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Sectors: Media
Governing Law: New York, View New York State Laws
Effective Date: March 31, 2003
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EXHIBIT: 10.11


Execution Copy


===============================================================================


$2,100,000,000


TERM LOAN AGREEMENT


Dated as of


March 31, 2003


Among


MOTH HOLDINGS, INC.
(To be renamed at the time of the Closing,
TIME WARNER CABLE INC.),


as Borrower,


The Lenders named herein,


CITICORP NORTH AMERICA, INC.
and
DEUTSCHE BANK AG, NEW YORK BRANCH,
as Co-Administrative Agents


===============================================================================


DEUTSCHE BANK SECURITIES INC. AND SALOMON SMITH BARNEY INC.,
as Joint Lead Arrangers and Joint Book Managers


TABLE OF CONTENTS


PAGE
ARTICLE I


DEFINITIONS


SECTION 1.01. Defined Terms..................................................................... 1 SECTION 1.02. Classification of Loans and Borrowings............................................ 18 SECTION 1.03. Terms Generally................................................................... 18 SECTION 1.04. Accounting Terms; GAAP............................................................ 19


ARTICLE II


THE LOANS


SECTION 2.01. Commitments....................................................................... 19 SECTION 2.02. Loans............................................................................. 19 SECTION 2.03. Notice of Borrowing............................................................... 20 SECTION 2.04. [Intentionally left blank]........................................................ 20 SECTION 2.05. [Intentionally left blank]........................................................ 20 SECTION 2.06. Funding of Loans.................................................................. 20 SECTION 2.07. Interest Elections................................................................ 21 SECTION 2.08. [Intentionally left blank]........................................................ 22 SECTION 2.09. Repayment of Loans at Maturity; Evidence of Debt.................................. 22 SECTION 2.10. Optional Prepayments and Mandatory Repayments of Loans............................ 23 SECTION 2.11. Fees.............................................................................. 24 SECTION 2.12. Interest.......................................................................... 24 SECTION 2.13. Alternate Rate of Interest........................................................ 25 SECTION 2.14. Increased Costs................................................................... 26 SECTION 2.15. Break Funding Payments............................................................ 27 SECTION 2.16. Taxes............................................................................. 27 SECTION 2.17. Payments Generally; Pro Rata Treatment; Sharing of Setoffs........................ 28 SECTION 2.18. Mitigation Obligations; Replacement of Lenders.................................... 30


ARTICLE III


REPRESENTATIONS AND WARRANTIES


SECTION 3.01. Organization Powers............................................................... 30 SECTION 3.02. Authorization; Enforceability..................................................... 31 SECTION 3.03. Governmental Approvals; No Conflicts.............................................. 31 SECTION 3.04. Financial Condition; No Material Adverse Change................................... 31 SECTION 3.05. Properties........................................................................ 32 SECTION 3.06. Litigation and Environmental Matters.............................................. 32 SECTION 3.07. Compliance with Laws and Agreements............................................... 32 SECTION 3.08. Government Regulation............................................................. 32


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PAGE SECTION 3.09. Taxes............................................................................. 32 SECTION 3.10. ERISA............................................................................. 33 SECTION 3.11. Disclosure........................................................................ 33 SECTION 3.12. Statements as to Taxes............................................................ 33


ARTICLE IV


CONDITIONS


SECTION 4.01. Closing Date...................................................................... 33


ARTICLE V


AFFIRMATIVE COVENANTS


SECTION 5.01. Financial Statements and Other Information........................................ 35 SECTION 5.02. Notices of Material Events........................................................ 37 SECTION 5.03. Existence; Conduct of Business.................................................... 37 SECTION 5.04. Payment of Obligations............................................................ 38 SECTION 5.05. Maintenance of Properties; Insurance.............................................. 38 SECTION 5.06. Books and Records; Inspection Rights.............................................. 38 SECTION 5.07. Compliance with Laws.............................................................. 38 SECTION 5.08. Use of Proceeds................................................................... 38 SECTION 5.09. Fiscal Periods; Accounting........................................................ 38 SECTION 5.10. Documentation; Status............................................................. 38 SECTION 5.11. Guarantees........................................................................ 39 SECTION 5.12. Syndication Efforts............................................................... 39 SECTION 5.13. Post-Closing Matters.............................................................. 39


ARTICLE VI


NEGATIVE COVENANTS


SECTION 6.01. Financial Covenants............................................................... 39 SECTION 6.02. Indebtedness...................................................................... 40 SECTION 6.03. Liens............................................................................. 40 SECTION 6.04. Mergers, Etc...................................................................... 42 SECTION 6.05. Investments....................................................................... 42 SECTION 6.06. Restricted Payments............................................................... 42 SECTION 6.07. Transactions with Affiliates...................................................... 42 SECTION 6.08. Unrestricted Subsidiaries......................................................... 43 SECTION 6.09. Maintenance of Corporate Separateness............................................. 43


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PAGE
ARTICLE VII


EVENTS OF DEFAULT


ARTICLE VIII


THE AGENTS


ARTICLE IX


MISCELLANEOUS


SECTION 9.01. Notices............................................................................ 48 SECTION 9.02. Waivers; Amendments................................................................ 49 SECTION 9.03. Expenses; Indemnity; Damage Waiver................................................. 50 SECTION 9.04. Successors and Assigns............................................................. 51 SECTION 9.05. Survival........................................................................... 53 SECTION 9.06. Counterparts; Integration; Effectiveness........................................... 54 SECTION 9.07. Severability....................................................................... 54 SECTION 9.08. Right of Setoff.................................................................... 54 SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of Process......................... 55 SECTION 9.10. WAIVER OF JURY TRIAL............................................................... 55 SECTION 9.11. Headings........................................................................... 55 SECTION 9.12. Confidentiality.................................................................... 55 SECTION 9.13. Acknowledgments.................................................................... 56


SCHEDULES:


Schedule 2.01 - Commitments Schedule 2.03(A) - Borrowing Notice/Interest Election Notice/Prepayment
Notice Schedule 2.03(B) - Authorized Account Numbers & Locations Schedule 6.08 - Unrestricted Subsidiaries Schedule 8 - List of Proper Persons


EXHIBITS:


Exhibit A - Form of Assignment and Acceptance Exhibit B - Form of Guarantee Exhibit C - Form of Note


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TERM LOAN AGREEMENT (this "Agreement"), dated as of March 31, 2003, among MOTH HOLDINGS, INC., a Delaware corporation (as successor in interest to MediaOne TWE Holdings, Inc. and to be renamed, at the time of the Closing (as defined below), TIME WARNER CABLE INC.) ("Borrower"), the Lenders named on the signature pages hereto (the "Lenders") and DEUTSCHE BANK AG, NEW YORK BRANCH ("DBNY"), and CITICORP NORTH AMERICA, INC., as administrative agents ("CNAI" and together with DBNY, in such capacity, the "Administrative Agents").


W I T N E S S E T H :
- - - - - - - - - -


WHEREAS, on August 19, 2002, Borrower issued to Comcast of Georgia, Inc., a Colorado corporation and indirect parent of Borrower (formerly named MediaOne of Colorado, Inc.), a Demand Promissory Note in principal amount of $2,100,000,000 (the "Comcast Promissory Note");


WHEREAS, AOL Time Warner, Inc., a Delaware corporation ("AOLTW"), Comcast Corporation (formerly named AT&T Comcast Corporation, "Comcast") and the other parties thereto have entered into a Restructuring Agreement (the "Restructuring Agreement"), dated as of August 20, 2002, for the restructuring of TIME WARNER ENTERTAINMENT COMPANY, L.P., a Delaware limited partnership ("TWE" or the "Guarantor"), (the restructuring of TWE contemplated in the Restructuring Agreement (and related agreements) is hereinafter referred to as the "Restructuring");


WHEREAS, Borrower (after giving effect to the Restructuring) is to be renamed "Time Warner Cable, Inc.", a newly acquired majority-owned subsidiary of AOLTW that will, immediately upon the consummation of the Restructuring, own approximately 94.3% of the partnership interests of TWE;


WHEREAS, Borrower desires that the Lenders extend, immediately prior to consummation of Restructuring, a $2,100,000,000 term loan facility to Borrower to fund the repayment of the Comcast Promissory Note;


NOW, THEREFORE, in consideration of the premises and the agreements, provisions and covenants herein contained, the parties hereby agree as follows:


ARTICLE I


DEFINITIONS


SECTION 1.01. Defined Terms. As used in this Agreement, the following terms have the meanings specified below:


"Adjusted Financial Statements" means, for any period, (a) the balance sheet of Borrower and its Restricted Subsidiaries (treating Unrestricted Subsidiaries as equity investments of Borrower to the extent that such Unrestricted Subsidiaries would not otherwise be treated as equity investments of Borrower in accordance with GAAP) as of the end of such period and (b) the related statements of operations and stockholders equity for such period and, if such period is not a fiscal


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year, for the then elapsed portion of the fiscal year (treating Unrestricted Subsidiaries as equity investments of Borrower to the extent that such Unrestricted Subsidiaries would not otherwise be treated as equity investments of Borrower in accordance with GAAP).


"Adjusted LIBO Rate" means with respect to any Eurocurrency Borrowing for any Interest Period, an interest rate per annum (rounded upwards, if necessary, to the next Basis Point) equal to (a) the LIBO Rate for such Interest Period multiplied by (b) the Statutory Reserve Rate.


"Administrative Agents" means (i) DBNY and CNAI, as administrative agents for the Lenders hereunder, together with any of their successors pursuant to Article VIII and (ii) immediately after the consummation of the syndication contemplated by the Separate Letter Agreements, either DBNY or CNAI, as designated by the Borrower, or in the absence of any such designation, as designated by DBNY and CNAI, together with its successors pursuant to Article VIII.


"Administrative Questionnaire" means, with respect to each Lender, an Administrative Questionnaire in a form supplied by the Administrative Agents.


"Affiliate" means, with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified; provided, that two or more Persons shall not be deemed Affiliates because an individual is a director and/or officer of each such Person.


"Agents" means those Lenders in those capacities, as designated by the Administrative Agents and Borrower in connection with the syndication contemplated by the Separate Letter Agreements, as well as the Paying Agent.


"AOLTW" has the meaning assigned to such term in the recitals hereto.


"Applicable Margin" means, for any day, the applicable rate per annum set forth below expressed in Basis Points based upon the senior unsecured long-term debt credit rating (or an equivalent thereof) (in each case, a "Rating") assigned by S&P and Moody's, respectively, applicable on such date to Borrower; provided that, until such time as Borrower has received a Rating, the Ratings of TWE shall be used as the basis for calculating the Applicable Margin:


=============================================================================
Applicable Margin for Applicable Margin for
Loans maintained as Loans maintained as Base
Rating Eurocurrency Loans Rate Loans - ----------------------------------------------------------------------------- Level 1 A/A2 or above 57.5 N/A - ----------------------------------------------------------------------------- Level 2 A-/A3 62.5 N/A - ----------------------------------------------------------------------------- Level 3 =============================================================================


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============================================================================= BBB+/Baa1 87.5 N/A - ----------------------------------------------------------------------------- Level 4 BBB/Baa2 100 N/A - ----------------------------------------------------------------------------- Level 5 BBB-/Baa3 125 25 - ----------------------------------------------------------------------------- Level 6 175 75 BB+/Ba1 or lower =============================================================================


For purposes of determining the Applicable Margin for Borrower, (A) if either S&P or Moody's shall not have in effect a relevant Rating (other than by reason of the circumstances referred to in clause (C) of this definition), then the Rating assigned by the other rating agency shall be used; (B) if the relevant Ratings assigned by S&P and Moody's shall fall within different Categories, the Applicable Margin shall be based on the higher of the two Ratings unless one of the two Ratings is two or more Categories lower than the other, in which case the Applicable Margin shall be determined by reference to the Category next below that of the higher of the two ratings; (C) if either rating agency shall cease to assign a relevant Rating solely because Borrower elects not to participate or otherwise cooperate in the ratings process of such rating agency, the Applicable Margin shall not be less than that in effect immediately before such rating agency's Rating for Borrower became unavailable; and (D) if the relevant Ratings assigned by S&P or Moody's shall be changed (other than as a result of a change in the rating system of S&P or Moody's), such change shall be effective as of the date on which it is first announced by the applicable rating agency. Each change in the Applicable Margin shall apply during the period commencing on the effective date of such change and ending on the date immediately preceding the effective date of the next such change. If the rating system of S&P or Moody's shall change, or if either such rating agency shall cease to be in the business of rating corporate debt obligations, Borrower and the Lenders shall negotiate in good faith to amend this definition to reflect such changed rating system or the unavailability of ratings from such rating agency, and, pending the effectiveness of any such amendment, the Applicable Margin of Borrower shall be determined by reference to the rating most recently in effect prior to such change or cessation, provided that, if Borrower elects to extend the Maturity Date of the Loans outstanding on the Initial Maturity Date pursuant to Section 2.09(f), each of the applicable rates per annum set forth above in Basis Points shall be increased by 25 Basis Points for the period that such Loans remain outstanding subsequent to the Initial Maturity Date.


"Applicable Percentage" means for any Lender at any date the percentage set forth next to such Lender's name on Schedule 2.01 to this Agreement, as the same may be modified from time to time, including, without limitation, to reflect the addition or withdrawal of a Lender or the assignment of all or a portion of an existing Lender's Applicable Percentage as permitted pursuant to Section 9.04.


"Arrangers" means DBSI and SSBI.


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"Assignment and Acceptance" means an assignment and acceptance entered into by a Lender and an assignee (with the consent of any party whose consent is required by Section 9.04), and accepted by the Administrative Agents, in substantially the form of Exhibit A.


"Base Lending Rate" means the rate of interest per annum publicly announced from time to time by each Administrative Agent as its base lending rate (and the average of the two during any time in which the Administrative Agents have different base lending rates), in effect from time to time at their principal offices in New York City; each change in the Base Lending Rate shall be effective from and including the date such change is publicly announced as being effective.


"Base Rate" means, for any day, a rate per annum equal to the greater of (a) the Base Lending Rate in effect on such day and (b) the Federal Funds Effective Rate in effect on such day plus 1/2 of 1%. Any change in the Base Rate due to a change in the Base Lending Rate or the Federal Funds Effective Rate shall be effective from and including the effective date of such change in the Base Lending Rate or the Federal Funds Effective Rate, respectively.


"Basis Point" means 1/100th of 1%.


"Board" means the Board of Governors of the Federal Reserve System of the United States.


"Borrower" has the meaning assigned to such term in the preamble hereto.


"Borrowing" means Loans of the same Type, made, converted or continued on the same date and, in the case of Eurocurrency Loans, as to which a single Interest Period is in effect.


"Borrowing Request" means the request by Borrower for a Borrowing in accordance with Section 2.03


"Business Day" means any day that is not a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law to remain closed; provided that, when used in connection with a Eurocurrency Loan, the term "Business Day" shall also exclude any day on which banks are not open for dealings in deposits in the applicable currency in the London interbank market.


"Capital Lease Obligations" of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP.


"Capital Stock" means, with respect to any Person, any and all shares, partnership interests or other equivalents (however designated and whether voting or non-voting) of such Person's equity, whether outstanding on the date hereof or hereafter issued, and any and all equivalent ownership interests in a Person (other than a corporation) and any and all rights, warrants or options to pur-


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chase or acquire or exchangeable for or convertible into such shares, partnership interests or other equivalents.


"Cash Equivalents" means (a) securities issued or directly and fully guaranteed or insured by the United States or any agency or instrumentality thereof (provided that the full faith and credit of the United States is pledged in support thereof) that (i) have maturities of not more than six months from the date of acquisition thereof or (ii) are subject to a repurchase agreement with an institution described in clause (b)(i) or (ii) below exercisable within six months from the date of acquisition thereof, (b) U.S. Dollar-denominated and Eurocurrency time deposits, certificates of deposit and bankers' acceptances of (i) any domestic commercial bank of recognized standing having capital and surplus in excess of $500,000,000 or (ii) any bank whose short-term commercial paper rating from S&P is at least A-2 or the equivalent thereof, from Moody's is at least P-2 or the equivalent thereof or from Fitch is at least F-2 or the equivalent thereof (any such bank, an "Approved Lender"), in each case with maturities of not more than six months from the date of acquisition thereof, (c) commercial paper and variable and fixed rate notes issued by any Lender or Approved Lender or by the parent company of any Lender or Approved Lender and commercial paper and variable rate notes issued by, or guaranteed by, any industrial or financial company with a short-term commercial paper rating of at least A-2 or the equivalent thereof by S&P or at least P-2 or the equivalent thereof by Moody's or at least F-2 or the equivalent thereof by Fitch, and in each case maturing within six months after the date of acquisition thereof, (d) securities with maturities of one year or less from the date of acquisition issued or fully guaranteed by any state, commonwealth or territory of the United States, by any political subdivision or taxing authority of any such state, commonwealth or territory or by any foreign government, the securities of which state, commonwealth, territory, political subdivision, taxing authority or foreign government (as the case may be) are rated at least A by S&P or A by Moody's, (e) securities with maturities of six months or less from the date of acquisition backed by standby letters of credit issued by any Lender or any commercial bank satisfying the requirements of clause (b) of this definition, (f) tax-exempt commercial paper of U.S. municipal, state or local governments rated at least A-2 or the equivalent thereof by S&P or at least P-2 or the equivalent thereof by Moody's or at least F-2 or the equivalent thereof by Fitch and maturing within six months after the date of acquisition thereof, (g) shares of money market mutual or similar funds sponsored by any registered broker dealer or mutual fund distributor, (h) repurchase obligations entered into with any bank meeting the qualifications of clause (b) above or any registered broker dealer whose short-term commercial paper rating from S&P is at least A-2 or the equivalent thereof or from Moody's is at least P-2 or the equivalent thereof or from Fitch is at least F-2 or the equivalent thereof, having a term of not more than 30 days, with respect to securities issued or fully guaranteed or insured by the United States government or residential whole loan mortgages, and (i) demand deposit accounts maintained in the ordinary course of business.


"Change in Control" means (a) a Person or "group" (within the meaning of Sections 13(d) and 14(d) of the Exchange Act) other than AOLTW and/or its Subsidiaries acquiring or having beneficial ownership (it being understood that a tender of shares or other equity interests shall not be deemed acquired or giving beneficial ownership until such shares or other equity interests shall have been accepted for payment) of securities (or options to purchase securities) having a majority or more of the ordinary voting power of Borrower (including options to acquire such voting power), (b) persons who are directors of Borrower immediately following consummation of the Restructuring or persons designated or approved by such directors ceasing to constitute a majority of the board of


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directors of Borrower, or (c) prior to consummation of syndication of the Loans, Borrower ceasing to own and control at least 94.3% of the residual equity capital or ceasing to be the sole general partner of TWE, (d) following consummation of syndication of the Loans, Borrower ceasing to own and control of record and beneficially securities (or options to
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