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Exhibit 10.20 (c)
CHARTER COMMUNICATIONS HOLDING COMPANY, LLC
00000 XXXXXXXXXXX XXXXX
XX. XXXXX, XXXXXXXX 00000
_________ __, 1999
Xxxxxx X. Xxxx
c/o Charter Investment, Inc.
00000 Xxxxxxxxxxx Xxxxx
Xx. Xxxxx, Xxxxxxxx 00000
Dear Xx. Xxxx:
Reference is made to that certain Nonqualified Membership Interest
Option Agreement, dated as of February 9, 1999, between you and Charter
Communications Holdings, LLC (the "Agreement"), which has been assigned and
assumed by Charter Communications Holding Company, LLC ("Charter Holdco"). All
capitalized terms used in this letter but not otherwise defined herein have the
meanings ascribed thereto in the Agreement, except that references to the
Company herein and in the Agreement shall, as a result of the assignment and
assumption, be deemed to refer to Charter Holdco.
In connection with the Initial Public Offering of the Public Company,
you and Charter Holdco agree that the Agreement shall be amended as follows:
1. Section 7 of the Agreement is hereby amended and restated in its
entirety as follows:
COMPLIANCE WITH SECURITIES AND OTHER LAWS. In no event shall the
Company be required to sell, issue or deliver Membership Interests pursuant to
this Option if in the opinion of the Company, based upon the written opinion of
counsel, the issuance thereof would constitute a violation by either Optionee or
the Company of any provision of any law or regulation of any governmental
authority or any securities exchange. Notwithstanding the foregoing, Optionee
and Optionee's counsel shall have reasonable opportunity to discuss with the
Company and its counsel any such potential violation prior to such determination
by the Company. As a condition of any sale or issuance of Membership Interests
pursuant to this Option, the Company may place legends on the certificates
representing the Membership Interests, issue stop-transfer orders and require
such agreements or undertakings from Optionee as the Company may deem necessary
or advisable to assure compliance with any such law or regulation, including, if
the Company or its counsel deems it appropriate, representations from Optionee
that Optionee is acquiring the Membership Interests solely for investment and
not with a view to distribution and that no distribution of the Membership
Interests acquired by Optionee will be made unless registered pursuant to
applicable federal and state securities laws or unless, in the opinion of
counsel to the Company, such registration is unnecessary.
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2. Subsections 10(c) and 10(d) are each hereby amended by adding the
following immediately prior to clause (ii) of each subsection, before the
semicolon: "provided, however, that in the event the Company shortens the
exercise period, Optionee shall have the right to exercise the Option by a
cashless exercise method to be agreed upon by the Company and Optionee."
3. Section 11 is amended by adding the definitions of "Exchange Agreement"
and "Public Company Value" and replacing the definition of "Fair Market Value,"
as follows:
"Exchange Agreement" means that certain Exchange Agreement, dated as of
_______ __, 1999, by and among the Public Company, CCI (now Charter Investment,
Inc.), Vulcan Cable III Inc. and Xxxxx.
"Fair Market Value" means the fair market value of the Company as
determined by the Company using the following formula:
(1) As of the occurrence of a Trigger Event prior to an
Initial Public Offering, the excess of (a) 13.7 times the projected cash flow of
the Company for the year succeeding the year in which such Fair Market Value
determination is made (as established in the budget for the Company, approved by
the Company's Board, or in the event no such budget has as of the date of the
Trigger Event been approved by the Board, as established by the Board within
thirty (30) days of any such Trigger Event, taking into account the most recent
forecasts for the Company) including all future acquisitions by the Company to
the extent of its interests for its fiscal year following the year in which the
Trigger Event occurs, over (b) the debt of the Company as reflected in its
financial statements or in such budget.
(2) From and after the consummation of an Initial Public
Offering, "Fair Market Value" shall mean (a) the Public Company Value, divided
by (b) the Percentage Interest of the Company represented by the Public
Company's Membership Interest."
"Public Company Value" means either (a) if the conditions set forth in
Sections 2.2.1 and 2.2.2 of the Exchange Agreement are satisfied, (x) the Share
Value, multiplied by (y) the total number of outstanding shares of common stock
of the Public Company, assuming the exercise of all options, warrants or other
similar rights held by any person to purchase common stock of the Public
Company; or (b) if the conditions set forth in Sections 2.2.1 and 2.2.2 of the
Exchange Agreement are not satisfied, the amount that would be distributed to
the Public Company upon the liquidation of the Company, as calculated in
accordance with Section 2.3(b) of the Exchange Agreement."
Except as otherwise set forth in this letter, the Agreement remains
unchanged and in full force and effect. This letter may be executed in any
number of counterparts, each of which will be deemed an original, but all of
which together will constitute one and the same instrument.
By signing below, Charter Communications, Inc. agrees to be bound by
the terms of the Agreement that may be applicable to it, including, without
limitation, the obligation to issue common stock arising out of Section 9 of the
Agreement, which requires Membership Interests held as a result of an exercise
of the Option to be exchanged automatically into common stock of the Public
Company.
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Very truly yours,
CHARTER COMMUNICATIONS HOLDING
COMPANY, LLC
By:___________________________
Name:
Title:
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ACCEPTED AND AGREED:
______________________________
Xxxxxx X. Xxxx
CHARTER COMMUNICATIONS, INC.
By:___________________________
Name:
Title:
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