Document:

LETTER FROM VULCAN INC.

 

Exhibit 10.3b

Vulcan Inc.

505 Union Station

505 Fifth Avenue South

Suite 900

Seattle, WA 98104

June 30, 2003

Charter Communications VII, LLC

CCO Holdings, LLC

12405 Powerscourt Drive

St. Louis, MO 63131

Ladies and Gentlemen:

               Reference is made to the Commitment Letter (the “Commitment Letter”)
dated as of April 14, 2003 between Vulcan Inc. (“Vulcan”) and Charter
Communications VII, LLC. Capitalized terms used but not defined herein have
the meanings assigned to them in the Commitment Letter.

               Extension of Termination Date

               The terms of the Commitment Letter provide that Vulcan’s commitment is
subject to the negotiation, execution and delivery on or before
June 30, 2003
(the “Original Documentation Date”) of the Definitive Documentation reasonably
satisfactory to Vulcan and its counsel. You have requested that Vulcan extend
the Original Documentation Date to March 31, 2004 (the “New Documentation
Date”). Vulcan hereby agrees to extend the Original Documentation Date to the
New Documentation Date subject to the terms and conditions of this letter
agreement (“Letter Agreement”). Except as modified by this Letter Agreement,
the terms of the commitment Letter remain in effect.

               Facility Fee

               The Commitment Letter provides that an amount equal to $3,000,000 of the
Facility Fee (1% of $300,000,000 (the “Commitment Amount”)) would be earned upon
execution of the Definitive Documentation and would be payable in equal
quarterly installments, commencing on the execution of the Definitive
Documentation and ending on the third anniversary of the date of the Commitment
Letter. As consideration for Vulcan’s extension of the Original Documentation
Date pursuant hereto, such $3,000,000 shall instead be earned on the date
hereof by Vulcan and shall be payable by you to Vulcan or its designee in
twelve equal installments on the last day of June, September, December and
March in each year (or, if any such day is not a Business Day, the next
succeeding Business Day), commencing on the date hereof and ending on
March 30, 2006; provided, that the first installment of such facility fee may be paid
on July 1, 2003. For purposes herein, “Business Day” means any day except a
Saturday, Sunday or other

 

 

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day on which commercial banks in New York City or
Dallas, Texas are authorized or required by law to close.

               Extension Fee

               As Consideration for Vulcan’s extension of the original Documentation Date
pursuant hereto, you agree to pay to Vulcan or its designee an extension fee,
accruing from the date hereof through and including the earlier of the date
that (i) the commitments under the Commitment Letter are terminated by you in
writing to Vulcan or expire pursuant to its terms or (ii) the execution and
delivery of Definitive Documentation reasonably satisfactory to Vulcan and its
counsel. The amount of the extension fee shall equal 0.50% per annum of the
Commitment Amount (computed on the basis of the actual number of days elapsed
in a year of 360 days). The extension fee shall be payable in arrears on the
last day of March, June, September and December in each year and on such date
of termination or expiration or such date of execution and delivery of
Definitive Documentation (or, if such day is not a Business Day, the next
succeeding Business Day), commencing on the earliest of
(A) September 30, 2003,
(B) such date of termination or expiration or (C) such date of execution and
delivery of Definitive Documentation. For the avoidance of doubt, the parties
understand that the extension fee shall be superseded in its entirety by the
Commitment Fee referenced in the Term Sheet upon the execution and
delivery of Definitive Documentation reasonably satisfactory to Vulcan and its
counsel and that no such Commitment Fee is due prior to the execution and
delivery of the Definitive Documentation.

               Out-of-Pocket Expenses

               As
set forth in the Commitment Letter, you agree to reimburse Vulcan and
its affiliates on demand for all reasonable out-of-pocket expenses (including
reasonable fees, charges and disbursements of counsel) incurred prior to and
hand including the date hereof in connection with the Facility and any related
documentation (including this Letter Agreement, the Commitment Letter, the Term
Sheet and the Definitive Documentation); provided, that such expenses to be
reimbursed incurred through the date of execution of the Definitive
Documentation shall not exceed $l,000,000.

******************

               This Letter Agreement shall be governed by, and construed in accordance
with, the laws of the State of New York. This Letter Agreement may be executed
in any number of counterparts, each of which shall be an original, and all of
which, when taken together, shall constitute one agreement. Delivery of an
executed signature page of this Letter Agreement by facsimile transmission
shall be effective as delivery of a manually executed counterpart hereof.

[Remainder of page intentionally left blank]

 

 

-3-

               If the foregoing correctly sets forth our agreement, please indicate
your acceptance of the terms hereof by (i) returning to us an executed
counterpart hereof not later than 6:00 p.m., Pacific Standard Time, on June
30, 2003 and (ii) paying the first installment of the facility fee no later
than July 1, 2003. Vulcan’s commitment under the Commitment Letter will
expire (i) on June 30, 2003 pursuant to its terms in the event Vulcan has
not received such executed counterpart or (ii) on July 1, 2003 pursuant to
its terms in the event Vulcan has not received such executed counterpart and the first installment
of the facility fee, in each case, in accordance with the immediately
preceding sentence.

	 	 	 	 	 
	 	 	Very truly yours,
	 	 	 	 	 
	 	 	VULCAN INC.
	 	 	 	 	 
	 	 	 	 	 
	 	 	
By:
	 	/s/  Jody
Patton

Name:

Title:

	 	 	 	 	 
	Accepted and agreed to as of

the date first written above by:	 	 
	 	 	 	 	 
	CHARTER COMMUNICATIONS VII, LLC	 
	 	 	 	 	 
	 	 	 	 	 
	By:	 	
/s/ Steven A Schumm

Name: Steven A Schumm

Title: EVP — interim CFO	 	 
	 	 	 	 	 
	 	 	 	 	 
	CCO HOLDINGS, LLC	 	 
	 	 	 	 	 
	 	 	 	 	 
	By:	 	
/s/ Steven A Schumm

Name: Steven A Schumm

Title: EVP – interim CFOAMENDED AND RESTATED MANAGEMENT AGREEMENT

 

Exhibit 10.4

AMENDED AND RESTATED

MANAGEMENT AGREEMENT

     THIS AMENDED AND RESTATED MANAGEMENT AGREEMENT (this “Agreement”) is made
as of the 19th day of June, 2003, by and between Charter Communications
Operating, LLC, a Delaware limited liability company (the “Company”), on behalf
of itself and all of its Specified Subsidiaries (as defined below, and,
collectively with the Company, the “Company Entities”), and Charter
Communications, Inc., a Delaware corporation (the “Manager”):

     A.     The Company Entities have retained the Manager to manage and operate the
cable television systems and related or incidental businesses now owned,
operated or hereafter acquired by the Company Entities (the “Cable Systems”).

     B.     The Manager has agreed to continue to manage and operate the Cable
Systems, all upon the terms and conditions hereinafter set forth.

     C.     The Company and the Manager previously entered into a Management
Agreement dated as of February 23, 1999 (such agreement, and all subsequent
amendments thereto, collectively, the “Prior Management Agreement”). This
Agreement amends and restates in its entirety the Prior Management Agreement.

     D.     Concurrently, the Manager and Charter Communications Holding Company,
LLC (“CCHC”) are entering into a Second Amended and Restated Mutual Services
Agreement (“Amended Mutual Services Agreement”), which provides, among other
things, that the Manager and CCHC, and, upon the transfer of certain assets to
CCO Holdings, LLC (“CCO Holdings”) CCO Holdings, shall each make its employees,
officers, services, facilities and assets available to the others as needed by
each of them in connection with their business and operations. Charter
Investment, Inc. (“CII”), the Manager and CCHC have also agreed that CII shall
continue to provide certain rights and services as reasonably requested
pursuant to the terms of the First Amended and Restated Mutual Services
Agreement (as modified and supplemented by CCHC, CCI and CII, the “Original
Mutual Services Agreement”, and together with the Amended Mutual Services
Agreement, the “Mutual Services Agreements”.) The Manager engages in the
business (“CCI Business”) of (i) acting as Manager of the Cable Systems under
this Agreement, (ii) acting as manager of the cable systems and related or
incidental businesses of its other direct and indirect subsidiaries, (iii)
acting as manager of its direct and indirect limited liability company
subsidiaries under applicable law, (iv) engaging in capital raising,
acquisition, disposition and other transactions, performing financial and
administrative services and financial reporting, performing other tasks and
functions related to or arising out of or incidental to the cable systems and
related or incidental businesses of its direct and indirect subsidiaries, and
engaging in other activities in connection with or related or incidental to the
foregoing activities.

     E.     In exchange for the Manager agreeing to continue to manage and operate
the Cable Systems under this Agreement, the Company Entities shall pay to the
Manager the Management Fee, as more fully set forth below.

 

 

     In consideration of the mutual covenants and agreements contained herein,
and for other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereto hereby agree as follows
(Capitalized terms not otherwise defined herein shall have the meanings set
forth in Section 9 hereto):

	 	1.	 	Appointment of Manager.

     The Company hereby reconfirms the appointment of the Manager to continue
as the manager for the Cable Systems, and the Manager hereby agrees to continue
to serve the Company Entities as a manager for the Cable Systems, pursuant to
the terms and conditions hereinafter set forth. The parties acknowledge that
the Manager may provide its management services and functions under this
Agreement through any of CCHC, CCO Holdings and CII under the Mutual Services
Agreements with the same force and effect as if the Manager had directly
provided such services.

	 	2.	 	Authority and Duties of the Manager.

               (a) The Company Entities shall seek the advice of the Manager regarding
the business, properties and activities of the Cable Systems during the term
hereof, and subject to the direction, control and general supervision of the
Company Entities, the Manager agrees to provide such advice. The Manager shall
give such advice in a businesslike, efficient, lawful and professional manner
in accordance with this Agreement.

               (b) Without limiting the generality of the foregoing, the Manager shall
provide all management services with respect to the operation of the Cable
Systems, including, but not limited to the following:

                         (i) advice concerning the hiring, termination, performance and training of
personnel;

                         (ii) review, consultation and advice concerning personnel, operations,
engineering and other management and operating policies and procedures;

                         (iii) review, consultation and advice concerning maintenance standards for
plant and equipment of the Cable Systems, advice as to the Cable Systems’
normal repairs, replacements, maintenance and plant upgrades, and provide for
periodic inspections;

                         (iv) recommendations on all necessary action to keep the operation of the
Cable Systems in compliance, in all material respects, with the conditions of
the Company Entities’ franchises and all applicable rules, regulations and
orders of any federal, state, county or municipal authority having jurisdiction
over the Cable Systems, and maintenance of the legal existence, qualifications
to do business, legal and tax good standing, and necessary licenses, franchises
and similar rights of the Company Entities;;

                         (v) assistance in the negotiation of, and direct negotiations of, on
behalf of the Company Entities, operating agreements (including, but not
limited to, pole attachment agreements, office and headend leases, easements
and right-of-way agreements), contracts for the purchase, lease, license or use
of properties, equipment,

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facilities, systems, services, programming, content and rights as may be
necessary or desirable in connection with the operation or maintenance of the
Cable Systems and such other agreements on behalf of the Company Entities as
are necessary or advisable for the Cable Systems and assistance in procuring on
behalf of the Company Entities, or directly procuring on behalf of the Company
Entities, such property, facilities, systems, programming, content, equipment,
billing and other services and other rights and assets deemed necessary and
advisable for the Cable Systems;

                         (vi) assistance in the negotiation of, and direct negotiations of, on
behalf of the Company Entities, such agreements for the provision of carriage,
advertising time and other rights or services by the Cable Systems;

                         (vii) development of recommendations for, and assistance in the
negotiation of, and direct negotiations of, on behalf of the Company Entities,
the acquisition and maintenance of, such insurance coverage with respect to the
Cable Systems as the Company Entities may determine upon advice and
consultation of the Manager;

                         (viii) guidance on all marketing, sales promotions and advertising for the
Cable Systems and assistance in the negotiation of, and direct negotiations of,
on behalf of the Company Entities of agreements in respect thereof;

                         (ix) assistance in the financial budgeting process and the implementation
of appropriate accounting, financial, administrative and managerial controls
for the Cable Systems;

                         (x) preparation for use by the Company Entities of financial reports and
maintenance of books of accounts and other records reflecting the results of
operation of each Cable System and/or subsidiary;

                         (xi) advice and consultation with the Company Entities in connection with
any and all aspects of the Cable Systems and the day to day operation thereof
and consultation with the Company Entities with respect to the selection of and
assistance in the retention of, and direct retention of, on behalf of the
Company Entities, third party service providers, including, but not limited to
attorneys, consultants, investment bankers, financial advisors and accountants;
and

                         (xii) other services and functions consistent with those enumerated above
or heretofore provided by the Manager to the Company Entities.

     3.     Payment of Management Fee. In consideration for the Manager providing,
directly or indirectly under the Mutual Services Agreements, the services and
functions described in Section 2 above, and the other activities of the Manager
in connection with the CCI Business, which the parties acknowledge are of
direct or indirect benefit to the Company Entities, the Company Entities shall
pay to the Manager (or without duplication to CCHC, CCO Holdings, CII in
respect of services or functions provided by them) the “Management Fee”, which
shall consist of the Reimbursement Management Fee and the Existing Deferred
Management Fee.

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               (a) The “Reimbursement Management Fee” shall be equal to all expenses,
costs, losses, liabilities, taxes, imposts, charges or damages incurred, paid
or accrued by the Manager (without duplication and including, without
limitation, all expenses, costs, losses, liabilities, taxes, imposts, charges
or damages actually incurred, paid or accrued pursuant to the Mutual Services
Agreements by any of the parties thereto) (“Expenses”) in connection with:

                         (i) its duties hereunder, including, without limitation, wages, salaries
and other labor costs, equipment, systems and facilities costs and costs of
services incurred in the construction, maintenance, expansion or operation of
the Cable Systems, or personnel working on special projects or services for or
on behalf of the Company Entities;

                         (ii) its activities in connection with the CCI Business, including,
without limitation, overhead, administration, wages, salaries and other labor
costs, equipment, systems and facilities costs and cost of services, including,
without limitation, services of third party providers such as attorneys,
consultants, investment bankers, financial advisors and accountants;

                         (iii) its duties, responsibilities and obligations attributable to or
arising out of its status as the manager under Delaware or other state law for
the Company Entities; and

                         (iv) financing, acquisition and other capital transactions of the Manager
or any of its subsidiaries, and any duties or activities in connection with the
status of the Manager or any of its subsidiaries as a reporting company or
issuer pursuant to federal and state securities laws, the rules or regulations
any exchange or the obligations under any credit, loan or financing agreement
or indenture.

     In connection with the determination and calculation of the Reimbursement
Management Fee, the Manager (and CCHC, CCO Holdings and CII) shall not be
entitled to make a profit or take a mark-up or premium in excess of the actual
Expenses incurred, paid or accrued by the Manager (and CCHC, CCO Holdings or
CII). Any Expenses of the Manager (and of CCHC, CCO Holdings and CII) which are
attributable to or for the benefit of both Company Entities and other direct
and indirect subsidiaries of the Manager shall be allocated amongst such
entities in good faith by the Manager on a quarterly basis.

          (b) Existing Deferred Management Fee. The Company Entities shall also be
obligated to pay to CII, the previous manager under the prior Management
Agreement, unpaid deferred percentage management fees accrued on or prior to
December 31, 2000, based on gross revenue, which amount does not exceed $14
million as of March 31, 2003, with such balance bearing interest until paid as
provided in Section 3(c) (such amount, as increased by such interest, the
“Existing Deferred Management Fee”). Except for the interest provided pursuant
to Section 3(c), there shall be no further accrual of Existing Deferred
Management Fees after the date hereof.

          (c) Payment of Management Fee. The Company Entities shall pay the
Management Fees from time to time, but at least monthly. The Existing Deferred

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Management Fee that remains unpaid shall be accrued as a liability of the
Company Entities and shall be payable as soon as any conditions to payment are
fulfilled. Such deferred Existing Deferred Management Fee will bear interest
(without duplication) at the rate of ten percent (10%) per annum, compounded
annually, from the date otherwise due and payable until the payment thereof.

          (d) Notwithstanding any termination of this Agreement pursuant to Section
4, the Manager (and CCHC, CCO Holdings, and CII, respectively) shall remain
entitled (i) to receive payment of any Expenses incurred, paid or accrued
(irrespective of whether incurred, paid or accrued before or after such
termination) which would have been Reimbursement Management Fees if this
Agreement had not been so terminated (provided that the Manager (and each of
CCHC, CCO Holdings, and CII, respectively) shall use its reasonable efforts to
mitigate such Expenses following such termination) and (ii) to receive payment
of any outstanding deferred Existing Deferred Management Fee as of the time of
such termination.

     4.     Term of Agreement. The term of this Agreement shall be ten years from
the date hereof, unless sooner terminated pursuant to the terms of this
Agreement. This Agreement may be terminated as follows: (a) by the Company
immediately upon written notice to the Manager for Cause (as defined below) or
(b) automatically on the consummation of the sale of all or substantially all
of the Company’s assets. For purposes hereof, “Cause” shall exist if the
Manager has engaged in gross negligence or willful misconduct in the
performance of its duties hereunder which could have a material adverse effect
on the Company. In the event that this Agreement or any of the Mutual Services
Agreements is terminated prior to all obligations under the Credit Agreement
and the other Loan Documents (as defined in the Credit Agreement) having been
paid in full in cash, the Manager and the Company shall not enter into any
other arrangement or agreement that, directly or indirectly, increases the
obligations of the Company Entities with respect to the matters covered by
Section 3 of this Agreement (including through the Mutual Services Agreements
or any other arrangement or agreement in substitution therefor) or otherwise in
a manner is inconsistent with provisions of the Credit Agreement and CCI will
not permit any of its affiliates to enter into any such arrangement or
agreement and this sentence shall survive any termination of the this
Agreement.

     5.     Liability. In addition to, and not in limitation of (but without
duplication) their obligations under this Agreement and any other obligations
imposed by law or agreement, the Company Entities shall bear any and all
expenses, liabilities, losses, damages, claims, obligations, actions, suits and
costs directly or indirectly resulting from their existence, legal and
contractual commitments and the operation of the Cable Systems, and the Manager
(and CCHC, CCO Holdings and CII), and their respective shareholders, members,
officers, directors and employees shall not, under any circumstances, be held
liable therefor, or any action taken or omitted to be taken by any of them in
connection with this Agreement or the services and functions contemplated by
this Agreement (except to the extent determined in a final, nonappealable
judgment by a court of competent jurisdiction to have resulted from such
person’s own gross negligence or willful misconduct in connection with its
duties expressly set forth herein), provided, that all amounts payable in this
Section 5 shall be allocated amongst such entities in good faith by the
Manager. Neither the Manager (and CCHC, CCO Holdings and CII) nor any of their
respective shareholders,

- 5 -

 

members, officers, directors and employees shall be held to have incurred
any liability to the Company Entities, the Cable Systems or any third party by
virtue of any action taken or omitted to be taken (except to the extent
determined in a final, nonappealable judgment by a court of competent
jurisdiction to have resulted from such person’s own gross negligence or
willful misconduct in connection with its duties expressly set forth herein) in
good faith by such person in discharge of such person’s duties hereunder, and
the Company Entities agree to indemnify the Manager (and CCHC, CCO Holdings and
CII), and their respective shareholders, members, officers, directors and
employees and hold the Manager (and CCHC, CCO Holdings and CII), and their
respective shareholders, members, officers, directors and employees, harmless
with respect to any and all actions, suits and claims that may be made against
any of them in respect of the foregoing, including, but not limited to,
reasonable attorneys’ fees. This Section 5 shall survive the termination of
this Agreement.

     6.     Notices. All notices, demands, requests or other communications which
may be or are required to be given, served or sent by a party pursuant to this
Agreement shall be in writing and shall be deemed given upon receipt if
personally delivered (including by messenger or recognized delivery or courier
service) or on the date of receipt on the return receipt if mailed by
registered or certified mail, return receipt requested, postage prepaid,
delivered or addressed as set forth below. Rejection or other refusal to
accept or the inability to deliver because of changed address of which no
notice was given shall be deemed receipt of the notice:

	 	 	 	 	 
	 	 	
(a)
	 	If to the Company Entities:
	 	 	 	 	 
	 	 	 	 	Charter Communications Operating, LLC
	 	 	 	 	12405 Powerscourt Drive
	 	 	 	 	St. Louis, Missouri 63131
	 	 	 	 	Attention: Carl Vogel
	 	 	 	 	 
	 	 	
(b)
	 	If to the Manager:
	 	 	 	 	 
	 	 	 	 	Charter Communications, Inc.
	 	 	 	 	12405 Powerscourt Drive
	 	 	 	 	St. Louis, Missouri 63131
	 	 	 	 	Attention: Carl Vogel

     7.     Governing Law. This Agreement and the rights and obligations of the
parties hereunder and the persons subject hereto shall be governed by, and
construed and interpreted in accordance with, the laws of the State of New
York, without giving effect to the choice of law principles thereof.

     8.     Miscellaneous. This Agreement shall be binding upon and inure to the
benefit of and be enforceable by and against the parties hereto and their
respective successors and assigns. This Agreement embodies the entire
agreement and understanding among the parties hereto with respect to the
subject matter hereof and supersedes all prior agreements and understandings
relating to the subject matter hereof. The headings in this Agreement are for
purposes of reference only and shall not limit or otherwise affect the meaning
hereof. This Agreement may be executed in any number of counterparts, each of

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which shall be an original, but all of which together shall constitute one
instrument. This Agreement is not transferable or assignable by any of the
parties hereto except as may be expressly provided herein. This Agreement may
not be amended, supplemented or otherwise modified except in accordance with
the Credit Agreement.

     9.     Definitions. For purposes of this Agreement, the following terms shall
have the meanings set forth below:

          (a) “Credit Agreement” shall mean the Credit Agreement, dated as of March
18, 1999, as amended and restated as of January 3, 2002 and as further amended
and restated by the Second Amended and Restated Credit Agreement dated as of
June      , 2003, by and among the Company, Charter Communications Holdings LLC,
the several banks and other financial institutions or entities from time to
time parties to this Agreement, J. P. Morgan Securities Inc. and Banc of
America Securities LLC, as lead arrangers and joint bookrunners, TD Securities
(USA) Inc., as syndication agent, Bank of America, N.A. and JPMorgan Chase
Bank, as Administrative Agents, and Bank of America, N.A., as Funding Agent, as
amended, supplemented or otherwise modified from time to time.

          (b) “Specified Subsidiaries” shall mean all of the Company’s Subsidiaries
from time to time, but excluding CF Finance-LaGrange, Inc., Charter-LaGrange,
L.L.C., Renaissance Media Group LLC and all of its direct and indirect
subsidiaries, and the assignees and/or successors in interest of each of the
foregoing.

          (c) “Subsidiaries” shall mean all direct and indirect subsidiaries of the
Company, but excluding any Non-Recourse Subsidiaries (as defined in the Credit
Agreement).

* * * * * * * * * * * *

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     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in the manner appropriate to each as of the day and year first above
written.

	 	 	 	 	 
	 	 	CHARTER COMMUNICATIONS OPERATING, LLC,

a Delaware limited liability company
	 	 	 	 	 
	 	 	
By:
	 	/s/ Eloise E. Schmitz
	 	 	 	

	 	 	
Name:
	 	Eloise E. Schmitz
	 	 	
Title:
	 	Vice President
	 	 	 	 	 
	 	 	CHARTER COMMUNICATIONS, INC.,

a Delaware corporation, on behalf of, and in its capacity as
manager under,
 the respective limited liability company agreements
of, the Specified 
Subsidiaries of CCO
	 	 	 	 	 
	 	 	
By:
	 	/s/ Eloise E. Schmitz
	 	 	 	

	 	 	
Name:
	 	Eloise E. Schmitz
	 	 	
Title:
	 	Vice President
	 	 	 	 	 
	 	 	CHARTER COMMUNICATIONS, INC.,

a Delaware corporation, on its own behalf
	 	 	 	 	 
	 	 	
By:
	 	/s/ Eloise E. Schmitz
	 	 	 	

	 	 	
Name:
	 	Eloise E. Schmitz
	 	 	
Title:
	 	Vice President

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