are customarily given by Persons acquiring securities in a
private placement or (y) provides the Company with a written opinion of

 

 

counsel reasonably satisfactory to the Company that such Transfer would
not result in a violation of the registration requirements of the Securities
Act, and (iii) any such Transfer will not result in violation of the
registration requirements of the Securities Act.

                  7.2.5 Transfer to Paul G. Allen, the Company, and Certain Other
Transferees. Notwithstanding anything to the contrary in this Agreement, all
Units shall be freely transferable without restriction to Paul G. Allen (or his
Affiliates), the Company, or any other Person to which Units may be put
pursuant to the Rifkin Put Agreement, or the Bresnan Put Agreement.

                  7.2.6 Transfers to PublicCo. Notwithstanding anything to the contrary in
this Agreement, certain Persons may Transfer their Units to PublicCo in
exchange for the Class A Common Stock or Class B Common Stock of PublicCo,
pursuant to the terms of the Bresnan Exchange Agreement, the CII Exchange
Agreement, and certain employee option/compensatory plans and agreements of the
Company.

                  7.2.7 Admission of a Transferee as a Member. Each transferee (other than
the Company) of a Transfer of a Membership Interest permitted by Section 7.2
shall be admitted to the Company as a Member of the Company upon completion of
the Transfer in accordance with the conditions set forth in Sections 7.1 and
7.2.

         7.3 Effective Date of Permitted Transfers. Any permitted Transfer of all
or any portion of a Membership Interest shall be effective no earlier than the
date following the date upon which the requirements of this Agreement have been
met. Any Transfer, issuance, or redemption of all or any portion of a
Membership Interest on any date shall be deemed to have occurred as of the end
of such date.

         7.4 Effect of Permitted Transfers. After the effective date of any
Transfer of any part of a Membership Interest in accordance with this
Agreement, the Membership Interest so Transferred shall continue to be subject
to the terms, provisions, and conditions of this Agreement and any further
Transfers shall be required to comply with all of the terms, provisions, and
conditions of this Agreement. Any transferee of all or any portion of a
Membership Interest shall take subject to the restrictions on Transfer imposed
by this Agreement. Notwithstanding anything to the contrary in this Section
7.4, any part of a Membership Interest Transferred to the Company shall be
deemed cancelled.

         7.5 Substitution of Members. Except as provided in Section 7.2, a
transferee of a Membership Interest shall not have the right to become a
substitute Member until each of the following is true: (i) the requirements of
Section 7.1.1 are satisfied; (ii) such Person executes an instrument
satisfactory to the Members approving the transfer and to the Manager accepting
and adopting the terms, provisions, and conditions of this Agreement, including
without limitation Section 10.15 herein, with respect to the acquired
Membership Interest; and (iii) such Person pays any reasonable out-of-pocket
expenses of the Company in connection with such Person’s admission as a new
Member. The admission of a substitute Member shall not result in the release
of the Member who assigned the Membership Interest from any liability that such
Member may have to the Company.

 

 

ARTICLE VIII

BOOKS AND RECORDS; ACCOUNTING; TAX MATTERS

         8.1 Books and Records. The Manager shall cause the books and records of
the Company to be kept, and the financial position and the results of its
operations to be recorded, in accordance with generally accepted accounting
principles; provided, however, that the Manager may, to the extent appropriate
under applicable tax and accounting principles, maintain separate and
corresponding records for book and tax purposes. The books and records of the
Company shall reflect all the Company transactions and shall be appropriate and
adequate for the Company’s business.

         8.2 Delivery to Members and Inspection.

                  8.2.1 Upon the request of any Member, the Manager shall make reasonably
available to the requesting Member the Company’s books and records; provided,
however, that the Manager shall have the right to keep confidential from the
Members, for such period of time as the Manager deems reasonable, any
information which the Manager reasonably believes to be in the nature of trade
secrets or other information the disclosure of which the Manager in good faith
believes is not in the best interest of the Company or could damage the Company
or its business or which the Company is required by law or by agreement with a
third party to keep confidential.

                  8.2.2 Any request, inspection, or copying of information by a Member under
this Section 8.2 may be made by that Person or that Person’s agent or attorney.

         8.3 Financial Statements.

                  8.3.1 General. The Manager shall provide any Member with such periodic
operating and financial reports of the Company as such Member may from time to
time reasonably request.

                  8.3.2 Annual Report. The Manager shall cause annual audited financial
statements to be sent to each Member holding more than one Unit not later than
90 days after the close of the calendar year, but in the case of a Member
holding more than one-tenth (1/10) of one percent (1%) of outstanding Common
Units, in no event later than when PublicCo receives such statements. The
report shall contain a balance sheet as of the end of the calendar year and an
income statement and statement of cash flow for the calendar year. Such
financial statements shall be prepared in accordance with generally accepted
accounting principles consistently applied and be accompanied by the report
thereon of the independent accountants engaged by the Company.

         8.4 Tax Returns. The Manager shall cause to be prepared at least annually
information necessary for the preparation of the Members’ federal and state
income tax and information returns. The Manager shall send or cause to be sent
to each Member, or as soon as practicable following the end of each Allocation
Period, but in no event later than July 15, (i) such information as is
necessary to complete such Member’s federal and state income tax or information
returns, and (ii) a schedule setting forth each Member’s Capital Account
balance as of the end of the most recent Allocation Period. The Manager shall
cause the

 

 

 income tax and information returns for the Company to be timely filed with
the appropriate authorities. If a Member requests, the Company shall provide
such Member with copies of the Company’s federal, state, and local income tax
or information returns for that year, tax-related schedules, work papers,
appraisals, and other documents as reasonably required by such Member in
preparing its tax returns.

         8.5 Other Filings. The Manager also shall cause to be prepared and timely
filed, with appropriate federal and state regulatory and administrative bodies,
amendments to, or restatements of, the Certificate and all reports required to
be filed by the Company with those entities under the Act or other then current
applicable laws, rules, and regulations.

         8.6 Bank Accounts. The Manager shall maintain the funds of the Company in
one or more separate bank accounts in the name of the Company, and shall not
permit the funds of the Company to be commingled in any fashion with the funds
of any other Person.

         8.7 Accounting Decisions and Reliance on Others. All decisions as to
accounting matters, except as otherwise specifically set forth herein, shall be
made by the Manager or the Board. The Manager or the Board may rely upon the
advice of the Company’s accountants as to whether such decisions are in
accordance with accounting methods followed for federal income tax purposes or
financial accounting purposes (as applicable).

         8.8 Tax Matters.

                  8.8.1 Taxation as Partnership. The Company shall be treated as a
partnership for tax purposes. The Company shall avail itself of any election
or procedure under the Code or the Regulations and under state and local tax
law, including any “check-the-box” election, for purposes of having an entity
classified as a partnership for tax purposes, and the Members shall cooperate
with the Company in connection therewith and hereby authorize the Manager,
directors, and officers to take whatever actions and execute whatever documents
are necessary or appropriate to effectuate the foregoing.

                  8.8.2 Elections; Tax Matters Partner. Subject to the provisions of this
Agreement, the Manager shall from time to time cause the Company to make such
tax elections as it deems to be necessary or appropriate. The Members hereby
designate CII as the “tax matters partner” (within the meaning of Code Section
6231(a)(7)) to represent the Company in connection with all examinations of the
Company’s affairs by tax authorities, including without limitation resulting
judicial and administrative proceedings, and shall expend Company funds for
professional services and costs associated therewith.

                  8.8.3 Section 754 Election. At the request of a transferee of or other
successor to any Units that takes a federal income tax basis in such Units
greater than the proportionate share of the Basis of the Company’s property
with respect to such Units, the Manager shall cause the Company to make an
election under Section 754 of the Code, unless the Manager determines that such
an election should not be made because any Member who holds a number of Units
(or other equity interests) at least as great as the number (or value) being
transferred has a built-in federal income tax loss with respect to such Units
(or other equity interests) held objects to such an election. If the Company
elects, pursuant to Section 754 of the Code and any like provision of
applicable state law, to

 

 

adjust the Basis of the Company’s property or, if any other information is
necessary to implement this Section 8.8.3, then each Member shall provide the
Company with all information necessary to give effect to such elections and to
implement such provisions.

ARTICLE IX

DISSOLUTION AND WINDING UP

         9.1 Dissolution. The Company shall be dissolved, its assets shall be
disposed of, and its affairs shall be wound up on the first to occur of the
following:

                           (a) The entry of a decree of judicial dissolution pursuant to Section
18-802 of the Act;

                           (b) The Approval of the Members; provided, however, that prior to the
beginning of the Put Period (as defined in the Bresnan Put Agreement), the
Company will not be dissolved or liquidated without the consent of all Bresnan
Holders, which consent shall not be unreasonably withheld; or

                           (c) The last remaining Member’s ceasing to be a Member of the Company
unless the Company is continued without dissolution in accordance with the Act.

         9.2 Winding Up. Upon the occurrence of any event specified in Section
9.1, the Company shall continue solely for the purpose of winding up its
affairs in an orderly manner, liquidating its assets, and satisfying the claims
of its creditors. The Manager shall be responsible for overseeing the winding
up and liquidation of the Company, shall take full account of the assets and
liabilities of the Company, shall either cause its assets to be sold to any
Person or distributed to a Member, and if sold, as promptly as is consistent
with obtaining the fair market value thereof, shall cause the proceeds
therefrom, to the extent sufficient therefor, to be applied and distributed as
provided in Section 9.5 herein. All actions and decisions required to be taken
or made by such Person(s) under this Agreement shall be taken or made only with
the consent of all such Person(s).

         9.3 Distributions in Kind. Any non-cash asset distributed to one or more
Members shall first be valued at its fair market value to determine the gain or
loss that would have been included in the amounts allocated pursuant to Article
VI if such asset were sold for such value. Such gain or loss shall then be
allocated pursuant to Article VI, and the Members’ Capital Accounts shall be
adjusted to reflect such allocations. The amount distributed and charged to
the Capital Account of each Member receiving an interest in such distributed
asset shall be the fair market value of such interest (net of any liability
secured by such asset that such Member assumes or takes subject to).
Notwithstanding anything to the contrary in this Section 9.3, the Company shall
not make distributions of non-cash assets to any Member who objects.

         9.4 Determination of Fair Market Value. For purposes of Section 9.2 and
9.3, the fair market value of each asset of the Company shall be determined in
good faith by the Manager, or if the Common Members holding more than one
percent (1%) of all outstanding Common Units request, by an independent,
third-party appraiser experienced in the valuation of the type of assets at
issue, selected in good faith by the Manager and the

 

 

 Common Members requesting such appraisal. The Company shall bear the
costs of the appraisal.

         9.5 Order of Distributions Upon Liquidation. After satisfying (whether by
payment or reasonable provision for payment) the debts and liabilities of the
Company to the extent required by law, including without limitation debts and
liabilities to Members who are creditors of the Company to the extent permitted
by law, the remaining assets shall be distributed to the Members in the
following order:

                  9.5.1 First, to the Class A Preferred Members as of the date of
distribution, pro rata to such Members in accordance with the respective sums
of (i) their Class A Preferred Contributed Amounts in respect of the Class A
Preferred Units then held by them, and (ii) the Class A Preferred Return
Amounts with respect to such Units, until each such Member shall have received
an amount equal to such sum with respect to such Member as of the date of
distribution; provided, however, that no distribution shall be made pursuant to
this Section 9.5.1 that creates or increases a Capital Account deficit for any
Member which exceeds such Member’s obligation deemed and actual to restore such
deficit, determined as follows: Distributions shall first be determined
tentatively pursuant to this Section 9.5.1 without regard to the Members’
Capital Accounts, and then the allocation provisions of Article VI shall be
applied tentatively as if such tentative distributions had been made. If any
Member shall thereby have a deficit Capital Account which exceeds such Member’s
obligation (deemed or actual) to restore such deficit, the actual distribution
to such Member pursuant to this Section 9.5.1 shall be equal to the tentative
distribution to such Member less the amount of the excess to such Member; and

                  9.5.2 Second, to the Common Members in accordance with their positive
Capital Account balances, after taking into account income and loss allocations
for the Company’s taxable year during which liquidation occurs.

         Such liquidating distributions shall be made by the end of the Company’s
taxable year in which the Company is liquidated, or, if later, within ninety
(90) days after the date of such liquidation.

         9.6 Limitations on Payments Made in Dissolution. 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 Net Profits reflected in such Member’s
positive Capital Account balance, a Member shall have no recourse against the
Company or any other Member.

         9.7 Certificate of Cancellation. Upon completion of the winding up of the
affairs of the Company, the Manager, as an authorized person, shall cause to be
filed in the office of the Delaware Secretary of State, an appropriate
certificate of cancellation.

         9.8 Termination. The Company shall terminate when all of the assets of
the Company have been distributed in the manner provided for in this Article
IX, and the certificate of cancellation is filed in accordance with Section
9.7.

 

 

         9.9 No Action for Dissolution. Except as expressly permitted in this
Agreement and to the fullest extent permitted by law, a Member shall not take
any voluntary action that directly causes a dissolution of the Company.

         9.10 Bankruptcy or Incapacity of a Member. The bankruptcy (as defined in
the Act) of a Member or the incapacity of a Member who is an individual shall
not cause the Member to cease to be a Member of the Company, and upon such an
event, the Company shall continue without dissolution.

ARTICLE X

MISCELLANEOUS

         10.1 Complete Agreement. This Agreement (including any schedules or
exhibits hereto), any documents referred to herein or therein (the “Transaction
Documents”), and the Certificate contain the entire understanding of the
parties with respect to the subject matter hereof. There are no restrictions,
agreements, promises, representations, warranties, covenants or undertakings
with respect to the subject matter hereof other than those expressly set forth
or referred to herein or in the Transaction Documents. Except for the
Transaction Documents, this Agreement supersedes all prior agreements and
understandings between the parties with respect to its subject matter.

         10.2 Binding Effect. Subject to the provisions of this Agreement relating
to transferability, this Agreement shall be binding upon and inure to the
benefit of the Members, and their respective heirs, representatives, successors
and permitted assigns.

         10.3 Parties in Interest. Except as expressly provided in the Act,
nothing in this Agreement shall confer any rights or remedies under or by
reason of this Agreement on any Persons other than the Members and their
respective heirs, representatives, successors and permitted assigns nor shall
anything in this Agreement relieve or discharge the obligation or liability of
any third person to any party to this Agreement, nor shall any provision give
any third person any right of subrogation or action over or against any party
to this Agreement.

         10.4 Pronouns; Statutory References; Agreement References. All pronouns
and all variations thereof shall be deemed to refer to the masculine, feminine,
or neuter, singular or plural, as the context in which they are used may
require. Any reference to the Code, the Regulations, the Act, or other
statutes or laws shall include all amendments, modifications, or replacements
of the specific sections and provisions concerned. Any reference to any
agreement defined in Article I of this Agreement shall include all amendments,
modifications, or replacements of the specific sections and provisions
concerned.

         10.5 Headings. All headings herein are inserted only for convenience and
ease of reference and shall not be considered in the construction or
interpretation of any provision of this Agreement.

         10.6 References to this Agreement. Numbered or lettered articles,
sections, and subsections herein contained refer to articles, sections, and
subsections of this Agreement unless otherwise expressly stated.

 

 

         10.7 Governing Law. This Agreement shall be enforced, governed by, and
construed in accordance with the laws of the State of Delaware, regardless of
the choice or conflict of laws provisions of Delaware or any other
jurisdiction.

         10.8 Severability. If any provision of this Agreement or the application
of such provision to any Person or circumstance shall be held invalid, the
remainder of this Agreement or the application of such provision to Persons or
circumstances other than those to which it is held invalid shall not be
affected thereby.

         10.9 Additional Documents and Acts. Each Member agrees to execute and
deliver, from time to time, such additional documents and instruments and to
perform such additional acts as may be necessary or appropriate to effectuate,
carry out, and perform all of the terms, provisions, and conditions of this
Agreement and the transactions contemplated hereby.

         10.10 Notices. Any notice to be given or to be served upon the Company or
any party hereto in connection with this Agreement shall be in writing (which
may include facsimile) and shall be deemed to have been given and received when
delivered to the address specified by the party to receive the notice. The
respective address of each Member shall be as set forth on Schedule A attached
hereto. Any party may, at any time by giving five (5) days’ prior written
notice to the other parties, designate any other address in substitution of the
foregoing address to which such notice shall be given.

         10.11 Amendments. Any amendment to this Agreement shall be adopted and be
effective as an amendment hereto only upon the Approval of the Members;
provided, however, (i) that this Agreement may not be amended in a manner that
is adverse to the Class C Common Members, without the consent of Class C Common
Members owning a majority of the Class C Common Units adversely affected, (ii)
that this Agreement may not be amended in a manner that is adverse to the Class
A Common Members, without the approval of the Class A Common Members owning a
majority of the Class A Common Units adversely affected, and (iii) that this
Agreement may not be amended (a) in a manner that is adverse to the Class A
Preferred Members with respect to their redemption and preferred return rights
under Section 3.5.2 or 3.5.3, transfer rights under Section 7.2.5, or
liquidation rights under Section 9.5.1 or (b) in a manner that adversely alters
any other expressly articulated rights of the Class A Preferred Members
hereunder and that treats the Class A Preferred Members in a discriminatory
manner vis-à-vis the Common Members, without the consent of Class A Preferred
Members owning a majority of the Class A Preferred Units. Without limiting the
generality of the foregoing, no consent of the Members, other than the Approval
of the Members, shall be required to amend this Agreement (x) to issue
additional Units or any other securities of the Company pursuant to the terms
of this Agreement, (y) to admit additional Members in connection with any
issuance of Units to such Persons pursuant to the terms of this Agreement, or
(z) to subdivide or combine any outstanding Units pursuant to Section 3.6.1 of
this Agreement. Each Member hereby irrevocably constitutes and appoints the
Manager as its true and lawful attorney-in-fact, in its name, place, and stead,
to make, execute, acknowledge, and file any duly adopted amendment to or
restatement of this Agreement (solely to the extent that such Member’s consent
is not required under this Agreement). It is expressly intended by each Member
that the power of attorney granted by the preceding sentence is coupled with an

 

 

 interest, shall be irrevocable, and shall survive and not be affected by
the subsequent disability or incapacity of such Member (or if such Member is a
corporation, partnership, trust, association, limited liability company or
other legal entity, by the dissolution or termination thereof).

         10.12 No Interest in Company Property; Waiver of Action for Partition. No
Member has any interest in specific property of the Company or any Subsidiary.
Without limiting the foregoing, each Member irrevocably waives during the
duration of the Company any right that such Member may have to maintain any
action for partition with respect to the property of the Company.

         10.13 Multiple Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
shall constitute one and the same instrument.

         10.14 Remedies Cumulative. The remedies under this Agreement are
cumulative and shall not exclude any other remedies to which any Person may be
lawfully entitled.

         10.15 Investment Representation. Each Member hereby represents to, and
agrees with, the other Members and the Company that such Member is acquiring
the Membership Interest for investment purposes for such Member’s own account
only and not with a view to or for sale in connection with any distribution of
all or any part of the Membership Interest. No other Person will have any
direct or indirect beneficial interest in or right to the Membership Interest.

         10.16 Spousal Consent. Each Member who is a married individual shall,
upon becoming a Member or, if later, upon becoming married, cause his spouse to
execute a spousal consent in the form attached hereto as Schedule 10.16 and
shall furnish such consent to the Company.

 

 

         IN WITNESS WHEREOF, the parties have executed this Agreement, effective as
of the date first written above.

	 	 	 	 	 
	 	 	Charter Communications, Inc.
	
	
	
	

	 	 	 	 	 
	
	
	
	

	 	 	
By:
	 	/s/ Marcy Lifton
	 	 	 	 	

	 	 	 	 	      Marcy Lifton, Vice President
	
	
	
	

	 	 	 	 	 
	
	
	
	

	 	 	Class A Preferred Members

Class A Common Members

Class C Common Members
	
	
	
	

	 	 	 	 	 
	
	
	
	

	 	 	
By:
	 	Charter Communications, Inc., as an

attorney-in-fact pursuant to Section 10.11 

of the Existing LLC Agreement

	 	 	 
	 	By:  	
/s/ Marcy Lifton
	 	 	

	 	 	
Marcy Lifton, Vice President

 

 

Accepting its appointment as the Manager of the Company under and to the extent
provided in Section 5.1.1 of this Agreement:

	 	 	 	 	 
	 	 	Charter Investment, Inc.
	
	
	
	

	 	 	 	 	 
	
	
	
	

	 	 	
By:
	 	/s/ Marcy Lifton
	 	 	 	 	

	 	 	 	 	      Marcy Lifton, Vice President
	
	
	
	

	 	 	 	 	 
	
	
	
	

	 	 	Charter Communications, Inc.
	
	
	
	

	 	 	 	 	 
	
	
	
	

	 	 	
By:
	 	/s/ Marcy Lifton
	 	 	 	 	

	 	 	 	 	      Marcy Lifton, Vice President

 

 

SCHEDULE A

Members; Address; Number of Units

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Class A
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Preferred
	 	 	Class A	 	Class B	 	Class C	 	Class A	 	Class B	 	Contributed
	Member/Address	 	Common	 	Common	 	Common	 	Preferred	 	Preferred	 	Amount
	

	Charter Investment, Inc.
	 	 	217,585,246	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
	
	
	

	12444 Powerscourt Drive, Suite 400

St. Louis, Missouri 63131

Attn: Jerald L. Kent	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Vulcan Cable III Inc.
	 	 	106,715,233	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
	
	
	

	110 110th Avenue, N.E., Suite 550

Bellevue, WA 98004

Attn: William D. Savoy	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Charter Communications, Inc.
	 	 	 	 	 	 	294,267,540	 	 	 	 	 	 	 	 	 	 	 	505,664	 	 	 	 	 
	
	
	
	

	12444 Powerscourt Drive, Suite 400

St. Louis, Missouri 63131

Attn: Jerald L. Kent	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	BCI (USA), LLC
	 	 	 	 	 	 	 	 	 	 	4,992,380	 	 	 	 	 	 	 	 	 	 	 	 	 
	
	
	
	

	c/o Bresnan Communications, Inc.

709 Westchester Avenue

White Plains, New York 10604

Attn: Jeffrey S. DeMond and

Robert V. Bresnan, Esq.	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	William J. Bresnan
	 	 	 	 	 	 	 	 	 	 	241,232	 	 	 	 	 	 	 	 	 	 	 	 	 
	
	
	
	

	c/o Bresnan Communications, Inc.

709 Westchester Avenue

White Plains, New York 10604

Attn: Jeffrey S. DeMond and

Robert V. Bresnan, Esq.	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Blackstone BC Capital Partners L.P.
	 	 	 	 	 	 	 	 	 	 	8,112,382	 	 	 	 	 	 	 	 	 	 	 	 	 
	
	
	
	

	c/o The Blackstone Group

345 Park Avenue

New York, New York 10154

Attn: Simon Lonergan	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Blackstone BC Offshore Capital
	 	 	 	 	 	 	 	 	 	 	909,681	 	 	 	 	 	 	 	 	 	 	 	 	 
	
	
	
	

	Partners L.P.

c/o The Blackstone Group

345 Park Avenue

New York, New York 10154

Attn: Simon Lonergan	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

 

 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Class A
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Preferred
	 	 	Class A	 	Class B	 	Class C	 	Class A	 	Class B	 	Contributed
	Member/Address	 	Common	 	Common	 	Common	 	Preferred	 	Preferred	 	Amount
	

	Blackstone Family Media
	 	 	 	 	 	 	 	 	 	 	575,877	 	 	 	 	 	 	 	 	 	 	 	 	 
	
	
	
	

	Partnership III L.P.

c/o The Blackstone Group

345 Park Avenue

New York, New York 10154

Attn: Simon Lonergan	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	CRM I Limited Partnership
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	325,412	 	 	 	 	 	 	$	325,412	 
	
	
	
	

	c/o Charles R. Morris III

4875 South El Camino Drive

Englewood, CO 80111	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	CRM II Limited Partnership, LLLP
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	1,127,321	 	 	 	 	 	 	$	1,127,321	 
	
	
	
	

	c/o Charles R. Morris III

4875 South El Camino Drive

Englewood, CO 80111	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Charles R. Morris, III
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	1,553,469	 	 	 	 	 	 	$	1,553,469	 
	
	
	
	

	4875 South El Camino Drive

Englewood, CO 80111	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

 

 

SCHEDULE 10.16

         The undersigned is the spouse of _____ and acknowledges that _____
[he/she] has read the Amended and Restated Limited Liability Company Agreement
(“Agreement”) of Charter Communications Holding Company, LLC, a Delaware
limited liability company (the “Company”), dated as of _______, as amended or
supplemented from time to time, and understands its provisions. The
undersigned is aware that, by the provisions of the Agreement, _____ [he/she]
and _____ [his/her] spouse have agreed to sell or transfer all _____ [his/her]
Membership Interest in the Company, including any community property interest
or quasi-community property interest, in accordance with the terms and
provisions of the Agreement. The undersigned hereby expressly approves of and
agrees to be bound by the provisions of the Agreement in its entirety,
including, but not limited to, those provisions relating to the sales and
transfers of Membership Interests and the restriction thereon. If the
undersigned predeceases _____ [his/her] spouse when _____ [his/her] spouse owns
any Membership Interest in the Company, _____ [he/she] hereby agrees not to
devise or bequeath whatever community property interest or quasi-community
property interest _____ [he/she] may have in the Company in contravention of the
Agreement.

Date:____________________________

Signature:________________________

Name:___________________________

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