-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, KitcNLC3dCO+6BtrK+QzAxWWxxV3smYH5BR2YVoqkhszdRRkDYet1rfyOsAEBnT0 Iqdr4PoDaCHHjeRlMSnkyA== 0000950133-04-002937.txt : 20040802 0000950133-04-002937.hdr.sgml : 20040802 20040802060149 ACCESSION NUMBER: 0000950133-04-002937 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 20040802 GROUP MEMBERS: ANNE COX CHAMBERS GROUP MEMBERS: BARBARA COX ANTHONY GROUP MEMBERS: COX DNS, INC. (FORMERLY COX DISCOVERY, INC.) GROUP MEMBERS: COX HOLDINGS, INC. SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: COX COMMUNICATIONS INC /DE/ CENTRAL INDEX KEY: 0000025305 STANDARD INDUSTRIAL CLASSIFICATION: CABLE & OTHER PAY TELEVISION SERVICES [4841] IRS NUMBER: 582112281 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-46251 FILM NUMBER: 04943629 BUSINESS ADDRESS: STREET 1: 1400 LAKE HEARN DR NE CITY: ATLANTA STATE: GA ZIP: 30319 BUSINESS PHONE: 4048435000 MAIL ADDRESS: STREET 1: 1400 LAKE HEARN DRIVE CITY: ATLANTA STATE: GA ZIP: 30319 FORMER COMPANY: FORMER CONFORMED NAME: COX COMMUNICATIONS INC/DE DATE OF NAME CHANGE: 19941123 FORMER COMPANY: FORMER CONFORMED NAME: COX CABLE COMMUNICATIONS INC DATE OF NAME CHANGE: 19940614 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: COX ENTERPRISES INC ET AL CENTRAL INDEX KEY: 0000779426 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 581035149 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 1400 LAKE HEARN DRIVE CITY: ATLANTA STATE: GA ZIP: 30319 BUSINESS PHONE: 4048435000 MAIL ADDRESS: STREET 1: 1400 LAKE HEARN DRIVE STREET 2: 1400 LAKE HEARN DRIVE CITY: ATLANTA STATE: GA ZIP: 30319 SC 13D/A 1 w99619a9sc13dza.htm SC 13D/A sc13dza
 

OMB APPROVAL
OMB Number: 3235-0145
Expires: December 31, 2005
Estimated average burden
hours per response...11


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D/A

(Rule 13d-101)

Under the Securities Exchange Act of 1934
(Amendment No. 9)*

Cox Communications, Inc.


(Name of Issuer)

Class A Common Stock, $1.00 par value per share


(Title of Class of Securities)

224044 10 7


(Cusip Number)

Andrew A. Merdek, Esq.,
Cox Enterprises, Inc.
6205 Peachtree Dunwoody Road
Atlanta, Georgia 30328 (678) 645-0000

(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)

August 1, 2004


(Date of Event Which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. o

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See §240.13d-7 for other parties to whom copies are to be sent.

* The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

 


 

             
CUSIP No. 224044 10 7 Page 2 of 18

  1. Name of Reporting Person:
Cox Enterprises, Inc.
I.R.S. Identification Nos. of above persons (entities only):

  2. Check the Appropriate Box if a Member of a Group (See Instructions):
    (a) o  
    (b) o  

  3. SEC Use Only:

  4. Source of Funds (See Instructions):
BK

  5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e): o

  6. Citizenship or Place of Organization:
Delaware

Number of
Shares
Beneficially
Owned by
Each Reporting
Person With
7. Sole Voting Power:
0

8. Shared Voting Power:
393,288,968 (Owned Indirectly)*

9. Sole Dispositive Power:
0

10.Shared Dispositive Power:
393,288,968 (Owned Indirectly)*

  11.Aggregate Amount Beneficially Owned by Each Reporting Person:
393,288,968 (Owned Indirectly)*

  12.Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions):
o

  13.Percent of Class Represented by Amount in Row (11):
Approximately 62.2%**

  14.Type of Reporting Person (See Instructions):
CO

*   Includes 27,597,792 shares of Class A Common Stock, par value $1.00 per share (the “Class A Common Stock”), into which the Class C Common Stock indirectly beneficially owned by Cox Enterprises, Inc. (“CEI”) may be converted at any time on a share-for-share basis.
 
**   The denominator is based on (i) 593,154,457 shares of Class A Common Stock outstanding as of March 31, 2004, as stated on the facing page of the Form 10-Q of Cox Communications, Inc., a Delaware corporation (the “Company”), for the quarter ended March 31, 2004, (ii) 11,212,121 shares of Class A Common Stock issued upon conversion of all of the Company’s outstanding Series A Preferred Stock (the “Series A Preferred Stock”) on June 23, 2004, and (iii) 27,597,792 shares of Class A Common Stock into which the Class C Common Stock indirectly beneficially owned by CEI may be converted at any time on a share-for-share basis.

2


 

             
CUSIP No. 224044 10 7 Page 3 of 18

  1. Name of Reporting Person:
Cox Holdings, Inc.
I.R.S. Identification Nos. of above persons (entities only):

  2. Check the Appropriate Box if a Member of a Group (See Instructions):
    (a) o  
    (b) o  

  3. SEC Use Only:

  4. Source of Funds (See Instructions):
Not Applicable

  5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e): o

  6. Citizenship or Place of Organization:
Delaware

Number of
Shares
Beneficially
Owned by
Each Reporting
Person With
7. Sole Voting Power:

8. Shared Voting Power:
366,407,116*

9. Sole Dispositive Power:
0

10.Shared Dispositive Power:
366,407,166*

  11.Aggregate Amount Beneficially Owned by Each Reporting Person:
366,407,116*

  12.Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions):
o

  13.Percent of Class Represented by Amount in Row (11):
Approximately 58.0%**

  14.Type of Reporting Person (See Instructions):
CO

*   Includes 25,696,740 shares of Class A Common Stock into which the Class C Common Stock owned by Cox Holdings, Inc. (“CHI”) may be converted at any time on a share-for-share basis.
 
**   The denominator is based on (i) 593,154,457 shares of Class A Common Stock outstanding as of March 31, 2004, as stated on the facing page of the Form 10-Q of the Company for the quarter ended March 31, 2004, (ii) 11,212,121 shares of Class A Common Stock issued upon conversion of all of the Company’s outstanding Series A Preferred Stock on June 23, 2004, and (iii) 27,597,792 shares of Class A Common Stock into which the Class C Common Stock beneficially owned by CHI and Cox DNS, Inc. (“CDNS”) may be converted at any time on a share-for-share basis.

3


 

             
CUSIP No. 224044 10 7 Page 4 of 18

  1. Name of Reporting Person:
Cox DNS, Inc. (formerly Cox Discovery, Inc.)
I.R.S. Identification Nos. of above persons (entities only):

  2. Check the Appropriate Box if a Member of a Group (See Instructions):
    (a) o  
    (b) o  

  3. SEC Use Only:

  4. Source of Funds (See Instructions):
Not Applicable

  5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e): o

  6. Citizenship or Place of Organization:
Delaware

Number of
Shares
Beneficially
Owned by
Each Reporting
Person With
7. Sole Voting Power:
0

8. Shared Voting Power:
26,881,852*

9. Sole Dispositive Power:
0

10.Shared Dispositive Power:
26,881,852*

  11.Aggregate Amount Beneficially Owned by Each Reporting Person:
26,881,852*

  12.Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions):
o

  13.Percent of Class Represented by Amount in Row (11):
Approximately 4.2%**

  14.Type of Reporting Person (See Instructions):
CO

*   Includes 1,901,322 shares of Class A Common Stock into which the Class C Common Stock owned by CDNS may be converted at any time on a share-for-share basis.
 
**   The denominator is based on (i) 593,154,457 shares of Class A Common Stock outstanding as of March 31, 2004, as stated on the facing page of the Form 10-Q of the Company for the quarter ended March 31, 2004, (ii) 11,212,121 shares of Class A Common Stock issued upon conversion of all of the Company’s outstanding Series A Preferred Stock on June 23, 2004, and (iii) 27,598,792 shares of Class A Common Stock into which the Class C Common Stock beneficially owned by CDNS and CHI may be converted at any time on a share-for-share basis.

4


 

             
CUSIP No. 224044 10 7 Page 5 of 18

  1. Name of Reporting Person:
Barbara Cox Anthony
I.R.S. Identification Nos. of above persons (entities only):

  2. Check the Appropriate Box if a Member of a Group (See Instructions):
    (a) o  
    (b) o  

  3. SEC Use Only:

  4. Source of Funds (See Instructions):
Not Applicable

  5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e): o

  6. Citizenship or Place of Organization:
U.S.A.

Number of
Shares
Beneficially
Owned by
Each Reporting
Person With
7. Sole Voting Power:
0

8. Shared Voting Power:
393,288,968 (Owned Indirectly)*

9. Sole Dispositive Power:
0

10.Shared Dispositive Power:
393,288,968 (Owned Indirectly)*

  11.Aggregate Amount Beneficially Owned by Each Reporting Person:
393,288,968 (Owned Indirectly)*

  12.Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions):
o

  13.Percent of Class Represented by Amount in Row (11):
Approximately 62.2%**

  14.Type of Reporting Person (See Instructions):
OO (Trustee, see Item 5(a))

*   Includes 25,597,792 shares of Class A Common Stock into which the Class C Common Stock indirectly owned by Mrs. Anthony may be converted at any time on a share-for-share basis.
 
**   The denominator is based on (i) 593,154,457 shares of Class A Common Stock outstanding as of March 31, 2004, as stated on the facing page of the Form 10-Q of the Company for the quarter ended March 31, 2004, (ii) 11,212,121 shares of Class A Common Stock issued upon conversion of all of the Company’s outstanding Series A Preferred Stock on June 23, 2004, and (iii) 27,597,792 shares of Class A Common Stock into which the Class C Common Stock indirectly beneficially owned by Mrs. Anthony may be converted at any time on a share-for-share basis.

5


 

             
CUSIP No. 224044 10 7 Page 6 of 18

  1. Name of Reporting Person:
Anne Cox Chambers
I.R.S. Identification Nos. of above persons (entities only):

  2. Check the Appropriate Box if a Member of a Group (See Instructions):
    (a) o  
    (b) o  

  3. SEC Use Only:

  4. Source of Funds (See Instructions):
Not Applicable

  5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e): o

  6. Citizenship or Place of Organization:
U.S.A.

Number of
Shares
Beneficially
Owned by
Each Reporting
Person With
7. Sole Voting Power:
0

8. Shared Voting Power:
393,288,968 (Owned Indirectly)*

9. Sole Dispositive Power:
0

10.Shared Dispositive Power:
393,288,968 (Owned Indirectly)*

  11.Aggregate Amount Beneficially Owned by Each Reporting Person:
393,288,968 (Owned Indirectly)*

  12.Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions):
o

  13.Percent of Class Represented by Amount in Row (11):
Approximately 62.2%**

  14.Type of Reporting Person (See Instructions):
OO (Trustee, see Item 5(a))

*   Includes 27,597,792 shares of Class A Common Stock into which the Class C Common Stock indirectly beneficially owned by Mrs. Chambers may be converted at any time on a share-for-share basis.
 
**   The denominator is based on (i) 593,154,457 shares of Class A Common Stock outstanding as of March 31, 2004, as stated on the facing page of the Form 10-Q of the Company for the quarter ended March 31, 2004, (ii) 11,212,121 shares of Class A Common Stock issued upon conversion of all of the Company’s outstanding Series A Preferred Stock on June 23, 2004, and (iii) 27,597,792 shares of Class A Common Stock into which the Class C Common Stock indirectly beneficially owned by Mrs. Chambers may be converted at any time on a share-for-share basis.

6


 

     
Amendment No. 9 to Schedule 13D
  Page 7 of 18
Cox Enterprises, Inc.
   
Cox Communications, Inc.
   

     CEI, CDNS and CHI (collectively, the “Cox Corporations”) together with Mrs. Anthony and Mrs. Chambers hereby file this Amendment No. 9 to Schedule 13D (this “Amendment”) to amend the Cox Corporations’ joint filing on Schedule 13D (filed with the Securities and Exchange Commission (the “Commission”) on January 27, 1995), as amended by Amendment No. 1 to Schedule 13D (filed with the Commission on April 18, 1995), Amendment No. 2 to Schedule 13D (filed with the Commission on July 17, 1995), Amendment No. 3 to Schedule 13D (filed with the Commission on July 1, 1996), Amendment No. 4 to Schedule 13D (filed with the Commission on April 27, 2001), Amendment No. 5 to Schedule 13D (filed with the Commission on November 16, 2001), Amendment No. 6 to Schedule 13D (filed with the Commission on January 30, 2002), Amendment No. 7 to Schedule 13D (filed with the Commission on February 25, 2002), and Amendment No. 8 to Schedule 13D (filed with the Commission on February 14, 2003) (the original joint filing on Schedule 13D and Amendment Nos. 1-8 to Schedule 13D are collectively referred to herein as the “Amended Schedule 13D”), with respect to their beneficial ownership of shares of Class A Common Stock, issued by the Company. Mrs. Anthony and Mrs. Chambers, both of whom had previously filed separately, began filing jointly with the Cox Corporations with Amendment No. 8 to Schedule 13D, and this Amendment also amends the Schedule 13D, as amended, originally filed by each of Mrs. Anthony and Mrs. Chambers.

     Except as modified in this Amendment, the Amended Schedule 13D is unmodified.

Item 2. Identity and Background

     This Amendment is being jointly filed by the Cox Corporations, Mrs. Anthony and Mrs. Chambers.

     All of the Cox Corporations are incorporated in the State of Delaware. The principal businesses of CEI are publishing, broadband communications, broadcasting and automobile auctions. CDNS and CHI are holding companies. The principal office and business address of the Cox Corporations is 6205 Peachtree Dunwoody Road, Atlanta, Georgia 30328. The principal residence address of Mrs. Anthony is 3944 Noela Place, Honolulu, Hawaii 96815, and the principal residence address of Mrs. Chambers is 426 West Paces Ferry Road, N.W., Atlanta, Georgia 30305.

     The directors and executive officers of CEI, CDNS and CHI (including Mrs. Chambers and Mrs. Anthony) are set forth on Schedules I through III, respectively, and incorporated herein by reference. These Schedules set forth the following information with respect to each such person:

  (i)   name;
 
  (ii)   residence or business address; and

 


 

     
Amendment No. 9 to Schedule 13D
  Page 8 of 18
Cox Enterprises, Inc.
   
Cox Communications, Inc.
   

  (iii)   present principal occupation or employment and the name, principal business and address of any corporation or other organization in which such employment is conducted.

During the last five years, none of the Cox Corporations, Mrs. Anthony, Mrs. Chambers nor, to the best knowledge of the persons filing this Amendment, any of the Cox Corporations’ respective executive officers or directors, have been convicted in any criminal proceedings (excluding traffic violations or similar misdemeanors).

     During the last five years, none of the Cox Corporations, Mrs. Anthony, Mrs. Chambers nor, to the best knowledge of the persons filing this Amendment, any of the Cox Corporations’ respective executive officers or directors, have been a party to any civil proceeding of a judicial or administrative body of competent jurisdiction as the result of which it, he or she was or is subject to any judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.

     To the best knowledge of the persons filing this Amendment, all of the individuals listed in Schedules I through III are citizens of the United States of America.

Item 3. Source and Amount of Funds or Other Consideration

     In connection with the proposed transaction described in Item 4, CEI estimates that the total amount of funds required to purchase all of the Company’s Class A Common Stock not currently owned by the Cox Corporations in the Offer (as defined in Item 4) and the Merger (as defined in Item 4), settle outstanding vested options with an exercise price less than the Offer Price (as defined in Item 4) and pay estimated fees and expenses will be approximately $7.9 billion. CEI has received a commitment letter from Citigroup Global Markets Inc., Citicorp North America, Inc., Lehman Brothers Inc. and Lehman Commercial Paper Inc., dated August 1, 2004, to provide total funding of $10 billion through a combination of revolving credit facilities, term loans and bridge loans, and CEI anticipates using the approximately $2.1 billion not used to fund the Offer and the Merger to refinance existing indebtedness and for working capital and other general corporate purposes.

     This summary of the commitment letter does not purport to be complete and is qualified in its entirety by the commitment letter attached hereto as Exhibit 7.06, the complete text of which is hereby incorporated by reference.

 


 

     
Amendment No. 9 to Schedule 13D
  Page 9 of 18
Cox Enterprises, Inc.
   
Cox Communications, Inc.
   

Item 4. Purpose of Transaction

     On August 1, 2004, CEI sent a letter to the Company’s Board of Directors stating that it proposes to acquire all of the outstanding Class A Common Stock not currently owned by the Cox Corporations (the “Shares”), and on August 2, 2004, CEI issued a related press release. Copies of CEI’s offer letter and press release are being filed herewith as Exhibits 7.04 and 7.05, respectively. CEI expects that the Company’s Board of Directors will form a special committee of independent directors (the “Special Committee”), and anticipates negotiating an Agreement and Plan of Merger (the “Acquisition Agreement”) with the Special Committee, whose approval of the proposed Acquisition Agreement would be a prerequisite to CEI proceeding with the transaction. CEI proposes that the Acquisition Agreement would contemplate initiating the transaction through a tender offer (the “Offer”) to purchase all of the Shares at a purchase price of $32.00 per share (the “Offer Price”). The Offer would be conditioned upon, among other things, tender of sufficient Shares to bring CEI’s beneficial ownership to at least 90% of the outstanding shares of Class A Common Stock.

     CEI also proposes that the Acquisition Agreement would contemplate that a wholly-owned subsidiary of CEI would be merged with and into the Company (the “Merger”) in accordance with the terms and conditions of the Acquisition Agreement and Delaware law and the Company would then exist as an indirect wholly-owned subsidiary of CEI. As a result of the Merger, all Shares (except those Shares as to which appraisal rights are exercised under Delaware law) will be converted into the right to receive the Offer Price in cash, without interest. If the Offer results in CEI beneficially owning at least 90% of the outstanding shares of Class A Common Stock, the Merger would be completed without a vote of stockholders pursuant to Section 253 of the Delaware General Corporation Law (the “DGCL”). If the Offer results in CEI beneficially owning less than 90% of the outstanding shares of Class A Common Stock, the Acquisition Agreement would provide that CEI could either (i) waive the 90% condition and purchase Shares tendered in the Offer, and the Company would call a special meeting of stockholders to vote on the Merger at which the Cox Corporations would vote their Company shares in favor of the Merger, and thereby approve the Merger pursuant to Section 251 of the DGCL, or (ii) not waive the 90% condition, and the Company would call a special meeting of stockholders to vote on the Merger at which the Cox Corporations would vote their Company shares in favor of the Merger, and thereby approve the Merger pursuant to Section 251 of the DGCL. In either case, stockholders who neither tender their shares of Class A Common Stock during the Offer nor exercise appraisal rights would be entitled to receive the Offer Price in cash for their shares in the Merger. The Offer and the Merger also will be subject to other conditions, and CEI expressly reserves the right to waive or not waive any unsatisfied condition in

 


 

     
Amendment No. 9 to Schedule 13D
  Page 10 of 18
Cox Enterprises, Inc.
   
Cox Communications, Inc.
   

the Offer or in the Merger. In addition, CEI also expressly reserves the right to abandon the transaction, in its sole discretion, prior to the execution of a definitive Acquisition Agreement.

     The foregoing is a summary of CEI’s current proposal and should not be construed as an offer to purchase Shares. Any offer will be made by means of a tender offer disclosure statement or a proxy statement if and when there is a definitive Acquisition Agreement with the Company. Stockholders are urged to read CEI’s tender offer disclosure statement, proxy statement and other relevant documents regarding the Offer and the Merger filed with the Commission when they become available because they will contain important information. Stockholders will be able to receive these documents (when they become available), as well as other documents filed by CEI with respect to the Offer and the Merger, free of charge at the Commission’s web site, www.sec.gov, or from CEI at (678) 645-0000, ATTN: Corporate Secretary.

     The Commission has adopted Rule 13e-3 under the Securities Exchange Act of 1934, as amended, which is applicable to certain “going private” transactions. Rule 13e-3 requires among other things, that certain financial information concerning the Company, and certain information relating to the fairness of the proposed transaction and the consideration offered to minority stockholders in such transaction, be filed with the Commission and disclosed to minority stockholders prior to consummation of the transaction. CEI and CHI expect to file the information required by Rule 13e-3 with the Commission at the time the Offer is commenced and to provide the required information to holders of Shares at such time.

     If the Merger is successfully completed, the surviving corporation would be an indirect wholly-owned subsidiary of CEI, and CEI would expect to amend and restate the certificate of incorporation and bylaws of the surviving corporation to make such changes it deems necessary or appropriate.

     The Cox Corporations understand that any of their respective executive officers and directors that hold shares of the Company’s Class A Common Stock do so for investment purposes. Other than as described above, none of the Cox Corporations nor, to the best knowledge of the persons filing this Amendment, any of Cox Corporations’ respective executive officers or directors, Mrs. Chambers or Mrs. Anthony have any plans or proposals that relate to or would result in any of the events set forth in Items 4(a) through (j) of Schedule 13D. However, if the proposed transaction does not occur for any reason, the Cox Corporations, their respective executive officers and directors, Mrs. Chambers and Mrs. Anthony intend to review continuously the Company’s business affairs, general industry and economic conditions and the capital needs of the Cox Corporations. Based on such review, these entities and individuals may, from time to time, determine to increase their ownership of Class A Common Stock, approve an extraordinary corporate transaction with

 


 

     
Amendment No. 9 to Schedule 13D
  Page 11 of 18
Cox Enterprises, Inc.
   
Cox Communications, Inc.
   

regard to the Company or engage in any of the events set forth in Items 4(a) through (j) of Schedule 13D, except that the Cox Corporations, Mrs. Chambers and Mrs. Anthony currently have no intention of selling any shares of Class A or Class C Common Stock of the Company.

Item 5. Interest in Securities of the Issuer

     (a) See Items 11 and 13 of the cover pages to this Amendment for the aggregate number of shares and percentage of Class A Common Stock beneficially owned by each of the Cox Corporations, Mrs. Chambers and Mrs. Anthony.

     On June 23, 2004, all 4,836,372 issued and outstanding shares of the Company’s Series A Convertible Preferred Stock were converted into 11,212,121 shares of the Company’s Class A Common Stock, in accordance with the terms of the Certificate of Designations of Powers, Preferences and Rights of the Series A Convertible Preferred Stock. Upon conversion, all of the issued and outstanding Series A preferred shares were retired and all certificates representing the Series A preferred shares were cancelled.

     There are 604,575,505 shares of common stock of CEI outstanding, with respect to which: (i) Mrs. Anthony, as trustee of the Anne Cox Chambers Atlanta Trust, exercises beneficial ownership over 174,949,266 shares (28.9%); (ii) Mrs. Chambers, as trustee of the Barbara Cox Anthony Atlanta Trust, exercises beneficial ownership over 174,949,266 shares (28.9%); (iii) Mrs. Anthony, Mrs. Chambers and Richard L. Braunstein, as trustees of the Dayton Cox Trust A, exercise beneficial ownership over 248,237,055 shares (41.1%); and (iv) 271 individuals and trusts exercise beneficial ownership over the remaining 6,396,181 shares (1.1%). Thus, Mrs. Anthony and Mrs. Chambers, who are sisters, together exercise beneficial ownership over 598,135,587 shares (98.9%) of the common stock of CEI. In addition, Garner Anthony, the husband of Mrs. Anthony, holds beneficially and of record 43,734 shares of common stock of CEI. Mrs. Anthony disclaims beneficial ownership of such shares. Thus, Mrs. Chambers and Mrs. Anthony share ultimate control over the Cox Corporations, and thereby indirectly exercise beneficial ownership over approximately 62.2% of the Class A Common Stock.

     The Cox Corporations have been informed that the following executive officers and directors of the Cox Corporations beneficially own shares of the Company’s Class A Common Stock:

 


 

     
Amendment No. 9 to Schedule 13D
  Page 12 of 18
Cox Enterprises, Inc.
   
Cox Communications, Inc.
   
         
G. Dennis Berry
    4,950  
David E. Easterly
    4,000  
James C. Kennedy
    241,500  
Robert C. O’Leary
    17,721  

Each of the individuals listed above beneficially owns less than one percent of the Class A Common Stock.

     (b) See Items 7 and 9 of the cover pages to this Amendment for the number of shares of Class A Common Stock beneficially owned by each of the Cox Corporations as to which there is shared power to vote or direct the vote or shared power to dispose or to direct the disposition of such shares of Class A Common Stock.

     Mrs. Chambers and Mrs. Anthony have the indirect shared power to direct the vote or direct the disposition of 393,288,968 shares of Class A Common Stock (including 27,597,792 shares of Class A Common Stock into which the Class C Common Stock indirectly beneficially owned by Mrs. Chambers and Mrs. Anthony may be converted at any time).

     The number of shares set forth above as beneficially owned by the Cox Corporations, Mrs. Chambers and Mrs. Anthony does not include any shares beneficially owned by any person listed on Schedules I through III hereto for his or her personal investment account. The Cox Corporations, Mrs. Chambers and Mrs. Anthony expressly disclaim beneficial ownership of all such shares owned by all such persons and are not a party to any agreement or arrangement of any kind with any such persons with respect to the acquisition, holding, voting or disposition of any such shares of Class A Common Stock or any shares of Class A Common Stock that they beneficially own.

     Except as indicated in Item 5(a), the Cox Corporations understand that the executive officers and directors listed in Item 5(a) above have the sole power to vote or direct the vote, and sole power to dispose or direct the disposition of the number of shares of Class A Common Stock that they beneficially own.

     (c) None of the Cox Corporations nor, to the best knowledge of the persons filing this Amendment, any of Eagle Corporations’ respective executive officers and directors, Mrs. Chambers or Mrs. Anthony have effected any transactions in the Class A Common Stock during the past sixty days.

 


 

     
Amendment No. 9 to Schedule 13D
  Page 13 of 18
Cox Enterprises, Inc.
   
Cox Communications, Inc.
   

     (d) No other person is known to have the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, the shares of Class A Common Stock referred to in paragraphs (a) and (b) above.

     (e) Not applicable.

Item 7. Material to Be Filed as Exhibits

     
Exhibit 7.01
  Joint Filing Agreement dated January 29, 1995, among CEI, CHI, CDNS and Cox Investment Company, Inc. (incorporated by reference to Exhibit 7.02 to the Cox Corporations’ Schedule 13D, as filed with the Commission on January 27, 1995).
 
   
Exhibit 7.02
  Joinder of Mrs. Anthony and Mrs. Chambers, dated as of February 14, 2003 to the Joint Filing Agreement, as amended, among CEI, CHI, CDNS, Cox Investment Company, Inc., Mrs. Anthony and Mrs. Chambers (incorporated by reference to Exhibit 7.03 to Amendment No. 8 to the Cox Corporations’ Schedule 13D, as filed with the Commission on February 14, 2003).
 
   
Exhibit 7.03
  Power of Attorney, dated as of June 27, 1995, appointing each of Marion H. Allen, III and Andrew A. Merdek, signing singly, as attorneys-in-fact for Mrs. Chambers (incorporated by reference as Exhibit 7.02 to Amendment No. 2 to the Schedule 13D of Mrs. Chambers (filed with the Commission on July 17, 1995)).
 
   
Exhibit 7.04
  Offer Letter dated August 1, 2004.
 
   
Exhibit 7.05
  Press Release dated August 2, 2004.
 
   
Exhibit 7.06
  Commitment Letter, dated August 1, 2004, from Citigroup Global Markets Inc., Citicorp North America, Inc., Lehman Brothers Inc. and Lehman Commercial Paper Inc.

 


 

     
Amendment No. 9 to Schedule 13D
  Page 14 of 18
Cox Enterprises, Inc.
   
Cox Communications, Inc.
   

SIGNATURE

     After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

         
    COX ENTERPRISES, INC.
 
       
August 1, 2004
Date
  By:   /s/ Andrew A. Merdek
Andrew A. Merdek

 


 

     
Amendment No. 9 to Schedule 13D
  Page 15 of 18
Cox Holdings, Inc.
   
Cox Communications, Inc.
   

SIGNATURE

     After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

         
    COX HOLDINGS, INC.
 
       
August 1, 2004
Date
  By:   /s/ Andrew A. Merdek
Andrew A. Merdek

 


 

     
Amendment No. 9 to Schedule 13D
  Page 16 of 18
Cox DNS, Inc.
   
Cox Communications, Inc.
   

SIGNATURE

     After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

         
    COX DNS, INC.
 
       
August 1, 2004
Date
  By:   /s/ Andrew A. Merdek
Andrew A. Merdek

 


 

     
Amendment No. 9 to Schedule 13D
  Page 17 of 18
Cox Communications, Inc.
   

SIGNATURE

     After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

         
    BARBARA COX ANTHONY
 
       
August 1, 2004
Date
  By:   /s/ Barbara Cox Anthony

Barbara Cox Anthony

 


 

     
Amendment No. 9 to Schedule 13D
  Page 18 of 18
Cox Communications, Inc.
   

SIGNATURE

     After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

         
    ANNE COX CHAMBERS
 
       
August 1, 2004
Date
  By:   /s/ Anne Cox Chambers

Anne Cox Chambers

 


 

Schedule I
Cox Enterprises, Inc.
Executive Officers and Directors

             
Name
  Business Address
  Principal Occupation
  Employed
James C. Kennedy*
  Cox Enterprises, Inc.   Chairman of the Board   Cox Enterprises, Inc.
  6205 Peachtree Dunwoody Road   and Chief Exec. Officer   6205 Peachtree Dunwoody Road
  Atlanta, GA 30328       Atlanta, GA 30328
 
           
David E. Easterly*
  Cox Enterprises, Inc.   Vice Chairman   Cox Enterprises, Inc.
  6205 Peachtree Dunwoody Road       6205 Peachtree Dunwoody Road
  Atlanta, GA 30328       Atlanta, GA 30328
 
           
G. Dennis Berry
  Cox Enterprises, Inc.   President and Chief   Cox Enterprises, Inc.
  6205 Peachtree Dunwoody Road   Operating Officer   6205 Peachtree Dunwoody Road
  Atlanta, GA 30328       Atlanta, GA 30328
 
           
Robert C. O’Leary*
  Cox Enterprises, Inc.   Exec. Vice President   Cox Enterprises, Inc.
  6205 Peachtree Dunwoody Road   and Chief Financial   6205 Peachtree Dunwoody Road
  Atlanta, GA 30328   Officer   Atlanta, GA 30328
 
           
John G. Boyette
  Cox Enterprises, Inc.   Senior Vice President   Cox Enterprises, Inc.
  6205 Peachtree Dunwoody Road   Investments and   6205 Peachtree Dunwoody Road
  Atlanta, GA 30328   Administration   Atlanta, GA 30328
 
           
Timothy W. Hughes
  Cox Enterprises, Inc.   Senior Vice President   Cox Enterprises, Inc
  6205 Peachtree Dunwoody Road   Administration   6205 Peachtree Dunwoody Road
  Atlanta, GA 30328       Atlanta, GA 30328
 
           
Alexander V. Netchvolodoff
  Cox Enterprises, Inc.   Senior Vice President   Cox Enterprises, Inc.
  6205 Peachtree Dunwoody Road   Public Policy   6205 Peachtree Dunwoody Road
  Atlanta, GA 30328       Atlanta, GA 30328
 
           
Barbara C. Anthony*
  Cox Enterprises, Inc.   Vice President   Cox Enterprises, Inc.
  6205 Peachtree Dunwoody Road       6205 Peachtree Dunwoody Road
  Atlanta, GA 30328       Atlanta, GA 30328
 
           
Preston B. Barnett
  Cox Enterprises, Inc.   Vice President and   Cox Enterprises, Inc.
  6205 Peachtree Dunwoody Road   General Tax Counsel   6205 Peachtree Dunwoody Road
  Atlanta, GA 30328       Atlanta, GA 30328
 
           
Anne C. Chambers*
  Cox Enterprises, Inc.   Vice President   Cox Enterprises, Inc.
  6205 Peachtree Dunwoody Road       6205 Peachtree Dunwoody Road
  Atlanta, GA 30328       Atlanta, GA 30328
 
           
Richard D. Huguley
  Cox Enterprises, Inc.   Vice President,   Cox Enterprises, Inc.
  6205 Peachtree Dunwoody Road   Development   6205 Peachtree Dunwoody Road
  Atlanta, GA 30328       Atlanta, GA 30328
 
           
Marybeth H. Leamer
  Cox Enterprises, Inc.   Vice President, Human   Cox Enterprises, Inc.
  6205 Peachtree Dunwoody Road   Resources   6205 Peachtree Dunwoody Road
  Atlanta, GA 30328       Atlanta, GA 30328

* Director of the Corporation

 


 

             
Name
  Business Address
  Principal Occupation
  Employed
Richard J. Jacobson
  Cox Enterprises, Inc.   Vice President &   Cox Enterprises, Inc.
  6205 Peachtree Dunwoody Road   Treasurer   6205 Peachtree Dunwoody Road
  Atlanta, GA 30328       Atlanta, GA 30328
 
           
Michael J. Mannheimer
  Cox Enterprises, Inc.   Vice President,    
  6205 Peachtree Dunwoody Road   Materials Management   Cox Enterprises, Inc
  Atlanta., GA       6205 Peachtree Dunwoody Road
Atlanta, GA 30328
 
           
Andrew A. Merdek
  Cox Enterprises, Inc.   Vice President- Legal   Cox Enterprises, Inc.
  6205 Peachtree Dunwoody Road   Affairs, General Counsel   6205 Peachtree Dunwoody Road
  Atlanta, GA 30328   and Corporate Secretary   Atlanta, GA 30328
 
           
Gregory B. Morrison
  Cox Enterprises, Inc.   Vice President   Cox Enterprises, Inc.
  6205 Peachtree Dunwoody Road   & Chief Information   6205 Peachtree Dunwoody Road
  Atlanta, GA 30328   Officer   Atlanta, GA 30328
 
           
John C. Williams
  Cox Enterprises, Inc.   Vice President   Cox Enterprises, Inc.
  6205 Peachtree Dunwoody Road   Marketing   6205 Peachtree Dunwoody Road
  Atlanta, GA 30328       Atlanta, GA 30328
 
           
R. Scott Whiteside
  Cox Enterprises, Inc.   Vice President,   Cox Enterprises, Inc.
  6205 Peachtree Dunwoody Road   Business Development   6205 Peachtree Dunwoody Road
  Atlanta, GA 30328       Atlanta, GA 30328
 
           
Thomas B. Whitfield
  Cox Enterprises, Inc.   Vice President,   Cox Enterprises, Inc.
  6205 Peachtree Dunwoody Road   Direct Marketing   6205 Peachtree Dunwoody Road
  Atlanta, GA 30328       Atlanta, GA 30328
 
           
Alexandra M. Wilson
  Cox Enterprises, Inc.   Vice President, Public   Cox Enterprises, Inc.
  6205 Peachtree Dunwoody Road   Policy   6205 Peachtree Dunwoody Road
  Atlanta, GA 30328       Atlanta, GA 30328
 
           
Arthur M. Blank*
  Cox Enterprises, Inc.   Chairman, President   AMB Group, LLC
  6205 Peachtree Dunwoody Road   & Chief Executive Officer   3290 Northside Parkway
  Atlanta, GA 30328       Atlanta, GA 30327
 
           
Richard L. Braunstein*
  Dow, Lohnes &   Member   Dow, Lohnes &
  Albertson, PLLC       Albertson, PLLC
  1200 New Hampshire Ave       1200 New Hampshire Ave.
  Washington, DC 20036       Washington, DC 20036
 
           
Thomas O. Cordy*
  3770 Village Drive   Director-   The Maxxis Group, Inc.
  Atlanta, GA 30331   Retired President and    
      Chief Executive Officer    
 
           
Carl R. Gross*
  Cox Enterprises, Inc.   Director-   Retired Senior Vice President
  6205 Peachtree Dunwoody Road       and Chief Administrative
  Atlanta, GA 30328       Officer
 
           

* Director of the Corporation

 


 

             
Name
  Business Address
  Principal Occupation
  Employed
Paul J. Rizzo*
  Cox Enterprises, Inc.   Director-   Franklin Street Partners
  6205 Peachtree Dunwoody Road   Retired Vice Chairman,   6330 Quadrangle Drive
  Atlanta, GA 30328   IBM Corporation   Chapel Hill, NC 27514

* Director of the Corporation

 


 

Schedule II
Cox Holdings, Inc.
Executive Officers and Directors

             
Name
  Business Address
  Principal Occupation
  Employed
G. Dennis Berry
  President   President and Chief   Cox Enterprises, Inc.
  Cox Holdings, Inc.   Operating Officer   6205 Peachtree Dunwoody Road
  6205 Peachtree Dunwoody Road       Atlanta, GA 30328
  Atlanta, GA 30328        
 
           
Preston B. Barnett
  Vice President   Vice President and   Cox Enterprises, Inc.
  Cox Holdings, Inc.   General Tax Counsel   6205 Peachtree Dunwoody Road
  6205 Peachtree Dunwoody Road       Atlanta, GA 30328
  Atlanta, GA 30328        
 
           
Richard J. Jacobson*
  Treasurer   Vice President &   Cox Enterprises, Inc.
  Cox Holdings, Inc.   Treasurer   6205 Peachtree Dunwoody Road
  6205 Peachtree Dunwoody Road       Atlanta, GA 30328
  Atlanta, GA 30328        
 
           
Andrew A. Merdek*
  Secretary   Vice President, Legal   Cox Enterprises, Inc.
  Cox Holdings, Inc.   Affairs, General Counsel   6205 Peachtree Dunwoody Road
  6205 Peachtree Dunwoody Road   and Corporate Secretary   Atlanta, GA 30328
  Atlanta, GA 30328        

* Director of the Corporation

 


 

Schedule III
Cox DNS, Inc.
Executive Officers and Directors

             
Name
  Business Address
  Principal Occupation
  Employed
Robert C. O’Leary*
  President   Executive Vice President   Cox Enterprises, Inc.
  Cox DNS, Inc.   and Chief Financial Officer   6205 Peachtree Dunwoody Road
  6205 Peachtree Dunwoody Road       Atlanta, GA 30328
  Atlanta, GA 30328        
 
           
Preston B. Barnett
  Vice President   Vice President and   Cox Enterprises, Inc.
  Cox DNS, Inc.   General Tax Counsel   6205 Peachtree Dunwoody Road
  6205 Peachtree Dunwoody Road       Atlanta, GA 30328
  Atlanta, GA 30328        
 
           
Richard J. Jacobson
  Treasurer   Vice President and   Cox Enterprises, Inc.
  Cox DNS, Inc.   Treasurer   6205 Peachtree Dunwoody Road
  6205 Peachtree Dunwoody Road       Atlanta, GA 30328
  Atlanta, GA 30328        
 
           
Andrew A. Merdek*
           
  Secretary   Vice President, Legal   Cox Enterprises, Inc.
  Cox DNS, Inc.   Affairs, General Counsel   6205 Peachtree Dunwoody Road
  6205 Peachtree Dunwoody Road   And Corporate Secretary   Atlanta, GA 30328
  Atlanta, GA 30328        
 
           
R. Scott Whiteside*
           
  Vice President   Vice President   Cox Enterprises, Inc.
  Cox DNS, Inc.   Business Development   6205 Peachtree Dunwoody Road
  6205 Peachtree Dunwoody Road       Atlanta, GA 30328
  Atlanta, GA 30328        

* Director of the Corporation

 

EX-7.4 2 w99619a9exv7w4.htm EX-7.4 exv7w4
 

Exhibit 7.04

[Letterhead]

August 1, 2004

Members of the Board:

     Cox Enterprises, Inc. (CEI) is pleased to offer to acquire the outstanding shares of Class A common stock of Cox Communications, Inc. (CCI) not currently owned by CEI at a purchase price of $32 per share. Through this offer it is our intention that CCI becomes a wholly owned subsidiary of CEI.

     We believe that our offer is fair to and in the best interest of CCI and its public shareholders. Although this transaction does not represent a change of control, this offer price represents a 16% premium over Friday’s closing price and a 14% premium to the average trading price of the Class A common stock for the last ten days.

     We believe our proposal makes great sense for CEI and its future. The competitive demands of the cable industry when balanced against the need for a public company to be vigilant with respect to short-term results have convinced us that private ownership of this business is desirable and will assist CCI in attaining its business objectives.

     We expect that the Board of Directors of CCI will form a special committee of independent directors to respond to our proposal on behalf of CCI’s public shareholders. Our representatives on the CCI board will vote in favor of that delegation of authority. We also encourage the special committee to retain its own legal and financial advisors to assist in its review. CEI would welcome the opportunity to present its proposal to the special committee as soon as possible. Our entire team, including our legal and financial advisors, looks forward to working with the special committee and its legal and financial advisors to complete a mutually acceptable transaction.

     Following the successful conclusion of our discussions with the special committee and execution of a merger agreement, we would propose to initiate the transaction through a tender offer. The tender offer would be conditioned on the tender of a number of Class A common shares sufficient to bring CEI’s ownership interest in the Class A common shares to 90%. We have received firm financing commitments from Citigroup and Lehman Brothers that would enable us to complete the transaction, refinance existing indebtedness and provide liquidity for additional working capital. We anticipate acquiring any shares not purchased in the tender through a merger, at the same cash price per share as the tender offer.

     In considering our proposal, you should be aware that we are interested only in acquiring the publicly held CCI shares and we will not sell our stake in CCI.

     Concurrently with sending this offer to you, we are filing a 13-D amendment, and as such, we feel compelled to issue a press release. A copy of the press release announcing our intention to commence this process is attached for your information. We expect to issue the press release the morning of August 2nd prior to opening of trading.

     Thank you for your consideration.

     /s/ James C. Kennedy

EX-7.5 3 w99619a9exv7w5.htm EX-7.5 exv7w5
 

Exhibit 7.05

Cox Enterprises, Inc. Proposes to Acquire Public Minority Stake in Cox Communications, Inc.

Proposal Price of $32 in Cash per Share for 38% Public Stake
Cox Communications, Inc. Would Become Wholly Owned by Cox Enterprises, Inc.

Atlanta, Georgia, August 2, 2004. Cox Enterprises, Inc. (CEI) announced today that it is proposing to acquire the outstanding publicly held minority interest in Cox Communications, Inc. (CCI) [NYSE:COX] for $32 per share in cash, representing a 16% premium over Friday’s closing price and a 14% premium over the ten-day average closing price. The aggregate consideration payable under the proposal for the 38% public stake would be approximately $7.9 billion, including fees and expenses. CEI currently owns approximately a 62% equity interest in CCI and has a 73% voting interest. Following the transaction, CCI would become a wholly owned subsidiary of CEI.

“Our proposal represents an excellent opportunity for CCI shareholders, giving them the ability to receive a meaningful premium to recent trading values,” said James C. Kennedy, Chairman and Chief Executive Officer of CEI.

“For CEI, this is a chance to make a substantial additional investment in an asset we know well. An increasingly competitive environment convinces us that future investments in the cable industry are best made through a private company structure,” he said.

Following the announcement, CEI expects the Board of Directors of CCI to form a special committee of independent directors to consider the proposal with the assistance of outside financial and legal advisors and to negotiate the proposal with CEI. Directors of CCI affiliated with CEI will not participate in the evaluation of the proposal, which requires the approval of the special committee.

Following successful conclusion of negotiations with the special committee, CEI expects to file appropriate materials with the Securities and Exchange Commission and mail such materials to CCI shareholders. CEI currently contemplates the transaction would be implemented through a cash tender offer for the publicly held CCI shares followed by a cash merger at the same per share price paid in the tender offer.

CEI has advised CCI that CEI’s sole interest is in acquiring the remaining shares of CCI held by the minority shareholders and that it has no interest in a disposition of its controlling equity and voting stake in CCI.

Citigroup Global Markets and Lehman Brothers, Inc. are serving as CEI’s financial advisors in the transaction and have committed to provide $7.9 billion to

 


 

fund the tender offer and merger, as well as related fees and expenses, under a $10 billion total funding commitment. The remaining $2.1 billion will be used to refinance existing indebtedness at CEI and for working capital and other corporate purposes.

CCI shareholders and other interested parties are urged to read CEI’s relevant documents filed with the SEC when they become available because they will contain important information. CCI shareholders will be able to obtain such documents free of charge at the SEC’s web site: www.sec.gov or from CEI at 6205 Peachtree Dunwoody Road, Atlanta, GA 30328, Attn: Corporate Communications.

About Cox Enterprises (www.coxenterprises.com)

Cox Enterprises is one of the nation’s leading media companies and providers of automotive services, with 2003 revenues of $10.7 billion and 77,000 employees. Major operating subsidiaries include Cox Communications, Inc. ([NYSE: COX] cable television distribution, telephone, high-speed Internet access and other advanced broadband services); Cox Newspapers, Inc. (newspapers, local and national direct mail advertising and customized newsletters); Cox Television (television and television sales rep firms); Cox Radio, Inc. ([NYSE: CXR] broadcast radio stations and interactive Web sites); and Manheim Auctions, Inc. (vehicle auctions, repair and certification services and web-based technology products). Cox Enterprises also owns an equity stake in AutoTrader.com, the world’s largest and most visited online source of vehicle listings for dealers and consumers.

CAUTIONARY STATEMENT: Statements in this document represent the intentions, plans, expectations and beliefs of CEI and involve risks and uncertainties that could cause actual events to differ materially from the events described in this document, including risks or uncertainties related to the success of our negotiations with the special committee, whether the conditions to the tender offer will be satisfied, and if not, whether the tender offer and merger will be completed, as well as changes in general economic conditions, stock market trading conditions, tax law requirements or government regulation, and changes in the broadband communications industry or the business or prospects of CCI. CEI wishes to caution the reader that these factors, as well as other factors described or to be described in CEI’s SEC filings with respect to the transaction, are among the factors that could cause actual events or results to differ materially from CEI’s current expectations described herein.

Media Inquiries: Bob Jimenez, Cox Enterprises, Inc., (678) 645-0070, bob.jimenez@coxinc.com.

Investor Inquiries: Richard Jacobson, Cox Enterprises, Inc., (678) 645-0111, richard.jacobson@coxinc.com.

 

EX-7.6 4 w99619a9exv7w6.htm EX-7.6 exv7w6
 

Exhibit 7.06

     
Citicorp North America, Inc.
Citigroup Global Markets Inc.
390 Greenwich Street
New York, New York 10013
  Lehman Commercial Paper Inc.
Lehman Brothers Inc.
745 Seventh Avenue
New York, New York 10019

August 1, 2004

Cox Enterprises, Inc.
6205 Peachtree Dunwoody Road
Atlanta, Georgia 30328
Attention:    Richard Jacobson
                      Vice President / Treasurer

Project NFL
Commitment Letter

Ladies and Gentlemen:

     You, Cox Enterprises, Inc., a Delaware corporation (“Cox Enterprises”), have informed us, Citigroup Global Markets Inc. (“CGMI”), Citicorp North America, Inc. (“CNAI”), Lehman Brothers Inc. (“LBI”) and Lehman Commercial Paper Inc. (“LCPI” and, together with CGMI, CNAI and LBI, the “Commitment Parties”), that, as of June 30, 2004, Cox Enterprises beneficially owned, through wholly owned subsidiaries, 27,597,792 shares of Class C Common Stock, par value $1.00 per share, of Cox Communications, Inc., a Delaware corporation (“Cox Communications”), and 365,751,156 of an aggregate of 604,947,345 outstanding shares of Class A Common Stock, par value $1.00 per share, of Cox Communications (“Class A Stock”) and that Cox Enterprises is considering whether to acquire all other outstanding shares of Class A Stock not already owned by Cox Enterprises or wholly owned subsidiaries of Cox Enterprises (the “Minority Shares”) by a Tender Offer described below and a merger (the “Merger”) of a newly formed wholly owned direct subsidiary (“Merger Sub”) of Cox Holdings, Inc., a wholly owned subsidiary of Cox Enterprises (“Cox Holdings”), with and into Cox Communications, in which Cox Communications would be the surviving corporation and as a result of which all of the outstanding capital stock of Cox Communications would be held and beneficially owned by wholly owned subsidiaries of Cox Enterprises and the former holders of Minority Shares (other than those holders who have properly exercised appraisal rights) would be entitled solely to receive, on account of the Minority Shares, a tender offer or merger consideration of $32.00 per share (the “Merger Consideration”), upon the terms and subject to the conditions set forth in a

 


 

merger agreement which would be executed and delivered by Cox Enterprises, Cox Holdings, Cox Communications and Merger Sub, approved by the directors and stockholders of Merger Sub, approved by the directors of Cox Communications, including the special committee of the independent directors of Cox Communications (which would have approved the transactions as an exception to the Business Combination provisions of Cox Communications’ charter), and which the special committee of independent directors of Cox Communications would have resolved to recommend for approval by the stockholders of Cox Communications (the “Merger Agreement”) prior to the commencement of the Tender Offer referred to below.

     You have further informed us that you are considering proposing to Cox Communications, if you were to decide to proceed with the Acquisition, that Cox Holdings and Cox Communications commence a joint public tender offer (the “Tender Offer” and, together with the Merger, the “Acquisition”) to purchase all of the Minority Shares for a purchase price equal to the Merger Consideration, subject to certain conditions that are to be reasonably satisfactory to us, and that, following satisfaction or waiver of such conditions, the Minority Shares tendered in the Tender Offer would be allocated to, and accepted for purchase and paid for by, Cox Holdings and Cox Communications generally in proportion to the financing available under the Facilities described below, except that if sufficient Minority Shares are tendered in the Tender Offer to permit Merger Sub to complete a “short-form” merger, then all of the Minority Shares tendered in the Tender Offer would be allocated to, and accepted for purchase and paid for by, Cox Holdings. In the event that sufficient Minority Shares are not tendered in the Tender Offer to permit Merger Sub to complete a “short-form” merger, whether or not any Minority Shares are purchased by Cox Holdings or Cox Communications in the Tender Offer, Cox Holdings and Cox Communications may file a proxy or information statement with the Securities and Exchange Commission (the “SEC”) to solicit votes from Cox Communications’ holders to approve the Merger.

     You have advised us that, if you were to decide to proceed with the Acquisition, you would finance it from the proceeds of loans under new senior unsecured credit facilities of Cox Enterprises and Cox Communications in an aggregate commitment amount of $10 billion (the “Facilities”) that would replace Cox Enterprises’ existing $1.1 billion revolving credit facility (the “Existing Cox Enterprises Facility”) and Cox Communications’ existing $1.25 billion revolving credit facility (the “Existing Cox Communications Facility”) and that would be allocated as separate credit facilities to Cox Enterprises as borrower (the “Cox Enterprises Credit Facility”) and to Cox Communications as borrower (the “Cox Communications Credit Facility”) in amounts and with revolving credit and term loan tranches and maturities (which will not exceed five years) to be agreed by the Commitment Parties, Cox Enterprises and Cox Communications.

     We understand that, if you were to decide to proceed with the Acquisition, the aggregate outstanding consolidated indebtedness of Cox Enterprises and its subsidiaries (except Cox Communications and its subsidiaries), other than the Cox Enterprises Credit Facility, would not exceed $3.5 billion and the aggregate outstanding

2


 

consolidated indebtedness of Cox Communications and its subsidiaries, other than the Cox Communications Credit Facility, would not exceed $7.5 billion.

     In connection with the foregoing, you have requested that, if you decide to proceed with the Acquisition, CGMI and LBI agree to structure, arrange and syndicate the Facilities, that CNAI and LCPI each commit (severally and not jointly) to provide 50% of the entire amount of each of the Facilities, for an aggregate of $10.0 billion, and that either CNAI or LCPI (as determined by you) serve as administrative agent and syndication agent for the Facilities.

     CGMI and LBI are pleased to advise you that they are willing to act as joint lead arrangers and joint bookrunners for the Facilities. Furthermore, CNAI is pleased to advise you of its commitment to provide 50% of the entire amount of each of the Facilities and LCPI is pleased to advise you of its commitment to provide 50% of the entire amount of each of the Facilities, for an aggregate of $10.0 billion, in each case severally and not jointly and upon the terms and subject to the conditions set forth or referred to in this Commitment Letter and in the Summary of Terms and Conditions attached hereto (the “Term Sheet” and, collectively with this letter and the Fee Letters referred to below, this “Commitment Letter”). The Commitment Parties acknowledge that you shall have the right in your absolute and sole discretion to reduce the amount of the Facilities so long as the Acquisition remains fully financed.

     It is agreed that, if you were to proceed with the Acquisition, CGMI and LBI (the “Arrangers”) would act as joint lead arrangers and joint bookrunners together with other financial institutions selected by you, that either CNAI or LCPI (as determined by you) would act as the sole administrative agent (the “Administrative Agent”) and that either CNAI or LCPI (as determined by you) would act as syndication agent (the “Syndication Agent and, together with the Administrative Agent, the “Agents”). Citigroup Global Markets Inc. and Lehman Brothers Inc. shall be credited as the exclusive joint lead arrangers and joint bookrunners with Loan Pricing Corporation. Other than as expressly contemplated by the Term Sheet or the Fee Letters referred to below, no other agents, co-agents, arrangers, co-arrangers, managers or co-managers will be appointed and no other titles will be awarded in connection with the Facilities to any person, including the parties hereto, unless you shall so agree. No compensation will be paid in connection with the Facilities to any person, including the parties hereto, unless you and, if the Ratings Condition, as defined in the Fee Letter described below entitled “Fee Letter” (the “Ratings Condition”), is not satisfied, we shall so agree.

     CNAI and LCPI reserve the right, before or after the execution of the mutually acceptable loan documentation incorporating substantially the terms and conditions outlined in this Commitment Letter (the “Operative Documents”), to syndicate all or a portion of their commitments to financial institutions selected by them in consultation with you and, if the Ratings Condition is satisfied, reasonably acceptable to you that will become parties to the Operative Documents pursuant to a syndication to be managed by the Arrangers (the financial institutions becoming parties to the Operative Documents being collectively referred to as the “Lenders”). You agree to provide such assistance in the syndication effort as may be reasonably requested, including by

3


 

requesting that members of management of Cox Enterprises and Cox Communications available to meet with prospective syndicate members at such times and places as the Arrangers may reasonably request, using commercially reasonable efforts to ensure that the syndication efforts benefit from Cox Enterprises’ and Cox Communications’ existing lending relationships, providing the Arrangers with all information reasonably deemed necessary by them that is reasonably available to you to successfully complete the syndication, and assisting the Arrangers in the preparation of an information memorandum and other marketing materials. It is understood that the commitments of CNAI and LCPI will be reduced as part of the final allocation of commitments prior to the effective date of the Facilities.

     You agree to provide the Commitment Parties with all information reasonably requested by any of them and reasonably available to you in connection with the arrangement of the Facilities. You represent and covenant that, to the best of your knowledge, (a) taken as a whole, all information (other than the financial projections referred to below) concerning Cox Enterprises and its subsidiaries and Cox Communications and its subsidiaries and the transactions contemplated hereby, made available to any Commitment Party or Lender by you or your authorized representatives is and will be complete and correct in all material respects and does not and will not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements contained therein not materially misleading in light of the circumstances under which such statements are made and (b) all financial projections prepared by you or your authorized representatives and made available to any Commitment Party or Lender have been or will be prepared in good faith based upon reasonable assumptions, it being understood that such projections are subject to significant uncertainties and contingencies, many of which are beyond your control and that no assurance can be given that such projections will be realized. You agree to supplement the information and projections from time to time until the date the Operative Documents become effective so that the representations and warranties contained in this paragraph remain correct. In providing this Commitment Letter, the Commitment Parties are relying on the accuracy of the information furnished to them by or on behalf of you or your affiliates without independent verification thereof.

     Subject to the foregoing, it is understood and agreed that the Arrangers will, after consultation with you, manage all aspects of the syndication.

     As consideration for each of the commitments and agreements of CNAI and LCPI hereunder and the Arrangers’ agreement to structure, arrange and syndicate the Facilities, you agree to pay to them the fees and perform the other obligations set forth in the Term Sheet and in the Fee Letters (the “Fee Letters”) dated the date hereof and delivered herewith. Once paid, such fees shall not be refundable under any circumstances. No compensation (other than that expressly contemplated by the Term Sheet and the Fee Letters) will be paid in connection with the Facilities to any person other than the parties hereto unless you and we shall so agree. The terms of the Fee Letters are an integral part of the commitments of CNAI and LCPI hereunder and constitute part of this Commitment Letter for all purposes hereof. For the avoidance of

4


 

doubt, the parties agree and acknowledge that no fees shall be payable hereunder or under either Fee Letter prior to the first funding of loans on the Closing Date.

     The Commitment Parties are satisfied with the results of their due diligence investigation of Cox Enterprises, Cox Communications and their respective subsidiaries and the Acquisition to date, and the commitments of the Commitment Parties are not subject to further due diligence. Each of the commitments of CNAI and LCPI hereunder and each Arranger’s agreement to perform the services described herein are subject to (a) the absence of any material adverse change or any event, condition, circumstance or other matter that could reasonably be expected to result in a material adverse change since December 31, 2003, in the business, assets, operations or condition (financial or otherwise) of Cox Enterprises and its subsidiaries (other than Cox Communications and its subsidiaries and other than those subsidiaries of Cox Enterprises that are not restricted under the Operative Documents of Cox Enterprises), taken as a whole, or of Cox Communications and its subsidiaries, taken as a whole; (b) the negotiation, execution and delivery, no later than December 15, 2004, of Operative Documents reasonably satisfactory to each Commitment Party and its counsel; (c) there not having occurred a material adverse change in loan syndication, financial, banking or capital markets since the date hereof that, in the reasonable judgment of any Commitment Party, has had or would reasonably be expected to have a material adverse effect on the syndication of the Facilities; (d) following the date hereof and during the syndication of the Facilities, neither Cox Enterprises and its subsidiaries (other than Cox Radio, Inc. (“Cox Radio”)) nor Cox Communications and its subsidiaries shall have offered, placed or arranged or attempt to or be in the process of offering, placing or arranging any debt facility or debt security (including renewals thereof) of Cox Enterprises or any of its subsidiaries (other than Cox Radio), or of Cox Communications or any of its subsidiaries, without the prior written consent of each Commitment Party which shall not be unreasonably withheld (other than any issuance of any debt securities of Cox Enterprises or Cox Communications the proceeds of which are to be used to replace or refinance a portion of the Facilities in an amount to be agreed by the Commitment Parties, Cox Enterprises and Cox Communications); (e) each Commitment Party having approved (which approval shall not be unreasonably withheld) the structure, terms and conditions of the Acquisition and the provisions of the Merger Agreement and all other agreements and documents relating to the Acquisition (and each Commitment Party confirms that it has approved the structure, terms and conditions of the Acquisition and the provisions of the Merger Agreement and any other agreements or documents described therein relating to the Acquisition, to the extent such structure, terms, conditions, provisions and other agreements and documents are substantially as set forth, or described, in the draft of the Merger Agreement dated July 31, 2004); (f) (i) if Cox Holdings at its option determines to commence the Tender Offer and to accept for purchase any shares tendered, the acceptance of shares for purchase in the Tender Offer (on the approved structure and terms upon satisfaction of the approved conditions, except as modified with the consent of the Commitment Parties, which will not be unreasonably withheld) no later than December 15, 2004; provided, that in any event the 90% minimum condition in the Tender Offer may be waived by Cox Holdings and Cox Communications without consent of the Commitment Parties or (ii) if Cox Holdings at its option determines not to commence a Tender Offer or not to accept for purchase any shares tendered in the Tender

5


 

Offer, the completion of the Merger (on the approved structure and terms upon satisfaction of the approved conditions, except as modified with the consent of the Commitment Parties, which will not be unreasonably withheld) no later than the nine-month anniversary date of the date on which the Merger Agreement is executed and delivered; (g) no Commitment Party becoming aware of any circumstance or condition or other matter (including any matter relating to financial models and underlying assumptions relating to projections) that (i) is inconsistent in any material respect with the information and projections previously provided to the Commitment Parties relating to the Acquisition or Cox Enterprises or Cox Communications or any of their respective subsidiaries or (ii) has had or could reasonably be expected to have a material adverse effect upon the Acquisition or the financing transactions contemplated hereby or upon the business, assets, operations or condition (financial or otherwise) of Cox Enterprises and its subsidiaries (other than Cox Communications and its subsidiaries), taken as a whole, or of Cox Communications and its subsidiaries, taken as a whole; (h) payment of all fees and expense reimbursements then due under this Commitment Letter, including the Term Sheet and the Fee Letters; (i) the execution, delivery and compliance with the terms of (i) the engagement letter dated the date hereof among you, CGMI and LBI relating to the issuance and sale of the Senior Notes, (ii) this Commitment Letter and (iii) the Fee Letters; (j) Cox Communications’ senior debt ratings by Moody’s and S&P on the Closing Date based on the indebtedness to be outstanding after completion of the Acquisition being Ba2 (with a stable or positive outlook) or higher by Moody’s and BB (with a stable or positive outlook) or higher by S&P; (k) delivery of financial statements and business plans satisfactory to the Commitment Parties (and each Commitment Party confirms that it is satisfied with the financial statements and business plans previously provided to it); and (l) the other conditions set forth or referred to in the Term Sheet. The terms and conditions of each of the commitments of CNAI and LCPI hereunder and of the Facilities are not limited to those set forth herein and in the Term Sheet. Those matters that are not covered by the provisions hereof and of the Term Sheet are subject to the approval and agreement of the Commitment Parties and Cox Enterprises, with the understanding that they will not be inconsistent with the Term Sheet.

     You agree to indemnify and hold harmless each Commitment Party and their respective officers, directors, employees, affiliates, agents, attorneys, advisors, representatives and controlling persons (each, an “Indemnified Party”) from and against any and all losses, claims, damages, liabilities and expenses, joint or several, that may be incurred by or asserted or awarded against any Indemnified Party in connection with any investigation, litigation or proceeding or the preparation of a defense in connection therewith, in each case, arising out of or in connection with or by reason of this Commitment Letter, the Operative Documents, the Acquisition or the financing transactions contemplated hereby or thereby or any actual or proposed use of the proceeds of the Facilities, and to reimburse such Indemnified Party upon demand for any legal or other expenses incurred in connection with investigating or defending any of the foregoing, except to the extent any such losses, claims, damages, liabilities or expenses are found in a final, non-appealable judgment by a court of competent jurisdiction to have resulted from such Indemnified Party’s willful misconduct or gross negligence. You also agree to pay or reimburse the Commitment Parties from time to time for all reasonable out-of-pocket expenses (including but not limited to expenses of due diligence,

6


 

syndication expenses, travel expenses and reasonable fees, disbursements and other charges of Latham & Watkins LLP, counsel for the Commitment Parties) incurred by the Commitment Parties in connection with the Facilities and the preparation of this Commitment Letter and the Operative Documents, whether or not the Acquisition is completed or any Operative Documents are executed, and further agree to pay all reasonable costs and expenses of each Commitment Party (including, without limitation, the reasonable fees and disbursements of counsel) incurred in connection with the enforcement of any of its rights or remedies hereunder. In the case of an investigation, litigation or other proceeding to which the indemnity in this paragraph applies, such indemnity shall be effective whether or not such investigation, litigation or proceeding is brought by you or any of your directors, security holders or creditors, an Indemnified Party or any other person or an Indemnified Party is otherwise a party thereto and whether or not the transactions contemplated hereby are consummated.

     No Indemnified Party shall have any liability (whether in contract, tort or otherwise) to Cox Enterprises or Cox Communications or any of their respective security holders or creditors for or in connection with the transactions contemplated hereby, except to the extent such liability is determined in a final non-appealable judgment by a court of competent jurisdiction to have resulted from such Indemnified Party’s gross negligence or willful misconduct. In no event, however, shall any Indemnified Party be liable on any theory of liability for any special, indirect, consequential or punitive damages (including, without limitation, any loss of profits, business or anticipated savings).

     By accepting delivery of this Commitment Letter, you agree that this Commitment Letter is for your confidential use only and that neither its existence nor the terms hereof will be disclosed by you to any person other than your officers, directors, employees, accountants, attorneys and other advisors, agents and representatives (the “Company Representatives”) and then only on a confidential and “need to know” basis in connection with the transactions contemplated hereby; provided, however, you may make such other public disclosures of a copy hereof, or of the terms and conditions hereof, as you are required by law, in the opinion of your counsel to make (including filing a copy hereof with the SEC) in connection with the Acquisition) and you may disclose this Commitment Letter to Cox Communications, its board of directors, and its officers, directors, employees, accountants, attorneys and other advisors, agents and representatives on a confidential and “need to know” basis in connection with the transactions contemplated hereby. You and we acknowledge and agree that you are not relying on us for tax advice in connection with the transactions contemplated by this Commitment Letter, and that nothing herein is a limitation on disclosure by you which protects the confidentiality of any tax strategy offered to you by us. You and we further acknowledge and agree that we have not, herein or otherwise, placed any limitation on disclosure by you of the tax treatment or the tax structure of the transactions contemplated by this Commitment Letter which protects the confidentiality of our tax strategies. No other advisor who is (or who is expected to be) paid the minimum fee (as defined in Treasury regulation section 1.6011-4(b)(3)) in connection with the transactions contemplated by this Commitment Letter has placed any

7


 

limitation on disclosure by you of the tax treatment or tax structure of those transactions which protects the confidentiality of that advisor’s tax strategies.

     You acknowledge that the Commitment Parties and their affiliates may be providing debt financing, equity capital or other services (including financial advisory services) to other companies in respect of which you or your affiliates may have conflicting interests regarding the transactions described herein and otherwise. Each Commitment Party agrees that it and its affiliates will not use confidential information obtained from you by virtue of the transactions contemplated by this Commitment Letter or other relationships with you for any other purpose than in connection with the transactions contemplated by this letter, including, without limitation, in connection with the engagement of such Commitment Party or its affiliates by other companies, and that such Commitment Party and its affiliates will not furnish any such information to such other companies. You also acknowledge that none of the Commitment Parties or their affiliates have any obligation to use in connection with the transactions contemplated by this letter, or to furnish to you or any of your affiliates, confidential information obtained from other companies.

     This Commitment Letter and the commitments and obligations of the Commitment Parties hereunder shall not be assignable by you without the prior written consent of each of the Commitment Parties (and any purported assignment without such consent shall be null and void), are intended to be solely for the benefit of the parties hereto and are not intended to confer any benefits upon, or create any rights in favor of, any person other than the parties hereto and, to the extent set forth herein, the Indemnified Parties. Please note that those matters that are not covered or made clear herein are subject to mutual agreement of the parties. Any and all obligations of, and services to be provided by the Commitment Parties hereunder may be performed, and any and all of their respective rights hereunder may be exercised, by or through their affiliates. This Commitment Letter may not be amended or waived except by an instrument in writing signed by you and each of us. The commitments and obligations of the Commitment Parties under this Commitment Letter shall be in all respects several, and not joint, and none of them shall be in any respect obligated for any commitment or obligation of any of the others of them. This Commitment Letter is not intended to create a fiduciary relationship among the parties hereto. This Commitment Letter 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 Commitment Letter by facsimile transmission shall be effective as delivery of a manually executed counterpart hereof. This Commitment Letter, including the Term Sheet and the Fee Letters, sets forth the entire agreement among the parties with respect to the matters addressed herein and supersedes all prior communications, written or oral, with respect hereto. This Commitment Letter shall be governed by, and construed in accordance with, the laws of the State of New York.

     We hereby notify you that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”), we and each Lender may be required to obtain, verify and record information that identifies you, which information includes your name and address and other information that will allow

8


 

us and each Lender to identify you in accordance with the Act. This notice is given in accordance with the requirements of the Act and is effective for us and each Lender.

     Each party hereto irrevocably waives all right to trial by jury in any action, proceeding or counterclaim (whether based on contract, tort or otherwise) arising out of or relating to this Commitment Letter or the transactions contemplated hereby or the actions of the parties hereto in the negotiation, performance or enforcement hereof.

     Please indicate your acceptance of the terms hereof and of the Fee Letters by signing in the appropriate space below and in the Fee Letters and returning to us the enclosed duplicate originals (or facsimiles) of this Commitment Letter and the Fee Letters not later than 11:59 p.m., New York City time, on August 1, 2004. The commitments and obligations of each of the Commitment Parties hereunder will expire at such time in the event that we have not received such executed duplicate originals (or facsimiles) in accordance with the immediately preceding sentence. This Commitment Letter and the commitments and obligations of each of the Commitment Parties hereunder shall terminate on the earlier of (a) the date the Operative Documents become effective and (b) December 15, 2004, unless each of the Commitment Parties, acting individually in its own discretion, agrees to an extension. Nothing herein shall be deemed to obligate Cox Enterprises to consummate the Tender Offer or the Merger, and therefore Cox Enterprises shall have the right to terminate this Commitment Letter at any time prior to the execution and delivery of the Operative Documents by written notice to the Commitment Parties. The reimbursement, indemnification and confidentiality provisions contained herein and all applicable provisions of the Fee Letters shall remain in full force and effect regardless of whether definitive financing documentation shall be executed and delivered and notwithstanding the termination of this Commitment Letter or any commitment or obligation hereunder.

9


 

     We are pleased to have been given the opportunity to assist you in connection with this important financing.
         
  Very truly yours,


CITIGROUP GLOBAL MARKETS INC.
 
 
  By:   /s/ Carolyn Kee    
    Name:   Carolyn Kee   
    Title:   Managing Director   
 
  CITICORP NORTH AMERICA, INC.
 
 
  By:   /s/ Maureen Maroney    
    Name:   Maureen Maroney   
    Title:   Director   
 
  LEHMAN BROTHERS INC.
 
 
  By:   /s/ William J. Hughes    
    Name:   William J. Hughes   
    Title:   Managing Director   
 
  LEHMAN COMMERCIAL PAPER INC.
 
 
  By:   /s/ William J. Hughes    
    Name:   William J. Hughes   
    Title:   Authorized Signatory   
 

 


 

         
  Accepted and agreed to
as of the date first
written above by:

COX ENTERPRISES, INC.
 
 
  By:   /s/ Richard Jacobson    
    Name:   Richard Jacobson   
    Title:   Vice President / Treasurer   
 

 


 

ANNEX I

Cox Enterprises and Cox Communications
Credit Facilities

Summary of Terms and Conditions

     
Borrowers:
  Cox Enterprises, Inc., a Delaware corporation (“Cox Enterprises”), and Cox Communications, Inc., a Delaware corporation (“Cox Communications” and, together with Cox Enterprises, the “Borrowers”).1
 
Facilities:
  $10.0 billion senior unsecured credit facilities to be allocated to Cox Enterprises (the “Cox Enterprises Credit Facility”) and Cox Communications (the “Cox Communications Credit Facility” and, together with the Cox Enterprises Credit Facility, the “Facilities”) in amounts and with revolving credit and term loan tranches and maturities (not to exceed five years) to be agreed by Citigroup Global Markets Inc. (“CGMI”), Citicorp North America, Inc. (“CNAI”), Lehman Brothers Inc. (“LBI”) and Lehman Commercial Paper Inc. (“LCPI” and, together with CGMI, CNAI and LBI, the “Commitment Parties”) and the Borrowers.
 
   
 
  A portion of any revolving credit facility in an amount to be determined may be drawn in the form of letters of credit.
 
 
  The definitive credit agreements will establish a mechanism under which individual lenders with commitments under a revolving credit facility may make discretionary loans up to an aggregate amount to be agreed and in lieu of loans committed under such revolving credit facility at rates (and, in the case of any Cox Enterprises revolving credit facility, in currencies) agreed upon from time to time with the applicable Borrower through a competitive bid process.


1   Merger Sub, transitorily and with immediate assumption by Cox Communications, if the Merger is to be completed as a short-form merger.

 


 

     
Administrative Agent:
  Either CNAI or LCPI, as determined by the relevant Borrower, will act as sole Administrative Agent (the “Administrative Agent”) for a syndicate of lenders reasonably satisfactory to Cox Enterprises, the Administrative Agent and the Arrangers (the “Lenders”) and will perform the duties and exercise the authority customarily performed and exercised by it in such role.
 
   
Syndication Agent:
  Either CNAI or LCPI, as determined by the relevant Borrower (the “Syndication Agent”). The relevant Borrower will also have the right to name an additional syndication agent.
 
   
Joint Lead Arrangers and Joint Bookrunners:
  CGMI and LBI (the “Arrangers” and, together with the Administrative Agent and Syndication Agent, the “Agents”). The relevant Borrower will also have the right to name additional joint lead arrangers and joint bookrunners.
 
   
Use of Proceeds of Facilities:
  The term loans under the Facilities (to be available in an aggregate amount to be agreed by the Commitment Parties and the Borrowers) may be used only to finance payment of the purchase price or merger consideration for the Acquisition and related expenses.
 
   
  Advances under revolving credit facilities that are part of the Facilities (in an aggregate amount to be agreed by the Commitment Parties and the Borrowers) will be reserved and may be used to finance payment of the purchase price or merger consideration for the Acquisition and related expenses. The remainder of such revolving credit facilities and, after the Merger is completed or in the event that the Merger Agreement is terminated in accordance with its terms, the portion thereof reserved to finance the Acquisition may be used for general corporate purposes.
 
   
Closing Date:
  The date (the “Closing Date”) on which all conditions precedent to the effectiveness of the Facilities are satisfied, which date shall be no later than (a) December 15, 2004, if Cox Holdings at its option determines to commence the Tender Offer and to accept for purchase any shares tendered in the Tender Offer or (b) the nine-month anniversary date of the date on which the Merger Agreement is executed and delivered, if Cox Holdings at its option determines not to commence a Tender Offer or not to accept for purchase any shares tendered in the

2


 

     
  Tender Offer.
 
Availability:
  All term loans under the Facilities will be funded in a single borrowing on the Closing Date, except that if (a) Cox Holdings elects to commence the Tender Offer and to accept shares for purchase in the Tender Offer, (b) the aggregate purchase price in the Tender Offer for the shares so accepted is less than the aggregate amount of the commitments for such term loans, and (c) the Merger is not concurrently consummated as a “short-form” merger, then the remainder of the commitments for such term loans will be available for funding in a single borrowing on the date the Merger becomes effective, which date shall be no later than nine months after the Closing Date.
 
   
 
  The undrawn portion of any revolving credit facility may be borrowed, repaid and reborrowed subject only to the satisfaction of applicable conditions to borrowing; provided that the total amount outstanding under any revolving credit facility may not exceed the aggregate amount of the commitments under that revolving credit facility.
 
   
Revolving Commitment
Termination:
  The Lenders’ commitments under a revolving credit facility will terminate on a date (no later than the fifth anniversary of the Closing Date) to be agreed by the Commitment Parties and the applicable Borrower.
 
   
Interest Rates and Fees:
  As set forth on the attached Annex I-A.
 
   
Currency of Borrowings:
  Committed borrowings under the Facilities will be available in U.S. Dollars (or, in respect of any Cox Enterprises revolving credit facility, from those Lenders willing to make loans in alternate currencies, in British pounds sterling, Japanese yen, Canadian dollars and Euros, in an aggregate U.S. Dollar equivalent principal amount not to exceed $300,000,000 in the aggregate).
 
   
Voluntary Prepayments and Commitment Reductions:
  All or a portion of the outstanding loans under any of the Facilities may be prepaid at any time and undrawn commitments may be terminated in whole or in part at any time at the applicable Borrower’s option, in minimum amounts to be specified, subject to reimbursement of redeployment costs in the case of Eurocurrency loans if prepayment occurs other than at the end of an applicable interest period.

3


 

     
Mandatory Prepayments:
  Mandatory prepayments may be required on term loans included in the Facilities, in amounts and under circumstances to be agreed by the Commitment Parties and the Borrowers.
 
   
Letters of Credit:
  Letters of credit will be issued under a revolving credit facility by one or more commercial banks that are Lenders designated by the Arrangers and the relevant Borrower in the syndication process (an “Issuing Bank”). Each letter of credit shall expire not later than the earlier of (i) the first anniversary of the issuance (or the most recent extension or renewal) of such letter of credit and (ii) the fifth business day prior to the termination of the commitments under that revolving credit facility.
 
   
 
  Drawings under any letter of credit shall be reimbursed by the Borrower for whose account such letter of credit was issued by 12:00 noon (i) if notice has been received by such Borrower by 10:00 a.m., on the same business day, or (ii) otherwise, on the next business day. To the extent that such Borrower does not reimburse the Issuing Bank when due, the Lenders under the applicable revolving credit facility will be irrevocably obligated to reimburse the Issuing Bank pro rata based upon their respective commitments under that revolving credit facility.
 
   
 
  The issuance of all letters of credit shall be subject to the customary procedures of the Issuing Bank.
 
Conditions to Closing:
  Usual for facilities and transactions of this type, those specified below and others to be reasonably specified by the Agents, including but not limited to execution of satisfactory credit documentation; evidence of authority; delivery of satisfactory legal opinions; accuracy of representations and warranties; absence of defaults; compliance with the terms of the Commitment Letter, including, without limitation, the payment in full of all fees, expenses and other amounts then payable under the Commitment Letter; (i) if Cox Holdings at its option determines to commence the Tender Offer and to accept for purchase any shares tendered, acceptance of such shares for purchase no later than December 15, 2004 on the approved structure and terms upon satisfaction of the approved conditions (as modified with the consent of the Arrangers, which will not to be unreasonably withheld, except that in any event the 90% minimum condition in the Tender Offer may be waived by Cox Holdings and

4


 

     
  Cox Communications without consent of the Agents or Lenders) and concurrent completion of the Merger if sufficient Minority Shares are tendered in the Tender Offer to permit Merger Sub to complete a “short-form” merger or (ii) if Cox Holdings at its option determines not to commence a Tender Offer or not to accept for purchase any shares tendered in the Tender Offer, the completion of the Merger no later than the nine-month anniversary date of the date on which the Merger Agreement is executed and delivered on the approved structure and terms upon satisfaction of the approved conditions as modified with the consent of the Arrangers (not to be unreasonably withheld); consents and approvals and expiration of all applicable waiting periods; and delivery of financial statements and business plans.
 
   
 
  In addition, the existing five-year revolving credit facilities of Cox Enterprises and Cox Communications (the “Existing Facilities”) shall have been, or shall simultaneously be, terminated and all amounts outstanding thereunder paid in full.
 
   
Conditions to Each Credit Event:
  Delivery of borrowing notices, accuracy of representations and warranties and absence of defaults.
 
   
Documentation:
  Separate documentation for the Cox Enterprises Credit Facility and for the Cox Communications Credit Facility, each usual for facilities and transactions of its type, containing provisions as specified below and others as may be reasonably specified by the Agents, including, without limitation:
 
   
Representations and Warranties:
  To include organization, qualification and subsidiaries; financial statements and absence of material adverse change; actions pending; default; title to assets; payment of taxes; conflicting or adverse agreements or restrictions; purpose of loans; authority; validity; consents or approvals; compliance with law; ERISA; Investment Company Act; disclosure; absence of undisclosed liabilities; enforceability of credit documentation; no conflict with law; indebtedness; liens; intellectual property; Federal Reserve regulations; licenses, permits, franchises and regulatory approvals; environmental matters; labor matters; and (if applicable) status of Credit Facilities as senior debt.

5


 

     
Affirmative Covenants:
  To include financial statements and other information; existence, laws and obligations; notice of litigation and other matters; books and records; inspection of property and records; maintenance of property and insurance; and ERISA; notice of defaults; continuation of business and maintenance of existence and material rights and privileges; compliance with laws and material contractual obligations; compliance with environmental laws; and payment of other obligations.
 
   
Negative Covenants:
  To include limitations on liens; merger, consolidation, disposition of assets; restricted payments; margin stock; loans and advances to and investments in unrestricted subsidiaries; subsidiary debt; and transactions with affiliates.
 
   
Financial Covenants:
  Each Borrower and its Restricted Subsidiaries will agree to maintain (i) a ratio of debt to annualized operating cash flow of not more than a ratio amount to be agreed; and (ii) a ratio of annualized operating cash flow to consolidated interest expense of not less than a ratio amount to be agreed.
 
   
Events of Default:
  To include failure to pay principal or interest; failure to pay other sums; failure to pay or acceleration of other debt; misrepresentation or breach of warranty; violation of certain covenants; violation of other covenants; undischarged judgment; change of control; assignment for benefit of creditors or nonpayment of debts; voluntary bankruptcy; involuntary bankruptcy; or dissolution; and certain ERISA events.
 
   
Cost and Yield Protection:
  Usual for facilities of this type, including (a) compensation in respect of redeployment costs, changes in reserve requirements, changes in taxes (including gross-up provisions for withholding taxes resulting from changes in law after the date hereof) and decreased profitability resulting from changes in U.S. or foreign capital adequacy requirements and other requirements of law, guidelines or policies or their interpretation or application and (b) indemnifying the Lenders for “breakage costs” incurred in connection with, among other things, any prepayment of a Eurodollar loan on a day other than the last day of an interest period with respect thereto.
 
Assignments and Participations:
  Lenders will be permitted to assign and participate loans, notes and commitments. Assignments will be by novation

6


 

     
  and in minimum amounts of $5,000,000 and will require the consent of the applicable Borrower (unless being made to an affiliate of a Lender or if an Event of Default has occurred and is continuing) and the Administrative Agent and, in the case of assignments of commitments under a revolving credit facility, the Issuing Bank under such revolving credit facility (unless being made (i) to an affiliate of a Lender, (ii) by an Agent and its affiliates or (iii) to another Lender), which consents will not be unreasonably withheld. Assignments to any Federal Reserve Bank will be permitted without consent.
 
   
  Participations will be without restriction and participants will be entitled to yield and increased cost protection to the same extent as the participating Lender. Upon the request of the applicable Borrower, each Lender will give prompt notice to such Borrower of each participant and the interest acquired by such participant.
 
   
  Each assignment will be subject to the payment of a service fee of $3,500 to the Administrative Agent by the parties to such assignment. The Borrowers shall not be liable for the payment of the costs and expenses of any assignment or participation.
 
   
Expenses and Indemnification:
  All reasonable out-of-pocket expenses of each Agent (and the Lenders for enforcement costs) associated with (a) the arrangement and the syndication of the Facilities and (b) the preparation, negotiation, execution, delivery, administration and enforcement of the definitive documentation contemplated hereby and any amendment or waiver with respect thereto (including the reasonable fees, charges and disbursements of counsel and the charges of IntraLinks) are to be paid by or on behalf of the applicable Borrower.
 
   
  The Agents and Lenders (and their affiliates and their respective officers, directors, employees, attorneys, affiliates, advisors and agents) will have no liability for, and will be indemnified by the applicable Borrower and held harmless from and against all losses, claims, damages, costs, expenses (including reasonable fees, charges and disbursements of counsel) and liabilities arising out of any investigation, litigation or proceeding arising out of or related to the financing contemplated hereby or the use or the proposed use of proceeds thereof (except to the extent resulting from the gross negligence

7


 

     
  or willful misconduct of the indemnified party).
 
   
Voting:
  Amendments and waivers of the documentation for the Facilities of any Borrower will require the approval of Lenders holding in excess of 50% of the outstanding loans, letter of credit exposures and commitments under all Facilities of that Borrower, except that (a) the consent of each Lender directly affected thereby shall be required with respect to (i) reductions in the amount or extensions of the scheduled date of final maturity of any Loan, (ii) reductions in the rate of interest or any fee or extensions of any due date thereof, (iii) increases in the amount or extensions of the expiry date of any Lender’s commitment, (iv) modifications to the pro rata provisions of the credit documentation or (v) modifications to the assignment provisions of the credit documentation which further restrict assignments thereunder and (b) the consent of 100% of the Lenders shall be required with respect to modifications to any of the voting percentages.
 
   
Governing Law and Forum:
  New York.
 
   
Counsel for the Agents:
  Latham & Watkins LLP.

8


 

ANNEX I-A

     
Interest Rates:
  Loans under each Facility will bear interest, at the option of the applicable Borrower, at (i) Adjusted LIBOR plus the Applicable LIBOR Margin, (ii) ABR plus any Applicable Base Rate Margin or (iii) the Federal Funds Rate plus the Applicable Federal Funds Rate Margin.
 
   
  The “Applicable LIBOR Margin” and the “Applicable Federal Funds Rate Margin” for any date will depend upon the applicable Borrower’s senior debt ratings by Moody’s Investors Service, Inc., and Standard and Poor’s Ratings Service (the “ratings”) and will be the percentage per annum set forth in the applicable table appearing on the pricing grid attached as Annex I to the Fee Letter entitled “Fee Letter” (the “Pricing Grid”) opposite such Borrower’s ratings on such date.
 
   
  The Applicable Base Rate Margin for any date will be zero unless the Applicable LIBOR Margin for such date exceeds 1.00%. If the Applicable LIBOR Margin for such date exceeds 1.00%, the Applicable Base Rate Margin for any date will be the Applicable LIBOR Margin for such date less 1.00%.
 
   
  The Borrowers may elect interest periods of 1, 2, 3 or 6 months (the “Interest Period”) for Adjusted LIBOR borrowings.
 
   
  Calculation of interest shall be on the basis of actual days elapsed in a year of 360 days (or 365 or 366 days, as the case may be, in the case of ABR loans based on the Prime Rate) and interest shall be payable at the end of each Interest Period and, in any event, at least every 3 months.
 
   
  ABR is the Alternate Base Rate, which is the higher of the Citibank N.A.’s Prime Rate and the Federal Funds Borrowing Rate plus 1/2 of 1%.
 
   
  “Federal Funds Rate” for any day shall be the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers, as published on the next succeeding business day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day that is a business day, the average of the quotations for the day of such transactions received by Citibank, N.A. from three federal funds brokers of

 


 

     
  recognized standing selected by it.
 
   
Letter of Credit Fees:
  A per annum fee equal to the applicable margin on the Adjusted LIBOR loans will accrue on the aggregate face amount of each outstanding letter of credit and will be payable in arrears at the end of each calendar quarter and upon the termination of the commitments under each revolving credit facility and such letter of credit, in each case based on the actual number of days elapsed over a 360-day year. Such fees shall be distributed to the Lenders participating in the revolving credit facility pro rata in accordance with the amounts of their applicable commitments. In addition, the applicable Borrower shall pay to the Issuing Bank in respect of each letter of credit (a) a fronting fee to be separately agreed upon on the aggregate face amount of such letter of credit during the period when it is outstanding, and (b) customary issuance, administration, amendment, payment and negotiation fees.
 
   
Commitment Fees:
  A commitment fee based on the Applicable Commitment Fee Percentage will be payable on the undrawn portion of each commitment in respect of each Facility, computed on the basis of actual days elapsed in a year of 365 or 366 days, as the case may be, in each case commencing to accrue on the earlier of the Closing Date or December 15, 2004, payable quarterly in arrears after such date and up to and including the date on which all unfunded commitments under such Facility have expired or been terminated. The “Applicable Commitment Fee Percentage” for any date shall be the percentage per annum set forth in the Pricing Grid opposite the pricing category applicable on such date.

2

-----END PRIVACY-ENHANCED MESSAGE-----