EXHIBIT 10.10
November 22, 2004
Charter Investment, Inc.
Vulcan Cable III Inc.
000 Xxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Gentlemen:
As you know, Charter Communications, Inc. ("PUBLICCO") has agreed to issue
approximately $862.5 million original principal amount of Convertible Senior
Notes due 2009 (the "DEBT ISSUANCE"). In connection with the Debt Issuance,
PublicCo has agreed to enter into a Share Lending Agreement (the "SHARE LENDING
AGREEMENT"), pursuant to which it will loan certain shares of its Class A common
stock (the "LOANED SHARES") to an affiliate of Citigroup Global Markets Inc. for
the purpose of facilitating hedging of such Notes by holders thereof (the "STOCK
LOAN"). The purpose of this letter agreement is to confirm the understanding of
PublicCo, Charter Investment, Inc., and Vulcan Cable III Inc. as to the manner
in which certain provisions of the Amended and Restated Limited Liability
Company Agreement for Charter Communications Holding Company, LLC ("HOLDCO"),
made and entered into effective as of August 31, 2001, as amended through the
date hereof (the "LLC AGREEMENT"), will be implemented in connection with the
Debt Issuance and the Stock Loan.
Pursuant to certain provisions of the LLC Agreement, including without
limitation Sections 3.1.3(g), 3.6.4(b), and 5.1.7, in connection with certain
issuances of securities or indebtedness by PublicCo, HoldCo is to issue to
PublicCo securities or indebtedness of HoldCo that mirror to the extent
practicable the terms and conditions of such securities or indebtedness of
PublicCo, as reasonably determined by PublicCo in its capacity as the Manager of
HoldCo. In connection with the Debt Issuance and the Stock Loan, PublicCo wishes
to confirm the understanding of the Members of HoldCo as follows:
(1) HoldCo will issue certain convertible senior notes to PublicCo, upon terms
and subject to conditions that mirror to the extent practicable the terms and
conditions of the Debt Issuance. HoldCo will also enter into a Unit Lending
Agreement (the "UNIT LENDING AGREEMENT"), pursuant to which it will loan certain
Class B Common Units in HoldCo (the "LOANED UNITS") to PublicCo, upon terms and
subject to conditions that mirror to the extent practicable the terms and
conditions of the Share Lending Agreement.
(2) In accordance with the Unit Lending Agreement, HoldCo will issue and loan to
PublicCo a number of Loaned Units equal to the number of Loaned Shares.
Charter Plaza - 00000 Xxxxxxxxxxx Xxxxx - Xx. Xxxxx, Xxxxxxxx - 00000-0000
XXX.XXXXXXX.XXX - TEL: 000.000.0000 - FAX: 000.000.0000
(3) Loaned Units will be returned to HoldCo under the Unit Lending Agreement at
the same time, and in the same number, as Loaned Shares are returned to PublicCo
under the Share Lending Agreement.
(4) Notwithstanding anything to the contrary expressed or implied above, to
mirror the overall economic effect of the Stock Loan and to avoid economic
distortions and administrative burden at HoldCo, for purposes of applying the
provisions of the LLC Agreement relating to allocations, adjustments to Gross
Asset Values, and, to the extent reasonably determined by PublicCo in its
capacity as the Manager of HoldCo, any other matter, Loaned Units will be
disregarded and treated as if they had not been issued until such time (and
except to the extent) that, as a result of a default by the Borrower under the
Share Lending Agreement or any other event thereunder, PublicCo determines that
Loaned Shares are to be treated in a manner that assumes they will neither be
returned to PublicCo by the Borrower thereunder nor be acquired by PublicCo in
lieu of such a return (a "NON-RETURN EVENT").
(5) In applying the provisions of the LLC Agreement, PublicCo, in its capacity
as the Manager of HoldCo, may from time to time make such other adjustments
(including without limitation in the allocations of, or the Capital Accounts in,
HoldCo) as it reasonably determines to be necessary or appropriate to mirror the
overall economic effect of the Stock Loan (and to reflect the overall economic
arrangement of the Members of HoldCo under the LLC Agreement), to reflect the
occurrence of any Non-return Event, to satisfy HoldCo's obligations under the
Unit Lending Agreement and PublicCo's obligations under the Unit Lending
Agreement and the Share Lending Agreement, or to do any of the foregoing in a
tax-efficient manner to the extent practicable. In making any determinations
under this paragraph (5), PublicCo, as the Manager of HoldCo, will reasonably
consult with Charter Investment, Inc., and Vulcan Cable III Inc.
(6) PublicCo, as the Manager of HoldCo, may from time to time take all actions
and direct or cause to be done all such acts or things to effectuate or carry
out the purposes and intent of this letter agreement and to perform the
obligations of HoldCo under the agreements and instruments referred to herein.
(7) The transactions contemplated by PublicCo and HoldCo in connection with the
Debt Issuance and the Stock Loan, including without limitation the Share Lending
Agreement and the Unit Lending Agreement, are intended to be consistent with the
LLC Agreement; the LLC Agreement is hereby amended to the extent necessary to
conform to the terms of this letter agreement.
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Please sign below to confirm your agreement to, and acceptance of, the terms of
this letter agreement effective as of the date first above written. This letter
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. This letter agreement may be
executed in counterparts, each of which shall be deemed an original but all of
which shall constitute one and the same instrument.
Sincerely,
Charter Communications, Inc.
By: /s/ Xxxxxxxx X. Xxxxxxx
-----------------------
Title: Vice President
AGREED AND ACCEPTED:
Charter Investment, Inc.
By: /s/ Xxxxxx X. Xxxxxx
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Title: Vice President
Vulcan Cable III Inc.
By: /s/ Xxxxxx X. Xxxxxx
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Title: Vice President
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