-----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, Q+EqTvPUTbyZpD4dggu6gTU7ImKtsEJi3k7OR6eqHEZlL14PQ59uXdi80V3PXita kHiKAPxANENzgJX0d1BbDA== 0000940180-98-000202.txt : 19980225 0000940180-98-000202.hdr.sgml : 19980225 ACCESSION NUMBER: 0000940180-98-000202 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 7 CONFORMED PERIOD OF REPORT: 19980224 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19980224 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: TCI COMMUNICATIONS INC CENTRAL INDEX KEY: 0000096903 STANDARD INDUSTRIAL CLASSIFICATION: CABLE & OTHER PAY TELEVISION SERVICES [4841] IRS NUMBER: 840588868 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 000-05550 FILM NUMBER: 98548451 BUSINESS ADDRESS: STREET 1: TERRACE TOWER II STREET 2: 5619 DTC PKWY CITY: ENGLEWOOD STATE: CO ZIP: 80111 BUSINESS PHONE: 3032675500 MAIL ADDRESS: STREET 1: TERRACE TOWER II STREET 2: 5619 DTC PKWY CITY: ENGLEWOOD STATE: CO ZIP: 80111 FORMER COMPANY: FORMER CONFORMED NAME: TELE COMMUNICATIONS INC DATE OF NAME CHANGE: 19920703 8-K 1 FORM 8-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report: February 24, 1998 Date of Earliest Event Reported: February 19, 1998 TCI COMMUNICATIONS, INC. (Exact name of registrant as specified in its charter) DELAWARE (State or other jurisdiction of incorporation) 0-5550 84-0588868 (Commission File Number) (I.R.S. Employer Identification No.) Terrace Tower II 5619 DTC Parkway Englewood, Colorado 80111-3000 (Address of principal executive offices, including zip code) Registrant's telephone number, including area code: (303) 267-5500 ITEM 5. OTHER EVENTS. Pursuant to a registration statement on Form S-3 (File No. 333-44745) (as amended, the "Registration Statement") filed with the Securities and Exchange Commission (the "Commission") under the Securities Act of 1933, as amended (the "Act"), and declared effective by the Commission on February 13, 1998, TCI Communications, Inc. (the "Registrant") has registered its senior, senior subordinated and subordinated debt securities (the "Debt Securities"), and TeleCommunications, Inc., a Delaware corporation (the "Parent"), has registered (i) shares of its Series Preferred Stock, which may be issued in the form of depositary shares evidenced by depositary receipts if the Parent elects to issue fractional interests in shares of a series of Series Preferred Stock, (ii) shares of its Tele-Communications, Inc. Series A TCI Group Common Stock, par value $1.00 per share ("Series A TCI Group Common Stock"), (iii) shares of Series A TCI Group Common Stock issuable upon conversion of Debt Securities of the Registrant or upon conversion of Series Preferred Stock of the Parent, and (iv) any guarantees of the Parent with respect to Debt Securities of the Company, all for delayed or continuous offering to the public pursuant to Rule 415 under the Act for a maximum aggregate initial offering price of $3 billion (or the equivalent thereof denominated in one or more foreign currencies or currency units). Reference is made to the Registration Statement for further information concerning the terms of the securities (including the Debt Securities) registered pursuant to the Registration Statement and the offering thereof. An indenture (the "Indenture"), substantially in the form of Exhibit 4.1 to the Registration Statement was executed as of February 19, 1998, between the Registrant and The Bank of New York, as Trustee, relating to senior Debt Securities of the Registrant. The definitive Indenture is filed as Exhibit 4.1 hereto. On February 19, 1998, an underwriting agreement (the "Underwriting Agreement"), substantially in the form of Exhibit 1.2 to the Registration Statement, was executed by Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Goldman, Sachs & Co., Salomon Brothers Inc, Bear, Stearns & Co. Inc., Credit Suisse First Boston Corporation and Lehman Brothers Inc. (the "Underwriters"), providing for the sale by the Registrant to, and the offering to the public by, the Underwriters of $300,000,000 aggregate principal amount of the Registrant's -2- 7 1/8% Senior Notes due February 15, 2028 (the "2028 Notes") which are a series of senior Debt Securities. The net proceeds to the Registrant from the sale of the 2028 Notes will be $295,218,000. The definitive Underwriting Agreement is filed as Exhibit 1.1 hereto. The 2028 Notes will be issued pursuant to the Indenture. The description of certain provisions of the Indenture and the 2028 Notes and information concerning the terms of their purchase and offering to the public by the Underwriters, are incorporated herein by reference (i) to the section entitled "Description of Debt Securities -- Senior Debt Securities" of the Prospectus, dated February 19, 1998 (the "Base Prospectus"), and (ii) to the sections entitled "Description of Notes" and "Underwriting" in the Prospectus Supplement thereto, dated February 19, 1998 (the "2028 Notes Prospectus Supplement"), each of which has been filed with the Commission pursuant to Rule 424(b)(5) under the Act. The form of 2028 Note is filed as Exhibit 4.2 hereto. On February 24, 1998, a distribution agreement (the "Distribution Agreement"), substantially in the form of Exhibit 1.3 to the Registration Statement, was executed by Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Credit Suisse First Boston Corporation, Lehman Brothers Inc. and Salomon Brothers Inc (collectively, the "Agents"), providing for the sale by the Registrant to the public of up to $750 million principal amount of the Registrant's Medium- Term Notes, Series D (the "Medium-Term Notes"), which are a series of senior Debt Securities. The Medium-Term Notes may be issued as fixed rate notes ("Fixed Rate Notes") or floating rate notes ("Floating Rate Notes"). The Registrant will pay a commission to each Agent in the form of a discount, ranging from .125% to .925% of the principal amount of the Medium-Term Notes sold through such Agent which discount depends upon the maturity date of the Medium-Term Notes as offered from time to time and the ratings assigned to such Medium-Term Notes by nationally recognized securities rating organizations unless otherwise specified in pricing supplements relating to the Medium-Term Notes to be filed pursuant to Rule 424(b) under the Act. The Distribution Agreement is filed as Exhibit 1.2 hereto. The description of certain provisions of the Indenture and the Medium Term Notes, and information concerning the terms of their offering to the public by the Agents, are incorporated herein by reference (i) to the section entitled "Description of Debt Securities -- Senior Debt -3- Securities" of the Base Prospectus, and (ii) to the sections entitled "Description of Notes" and "Plan of Distribution" in the Prospectus Supplement thereto, dated February 24, 1998 (the "MTN Prospectus Supplement"), which has been filed with the Commission pursuant to Rule 424(b) under the Act. Pursuant to Item 601(a) of Regulation S-K promulgated by the Commission ("Regulation S-K"), the Registrant filed as Exhibit 5 to the Registration Statement an opinion, dated February 11, 1998, rendered to the Registrant by Stephen M. Brett, Esq., Executive Vice President of the Registrant, as to the matters referred to in Item 601(b)(5)(i) of Regulation S-K with respect to the Debt Securities generally. On February 24, 1998, Baker & Botts, L.L.P. rendered to the Registrant an opinion (the "2028 Opinion") as to such matters specifically relating to the 2028 Notes. A copy of the 2028 Opinion is filed as Exhibit 5.1 hereto and includes the consent of Baker & Botts, L.L.P. (the "2028 Consent") to the filing of the 2028 Opinion as Exhibit 5.1 hereto and the incorporation by reference thereof into the Registration Statement. Also on February 24, 1998, Baker & Botts, L.L.P., counsel to the Registrant rendered to the Registrant an opinion (the "MTN Opinion") as to such matters specifically relating to the Medium-Term Notes. The MTN Opinion is filed as Exhibit 5.2 hereto and includes the consent of Baker & Botts, L.L.P. (the "MTN Consent") to the filing of the MTN Opinion as Exhibit 5.2 hereto and the incorporation by reference thereof into the Registration Statement. The Registrant is filing this Current Report on Form 8-K in order to cause the Underwriting Agreement, the Distribution Agreement, the Indenture, the 2028 Opinion and 2028 Consent and the MTN Opinion and MTN Consent to be incorporated into the Registration Statement by reference. By filing this Current Report on Form 8-K, however, the Registrant does not believe that any of the documents listed in the previous sentence or the information set forth herein represent, either individually or in the aggregate, a "fundamental change" (as such term is used in Item 512(a)(1)(ii) of Regulation S-K) in the information set forth in the Registration Statement. -4- ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS. Exhibits -------- 1.1 Underwriting Agreement, dated February 19, 1998, between Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Goldman, Sachs & Co., Salomon Brothers Inc, Bear, Stearns & Co. Inc., Credit Suisse First Boston Corporation and Lehman Brothers Inc. and the Registrant. 1.2 Distribution Agreement, dated February 24, 1998, among Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Credit Suisse First Boston Corporation, Lehman Brothers Inc. and Salomon Brothers Inc and the Registrant. 4.1 Indenture, dated as of February 19, 1998, between The Bank of New York and the Registrant. 4.2 Form of 71/8% Senior Note due February 15, 2028. 5.1 Opinion, dated February 24, 1998, of Baker & Botts, L.L.P., counsel to the Registrant, as to validity of the 71/8% Senior Notes due February 15, 2028. 5.2 Opinion, dated February 24, 1998, of Baker & Botts, L.L.P., counsel to the Registrant, as to the validity of the Medium-Term Notes, Series D. 23.1 Consent of Baker & Botts, L.L.P. (included in Exhibit 5.1). 23.2 Consent of Baker & Botts, L.L.P. (included in Exhibit 5.2). -5- SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Dated: February 24, 1998 TCI COMMUNICATIONS, INC. (Registrant) By /s/ Stephen M. Brett ----------------------------- Name: Stephen M. Brett Title: Executive Vice President -6- EXHIBIT INDEX ------------- Exhibits -------- 1.1 Underwriting Agreement, dated February 19, 1998, between Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Goldman, Sachs & Co., Salomon Brothers Inc, Bear, Stearns & Co. Inc., Credit Suisse First Boston Corporation and Lehman Brothers Inc. and the Registrant. 1.2 Distribution Agreement, dated February 24, 1998, among Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Credit Suisse First Boston Corporation, Lehman Brothers Inc. and Salomon Brothers Inc and the Registrant. 4.1 Indenture, dated as of February 19, 1998, between The Bank of New York and the Registrant. 4.2 Form of 71/8% Senior Note due February 15, 2028. 5.1 Opinion, dated February 24, 1998, of Baker & Botts, L.L.P., counsel to the Registrant, as to validity of the 71/8% Senior Notes due February 15, 2028. 5.2 Opinion, dated February 24, 1998, of Baker & Botts, L.L.P., counsel to the Registrant, as to the validity of the Medium-Term Notes, Series D. 23.1 Consent of Baker & Botts, L.L.P. (included in Exhibit 5.1). 23.2 Consent of Baker & Botts, L.L.P. (included in Exhibit 5.2). EX-1.1 2 UNDERWRITING AGREEMENT EXHIBIT 1.1 TCI COMMUNICATIONS, INC. UNDERWRITING AGREEMENT 71/8% Senior Notes due February 15, 2028 February 19, 1998 Merrill Lynch & Co. Merrill Lynch, Pierce, Fenner & Smith Incorporated Goldman, Sachs & Co. Salomon Brothers Inc Bear, Stearns & Co. Inc. Credit Suisse First Boston Corporation Lehman Brothers Inc. c/o Merrill Lynch & Co. Merrill Lynch, Pierce, Fenner & Smith Incorporated North Tower, 10th Floor World Financial Center New York, New York 10281-1310 Dear Sirs: TCI Communications, Inc., a Delaware corporation (the "Company"), proposes to issue and sell $300,000,000 principal amount of its 71/8% Senior Notes due February 15, 2028 (the "Offered Securities") pursuant to an indenture, dated as of February 19, 1998 (as the same may be amended or supplemented, the "Indenture"), with The Bank of New York, as trustee (the "Trustee"). Each Offered Security will be issuable in the denominations and shall have the terms set forth in Exhibit A. The term "Underwriters" as used herein will mean and refer collectively to one or more of the several Underwriters named in Exhibit B (and any substitute underwriter pursuant to Section 9 hereof), and the term "Underwriter" will refer to any of the several Underwriters named in Exhibit B (and any substitute underwriter pursuant to Section 9 hereof). The Company confirms as follows its agreement with you and the Underwriters. 1. Registration Statement and Prospectus: The Company and Tele- Communications, Inc., a Delaware corporation (the "Parent"), have filed with the Securities and Exchange Commission (the "Commission"), in accordance with the Securities Act of 1933, as amended, and the rules and regulations of the Commission promulgated thereunder (collectively called the "Act"), a shelf registration statement on Form S-3 (File No. 333-44745), including a prospectus, relating to, among other securities, debt securities of the Company ("Debt Securities") issuable from time to time in one or more series, including the Offered Securities, guarantees of the Parent that may be issued in respect of Debt Securities, and shares of Tele-Communications, Inc. Series A TCI Group Common Stock, par value $1.00 per share, of the Parent ("Common Stock") issuable from time to time upon conversion of convertible Debt Securities, which has become effective under the Act, and will promptly file with the Commission a prospectus supplement specifically relating to the Offered Securities pursuant to Rule 424 under the Act. As used in this Agreement, the term "Registration Statement" means such shelf registration statement, including exhibits and financial statements and schedules and documents incorporated by reference therein, as amended or supplemented to the date hereof and, in the case of references to the Registration Statement as of a date subsequent to the date hereof, as amended or supplemented as of such date. The term "Basic Prospectus" means the prospectus, dated February 19, 1998, as filed with the Commission pursuant to Rule 424 under the Act and forming part of the Registration Statement. The term "Prospectus" means the Basic Prospectus together with the prospectus supplement specifically relating to the Offered Securities as filed with the Commission pursuant to Rule 424 under the Act and any information deemed to be a part thereof pursuant to Rule 434 under the Act. The term "preliminary prospectus" means any preliminary prospectus supplement specifically relating to the Offered Securities together with the Basic Prospectus. Any reference herein to any preliminary prospectus or the Prospectus shall be deemed to refer to and include the documents incorporated by reference therein pursuant to Item 12 of Form S-3 under the Act, as of the date of such preliminary prospectus or the Prospectus, as the case may be, and any reference herein to any amendment or supplement to any preliminary prospectus or the Prospectus, except the reference in Section 4(c), shall be deemed to refer to and include any documents filed after such date under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and so incorporated by reference. 2. Agreements to Sell and Purchase: The Company agrees to sell to the Underwriters, and upon the basis of the representations, warranties and agreements of the Company herein contained and subject to the terms and conditions of this Agreement each of the Underwriters agrees to purchase from the Company, severally and not jointly, the principal amount of Offered Securities set forth opposite each Underwriter's respective name in Exhibit B, at a purchase price of 98.406% of the principal amount of the Offered Securities, plus accrued interest from February 24, 1998. With respect to any of the Offered Securities purchased by you hereunder that you continue to own or hold at any time on or after the 90th day following the Closing Date (as defined in Section 3), you agree that upon receipt of written notice from the Company of its intention to bid for or purchase any Offered Security or any security of the same class and series as the Offered Securities or to take any other action, directly or indirectly, the taking of which would be proscribed by Regulation M promulgated by the Commission under the Exchange Act (or any successor or equivalent rule or regulation) during the distribution of the Offered Securities, you will, and will cause your "affiliated purchasers" (as defined in Rule 100 of said Regulation) to, cease distributing the Offered Securities for such period of time as the Company may deem necessary so that the action or actions proposed to be taken, directly or indirectly, by it may be taken in full compliance with such Regulation (or any successor or equivalent rule or regulation). 2 3. Delivery and Payment: Delivery of and payment for the Offered Securities shall be made at 10:00 a.m., New York time, on February 24, 1998 (such time and date are referred to herein as the "Closing Date"), at the offices of Baker & Botts, L.L.P., 599 Lexington Avenue, New York, New York 10022. The Closing Date and the place of delivery of and payment for the Offered Securities may be varied by agreement between you and the Company. Delivery of the Offered Securities (in definitive form and registered in such names and in such authorized denominations as you shall request at least 48 hours prior to the Closing Date by written notice to the Company) shall be made to you against payment by you of the purchase price therefor by cashier or official bank check or checks payable to the order of the Company in, or by wire transfer to an account specified by the Company of, same day funds. For the purpose of expediting the checking and packaging of the Offered Securities, the Company agrees to make the Offered Securities available to you for inspection at least 24 hours prior to the Closing Date or such shorter period of time as you may agree to. 4. Agreements of the Company: The Company agrees with you as follows: (a) The Company will notify you promptly, and (if requested by you in writing) will confirm such advice in writing, during the period of the distribution of the Offered Securities (1) of the effectiveness of any amendment to the Registration Statement and of the filing of any supplement to the Prospectus, (2) of any comments of the Commission regarding the Registration Statement or the Prospectus (or any of the documents incorporated by reference therein) or of any request by the Commission for amendments or supplements to the Registration Statement or the Prospectus or for additional information, (3) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or the initiation or threatening of any proceedings for that purpose, (4) of the receipt by the Company of any notification with respect to the suspension of the qualification of the Offered Securities for offer or sale in any jurisdiction or the initiation or threatening of any proceedings for such purpose and (5) of the happening of any event during the period mentioned in paragraph (d) below which makes any statement of a material fact made in the Registration Statement or the Prospectus (as theretofore amended or supplemented) untrue or which requires the making of any changes in the Registration Statement or the Prospectus (as theretofore amended or supplemented) in order to make the statements therein, in light of the circumstances when the Prospectus is delivered to a purchaser, not misleading. The Company will use its reasonable best efforts to prevent the issuance of any order suspending the effectiveness of the Registration Statement or suspending the qualification of the Offered Securities for offer or sale in any jurisdiction, and if any such order is issued, the Company will make every reasonable effort to obtain the withdrawal of such order at the earliest possible moment. (b) The Company will furnish to each of you, without charge, one conformed copy of the Registration Statement and any post-effective amendment thereto filed in connection with the offering of the Offered Securities, including all financial statements and 3 schedules, exhibits and documents incorporated therein by reference (including exhibits incorporated therein by reference to the extent not previously furnished to you). (c) The Company will give you advance notice of its intention to file any amendment or supplement to the Registration Statement or the Prospectus with respect to the Offered Securities, and will not file any such amendment or supplement to which you shall reasonably object in writing. (d) During the period of time that the Prospectus is required by law to be delivered, the Company will deliver to each Underwriter, without charge, as many copies of the Prospectus or any amendment or supplement thereto as such Underwriter may reasonably request. The Company consents to the use of the Prospectus or any amendment or supplement thereto by the Underwriters and by all dealers to whom the Offered Securities may be sold, both in connection with the offering or sale of the Offered Securities and for such period of time thereafter as the Prospectus is required by law to be delivered in connection therewith. If during such period of time any event shall occur which in the judgment of the Company should be set forth (or incorporated by reference) in the Prospectus in order to make the statements therein, in light of the circumstances when the Prospectus is delivered to a purchaser, not misleading, or if it is necessary to supplement or amend the Prospectus to comply with law, the Company will forthwith prepare and duly file with the Commission an appropriate supplement or amendment thereto, and forthwith file all reports and any definitive proxy statement or information statement required to be filed by the Company with the Commission pursuant to Sections 13(a), 13(c) or 14 of the Exchange Act subsequent to the date of the Prospectus and during such period, and will deliver to each Underwriter, without charge, such number of copies thereof as such Underwriter may reasonably request. If during such period of time any event shall occur which in your judgment should be so set forth (or incorporated by reference) in the Prospectus, or which in your judgment makes it necessary to so supplement or amend the Prospectus, the Company will consult with you concerning the necessity of filing with the Commission a supplement or an amendment to the Prospectus or a report pursuant to Sections 13(a), 13(c) or 14 of the Exchange Act. (e) Prior to any public offering of the Offered Securities by the Underwriters, the Company will cooperate with you and your counsel in connection with the registration or qualification of the Offered Securities for offer and sale under the securities or Blue Sky laws of, and the determination of the eligibility of the Offered Securities for investment under the laws of, such jurisdictions as you request; provided, that in no event shall the Company be obligated to qualify to do business as a foreign corporation or as a securities dealer in any jurisdiction where it is not now so qualified, to conform its capitalization or the composition of its assets to the securities or Blue Sky laws of any jurisdiction or to take any action which would subject it to taxation or general service of process in any jurisdiction where it is not now so subject. The Company will pay all reasonable fees and expenses (including reasonable counsel fees and expenses) relating to qualification of the Offered Securities 4 under such securities or Blue Sky laws and in connection with the determination of the eligibility of the Offered Securities for investment under the laws of such jurisdictions as you may designate. (f) The Company will make generally available to its security holders and to you consolidated earnings statements (which need not be audited) that satisfy the provisions of Section 11(a) of the Act and Rule 158 thereunder. (g) The Company will pay all expenses in connection with (1) the preparation, printing and filing of the Registration Statement, any preliminary prospectus, the Prospectus, any legal investment memorandum and Blue Sky memorandum as contemplated by Section 4(e), (2) the preparation, issuance and delivery of the Offered Securities (other than transfer taxes) and the execution and delivery of the Indenture, (3) the printing of any dealer agreement, (4) furnishing such copies of the Registration Statement, the Prospectus and any preliminary prospectus, and all amendments and supplements thereto, including any term sheets delivered by the Company pursuant to Rule 434 under the Act, as may be requested for use in connection with the offering and sale of the Offered Securities by dealers to whom Offered Securities may be sold, and (5) any fees paid to rating agencies, if any, selected by the Company in connection with the rating of the Offered Securities. (h) If this Agreement is terminated by you because any condition to the obligations of the Underwriters set forth in Section 7 hereof is not satisfied or because of any failure or refusal on the part of the Company to comply with the terms hereof or if for any reason the Company shall be unable to perform its obligations hereunder, the Company will reimburse the Underwriters for all out-of-pocket expenses (including the fees and expenses of your counsel) reasonably incurred by the Underwriters in connection herewith. The Company will not in any event be liable to you or any of the Underwriters for damages on account of loss of anticipated profits. (i) From the date hereof to and including the Closing Date, the Company will not offer or sell, or contract to sell, any Debt Securities of the Company with a maturity of more than one year, including additional Offered Securities, pursuant to a public offering without your prior written consent. 5. Representations and Warranties of the Company: The Company represents and warrants to each Underwriter that: (a) the documents incorporated by reference in the Registration Statement and the Prospectus, when they were filed (or, if an amendment with respect to any such document was filed, when such amendment was filed) with the Commission, conformed in all material respects to the requirements of the Exchange Act and the rules and regulations of the Commission promulgated thereunder, and any further documents so filed and incorporated by reference during the period of the distribution of the Offered Securities will, when they 5 are filed with the Commission, conform in all material respects to the requirements of the Exchange Act and the rules and regulations of the Commission promulgated thereunder, none of such documents, when it was filed (or, if an amendment with respect to any such document was filed, when such amendment was filed), contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; and no such further document, when it is filed, will contain an untrue statement of a material fact or will omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they are made, not misleading; (b) the Registration Statement, when declared effective by the Commission, complied in all material respects with the requirements of the Act; each preliminary prospectus, if any, relating to the Offered Securities, filed pursuant to Rule 424 or Rule 434 under the Act, will comply when so filed in all material respects with the Act; and when the Prospectus or any term sheet is first filed with the Commission pursuant to Rule 424 or Rule 434 and as of the Closing Date, the Registration Statement and the Prospectus (as amended or supplemented, if applicable) will comply in all material respects with the requirements of the Act and the Indenture will comply in all material respects with the requirements of the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"). When it was declared effective by the Commission, the Registration Statement did not, and as of the date the Prospectus is first filed with the Commission pursuant to Rule 424 or Rule 434 and as of the Closing Date the Registration Statement (as amended or supplemented, if applicable) will not, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading. When the Prospectus is first filed with the Commission pursuant to Rule 424 or Rule 434 and as of the Closing Date, the Prospectus (as amended or supplemented, if applicable) will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. Notwithstanding the foregoing, this representation and warranty does not apply to statements or omissions in the Registration Statement or the Prospectus or any preliminary prospectus made in reliance upon information furnished to the Company in writing by any Underwriter expressly for use therein or to that part of the Registration Statement which consists of the Statements of Eligibility on Form T-1 under the Trust Indenture Act of the trustees for the Debt Securities; (c) the Offered Securities and the Indenture have been duly authorized by the Company and each will conform to the descriptions thereof in the Prospectus; (d) the issuance and sale of the Offered Securities and the fulfillment of the terms of this Agreement will not result in a breach of any of the terms or provisions of, or constitute a default under, the Company's charter or by-laws or any indenture, mortgage, deed of trust or other material agreement or instrument to which the Company or any of its 6 significant subsidiaries (as such term is defined in Rule 1.02(w) of Regulation S-X) is now a party or by which it is bound, or any order of any court or governmental agency or authority entered in any proceeding to which the Company or any of its significant subsidiaries was or is now a party or by which it is bound; (e) KPMG Peat Marwick LLP, the Company's auditors, are independent accountants as required by the Act; (f) so long as may be required for the distribution of the Offered Securities by the Underwriters or by any dealers that participate in the distribution thereof, the Company will comply with all requirements under the Exchange Act relating to the timely filing with the Commission of its reports pursuant to Sections 13(a) and 13(c) of the Exchange Act and of its proxy statements pursuant to Section 14 of the Exchange Act; and (g) except to the extent set forth in the Prospectus, the Company has not received any notice of, nor does it have any actual knowledge of, any failure by it or any of its significant subsidiaries to be in substantial compliance with all existing statutes and regulations applicable to it or such subsidiaries, which failure would materially and adversely affect the conduct of the business of the Company and its subsidiaries, considered as a whole. 6. Indemnification: The Company agrees to indemnify and hold harmless each Underwriter, and each person, if any, who controls each Underwriter within the meaning of either Section 15 of the Act or Section 20 of the Exchange Act, from and against any and all losses, claims, damages, liabilities and expenses (including reasonable costs of investigation) arising out of or based upon any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or the Prospectus or in any amendment or supplement thereto or in any preliminary prospectus, or arising out of or based upon any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein (in the case of the Prospectus, in light of the circumstances under which they were made) not misleading, except insofar as such losses, claims, damages, liabilities or expenses arise out of or are based upon any such untrue statement or omission or allegation thereof based upon information furnished in writing to the Company by any Underwriter expressly for use therein; provided, however, the Company shall not indemnify any Underwriter or any person who controls such Underwriter from any such losses, claims, damages or liabilities alleged by any person who purchased Offered Securities from such Underwriter if the untrue statement, omission or allegation thereof upon which such losses, claims, damages or liabilities are based was made in: (i) any preliminary prospectus, if a copy of the Prospectus (as then amended or supplemented if the Company shall have furnished any amendments or supplements thereto) was not sent or given by or on behalf of such Underwriter to such person at or prior to the written confirmation of the sale of Offered Securities to such person, and if the Prospectus (as so amended or supplemented) corrected the untrue statement or omission giving rise to such loss, claim, damage or liability; (ii) any Prospectus used by such Underwriter or any person who controls such Underwriter, after such time as the Company advised you that the filing of a post- 7 effective amendment or supplement thereto was required, except the Prospectus as so amended or supplemented; or (iii) any Prospectus used after such time as the obligation of the Company to keep the same current and effective has expired. This indemnity will be in addition to any liability which the Company may otherwise have. If any action or proceeding (including any governmental investigation) shall be brought or asserted against any Underwriter or any person controlling an Underwriter in respect of which indemnity may be sought from the Company, such Underwriter or such controlling person shall promptly notify the Company in writing, and the Company shall assume the defense thereof, including the employment of counsel reasonably satisfactory to you and the payment of all expenses. Any omission so to notify the Company shall not, however, relieve the Company from any liability which it may have to any indemnified party otherwise than under this Section 6. Any such Underwriter or any such person controlling an Underwriter shall have the right to employ separate counsel in any such action or proceeding and to participate in the defense thereof, but the fees and expenses of such separate counsel shall be such Underwriter's expense or the expense of such controlling person unless (a) the Company has agreed to pay such fees and expenses or (b) the Company shall have failed to assume the defense of such action or proceeding and employ counsel reasonably satisfactory to you in any such action or proceeding or (c) the named parties to any such action or proceeding (including any impleaded parties) include both such Underwriter or such controlling person and the Company, and you shall have been advised by your counsel that there may be a conflict of interest between such Underwriter or controlling person and the Company in the conduct of the defense of such action (in which case, if such Underwriter or such controlling person notifies the Company in writing that it elects to employ separate counsel at the expense of the Company, the Company shall not have the right to assume the defense of such action or proceeding on behalf of such Underwriter or such controlling person), it being understood, however, that the Company shall not, in connection with any one such action or proceeding or separate but substantially similar or related actions or proceedings arising out of the same general allegations or circumstances, be liable for the reasonable fees and expenses of more than one separate firm of attorneys (unless the members of such firm are not admitted to practice in a jurisdiction where an action is pending, in which case the Company shall pay the reasonable fees and expenses of one additional firm of attorneys to act as local counsel in such jurisdiction, provided the services of such counsel are substantially limited to that of appearing as attorneys of record) at any time for all indemnified parties, which firm shall be designated in writing by you. The Company shall not be liable for any settlement of any such action or proceeding effected without its written consent, but if settled with its written consent, or if there be a final judgment for the plaintiff in any such action or proceeding, the Company agrees to indemnify and hold harmless each Underwriter and any such controlling person from and against any loss or liability by reason of such settlement or judgment. Each Underwriter severally agrees to indemnify and hold harmless the Company, its directors and each of its officers, and each person, if any, who controls the Company within the meaning of either Section 15 of the Act or Section 20 of the Exchange Act, to the same extent as the foregoing indemnity from the Company to each Underwriter, but only with respect to information furnished in writing by such Underwriter expressly for use in the Registration Statement, the Prospectus, or 8 any amendment or supplement thereto, or any preliminary prospectus. In case any action or proceeding shall be brought against the Company or its directors or officers or any such controlling person, in respect of which indemnity may be sought against one or more of the several Underwriters, such Underwriters acting through the Representatives shall have the rights and duties given to the Company, and the Company or its directors or officers or such controlling person shall have the rights and duties given to you and the several Underwriters, by the preceding paragraph. If the indemnification provided for in this Section 6 is unavailable to an indemnified party under the first or third paragraph hereof in respect of any losses, claims, damages or liabilities referred to therein (other than by reason of such indemnified party's failure to comply with the first sentence of the second paragraph of this Section 6), then each applicable indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Underwriters on the other hand from the offering of the Offered Securities or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company on the one hand and the Underwriters on the other in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Underwriters on the other in connection with the Offering of the Offered Securities shall be deemed to be in the same proportion as the total net proceeds from the offering of the Offered Securities received by the Company bear to the total underwriting discounts received by the Underwriters in respect thereof. The relative fault of the Company on the one hand and of the Underwriters on the other shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or by the Underwriters through you and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The amount paid or payable by a party as a result of the losses, claims, damages and liabilities referred to above shall be deemed to include, subject to the limitations set forth in the second paragraph of this Section 6, any legal or other fees or expenses reasonably incurred by such party in connection with investigating or defending any action or claim. The Company and each Underwriter agree that it would not be just and equitable if contribution pursuant to this Section 6 were determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to in the immediately preceding paragraph. Notwithstanding the provisions of this Section 6, the Underwriters shall not be required to contribute any amount in excess of the amount by which the total price at which the Offered Securities were offered to the public exceeds the amount of any damages which the Underwriters have otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. 9 The indemnity and contribution agreements contained in this Section 6 and the representations and warranties of the Company contained in this Agreement shall remain operative and in full force and effect regardless of (a) any investigation made by or on behalf of the Underwriters, by or on behalf of any person controlling any Underwriter or by or on behalf of the Company, (b) acceptance of any of the Offered Securities and payment therefor or (c) any termination of this Agreement. 7. Conditions of the Underwriters' Obligations: The Underwriters' obligations hereunder are subject to the following conditions: (a) at the Closing Date, (i) no stop order suspending the effectiveness of the Registration Statement shall have been issued and no proceedings for that purpose shall be pending or threatened by the Commission; and you shall have received a certificate, dated the Closing Date and signed by the Chairman of the Board, the President, an Executive Vice President or a Senior Vice President of the Company (who may, as to threatened proceedings, rely upon the best of his information and belief), to that effect and to the effect set forth in clause (e) of this Section 7, and (ii) the rating assigned by a nationally recognized securities rating organization in the United States to the senior debt securities of the Company as of the date of this Agreement shall not have been lowered since that date; (b) you shall have received opinions, dated the Closing Date and reasonably satisfactory to counsel retained for the Underwriters, (A) from Cole, Raywid & Braverman, L.L.P. or such other special communications counsel for the Company as may be reasonably satisfactory to you, (B) from the General Counsel of the Company to the following effect and covering such additional matters as the Underwriters may reasonably request: (i) the Company and each of its significant subsidiaries is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has the corporate power and authority to carry on its business as described in the Prospectus (as amended or supplemented, if applicable) and the Company has the corporate power and authority to execute and deliver and perform its obligations under this Agreement and to issue and sell the Offered Securities as contemplated by this Agreement; (ii) the Company and each of its significant subsidiaries is duly qualified as a foreign corporation and is in good standing in each jurisdiction in which the failure to so qualify would, in the aggregate, have a material adverse effect upon the financial condition, results of operations, business or properties of the Company and its subsidiaries taken as a whole; (iii) all corporate proceedings legally required in connection with the authorization and issuance of the Offered Securities and the sale of the Offered 10 Securities by the Company in accordance with the terms of this Agreement have been taken; (iv) to the best knowledge of such counsel, there is no legal or governmental proceeding pending or threatened against the Company or any of its subsidiaries which is required to be disclosed in the Prospectus (as amended or supplemented, if applicable) and is not so disclosed and correctly summarized therein; (v) to the best knowledge of such counsel, there is no contract or other document known to such counsel of a character required to be described in the Prospectus (as amended or supplemented, if applicable) or to be filed as an exhibit to the Registration Statement (or to a document incorporated by reference therein) that is not described or filed as required; (vi) the execution and delivery of this Agreement and the Indenture, the issuance of the Offered Securities and the fulfillment of the terms herein and therein contained do not conflict with, or result in a breach of, or constitute a default under, the charter or by-laws of the Company or, to the best knowledge of such counsel, conflict in any material respect with, or result in a material breach of or constitute a material default under any material agreement, indenture or other instrument known to such counsel to which the Company or any of its significant subsidiaries is a party or by which it is bound, or result in a violation of any law, administrative regulation or court or governmental decree known to such counsel applicable to the Company or any of its subsidiaries, except that such counsel need not express any opinion with respect to (i) matters opined upon by special communications counsel and Sherman & Howard LLC or (ii) the federal securities laws, the Blue Sky or securities laws of any jurisdiction; and (vii) to the best knowledge of such counsel, neither the Registration Statement nor the Prospectus, as amended or supplemented, if applicable (except as to the financial statements and schedules and any other financial and statistical data contained and incorporated by reference in the Registration Statement or Prospectus, as to which no opinion need be expressed), contained, as of the date the Prospectus was first filed with the Commission pursuant to Rule 424, or contains, as of the Closing Date, any untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein (in the case of the Prospectus (as amended or supplemented, if applicable), in light of the circumstances under which they were made,) not misleading. (C) from Sherman & Howard LLC, special counsel to the Company, to the following effect and covering such additional matters as you may reasonably request: 11 (i) the execution and delivery of this Agreement and the Indenture, the issuance of the Offered Securities and the fulfillment of the terms herein and therein contained do not, to the best knowledge of such counsel, result in a material breach of or constitute a material default under any material agreement for borrowed money known to such counsel to which the Company or any of its significant subsidiaries is a party or by which it is bound; and (ii) the Company is not an "investment company" within the meaning of the Investment Company Act of 1940, as amended, and is not subject to regulation under such Act. and (D) from Baker & Botts, L.L.P., special counsel to the Company, or such other counsel to the Company as may be reasonably satisfactory to you, to the following effect and covering such additional matters as you may reasonably request: (i) this Agreement and the Indenture have been duly authorized, executed and delivered by the Company; and the Indenture is a legal, valid and binding agreement of the Company enforceable in accordance with its terms, except (A) as such enforceability may be limited by bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium and other laws affecting creditors' rights generally, and (B) that the remedy of specific performance and injunctive and other forms of equitable relief are subject to certain equitable defenses and to the discretion of the court before which any proceeding therefor may be brought; (ii) the Indenture has been duly qualified under, and complies in all material respects with the requirements of, the Trust Indenture Act; (iii) the Offered Securities, when executed and authenticated in accordance with the terms of the Indenture and delivered to and paid for by the Underwriters in accordance with this Agreement, will be legal, valid and binding obligations of the Company entitled to the benefits of the Indenture and enforceable in accordance with their terms, except (A) as such enforceability may be limited by bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium and other laws affecting creditors' rights generally, and (B) that the remedy of specific performance and injunctive and other forms of equitable relief are subject to certain equitable defenses and to the discretion of the court before which any proceeding therefor may be brought; (iv) the Registration Statement is effective under the Act and, to the best knowledge of such counsel, no stop order suspending the effectiveness of the Registration Statement has been issued and no proceeding for that purpose is pending or threatened by the Commission; and 12 (v) the Offered Securities and the Indenture conform in all material respects as to legal matters to the descriptions thereof in the Prospectus. In addition, such counsel shall state that: "The Registration Statement and the Prospectus, as amended or supplemented, if applicable (except as to (x) the financial statements and schedules and any other financial and statistical data contained or incorporated by reference therein and (y) the documents incorporated or deemed to be incorporated by reference therein, as to which no opinion is expressed), complied, as of the date the Prospectus was first filed with the Commission pursuant to Rule 424, and comply, as of the date hereof, as to form in all material respects with the requirements of the Act and the rules and regulations of the Commission under the Act (the "Rules"). In passing upon the form of such documents, we have necessarily assumed the correctness and completeness of the statements made or included therein by the Company and take no responsibility for the accuracy, completeness or fairness of the statements contained therein except insofar as such statements relate to the description of the Offered Securities and the Indenture or relate to us. However, in connection with the preparation of the Registration Statement and the Prospectus, we had conferences with certain officers and other representatives of the Company, and our examination of the Registration Statement and the Prospectus and our discussions in such conferences did not disclose to us any information (relying as to the materiality of any such information primarily upon officers and other representatives of the Company) which gave us reason to believe that either the Registration Statement or the Prospectus, as amended or supplemented, if applicable (except as to (x) the financial statements and schedules and any other financial and statistical data contained or incorporated by reference in the Registration Statement or the Prospectus and (y) the documents incorporated or deemed to be incorporated by reference therein, as to which no opinion is expressed), contained, as of the date the Prospectus was first filed with the Commission pursuant to Rule 424, or contains, as of the date hereof, any untrue statement of a material fact or omitted or omits to state any material fact required to be stated therein or necessary to make the statements therein (in the case of the Prospectus, as amended or supplemented, if applicable, in light of the circumstances under which they were made,) not misleading." In giving such opinions, such counsel may rely (x) as to matters of fact, to the extent they deem proper, upon certificates of officers of the Company, public officials and others, and (y) as to matters of law if other than the United States or Colorado (in the case of Sherman & Howard LLC and General Counsel of the Company) or New York (in the case of Baker & Botts, L.L.P.), on the opinions of local counsel retained by them or the Company, provided that such counsel are satisfactory to you and counsel for the Underwriters; (c) you shall have received on the Closing Date from counsel retained by you on behalf of the Underwriters an opinion to the effect set forth in clauses (b)(D)(i) and (iii) and 13 to the effect that the Registration Statement and the Prospectus, as amended or supplemented, if applicable, (except as to (x) the financial statements and schedules and any other financial and statistical data contained or incorporated by reference therein, and (y) the documents incorporated or deemed to be incorporated by reference therein, as to which no opinion need be expressed) comply as to form in all material respects with the Act. In addition, you shall have received on the Closing Date from such counsel an opinion with respect to the Registration Statement and the Prospectus in the form customarily given by such firm; (d) on the Closing Date you shall have received a letter addressed to the Representatives from KPMG Peat Marwick LLP, independent auditors for the Company, reasonably satisfactory to you; (e) the representations and warranties of the Company in this Agreement shall be true and correct on and as of the Closing Date; the Company shall have complied with all agreements and satisfied all conditions on its part to be performed or satisfied at or prior to the Closing Date; and except as reflected in or contemplated by the Registration Statement and the Prospectus, since the respective dates as of which information is given in the Registration Statement and the Prospectus, there shall not have been, at the Closing Date, any material adverse changes in the condition (financial or otherwise), business, prospects or results of operations of the Company and its subsidiaries, considered as a whole; and (f) subsequent to the date of this Agreement, there shall not have occurred any change, or any development involving a prospective change, in or affecting particularly the business, prospects or financial affairs of the Company and its subsidiaries, considered as a whole which, in your reasonable judgment, is so material and adverse that it would be impracticable to proceed with the public offering or delivery of the Offered Securities on the terms and in the manner contemplated by the Prospectus. 8. Termination of Agreement: The obligation of the Underwriters to purchase the Offered Securities may be terminated at any time prior to the Closing Date by notice to the Company from you, without liability on the part of the Underwriters to the Company, if, on or prior to such date, (i) additional material governmental restrictions, not in force and effect on the date of this Agreement, shall have been imposed upon trading in securities generally or minimum or maximum prices shall have been generally established on the New York Stock Exchange or on the American Stock Exchange, or trading in securities generally shall have been suspended on either such Exchange or trading in the common stock or debt securities of the Company in the over-the-counter market shall have been suspended or a general banking moratorium shall have been established by Federal or New York authorities, or (ii) a war involving the United States of America or other national calamity shall have occurred or shall have accelerated to such an extent as to affect adversely the marketability of the Offered Securities. 14 9. Default by One or More of the Underwriters: If one or more of the Underwriters shall fail on the Closing Date to purchase the Offered Securities that it or they are obligated to purchase hereunder (the "Defaulted Securities"), the Underwriters shall have the right, within 24 hours thereafter, to make arrangements for one or more of the non-defaulting Underwriters, or any substitute underwriter, to purchase all, but not less than all, of the Defaulted Securities in such amounts as may be approved by you and upon the terms herein set forth; if however, you have not completed such arrangements within such 24- hour period, then: (a) if the principal amount of Defaulted Securities does not exceed 10% of the aggregate principal amount of Offered Securities, the non-defaulting Underwriters shall be obligated to purchase the full amount thereof in the proportions that their respective underwriting obligations hereunder bear to the underwriting obligations of all non- defaulting Underwriters, or (b) if the principal amount of Defaulted Securities exceeds 10% of the aggregate principal amount of Offered Securities, the Company shall be entitled for an additional 24- hour period to find one or more substitute underwriters satisfactory to the Underwriters in their reasonable discretion to purchase such Defaulted Securities. In the event of any such default either the Underwriters or the Company shall have the right to postpone the Closing Date for a period not exceeding seven days in order to effect any required changes in the Registration Statement or Prospectus or in any other documents or arrangements relating to the purchase of the Offered Securities. If the principal amount of Defaulted Securities exceeds 10% of the aggregate principal amount of Offered Securities, and neither the Underwriters nor the Company make arrangements pursuant to this Section 9 within the period stated for the purchase of the Defaulted Securities, this Agreement shall terminate without liability on the part of any non-defaulting Underwriter to the Company except as provided in Section 6. No action taken pursuant to this Section 9 shall relieve any defaulting Underwriter from liability in respect of its default. A substitute underwriter hereunder shall be an Underwriter for all purposes of this Agreement. 10. Miscellaneous: Notice given pursuant to any of the provisions of this Agreement shall be in writing and shall be mailed or delivered (a) to the Company at its principal executive offices, located at Terrace Tower II, 5619 DTC Parkway, Englewood, Colorado 80111-3000, Attention: Chief Financial Officer, Facsimile: (303) 488-3200 or (b) to you at Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, North Tower, 10th Floor, World Financial Center, New York, New York 10281-1310, attention of: Debt Syndicate, Facsimile: (212) 449- 15 2234. Any notice under Section 8 hereof may be made by facsimile transmission or telephone, but if so made shall be subsequently confirmed in writing. This Agreement has been and is made solely for the benefit of the Underwriters and the Company and of the controlling persons, directors and officers referred to in Section 6 hereof, and their respective successors and assigns, and no other person shall acquire or have any right under or by virtue of this Agreement. The term "successors and assigns" as used in this Agreement shall not include a purchaser, as such purchaser, of Offered Securities from any Underwriter. This Agreement shall be governed by and construed in accordance with the internal laws of the State of New York. 16 Please confirm that the foregoing correctly sets forth the agreement between the Company and the Underwriters. Very truly yours, TCI COMMUNICATIONS, INC. By: /s/ Stephen M. Brett ------------------------------- Name: Stephen M. Brett Title: Executive Vice President Confirmed and Accepted, as of the date first above written: Merrill Lynch & Co. Merrill Lynch, Pierce, Fenner & Smith Incorporated Goldman, Sachs & Co. Salomon Brothers Inc Bear, Stearns & Co. Inc. Credit Suisse First Boston Corporation Lehman Brothers Inc. BY: MERRILL LYNCH & CO. MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED By: /s/ Rob Schmiedeler --------------------------------- Name: Rob Schmiedeler Title: Director 17 EXHIBIT A DEBT SECURITIES Designation: 71/8% Senior Notes due February 15, 2028 Issue Date: February 24, 1998 Maturity: February 15, 2028 Authorized Denominations: $1,000 and integral multiples thereof Interest Rate: 71/8% Interest Payment Dates: February 15 and August 15 (commencing August 15, 1998) Record Dates: February 1 and August 1 Sinking Fund: None Optional Redemption: None A-1 EXHIBIT B
Principal Amount Underwriters of Offered Securities Merrill Lynch & Co. Merrill Lynch, Pierce, Fenner & Smith Incorporated................................................$72,000,000 Goldman, Sachs & Co....................................................................................$69,000,000 Salomon Brothers Inc...................................................................................$69,000,000 Bear, Stearns & Co. Inc................................................................................$30,000,000 Credit Suisse First Boston Corporation.................................................................$30,000,000 Lehman Brothers Inc....................................................................................$30,000,000 Total...................................$300,000,000 ============
B-1 EX-1.2 3 DISTRIBUTION AGREEMENT DATED 2/24/98 EXHIBIT 1.2 TCI COMMUNICATIONS, INC. MEDIUM-TERM NOTES, SERIES D DISTRIBUTION AGREEMENT February 24, 1998 Merrill Lynch & Co. Merrill Lynch, Pierce, Fenner & Smith Incorporated North Tower, 10th Floor World Financial Center New York, New York 10281-1310 Credit Suisse First Boston Corporation 11 Madison Avenue New York, New York 10010 Lehman Brothers Inc. 3 World Financial Center New York, New York 10285-1800 Salomon Brothers Inc Seven World Trade Center New York, New York 10048 Dear Sirs: TCI Communications, Inc., a company duly incorporated under the laws of the State of Delaware (the "Company"), confirms its agreement with Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Credit Suisse First Boston Corporation, Lehman Brothers Inc. and Salomon Brothers Inc (each, an "Agent" and, collectively, the "Agents") with respect to the issue and sale by the Company of Medium-Term Notes, Series D, described herein (the "Notes"). The Notes are to be issued pursuant to an indenture, dated as of February 19, 1998 (the "Indenture"), between the Company and The Bank of New York, as trustee (the "Trustee"). Securities issued or to be issued under the Indenture, including the Notes, are herein called "Securities". As of the date hereof, the Company has authorized the issuance and sale of up to U.S. $750,000,000 aggregate principal amount of Notes through or to the Agents pursuant to the terms of this Agreement. It is understood, however, that the Company may from time to time authorize the issuance of additional Notes and that such additional Notes may be sold through or to the Agents pursuant to the terms of this Agreement, all as though the issuance of such Notes were authorized as of the date hereof. This Agreement provides both for the sale of Notes by the Company directly to purchasers, in which case an Agent will act as an agent of the Company in soliciting Note purchases, and (as may from time to time be agreed to by the Company and an Agent) to an Agent as principal for resale to purchasers. The Company has filed with the Securities and Exchange Commission (the "Commission") a registration statement on Form S-3 (No. 333-44745) relating to, among other things, the Securities and the offering thereof from time to time in accordance with Rule 415 under the Securities Act of 1933, as amended (the "1933 Act"), and has filed such amendments thereto as may have been required to the date hereof. Such registration statement, as amended, has been declared effective by the Commission, and the Indenture has been qualified under the Trust Indenture Act of 1939, as amended (the "1939 Act"). Such registration statement, as amended as of each respective Representation Date (as herein defined) (and any further registration statements which may be filed by the Company for the purpose of registering additional Notes), and the prospectus and prospectus supplement relating to the Notes constituting a part thereof as amended and supplemented as of each respective Representation Date, including in each case all documents incorporated therein by reference and all exhibits thereto, as from time to time amended or supplemented pursuant to the Securities Exchange Act of 1934, as amended (the "1934 Act"), the 1933 Act or otherwise, are referred to herein as the "Registration Statement" and the "Prospectus", respectively, except that if any revised prospectus shall be provided to the Agents or any of them by the Company for use in connection with the offering of the Notes which is not required to be filed by the Company pursuant to Rule 424(b) under the 1933 Act, the term "Prospectus" shall refer to such revised prospectus and prospectus supplement from and after the time it is first provided to the Agents or any of them for such use. Section 1. Appointment as Agents. (a) Appointment of Agents. Subject to the terms and conditions stated herein, the Company hereby appoints each of the Agents as agent of the Company for the purpose of soliciting purchases of the Notes from the Company by others and agrees that, except as otherwise contemplated herein, whenever the Company determines to sell Notes directly to an Agent as principal for resale to others, the Agent will enter into a Terms Agreement with the Company (hereafter defined) relating to such sale in accordance with the provisions of Section 3(b) hereof. Each Agent is authorized to engage the services of any other broker or dealer in connection with the offer or sale of the Notes purchased by the Agent as principal for resale to others but is not authorized to appoint sub-agents. The Company may, from time to time, offer Notes for sale otherwise than through an Agent; provided, however, that so long as this Agreement shall be in effect the Company shall not solicit or accept offers to purchase Notes through any agent other than an Agent, unless such agent shall have entered into an agreement with the Company substantially similar to this Agreement (including, but not limited to, Schedule A hereto). Written notice of such agreement shall be given to the Agents within one day of the execution thereof. In addition, the Company shall have the right at any time or from time to time to sell Notes directly to investors. (b) Reasonable Best Efforts Solicitations; Right to Reject Offers. Upon receipt of instructions from the Company, each Agent will use its reasonable best efforts to solicit purchases of such principal amount of the Notes as the Company and the Agents shall agree upon from time to time during the term of this Agreement, it being understood that the Company from time to time may allocate or reallocate the Notes which are to be sold by any Agent and that the Company shall not approve the solicitation of purchases of Notes in excess of the principal amount of Securities registered pursuant to the Registration Statement that from time to time remain unsold. The Agents will have no responsibility for maintaining records with respect to the aggregate principal amount of Notes sold, or of otherwise monitoring the availability of Notes for sale under the Registration Statement. Each Agent will communicate to the Company, orally or in writing, each reasonable offer to purchase Notes. Each Agent shall have the right, in its discretion reasonably exercised, to reject any proposed purchase of Notes, as a whole or in part, and any such rejection shall not be deemed a breach of the Agent's agreement contained herein. The Company shall have the sole right to accept any offers to purchase the Notes and may reject in its sole discretion any proposed purchase of the Notes, in whole or in part. (c) Solicitations as Agent; Purchases as Principal. In soliciting purchases of the Notes on behalf of the Company, each Agent shall act solely as agent for the Company and not as principal. Each Agent shall make reasonable best efforts to assist the Company in obtaining performance by each purchaser whose offer to purchase Notes has been solicited by the Agent and accepted by the Company. No Agent shall have any obligation to purchase Notes from the Company as principal, but an Agent may agree from time to time to purchase Notes as principal. Any such purchase of Notes by an Agent as principal shall be made pursuant to a Terms Agreement in accordance with Section 3(b) hereof. (d) Reliance. The Company and each Agent agree that any Notes the placement of which an Agent arranges shall be placed by the Agent, and any Notes purchased by an Agent shall be purchased by such Agent, in reliance on the representations, warranties, covenants and agreements of the Company contained herein and 2 on the terms and conditions and in the manner provided herein, in the Prospectus and in the Administrative Procedures (as defined in Section 3(c)). Section 2. Representations and Warranties. The Company represents and warrants to each Agent as of the date hereof, as of the date of each acceptance by the Company of an offer for the purchase of Notes (whether through an Agent as agent or to an Agent as principal), as of the date of each delivery of Notes (whether through an Agent as agent or to an Agent as principal) (the date and time of each such delivery to an Agent as principal being hereafter referred to as a "Settlement Time"), and as of any time that the Registration Statement or the Prospectus shall be amended or supplemented (other than by an amendment or supplement (i) providing solely for the specification of or a change in the interest rates, maturities, pricing or other similar terms of any Notes or a change in the principal amount of Notes remaining to be sold or similar changes (each an "Excluded Supplement") or (ii) relating to an offering of Securities other than the Notes) or that there is filed with the Commission any document incorporated by reference into the Prospectus (other than any Current Report on Form 8-K relating exclusively to the issuance of Securities other than the Notes under the Registration Statement) (each of the dates or times referenced above being referred to herein as a "Representation Date") as follows: (a) Incorporated Documents. The documents incorporated by reference in the Registration Statement and the Prospectus, when they were filed (or, if an amendment with respect to any such document was filed, when such amendment was filed) with the Commission, conformed in all material respects to the requirements of the 1934 Act and the rules and regulations of the Commission promulgated thereunder (the "1934 Act Regulations"), and any further documents so filed and incorporated by reference will, when they are filed with the Commission, conform in all material respects to the requirements of the 1934 Act and the 1934 Act Regulations; none of such documents, when it was filed (or, if an amendment with respect to any such document was filed, when such amendment was filed), contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; and no such further document, when it is filed, will contain an untrue statement of a material fact or will omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they are made, not misleading. (b) Registration Statement and Prospectus. The Registration Statement and the Prospectus, at the time the Registration Statement became effective, complied, and the Registration Statement and Prospectus, as then amended or supplemented as of each Representation Date, will comply in all material respects with the 1933 Act and the rules and regulations of the Commission thereunder (the "1933 Act Regulations") and the Indenture complies in all material respects with the requirements of the 1939 Act and the rules and regulations of the Commission thereunder (the "1939 Act Regulations"). The Registration Statement, at the time the Registration Statement became effective (or, if an amendment to the Registration Statement or an annual report on Form 10-K of the Company incorporated by reference into the Prospectus has been filed with the Commission subsequent to the effectiveness of the Registration Statement, then at the time of the most recent such filing) and as then amended or supplemented as of each Representation Date, did not and will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading. The Prospectus, at the time the Registration Statement became effective and as then amended or supplemented as of each Representation Date, did not and will not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided, however, that the representations and warranties in this subsection shall not apply (i) with respect to an Agent, to statements or omissions from the Registration Statement or Prospectus made in reliance upon and in conformity with information furnished to the Company by or on behalf of such Agent expressly for use in the Registration Statement or Prospectus or (ii) to that part of the Registration Statement which shall constitute the Statement of Eligibility under the 1939 Act (Form T-1) of the Trustee under the Indenture. 3 (c) The Notes and The Indenture. The Notes and the Indenture have been duly authorized by the Company and conform to the descriptions thereof in the Prospectus. (d) No Defaults. The issuance and sale of the Notes and the fulfillment of the terms of this Agreement will not result in a breach of any of the terms or provisions of, or constitute a default under, (i) the Company's charter or bylaws, (ii) any indenture, mortgage, deed of trust or other agreement or instrument to which the Company or any of its Significant Subsidiaries (as such term is defined in Rule 1.02(w) of Regulation S-X) is now a party or by which it is bound which would have a material adverse effect on the conduct of the business of the Company and its consolidated subsidiaries considered as one enterprise, or (iii) any order of any court or governmental agency or authority entered in any proceeding to which the Company or any of its Significant Subsidiaries was or is now a party or by which it is bound. (e) Accountants. KPMG Peat Marwick LLP, the Company's auditors, or its successor are independent accountants as required by the 1933 Act. (f) 1934 Act Filings. So long as may be required for the distribution of the Notes by the Agents or by any dealers that participate in the distribution thereof, the Company will comply with all requirements under the 1934 Act relating to the timely filing with the Commission of its reports pursuant to Section 13(a) and (c) of the 1934 Act and of its proxy statements pursuant to Section 14 of the 1934 Act. (g) Operating Permits, Certificates, etc. Except to the extent set forth in the Prospectus, the Company has not received any notice of, nor does it have any actual knowledge of, any failure by it or any of its Significant Subsidiaries to be in substantial compliance with all material existing statutes and regulations applicable to it or such Significant Subsidiaries, which failure would materially and adversely affect the conduct of the business of the Company and its consolidated subsidiaries considered as one enterprise. Any certificate required hereby, signed by any executive officer of the Company or Assistant Treasurer and delivered to an Agent or counsel for the Agents, shall be deemed a representation and warranty by the Company as to the matters covered thereby. Section 3. Solicitations as Agent; Purchases as Principal. (a) Solicitations as Agent. On the basis of the representations and warranties herein contained, but subject to the terms and conditions herein set forth, each Agent agrees, as an agent of the Company, to use its reasonable best efforts to solicit offers to purchase the Notes upon the terms and conditions set forth herein, in the Prospectus and in the Administrative Procedures. The Company reserves the right, in its sole discretion, to (i) suspend solicitation of purchases of the Notes through the Agents, in each case as agent, commencing at any time for any period of time or permanently, and (ii) allocate or reallocate the Notes which are to be sold by any Agent. Upon receipt of instructions from the Company, each Agent receiving such instructions will forthwith suspend solicitation of purchases from the Company until such time as the Company has advised said Agent that such solicitation may be resumed. The Company agrees to pay each Agent a commission with respect to each consummation of the sale of a Note by the Company as a result of a solicitation made by such Agent, in the form of a discount, equal to the applicable percentage as set forth in Schedule A hereto of the principal amount of such Note or, in the case of an Original Issue Discount Note (as defined in the Prospectus), of the Issue Price (as defined in the Prospectus) of such Note. The purchase price, interest rate, maturity date and other terms of the Notes in connection with each sale of Notes to or through an Agent shall be agreed upon by the Company and the Agent and set forth in a pricing supplement to the Prospectus to be prepared following each acceptance by the Company of an offer for the purchase of Notes. Except as may be otherwise provided in such supplement to the Prospectus, the Notes will be 4 issued in denominations of $1,000 or an integral multiple of $1,000. All Notes sold through an Agent as agent will be sold at 100% of their principal amount unless otherwise agreed to by the Company and the Agent. (b) Purchases as Principal. Each sale of Notes to an Agent as principal shall be made in accordance with the terms contained herein and (unless the Company and such Agent shall otherwise agree in writing) only pursuant to a separate agreement which shall provide for the sale of such Notes to, and the purchase and reoffering thereof by, such Agent. Each such separate agreement (which may be an oral agreement, confirmed in writing which may be a facsimile transmission) between an Agent and the Company is herein referred to as a "Terms Agreement". Unless the context otherwise requires, each reference contained herein to "this Agreement" shall be deemed to include any applicable Terms Agreement between the Company and an Agent. Each such Terms Agreement, whether oral, (confirmed in writing, which may be a facsimile transmission), or in writing, shall be with respect to such information (as applicable) as is specified in Exhibit A hereto. An Agent's commitment to purchase Notes as principal pursuant to any Terms Agreement shall be deemed to have been made on the basis of the representations and warranties of the Company herein contained and shall be subject to the terms and conditions herein set forth. Each Terms Agreement with an Agent shall specify the principal amount of Notes to be purchased by the Agent pursuant thereto, the price to be paid to the Company for such Notes (which shall be at a discount equivalent to the applicable commission set forth in Schedule A hereto unless otherwise specified in an applicable Terms Agreement), the Settlement Time and place of delivery of and payment for such Notes, any provisions relating to rights of, and default by, purchasers acting together with the Agent in the reoffering of the Notes, and such other provisions (including further terms of the Notes) as may be mutually agreed upon. Each Agent may utilize a selling or dealer group in connection with the resale of the Notes purchased. The Terms Agreement shall also specify the requirements for the officer's certificate, opinions of counsel and comfort letter pursuant to Sections 7(b), 7(c) and 7(d) hereof and, if applicable, the period of time referred to in Section 4(g). With respect to any Notes purchased by an Agent as principal pursuant to a Terms Agreement that have not been resold by such Agent prior to the earlier of (i) the 90th day following the related Settlement Time and (ii) a date specified in an applicable Terms Agreement, such Agent agrees (and by entering into such Terms Agreement shall be deemed to have reconfirmed such agreement) that upon receipt of written notice from the Company of its intention to bid for or purchase any Notes or any security of the same class and series as the Notes or to take any other action, directly or indirectly, the taking of which would be proscribed by Regulation M under the 1934 Act (or any successor or equivalent rule or regulation) during the reoffering of the Notes, such Agent will, and will cause any selling or dealer group utilized by it in connection with such reoffering to, cease reoffering such Notes for such period of time as the Company may deem necessary so that the action or actions proposed to be taken, directly or indirectly, by it may be taken in full compliance with such Regulation (or any successor or equivalent rule or regulation). (c) Administrative Procedures. Administrative procedures with respect to the sale of Notes shall be agreed upon from time to time by the Agents and the Company (the "Administrative Procedures"). The Agents and the Company agree to perform the respective duties and obligations specifically provided to be performed by them in the Administrative Procedures. Section 4. Covenants of the Company. The Company covenants with each Agent as follows: (a) Notice of Certain Events. Prior to the termination of the offering of the Notes, the Company will notify the Agents promptly, and (if requested by the Agents in writing) will confirm such advice in writing, (1) of the effectiveness of any amendment to the Registration Statement and of the filing of any supplement to the Prospectus (other than an Excluded Supplement or an amendment or supplement providing solely for the inclusion of additional financial information, and, unless the Agents shall otherwise specify, an amendment or supplement which relates exclusively to an offering of Securities other than the Notes), (2) of any comments of the Commission regarding the Registration Statement or the Prospectus (or any of the documents incorporated by reference therein) or of any request by the Commission for amendments or supplements to the Registration Statement or the Prospectus or for additional information, (3) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or 5 the initiation or threatening of any proceedings for that purpose, (4) of the receipt by the Company of any notification with respect to the suspension of the qualification of the Notes for offer or sale in any jurisdiction or the initiation or threatening of any proceedings for such purpose and (5) of the happening of any event during the period mentioned in paragraph (d) below which makes any statement of a material fact made in the Registration Statement or the Prospectus untrue or which requires the making of any changes in the Registration Statement or the Prospectus in order to make the statements therein, in light of the circumstances when the Prospectus is delivered to a purchaser, not misleading. Upon receipt of notice of an event described in (3), (4) or (5) above, the Agents shall cease solicitations of offers to purchase the Notes, as agent, and cease sales of Notes the Agents may own as principal; provided, however, that if such cessation arises out of an event described in (4) above, it shall be limited to cessation of solicitation of offers to purchase and sales in the jurisdiction or jurisdictions identified in such notice. The Company will use its reasonable best efforts to prevent the issuance of any order suspending the effectiveness of the Registration Statement or suspending the qualification of the Notes for offer or sale in any jurisdiction, and if any such order is issued, the Company will make every reasonable effort to obtain the withdrawal of such order at the earliest possible moment. (b) Registration Statement. The Company will furnish to each of the Agents, without charge, one copy of the Registration Statement (which may be conformed) and any post-effective amendment thereto, including all financial statements and schedules, exhibits and documents incorporated therein by reference (including exhibits incorporated therein by reference to the extent not previously furnished to the Agents). (c) Notice of Certain Proposed Filings. Prior to the termination of the offering of the Notes, the Company will not file any amendment or supplement to the Registration Statement or the Prospectus (except for (i) periodic or current reports filed under the 1934 Act, (ii) an Excluded Supplement, or (iii) a supplement relating to an offering of Securities other than the Notes) unless the Company has furnished each Agent a copy for its review prior to filing such proposed amendment or supplement. (d) Copies; Revisions of Prospectus--Material Changes. During the period of time that the Prospectus is required by law to be delivered, the Company will deliver to the Agents, without charge, as many copies of the Prospectus, as amended or supplemented, as the Agents may reasonably request. The Company consents to the use of the then current Prospectus, as amended or supplemented, by the Agents in connection with the offering or sale of the Notes and for such period of time thereafter as the Prospectus is required by law to be delivered in connection therewith. If during such period of time, any event shall occur which in the judgment of the Company should be set forth (or incorporated by reference) in the Prospectus in order to make the statements therein, in light of the circumstances when the Prospectus is delivered to a purchaser, not misleading, or if it is necessary to supplement the Prospectus or amend the Registration Statement to comply with law, immediate notice shall be given by the Company, and confirmed in writing, to the Agents to cease the solicitation of offers to purchase the Notes in the Agents' capacity as agents and to cease sales of any Notes the Agents may then own as principals pursuant to a Terms Agreement (and, if so notified by the Company, each Agent shall forthwith cease such solicitations and sales), and the Company will forthwith prepare and duly file with the Commission an appropriate supplement or amendment thereto, and forthwith file all reports and any definitive proxy statement or information statement required to be filed by the Company with the Commission pursuant to Sections 13(a), 13(c) or 14 of the 1934 Act subsequent to the date of the Prospectus, and will deliver to the Agents, without charge, such number of copies thereof as they may reasonably request. If during such period of time any event shall occur which in the Agents' judgment should be so set forth (or incorporated by reference), in the Prospectus, or which in the Agents' judgment makes it necessary to so supplement or amend the Prospectus, the Company will consult with the Agents concerning the necessity of filing with the Commission a supplement to the Prospectus, an amendment to the Registration Statement or a report pursuant to Sections 13(a), 13(c) or 14 of the 1934 Act. (e) Blue Sky. Prior to any public offering of the Notes by the Agents, the Company will cooperate with the Agents and counsel for the Agents in connection with the registration or qualification of the Notes for offer and sale under the securities or Blue Sky laws of, and the determination of the eligibility of the 6 Notes for investment under the laws of, such jurisdictions as the Agents request (to the extent the Agents determine such actions are required by applicable law or are otherwise desirable); provided, that in no event shall the Company be obligated to qualify to do business as a foreign corporation or as a securities dealer in any jurisdiction where it is not now so qualified, to conform its capitalization or the composition of its assets to the securities or Blue Sky laws of any jurisdiction or to take any action which would subject it to taxation or general service of process in any jurisdiction where it is not now so subject. The Company will pay all reasonable fees and expenses (including reasonable counsel fees and expenses) relating to qualification of the Notes under such securities or Blue Sky laws and in connection with the determination of the eligibility of the Notes for investment under the laws of such jurisdictions as the Agents may designate. (f) Earnings Statements. The Company will make generally available to its security holders and to the Agents consolidated earnings statements (which need not be audited) that satisfy the provisions of Section 11(a) of the 1933 Act and Rule 158 thereunder. (g) Stand-Off Agreement. Between the date of any Terms Agreement and the Settlement Time or such other time as is specified in the Terms Agreement, the Company will not offer or sell, or contract to sell, any debt securities of the Company substantially similar to those issued pursuant to the Terms Agreement, which may include substantially similar Notes, pursuant to a public offering of such similar debt securities without the prior written consent of the Agent party to such Terms Agreement, which shall not be unreasonably withheld. (h) Preparation of Pricing Supplements. The Company will prepare, with respect to each Note to be sold through or to an Agent pursuant to this Agreement, a pricing supplement with respect to such Notes in a general form previously approved by the Agents, and will file such pricing supplement pursuant to the applicable paragraph of Rule 424(b) under the 1933 Act within the time period therein prescribed. (i) Suspension of Certain Obligations. The Company shall not be required to comply with the provisions of subsections (b), (c) or (d) of this Section during any period from the time (i) any Agent shall have suspended solicitation of purchases of the Notes in its capacity as agent pursuant to a request from the Company and (ii) any Agent shall not then hold any Notes as a principal, purchased pursuant to a Terms Agreement, to the time the Company shall determine that solicitation of purchases of the Notes should be resumed or shall subsequently enter into a new Terms Agreement with an Agent. Section 5. Conditions of Obligations. The obligations of each Agent to solicit offers to purchase the Notes as agent of the Company, the obligations of any purchasers of the Notes sold through an Agent as agent, and any obligation of an Agent to purchase Notes pursuant to a Terms Agreement will be subject to the accuracy of the representations and warranties on the part of the Company contained in Section 2 hereof and in any certificate furnished pursuant to the provisions hereof, to the performance and observance by the Company of all of its covenants and agreements herein contained and to the following additional conditions precedent: (a) Legal Opinions. On the date hereof, the Agents shall have received: (1) The favorable opinions, dated as of the date hereof, from (A) special communications counsel for the Company with respect to matters of communications law, and (B) General Counsel of the Company, in form and substance satisfactory to the Agents, to the effect that: (i) the Company and each of its Significant Subsidiaries is a corporation duly incorporated, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has the corporate power and authority to carry on its business as described in the Prospectus and the Company has the corporate power and authority to execute and deliver and perform its obligations under this Agreement and to issue and sell the Notes as contemplated by this Agreement; (ii) the Company and each of its Significant Subsidiaries is duly qualified as a foreign corporation and is in good standing in each jurisdiction in which the failure to so qualify would, in the aggregate, have a material adverse effect upon the financial condition, results of operations, business or properties of the Company and its consolidated subsidiaries taken as a whole; 7 (iii) all corporate proceedings legally required in connection with the authorization and issuance of the Notes and the sale of the Notes by the Company in accordance with the terms of this Agreement have been taken; (iv) to the best knowledge of such counsel, there is no legal or governmental proceeding pending or threatened against the Company or any of its subsidiaries which is required to be disclosed in the Prospectus and is not so disclosed and correctly summarized therein; (v) to the best knowledge of such counsel, there is no contract or other document known to such counsel of a character required to be described in the Prospectus or to be filed as an exhibit to the Registration Statement (or to a document incorporated by reference therein) that is not described or filed as required; (vi) the execution and delivery of this Agreement and the Indenture, the issuance of the Notes and the fulfillment of the terms herein and therein contained do not conflict with, or result in a breach of, or constitute a default under, the charter or by-laws of the Company or, to the best knowledge of such counsel, conflict in any material respect with, or result in a material breach of or constitute a material default under any material agreement or other instrument known to such counsel to which the Company or any of its Significant Subsidiaries is a party or by which it is bound, or result in a violation of any law, administrative regulation or court or governmental decree known to such counsel applicable to the Company or any of its subsidiaries, except that such counsel need not express any opinion with respect to (i) matters opined upon by other special counsel to the Company or (ii) the Blue Sky or securities laws of any jurisdiction; and (vii) such counsel has no reason to believe that either the Registration Statement or the Prospectus, as amended or supplemented, if applicable (except as to financial statements and schedules and any other financial and statistical data contained or incorporated by reference in the Registration Statement or Prospectus, as to which no opinion need be expressed), contained, as of the date the Prospectus was first filed with the Commission pursuant to Rule 424 under the 1933 Act, or contains, as of the date hereof (or if such opinion is being delivered in connection with a Terms Agreement pursuant to Section 7(c) hereof, at the date of such Terms Agreement and at the Settlement Time with regard thereto, as the case may be), any untrue statement of a material fact or omitted or omits to state any material fact required to be stated therein or necessary to make the statements therein (in the case of the Prospectus, in light of the circumstances under which they were made) not misleading. (2) The favorable opinion, dated as of the date hereof, from special counsel to the Company, in form and substance satisfactory to the Agents, to the effect that: (i) the execution and delivery of this Agreement and the Indenture, the issuance of the Notes and the fulfillment of the terms herein and therein contained do not, to the best knowledge of such counsel, result in a material breach of or constitute a material default under any material agreement for borrowed money known to such counsel to which the Company or any of its Significant Subsidiaries is a party or by which it is bound, and (ii) the Company is not an "investment company" within the meaning of the Investment Company Act of 1940, as amended, and is not subject to regulation under such Act. (3) The favorable opinion, dated as of the date hereof, from special counsel to the Company, in form and substance satisfactory to the Agents, to the effect that: (i) this Agreement and the Indenture have been duly authorized, executed and delivered by the Company; and the Indenture is a legal, valid and binding agreement of the Company enforceable in accordance with its terms, except (A) as such enforceability may be limited by bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium and other laws affecting creditors' rights generally, 8 and (B) that the remedy of specific performance and injunctive and other forms of equitable relief are subject to certain equitable defenses and to the discretion of the court before which any proceeding therefor may be brought; (ii) the Indenture has been duly qualified under, and complies in all material respects with the requirements of, the 1939 Act; (iii) the Notes, when executed by the Company, completed, authenticated and delivered by the Trustee in accordance with the Indenture, issued and delivered by the Company and paid for, all as contemplated by and in accordance with the order of the Company, the procedures specified therein and this Agreement, will be legal, valid and binding obligations of the Company entitled to the benefits of the Indenture and enforceable in accordance with their terms, except (A) as such enforceability may be limited by bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium and other laws affecting creditors rights generally, and (B) that the remedy of specific performance and injunctive and other forms of equitable relief are subject to certain equitable defenses and to the discretion of the court before which any proceeding therefor may be brought; (iv) the Registration Statement is effective under the 1933 Act and, to the best knowledge of such counsel, no stop order suspending the effectiveness of the Registration Statement has been issued and no proceeding for that purpose is pending or threatened by the Commission; and (v) the Notes (subject to completion in accordance with the applicable pricing supplement) and the Indenture conform in all material respects as to legal matters to the descriptions thereof in the Prospectus. In addition, such counsel shall state that: "The Registration Statement and the Prospectus (except as to (x) the financial statements and schedules and any other financial and statistical data contained or incorporated by reference therein and (y) the documents incorporated or deemed to be incorporated by reference therein, as to which no opinion is expressed), comply, as of the date hereof, as to form in all material respects with the requirements of the 1933 Act and the 1933 Act Regulations. In passing upon the form of such documents, we have necessarily assumed the correctness and completeness of the statements made or included therein by the Company and take no responsibility for the accuracy, completeness or fairness of the statements contained therein except insofar as such statements relate to the description of the Notes and the Indenture or relate to us. However, we had conferences with certain officers and other representatives of the Company, and our examination of the Registration Statement and the Prospectus and our discussions in such conferences did not disclose to us any information (relying as to the materiality of any such information primarily upon officers and other representatives of the Company) which gave us reason to believe that either the Registration Statement or the Prospectus (except as to (x) the financial statements and schedules and any other financial and statistical data contained or incorporated by reference in the Registration Statement or Prospectus and (y) the documents incorporated or deemed to be incorporated by reference therein, as to which no opinion is expressed, and except as to the terms of the particular Notes which are to be provided in a pricing supplement), contains, as of the date hereof, any untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein (in the case of the Prospectus, in light of the circumstances under which they were made) not misleading." In giving such opinions, such counsel may rely (x) as to matters of fact, to the extent they deem proper, upon certificates of officers of the Company, public officials and others, and (y) as to matters of law other than the United States or Colorado (in the case of General Counsel of the Company) or New York (in the case of special counsel to the Company), on the opinions of local counsel retained by them or the Company, provided that such counsel are satisfactory to the Agents and counsel for the Agents. In addition, it is understood that the General Counsel of the Company may elect to provide favorable opinions with respect to the matters set forth in clause (i) of subsection (a)(2) of this Section and clause (iv) of subsection (a)(3) of this Section in lieu of special counsel to the Company providing such opinions. 9 (4) The favorable opinion, dated as of the date hereof, of counsel for the Agents, with respect to the matters set forth in clauses (i) and (iii) of subsection (a)(3) of this Section and to the effect that the Registration Statement and the Prospectus (except as to (x) the financial statements and schedules and any other financial and statistical data contained or incorporated by reference therein and (y) the documents incorporated or deemed to be incorporated by reference therein, as to which no opinion need be expressed) comply as to form in all material respects with the 1933 Act. In addition, the Agents shall have received on the date hereof from counsel for the Agents an opinion with respect to the Registration Statement and the Prospectus in the form customarily given by such firm. (b) Material Changes; Officer's Certificates. On the date hereof there shall not have been, since the respective dates as of which information is given in the Registration Statement, any material adverse change or any development resulting in the substantial possibility of a prospective material adverse change in the condition, financial or otherwise, of the Company and its consolidated subsidiaries considered as one enterprise, or in the earnings or business affairs of the Company and its consolidated subsidiaries considered as one enterprise, whether or not arising in the ordinary course of business, and the Agents shall have received a certificate of the President, the Principal Financial Officer, an Executive Vice President or a Senior Vice President, the Treasurer or the Assistant Treasurer of the Company, dated as of the date hereof, to the effect that (i) there has been no such material adverse change with respect to the Company and its consolidated subsidiaries considered as a whole, (ii) no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose are pending or threatened by the Commission, (iii) the representations and warranties of the Company contained in Section 2 are true and correct as of the date hereof, and (iv) the Company has performed or complied with all agreements and satisfied all conditions pursuant to this Agreement in connection with the issuance of the Notes on its part to be performed or satisfied at or prior to the date of such certificate. (c) Comfort Letter. On the date hereof, the Agents shall have received from KPMG Peat Marwick LLP or its successors or other independent certified public accountants acceptable to the Agents, a letter, dated as of the date hereof, in form and substance reasonably satisfactory to the Agents; provided, that the delivery of such letter by KPMG Peat Marwick LLP (or its successors) shall be conditioned upon the receipt by KPMG Peat Marwick LLP (or its successors) of: (i) an opinion of counsel for the Agents, in form and substance reasonably satisfactory to KPMG Peat Marwick LLP (or such successor) to the effect that the Agents would be entitled to assert the due diligence defense under the 1933 Act; or (ii) a representation letter from the Agents addressed to KPMG Peat Marwick LLP in the form set forth as Exhibit B hereto. (d) Other Matters. At each Settlement Time with respect to any Terms Agreement, counsel for the Agents shall have been furnished with such documents and opinions as they may reasonably require for the purpose of enabling them to pass upon the issuance and sale of the Notes as therein contemplated and related proceedings or in order to evidence the accuracy and completeness of any of the representations and warranties, or the fulfillment of any of the conditions, herein contained. All proceedings taken by the Company in connection with the issuance and sale of the Notes as herein contemplated shall be satisfactory in form and substance to the Agents. If any condition specified in this Section 5 shall not have been fulfilled when and as required to be fulfilled, this Agreement (or, at the option of the applicable Agent, any Terms Agreement) may be terminated by an Agent by notice to the Company at any time (or, in the case of termination of a Terms Agreement, at or at any time prior to the Settlement Time) and any such termination shall be with the effect set forth in Section 12(c). Section 6. Delivery of and Payment for Notes Sold through an Agent. Delivery of Notes sold through an Agent as agent shall be made by the Company to the Agent for the account of any purchaser only against payment therefor in immediately available funds. In the event that a purchaser shall fail either to accept delivery of, or to make payment for, a Note on the date fixed for settlement, the Agent that solicited such purchaser shall promptly notify the Company and deliver the Note to the Company, and, if the Agent has theretofore paid the Company for such Note, the Company will return such funds to the Agent within three business days. If such 10 failure occurred for any reason other than default by the Agent in the performance of its obligations hereunder, the Company will reimburse the Agent for its loss of the use of the funds for the period such funds were credited to the Company's account. Such reimbursement shall be in an amount equal to the lower of the Company's cost of funds and the Agent's cost of funds. Section 7. Additional Covenants of the Company. The Company covenants and agrees with the Agents that: (a) Reaffirmation of Representations and Warranties. Each acceptance by it of an offer for the purchase of Notes, and each delivery of Notes to an Agent pursuant to a Terms Agreement, shall be deemed to be an affirmation that the representations and warranties of the Company contained in Section 2 of this Agreement and in any certificate theretofore delivered to such Agent pursuant hereto are true and correct at the time of such acceptance or sale, as the case may be, and an undertaking that such representations and warranties will be true and correct at the time of delivery to the purchaser or his agent, or to such Agent, of the Note or Notes relating to such acceptance or sale, as the case may be, as though made at and as of each such time (and it is understood that such representations and warranties shall relate to the Registration Statement and Prospectus as amended and supplemented to each such time); (b) Subsequent Delivery of Certificates. Each time that (i) the Registration Statement or the Prospectus shall be amended or supplemented (other than by a pricing supplement, an Excluded Supplement or by an amendment or supplement providing solely for the inclusion of additional financial information, or, unless the Agents shall otherwise specify, other than by an amendment or supplement which relates exclusively to an offering of Securities other than the Notes), (ii) there is filed with the Commission any Report on Form 10-K, (iii) there is filed with the Commission any document incorporated by reference into the Prospectus (other than any proxy or information statement or Current Report on Form 8- K), (iv) there is filed with the Commission any proxy or information statement that pertains to matters other than, or in addition to, an election of directors, the adoption of a benefit plan, the ratification of the Company's auditors or other routine housekeeping matters, (v) there is filed with the Commission any Current Report on Form 8-K containing information that is reasonably deemed by the Company to be materially adverse to the business affairs or prospects of the Company, or (vi) (if required pursuant to the terms of a Terms Agreement) the Company sells Notes to an Agent pursuant to a Terms Agreement, the Company shall furnish or cause to be furnished to the Agents forthwith a certificate dated the date of filing with the Commission of such supplement or document, the date of effectiveness of such amendment, or the date of such sale, as the case may be, in form satisfactory to the Agent to the effect that the statements contained in the certificate of the Company referred to in Section 5(b) hereof which was last furnished to the Agent are true and correct at the time of such amendment, supplement, filing or sale, as the case may be, as though made at and as of such time (except that such statements shall be deemed to relate to the Registration Statement and the Prospectus as amended and supplemented to such time) or, in lieu of such certificate, a certificate of the same tenor as the certificate referred to in said Section 5(b), modified as necessary to relate to the Registration Statement and the Prospectus as amended and supplemented to the time of delivery of such certificate. In the case of certificates to be furnished pursuant to (iii), (iv) or (v) above, the Company may request that the Agents waive the requirement for the certificates, which request shall not be unreasonably refused; (c) Subsequent Delivery of Legal Opinions. Each time that (i) the Registration Statement or the Prospectus shall be amended or supplemented (other than by a pricing supplement, an Excluded Supplement or by an amendment or supplement providing solely for the inclusion of additional financial information, or, unless the Agents shall otherwise specify, other than by an amendment or supplement which relates exclusively to an offering of Securities other than the Notes), (ii) there is filed with the Commission any Report on Form 10-K, (iii) there is filed with the Commission any document incorporated by reference into the Prospectus (other than any proxy or information statement or Current Report on Form 8- K or a Quarterly Report on Form 10-Q), (iv) there is filed with the Commission any proxy or information statement that pertains to matters other than, or in addition to, an election of directors, the adoption of a benefit plan, the ratification of the Company's auditors or other routine housekeeping matters, (v) there is filed with the 11 Commission any Current Report on Form 8-K containing information that is reasonably deemed by the Company to be materially adverse to the business affairs or prospects of the Company, (vi) (if required pursuant to the terms of a Terms Agreement) the Company sells Notes to an Agent pursuant to a Terms Agreement, the Company shall furnish or cause to be furnished forthwith to the Agents and to counsel to the Agents the written opinions of the General Counsel of the Company and special counsel to the Company or other counsel satisfactory to the Agent dated the date of filing with the Commission of such supplement or document, the date of effectiveness of such amendment, or the date of such sale, as the case may be, in form and substance satisfactory to the Agents, of the same tenor as the opinions referred to in Section 5(a)(1)(B) and 5(a)(3) hereof, but modified, as necessary, to relate to the Registration Statement and the Prospectus as amended and supplemented to the time of delivery of such opinions, or (vi) in lieu of any such opinion required under Subsection (7)(c)(v) above, counsel last furnishing such opinion to the Agents shall furnish the Agents with a letter to the effect that the Agents may rely on such last opinion to the same extent as though it was dated the date of such letter authorizing reliance (except that statements in such last opinion shall be deemed to relate to the Registration Statement and the Prospectus as amended and supplemented to the time of delivery of such letter authorizing reliance). In the case of opinions to be furnished pursuant to (iii), (iv) or (v) above, the Company may request that Agents waive the requirement for the opinions, which request shall not be unreasonably refused; and (d) Subsequent Delivery of Comfort Letters. Each time that (i) the Registration Statement or the Prospectus shall be amended or supplemented to include additional financial information with respect to the Company, (ii) the Company files with the Commission any Report on Form 10-K, (iii) the Company files with the Commission any document incorporated by reference to the Prospectus which contains additional financial information (other than any Current Report on Form 8-K), (iv) the Company files with the Commission any Current Report on Form 8-K (containing additional information) which contains information that is reasonably deemed to be materially adverse to the business affairs or prospects of the Company, or (v) (if required pursuant to the terms of a Terms Agreement) the Company sells Notes to an Agent pursuant to a Terms Agreement, the Company shall cause KPMG Peat Marwick LLP or its successors forthwith to furnish the Agents a letter, dated the date of filing with the Commission of such amendment, supplement or document, the date of effectiveness of such amendment, or the date of such sale, as the case may be, in form satisfactory to the Agents, of the same tenor as the portions of the letter delivered pursuant to Section 5(c) but modified to relate to the Registration Statement and Prospectus, as amended and supplemented to the date of such letter, and as may be necessary to reflect changes in the financial statements and other information derived from the accounting records of the Company; provided, however, that if the Registration Statement or the Prospectus is amended or supplemented solely to include the financial information as of and for an interim period, KPMG Peat Marwick LLP or its successors may limit the scope of such letter to the unaudited financial statements included in such amendment or supplement unless any other information included therein of an accounting, financial or statistical nature is of such a nature that, in the reasonable judgment of the Agents, such letter should cover such other information, and provided, further, that the delivery of such letter by KPMG Peat Marwick LLP (or its successors) shall be conditioned upon the receipt by KPMG Peat Marwick LLP (or its successors) of: (i) an opinion of counsel for the Agents, in form and substance reasonably satisfactory to KPMG Peat Marwick LLP (or such successor) addressing whether the Agents can avail themselves of the due diligence defense under the 1933 Act; or (ii) a representation letter from the Agents addressed to KPMG Peat Marwick LLP in the form set forth as Exhibit C hereto. In the case of letters to be furnished pursuant to (iii) or (iv) above, the Company may request that the Agents waive the requirement for the letters, which request shall not be unreasonably refused. Section 8. Payment of Expenses. The Company agrees to pay all expenses incident to the performance of its obligations under this Agreement, including: (a) the preparation and filing of the Registration Statement and all amendments thereto and the Prospectus and any amendments or supplements thereto; (b) the preparation, filing and reproduction of this Agreement; 12 (c) the preparation, printing, issuance and delivery of the Notes, including any fees and expenses relating to the use of book-entry notes (excluding any fees payable by an Agent solely as member of The Depository Trust Company); (d) the fees and disbursements of the Company's accountants and counsel, of the Trustee and its counsel, and of any Calculation Agent or Exchange Rate Agent; (e) the reasonable fees and disbursements of counsel to the Agents incurred from time to time in connection with the transactions contemplated hereby; (f) the qualification of the Notes under state securities laws in accordance with the provisions of Section 4(e) hereof, including filing fees and the reasonable fees and disbursements of counsel for the Agents in connection therewith and in connection with the preparation of any Blue Sky Survey and any Legal Investment Survey; (g) the printing and delivery to the Agents in quantities as hereinabove stated of copies of the Registration Statement and any amendments thereto, and of the Prospectus and any amendment or supplements thereto, and the delivery by the Agents of the Prospectus and any amendments or supplements thereto in connection with solicitations or confirmations of sales of the Notes; (h) the preparation, printing, reproducing and delivery to the Agents of copies of the Indenture and all supplements and amendments thereto; (i) any fees charged by rating agencies for the rating of the Notes; (j) the fees and expenses incurred in connection with the listing of the Notes on any securities exchange; (k) the fees and expenses, if any, incurred with respect to any filing with the National Association of Securities Dealers, Inc.; (l) any advertising and other out-of-pocket expenses of an Agent incurred with the approval of the Company; and (m) the fees and expenses of any Depository (as defined in the Indenture) and any nominees thereof in connection with Notes. Section 9. Indemnification. The Company agrees to indemnify and hold harmless each Agent, and each person, if any, who controls each Agent within the meaning of either Section 15 of the 1933 Act or Section 20 of the 1934 Act, from and against any and all losses, claims, damages, liabilities and expenses (including reasonable costs of investigation), as incurred, arising out of or based upon any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or the Prospectus or in any amendment or supplement thereto or in any preliminary prospectus, or arising out of or based upon any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, except insofar as such losses, claims, damages, liabilities or expenses arise out of or are based upon any such untrue statement or omission or allegation thereof based upon information furnished in writing to the Company by such Agent expressly for use, therein; provided, however, the Company shall not indemnify such Agent or any person who controls such Agent from any such losses, claims, damages or liabilities alleged by any person who purchased Notes from such Agent if the untrue statement, omission or allegation thereof upon which such losses, claims, damages or liabilities are based was made in: (i) any preliminary prospectus or Prospectus, if a copy of the Prospectus, or the Prospectus as then amended or supplemented (if the Company shall have furnished any amendments or supplements thereto), as the case may be, was not sent or given by or on behalf of such Agent to such person at or prior to the written confirmation of the sale of the Notes to such person, and if the Prospectus, or the Prospectus as so amended or supplemented, as the case may be, corrected the untrue statement or omission giving rise to such loss, claim, damage or liability; (ii) any Prospectus used by such Agent (or any broker or dealer appointed or engaged by such Agent) or any person who controls such Agent, after such time as the Company advised such 13 Agent that the filing of a post-effective amendment or supplement thereto was required, except the Prospectus as so amended or supplemented; or (iii) any Prospectus used by such Agent (or any broker or dealer appointed or engaged by such Agent) or any person who controls such Agent, after the termination of the offering of the Notes. This indemnity will be in addition to any liability which the Company may otherwise have. If any action or proceeding (including any governmental investigation) shall be brought or asserted against an Agent or any person controlling an Agent in respect of which indemnity may be sought from the Company, such Agent or such controlling person shall promptly notify the Company in writing, and the Company shall assume the defense thereof, including the employment of counsel reasonably satisfactory to the Agent's party to such action or proceeding and the payment of all expenses. Any omission so to notify the Company shall not, however, relieve the Company from any liability which it may have to any indemnified party otherwise than under this Section 9. Such Agent or any such controlling person shall have the right to employ separate counsel in any such action or proceeding and to participate in the defense thereof, but the fees and expenses of such separate counsel shall be such Agent's expense or the expense of such controlling person unless (a) the Company has agreed to pay such fees and expenses, (b) the Company shall have failed to assume the defense of such action or proceeding and employ counsel reasonably satisfactory to the Agents in any such action or proceeding within a reasonable time after notice of the commencement of such action or proceeding or (c) the named parties to any such action or proceeding (including any impleaded parties) include an Agent or any such controlling person and the Company, and such Agent or such controlling person shall have been advised by such counsel that there may be a conflict of interest between such Agent or such controlling person and the Company in the conduct of the defense of such action (in which case, if such Agent or such controlling person notifies the Company in writing that it elects to employ separate counsel at the expense of the Company, the Company shall not have the right to assume the defense of such action or proceeding on such Agent's behalf or on behalf of such controlling person, it being understood, however, that the Company shall not, in connection with any one such action or proceeding or separate but substantially similar or related actions or proceedings arising out of the same general allegations or circumstances, be liable for the reasonable fees and expenses of more than one separate firm of attorneys (unless the members of such firm are not admitted to practice in a jurisdiction where an action is pending, in which case the Company shall pay the reasonable fees and expenses of one additional firm of attorneys to act as local counsel in such jurisdiction, provided the services of such counsel are substantially limited to that of appearing as attorneys of record) at any time for all indemnified parties, which firm shall be designated in writing by such Agent). The Company shall not be liable for any settlement of any such action or proceeding effected without its written consent, but if settled with its written consent, or if there be a final judgment for the plaintiff in any such action or proceeding, the Company agrees to indemnify and hold harmless the Agent and any such controlling person from and against any loss or liability by reason of such settlement or judgment. Each Agent agrees to indemnify and hold harmless the Company, its directors and each of its officers, and each person, if any, who controls the Company within the meaning of either Section 15 of the 1933 Act or Section 20 of the 1934 Act, to the same extent as the foregoing indemnity from the Company to the Agents, but only with respect to information furnished in writing by such Agent expressly for use in the Registration Statement, the Prospectus, or any amendment or supplement thereto, or any amendment or supplement thereto, or any preliminary prospectus. In case any action or proceeding shall be brought against the Company or its directors or officers or any such controlling person, in respect of which indemnity may be sought against an Agent, such Agent shall have the rights and duties given to the Company, and the Company or its directors or officers or such controlling person shall have the rights and duties given to the Agents, by the preceding paragraph. Section 10. Contribution. If the indemnification provided for in Section 9 is unavailable to an indemnified party under the first or third paragraph thereof in respect of any losses, claims, damages or liabilities referred to therein (other than by reason of such indemnified party's failure to comply with the first sentence or the last sentence of the second paragraph of Section 9), then each applicable indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or payable by such indemnified party as a result of 14 such losses, claims, damages or liabilities, as incurred (i) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and by each Agent on the other hand from the offering of the Notes to which such loss, claim, damage or liability (or action in respect thereof) relates, or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company on the one hand and of each Agent on the other in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and by each Agent on the other in connection with the offering of the Notes shall be deemed to be such that each Agent shall be responsible for the aggregate losses, claims, damages and liabilities represented by the percentage that the total underwriting discounts and agency commissions received by such Agent with respect to the Notes giving rise to such losses, claims, damages or liabilities bears to the total net proceeds for the sale of such Notes, and the Company shall be responsible for the balance. The relative fault of the Company on the one hand and of each Agent on the other shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or by each Agent and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The amount paid or payable by a party as a result of the losses, claims, damages and liabilities referred to above shall be deemed to include, subject to the limitations set forth in the second paragraph of Section 9, any legal or other fees or expenses reasonably incurred by such party in connection with investigating or defending any action or claim. The Company and each Agent agree that it would not be just and equitable if contribution pursuant to this Section 10 were determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to in the immediately preceding paragraph. Notwithstanding the provisions of this Section 10, each Agent shall not be required to contribute any amount in excess of the amount by which the total price at which the Notes were offered to the public exceeds the amount of any damages which such Agent has otherwise been required to pay by reason of such untrue statement or omission or alleged untrue statement or omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. Section 11. Representations, Warranties and Agreements to Survive Delivery. All representations, warranties and agreements contained in this Agreement by the Company and the Agents, or contained in certificates of executive officers of the Company submitted pursuant hereto, shall remain operative and in full force and effect regardless of any investigation made by or on behalf of any Agent or controlling person, or by or on behalf of the Company, and shall survive each delivery of and payment for any Notes. Section 12. Termination. (a) Termination of this Agreement. This Agreement (excluding any Terms Agreement) may be terminated for any reason, at any time by the Company with respect to any of the Agents, and any Agent may resign as Agent hereunder, upon the giving of 1 day written notice of such termination to the other parties hereto; provided, however, that in the event this Agreement is terminated with respect to only one of the Agents, this Agreement shall remain in full force and effect between the Company and other Agents. (b) Termination of a Terms Agreement. An Agent may terminate any Terms Agreement between such Agent and the Company, immediately upon notice to the Company, at any time at or prior to the Settlement Time relating thereto (i) if there has been since the date of the Terms Agreement or since the respective dates as of which information is given in the Prospectus (as amended or supplemented to the date of the Terms Agreement), any material adverse change in the condition, financial or otherwise, of the Company and its consolidated subsidiaries considered as one enterprise, or in the earnings, business affairs or business prospects of the Company and its consolidated subsidiaries considered as one enterprise, whether not arising in the ordinary 15 course of business, (ii) if there shall have occurred any material adverse change in the financial markets in the United States or any outbreak or escalation of hostilities or other national or international calamity or crisis the effect of which on the financial markets of the United States is such as to make it, in the judgment of such Agent, impracticable to market the Notes or enforce contracts for the sale of the Notes, (iii) if the rating assigned by any nationally recognized securities rating organization in the United States to any debt securities of the Company as of the date of the Terms Agreement or if any such rating organization shall have publicly announced that it has placed any debt securities of the Company on what is commonly termed a "watch list" for possible downgrading, or (iv) if there shall have come to such Agent's attention any facts that would cause such Agent reasonably to believe that the Prospectus contains an untrue statement of a material fact or omits to state a material fact necessary in order to make the statements therein, in the light of the circumstances then existing, not misleading. (c) General. In the event of any such termination pursuant to subsection (a) or (b) above or Section 5 hereof, the resigning or terminating party will have no liability to the other parties hereto and no other remaining party hereto will have any liability to the resigning or terminating party, except that (i) each Agent shall be entitled to any commission earned in accordance with the third paragraph of Section 3(a) hereof, (ii) if at the time of termination by the Company (a) an Agent shall own any Notes purchased pursuant to a Terms Agreement with the intention of reselling them or (b) an offer to purchase any of the Notes has been accepted by the Company but the time of delivery to the purchaser or his agent of the Note or Notes relating thereto has not occurred, the covenants set forth in Sections 4 and 7 hereof shall remain in effect until (A) the earlier of the date such Notes are so resold or at the 90th day following the related Settlement Time or (B) such Notes are delivered, as the case may be, and (iii) the last sentence of Section 3(b), the covenant regarding provision of an earnings statement set forth in Section 4(f) hereof, the provisions concerning payment of expenses set forth in Section 4(e) and Section 8 hereof, the indemnity and contribution agreements set forth in Section 9 and 10 hereof and the provisions of Section 11 (but only as such Sections relates to representations and warranties) and Section 14 hereof shall remain effect. Section 13. Notices. Unless otherwise provided herein, all notices required under the terms and provisions hereof shall be in writing, either delivered by hand, by mail or by telex, facsimile transmission, receipt acknowledged, or telegram, and any such notice shall be effective when received at the address specified below. If to the Company: TCI Communications, Inc. Terrace Tower II 5619 DTC Parkway Englewood, Colorado 80111-3000 Attention:Bernard W. Schotters Telephone:(303) 267-5500 Facsimile:(303) 488-3200 with a copy (similarly addressed) to the attention of the General Counsel. If to the Agents: Merrill Lynch & Co. Merrill Lynch, Pierce, Fenner & Smith Incorporated North Tower, 10th Floor World Financial Center New York, New York 10281-1310 Attention:MTN Product Management Telephone:(212) 449-7476 Facsimile:(212) 449-2234 16 or, as the case may be, Credit Suisse First Boston Corporation 11 Madison Avenue New York, New York 10010 Attention:Medium Term Finance Telephone:(212) 325-7198 Facsimile:(212) 325-8183 or, as the case may be, Lehman Brothers Inc. 3 World Financial Center New York, New York 10285 Attention:Medium-Term Note Department Telephone:(212) 526-2040 Facsimile:(212) 528-1718 or, as the case may be, Salomon Brothers Inc Seven World Trade Center New York, New York 10048 Attention:Medium-Term Note Department Telephone:(212) 783-5897 Facsimile:(212) 783-2274 or at such other address as such party may designate from time to time by notice duly given in accordance with the terms of this Section 13. Section 14. Parties. This Agreement shall inure to the benefit of and be binding upon the Agents and the Company, and their respective successors. Nothing expressed or mentioned in any Terms Agreement or this Agreement is intended or shall be construed to give any person, firm or corporation, other than the parties hereto or thereto and their respective successors and the controlling persons and officers and directors referred to in Sections 9 and 10 and their heirs and legal representatives, any legal or equitable right, remedy or claim under, or in respect of, this Agreement or any provision herein contained. This Agreement and all conditions and provisions thereof and hereof are intended to be for the sole and exclusive benefit of the parties and their respective successors and said controlling persons and officers and directors and their heirs and legal representatives, and for the benefit of no other person, firm or corporation. No purchaser of Notes from any Agent shall be deemed to be a successor by reason merely of such purchase. Section 15. Governing Law. This Agreement shall be governed by the laws of the State of New York applicable to agreements made and performed in such State. If the foregoing is in accordance with the Agents' understanding of our agreement, please sign and return to the Company a counterpart hereof, whereupon this instrument along with all counterparts will become a binding agreement among the Agents and the Company in accordance with its terms. Very truly yours, TCI Communications, Inc. /s/ Bernard W. Schotters By: _________________________________ Name: Bernard W. Schotters Title: Executive Vice President and Treasurer 17 Accepted: Merrill Lynch, Pierce, Fenner & Smith Incorporated /s/ Scott Primrose By: ___________________________ Authorized Signatory Credit Suisse First Boston Corporation /s/ Helena Willner By: ___________________________ Authorized Signatory Salomon Brothers Inc /s/ Dominick Lepore By: ___________________________ Authorized Signatory Lehman Brothers Inc. /s/ Bart McDade By: ___________________________ Authorized Signatory 18 SCHEDULE A As compensation for the services of the Agents hereunder, the Company shall pay, on a discount basis, at the Settlement Time to each Agent a commission in connection with each original issuance of Notes by the Company for the sale of each Note resulting from a placement made by such Agent equal to the principal amount of such Note (or, if such Note is an Original Issue Discount Note, the Issue Price of such Note) multiplied by the appropriate percentage set forth below:
PERCENT OF PRINCIPAL AMOUNT ---------------------------- MATURITY RANGES SPLIT RATED INVESTMENT GRADE --------------- ----------- ---------------- From 9 months to less than 1 year.................. .150% .125% From 1 year to less than 18 months................. .200 .150 From 18 months to less than 2 years................ .250 .200 From 2 years to less than 3 years.................. .350 .250 From 3 years to less than 4 years.................. .450 .350 From 4 years to less than 5 years.................. .550 .450 From 5 years to less than 6 years.................. .600 .500 From 6 years to less than 7 years.................. .600 .550 From 7 years to less than 8 years.................. .700 .600 From 8 years to less than 9 years.................. .700 .600 From 9 years to less than 10 years................. .700 .600 From 10 years to less than 12 years................ .800 .625 From 12 years to less than 15 years................ .800 .625 From 15 years to less than 20 years................ .875 .700 From 20 years to 30 years.......................... .925 .750
19 EXHIBIT A TO DISTRIBUTION AGREEMENT TERMS AGREEMENT PROVISIONS The following terms, if applicable, shall be agreed to by the applicable Agent and the Company pursuant to each Terms Agreement: Principal Amount: $ (or principal amount of foreign currency) Interest Rate: If Fixed Rate Note, Interest Rate: Interest Payment Dates (if other than February 15 and August 15): If Floating Rate Note: Interest Rate Basis or Bases: Initial Interest Rate: Initial Interest Reset Date: Spread or Spread Multiplier, if any: Interest Reset Dates: Interest Reset Period: Interest Payment Dates: Interest Payment Period: Index Maturity: Maximum Interest Rate, if any: Minimum Interest Rate, if any: Interest Determination Dates: Calculation Agent: Calculation Date: If Redeemable by the Company: Initial Redemption Date: Initial Redemption Percentage: Annual Redemption Percentage Reduction: If Repayable at option of the holder thereof: Optional Repayment Date(s): Stated Maturity: Purchase Price: % Settlement Time: Currency of Denomination: Denominations (if currency is other than solely United States dollars): Currency Payment: Additional Terms: Also, agreement as to whether the following will be required: Officer's Certificates pursuant to Section 7(b) of the Distribution Agreement. Accountant's Comfort Letters pursuant to Section 7(d) of the Distribution Agreement. Legal Opinions pursuant to Section 7(c) of the Distribution Agreement. Stand-Off Agreement pursuant to Section 4(g) of the Distribution Agreement. 20 EXHIBIT B TO DISTRIBUTION AGREEMENT (Date) KPMG Peat Marwick LLP 707 17th Street Suite 2300 Denver, CO 80202 Dear KPMG Peat Marwick LLP: (Name of financial intermediary), as Agents, in the placement of (identify securities) to be issued by TCI Communications, Inc., will be reviewing certain information relating to TCI Communications, Inc. that will be included (incorporated by reference) in the (identify document), which may be delivered to investors and utilized by them as a basis for their investment decision. This review process, applied to the information relating to the issuer, is substantially consistent with the due diligence review process that an underwriter would perform in connection with this placement of securities. We are knowledgeable with respect to the due diligence review process that an underwriter would perform in connection with a placement of securities registered pursuant to the Securities Act of 1933. We hereby request that you deliver to us a "comfort" letter concerning the financial statements of the issuer and certain statistical and other data included in the offering document. We will contact you to identify the procedures we wish you to follow and the form we wish the comfort letter to take. Very truly yours, (Name of Financial Intermediary) EXHIBIT C TO DISTRIBUTION AGREEMENT (Date) KPMG Peat Marwick LLP 707 17th Street Suite 2300 Denver, CO 80202 Dear KPMG Peat Marwick LLP: (Name of financial intermediary), as Agents, in the placement of (identify securities) to be issued by TCI Communications, Inc., will be reviewing certain information relating to TCI Communications, Inc. that will be included (incorporated by reference) in the (identify document), which may be delivered to investors and utilized by them as a basis for their investment decision. This review process, applied to the information relating to the issuer, is substantially consistent with the due diligence review process that an underwriter would perform in connection with this placement of securities. We are knowledgeable with respect to the due diligence review process that an underwriter would perform in connection with a placement of securities registered pursuant to the Securities Act of 1933. We hereby request that you deliver to us a "comfort" letter concerning the financial statements of the issuer and certain statistical and other data included in the offering document. We will contact you to identify the procedures we wish you to follow and the form we wish the comfort letter to take. Very truly yours, (Name of Financial Intermediary) EX-4.1 4 INDENTURE DATED 2/19/98 EXHIBIT 4.1 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- TCI COMMUNICATIONS, INC. AND THE BANK OF NEW YORK, TRUSTEE ---------------- INDENTURE DATED AS OF FEBRUARY 19, 1998 ---------------- DEBT SECURITIES - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- CROSS-REFERENCE TABLE
TIA INDENTURE SECTION SECTION 310 (a)(1).............................................. 7.10 (a)(2).............................................. 7.10 (a)(3).............................................. N.A. (a)(4).............................................. N.A. (a)(5).............................................. 7.10 (b)................................................. 7.08; 7.10; 11.02 (c)................................................. N.A. 311 (a)................................................. 7.11 (b)................................................. 7.11 (c)................................................. N.A. 312 (a)................................................. 2.07 (b)................................................. 11.03 (c)................................................. 11.03 313 (a)................................................. 7.06 (b)(1).............................................. N.A. (b)(2).............................................. 7.06 (c)................................................. 11.02 (d)................................................. 7.06 314 (a)................................................. 4.05; 4.06; 11.02 (b)................................................. N.A. (c)(1).............................................. 11.04 (c)(2).............................................. 11.04 (c)(3).............................................. N.A. (d)................................................. N.A. (e)................................................. 11.05 (f)................................................. N.A. 315 (a)................................................. 7.01(b) (b)................................................. 7.05; 11.02 (c)................................................. 7.01(a) (d)................................................. 7.01(c) (e)................................................. 6.11 316 (a)(last sentence).................................. 11.06 (a)(1)(A)........................................... 6.05 (a)(1)(B)........................................... 6.04 (a)(2).............................................. N.A. (b)................................................. 6.07 317 (a)(1).............................................. 6.08 (a)(2).............................................. 6.09 (b)................................................. 2.06 318 (a)................................................. 11.01
- -------- N.A. means Not Applicable. 2 TABLE OF CONTENTS ----------------
Section Heading Page ARTICLE ONE Definitions and Incorporation by Reference 1.01. Definitions.................................................... 6 1.02. Other Definitions.............................................. 12 1.03. Incorporation by Reference of Trust Indenture Act.............. 12 1.04. Rules of Construction.......................................... 12 ARTICLE TWO The Securities 2.01. Forms Generally................................................ 13 2.02. Amount Unlimited; Issuable in Series........................... 13 2.03. Denominations.................................................. 16 2.04. Execution, Authentication, Delivery and Dating................. 16 2.05. Registrar, Paying Agent, Conversion Agent and Authenticating Agent.......................................................... 18 2.06. Paying Agent to Hold Money and Securities in Trust............. 20 2.07. Securityholder Lists........................................... 20 2.08. Transfer and Exchange.......................................... 20 2.09. Replacement Securities......................................... 23 2.10. Securities in Global Form...................................... 24 2.11. Temporary Securities........................................... 25 2.12. Cancellation................................................... 25 2.13. Payment of Interest; Defaulted Interest........................ 25 2.14. Persons Deemed Owners.......................................... 26 ARTICLE THREE Redemption 3.01. Applicability of Article....................................... 27 3.02. Notices to Trustee............................................. 27 3.03. Selection of Securities to be Redeemed......................... 28 3.04. Notice of Redemption........................................... 28 3.05. Effect of Notice of Redemption................................. 29 3.06. Deposit of Redemption Price.................................... 29 3.07. Securities Redeemed in Part.................................... 30 3.08. Conversion Arrangement on Call for Redemption.................. 30 ARTICLE FOUR Covenants 4.01. Payment of Securities; Maintenance of Office or Agency......... 30 4.02. Limitation on Restricted Subsidiary Funded Debt................ 32 4.03. Designation of Restricted Subsidiaries......................... 32 4.04. Limitation on Liens............................................ 33 4.05. SEC Reports.................................................... 34 4.06. Compliance Certificate......................................... 34 4.07. Corporate Existence............................................ 34 4.08. Waiver of Certain Covenants.................................... 34 4.09. No Lien Created................................................ 35 4.10. Calculation of Original Issue Discount......................... 35
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Section Heading Page ARTICLE FIVE Successor Corporation 5.01. When Company May Merge, etc...................................... 35 ARTICLE SIX Defaults and Remedies 6.01. Events of Default................................................ 35 6.02. Acceleration..................................................... 36 6.03. Other Remedies................................................... 37 6.04. Waiver of Existing Defaults...................................... 37 6.05. Control by Majority.............................................. 37 6.06. Limitation on Suits.............................................. 38 6.07. Rights of Holders to Receive Payment and to Convert.............. 38 6.08. Collection Suit by Trustee....................................... 38 6.09. Trustee May File Proofs of Claim................................. 38 6.10. Priorities....................................................... 38 6.11. Undertaking for Costs............................................ 39 ARTICLE SEVEN Trustee 7.01. Duties of Trustee................................................ 39 7.02. Rights of Trustee................................................ 40 7.03. Individual Rights of Trustee..................................... 40 7.04. Trustee's and Authenticating Agent's Disclaimer.................. 40 7.05. Notice of Defaults............................................... 40 7.06. Reports by Trustee to Holders.................................... 40 7.07. Compensation and Indemnity....................................... 41 7.08. Replacement of Trustee........................................... 41 7.09. Successor Trustee by Merger, etc................................. 42 7.10. Eligibility; Disqualification.................................... 42 7.11. Preferential Collection of Claims Against Company................ 42 ARTICLE EIGHT Discharge of Indenture 8.01. Termination of Company's Obligations............................. 42 8.02. Application of Trust Fund........................................ 43 8.03. Repayment to Company............................................. 43 ARTICLE NINE Amendments, Supplements and Waivers 9.01. Without Consent of Holders....................................... 43 9.02. With Consent of Holders.......................................... 44 9.03. Compliance with Trust Indenture Act.............................. 45 9.04. Effect of Amendments and Supplements............................. 45 9.05. Notation on or Exchange of Securities............................ 45 9.06. Trustee to Sign Amendments, etc.................................. 45
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Section Heading Page ARTICLE TEN Conversion 10.01. Applicability of Article....................................... 46 10.02. Conversion Privilege........................................... 46 10.03. Conversion Procedure........................................... 46 10.04. Fractional Shares.............................................. 47 10.05. Taxes on Conversion............................................ 47 10.06. Reservation of Parent Stock, Etc. ............................. 47 10.07. Adjustment for Change in Parent Capital Stock.................. 47 10.08. Adjustment for Rights Issue.................................... 48 10.09. Adjustments for Other Distributions............................ 49 10.10. Voluntary Adjustment........................................... 50 10.11. Certain Definitions............................................ 50 10.12. When Adjustment May Be Deferred................................ 51 10.13. When Adjustment Is Not Required................................ 51 10.14. Notice of Adjustment........................................... 52 10.15. Notice of Certain Transactions................................. 52 10.16. Consolidation, Merger or Sale of the Parent.................... 52 10.17. Company Determination Final.................................... 52 10.18. Trustee's and Conversion Agent's Disclaimer.................... 52 10.19. Simultaneous Adjustments....................................... 53 ARTICLE ELEVEN Miscellaneous 11.01. Trust Indenture Act Controls................................... 53 11.02. Notices........................................................ 53 11.03. Communication by Holders with Other Holders.................... 54 11.04. Certificate and Opinion as to Conditions Precedent............. 54 11.05. Statements Required in Certificate or Opinion.................. 54 11.06. When Treasury Securities Disregarded........................... 55 11.07. Rules by Trustee and Agents.................................... 55 11.08. Legal Holidays................................................. 55 11.09. Governing Law.................................................. 55 11.10. No Adverse Interpretation of Other Agreements.................. 55 11.11. No Recourse Against Others..................................... 55 11.12. Successors..................................................... 55 11.13. Duplicate Originals............................................ 55 11.14. Table of Contents, Headings, Etc............................... 56 11.15. Acts of Holders................................................ 56 ARTICLE TWELVE Meetings of Holders of Securities 12.01. Purposes for which Meetings May be Called...................... 57 12.02. Call, Notice and Place of Meetings............................. 57 12.03. Persons Entitled to Vote at Meetings........................... 57 12.04. Quorum; Action................................................. 58 12.05. Determination of Voting Rights; Conduct and Adjournment of Meetings....................................................... 58 12.06. Counting Votes and Recording Action of Meetings................ 59 Signatures.............................................................. 60
5 INDENTURE dated as of February 19, 1998 between TCI COMMUNICATIONS, INC., a Delaware corporation ("Company"), and THE BANK OF NEW YORK, a New York banking corporation ("Trustee"). The Company has duly authorized the execution and delivery of this Indenture to provide for the issuance from time to time of its unsecured debentures, notes, bonds or other evidences of indebtedness ("Securities"), to be issued in one or more series as provided in this Indenture. Each party agrees as follows for the benefit of the other party and for the equal and ratable benefit of the respective Holders from time to time of the Securities or of series thereof: ARTICLE ONE Definitions and Incorporation by Reference Section 1.01. Definitions. Additional Amounts means any additional amounts which are required hereby or by any Security, under circumstances specified herein or therein, to be paid by the Company in respect of certain taxes imposed on Holders specified therein and which are owing to such Holders. Affiliate of any person means any other person directly or indirectly controlling or controlled by or under direct or indirect common control with such person. Agent means any Registrar, Paying Agent, co-Registrar or Conversion Agent. See Section 2.05. Authenticating Agent means any person authorized by the Trustee pursuant hereto to act on behalf of the Trustee to authenticate Securities of one or more series. Authorized Newspaper means a newspaper, in the English language or in an official language of the place of publication, customarily published on each day that is a Business Day in the place of publication, whether or not published on days that are Legal Holidays in the place of publication, and of general circulation in each place in connection with which the term is used or in the financial community of each such place. Where successive publications are required to be made in Authorized Newspapers, the successive publications may be made in the same or in different newspapers in the same city meeting the foregoing requirements in and each case on any day that is a Business Day in the place of publication. Bearer Security means any Security which is established pursuant to this Indenture which is payable to bearer. Board of Directors means the Board of Directors of the Company or any authorized committee thereof. Business Day, except as may otherwise be provided in the form of Securities of any particular series, means, with respect to any place of payment or other location, each Monday, Tuesday, Wednesday, Thursday and Friday that is not a Legal Holiday in such place of payment or other location. Capitalized Lease Obligation of any Person means any obligation of such person to pay rent or other amounts under a lease with respect to any property (whether real, personal or mixed) acquired or leased by such person and used in its business that is required to be accounted for as a liability on the balance sheet of such person in accordance with generally accepted accounting principles and the amount of such Capitalized Lease Obligation shall be the amount so required to be accounted for as a liability. Company means TCI Communications, Inc., a Delaware corporation, until a successor replaces it pursuant to the applicable provisions of this Indenture and thereafter means the successor. 6 Convertible Securities means any or all options, warrants, securities and rights, except the Series B Stock and the Securities, which are convertible into or exercisable or exchangeable for Parent Stock or which otherwise entitle the holder thereof to subscribe for, purchase or otherwise acquire Parent Stock. coupon means any interest coupon appertaining to a Bearer Security. Debt means, with respect to any person: (1) any indebtedness of such person (i) for borrowed money or (ii) evidenced by a note, debenture or similar instrument (including a purchase money obligation) given in connection with the acquisition of any property or assets, including securities; (2) any guarantee by such person of any indebtedness of others described in the preceding clause (1); and (3) any amendment, renewal, extension or refunding of any such indebtedness or guarantee. Default means any event which is, or after notice or passage of time would be, an Event of Default. Dollar or $ or U.S. Dollar means a dollar or other equivalent unit in such coin or currency of the United States of America as at the time shall be legal tender for the payment of public and private debts. Funded Debt of any person means, as of the date as of which the amount thereof is to be determined, without duplication, all indebtedness of such person for borrowed money or for the deferred purchase price of property or assets in respect of which such person is liable and all guaranties by such person of any indebtedness of others for borrowed money, and all Capitalized Lease Obligations of such person, which by the terms thereof have a final maturity, duration or payment date more than one year from the date of determination thereof (including, without limitation, any balance of such indebtedness or obligation which was Funded Debt at the time of its creation maturing within one year from such date of determination) or which has a final maturity, duration or payment date within one year from such date of determination but which by its terms may be renewed or extended at the option of such person for more than one year from such date of determination, whether or not theretofore renewed or extended. The term "Funded Debt" excludes (A) for purposes of the covenant contained in Section 4.04 (Limitation on Liens) and Section 6.01 (Events of Default), (1) any indebtedness of the Company or any Subsidiary to the Company or another Subsidiary, (2) any guarantee by the Company or any Subsidiary of indebtedness of the Company or another Subsidiary, provided that such guarantee is not secured by a Lien on any Property, and (3) any guarantee by the Company or any Subsidiary of the indebtedness of any person (including, without limitation, a business trust), if the obligation of the Company or such Subsidiary under such guarantee is limited in amount to the amount of funds held by or on behalf of such person that are available for the payment of such indebtedness, and (B) for purposes of each of the covenants contained in Sections 4.02 (Limitation on Restricted Subsidiary Funded Debt) and 4.03 (Designation of Restricted Subsidiaries), (1) any indebtedness of the Company or any Restricted Subsidiary to the Company or another Restricted Subsidiary, (2) any guarantee by the Company or any Restricted Subsidiary of indebtedness of the Company or another Restricted Subsidiary, provided that such guarantee is not secured by a Lien on Restricted Property, (3) any guarantee by the Company or any Restricted Subsidiary of the indebtedness of any person (including, without limitation, a business trust), if the obligation of the Company or such Restricted Subsidiary under such guarantee is limited in amount to the amount of funds held by or on behalf of such person that are available for the payment of such indebtedness and (4) any indebtedness of the Company or any Restricted Subsidiary to any Unrestricted Subsidiary which indebtedness is subordinated in right of payment to the prior payment in full of the outstanding Securities of such series on terms no less favorable to the holders of such Securities than those contained in Article Ten of that certain Indenture, dated as of April 1, 1991, between the Company and Chemical Bank, as Trustee, pursuant to which the Company's subordinated debt securities are subordinated to all Senior Debt of the Company (as defined therein), without giving effect to any amendment, modification or supplement to, or discharge of, such Indenture after the date hereof, and which indebtedness is not secured by a Lien on Restricted Property. For purposes of determining the outstanding principal amount of Funded Debt at any date, the amount of indebtedness issued at a price less than the principal amount thereof shall be equal to the amount of the liability in respect thereof at such date determined in accordance with generally accepted accounting principles. 7 Government Obligations, with respect to any Security, means (i) direct obligations of the government or governments which issued the currency in which the principal of or any interest on such Security or any Additional Amounts in respect thereof shall be payable, in each case where the payment or payments thereunder are supported by the full faith and credit of such government or governments or (ii) obligations of a person controlled or supervised by and acting as an agency or instrumentality of such government or governments, in each case where the payment or payments thereunder are unconditionally guaranteed as a full faith and credit obligation by such government or governments, and which, in the case of (i) or (ii), are not callable or redeemable at the option of the issuer or issuers thereof, and shall also include a depository receipt issued by a bank or trust company as custodian with respect to any such Government Obligation or a specific payment of interest on or principal of or other amount with respect to any such Government Obligation held by such custodian for the account of the holder of a depository receipt, provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the Government Obligation or the specific payment of interest on or principal of or other amount with respect to the Government Obligation evidenced by such depository receipt. Holder or Securityholder means, when used with respect to any Security, in the case of a Registered Security the person in whose name the Security is registered in the security register and in the case of a Bearer Security the bearer thereof and, when used with respect to any coupon, means the bearer thereof. Indenture means this Indenture as amended or supplemented from time to time and, unless the context indicates otherwise, shall include the form and terms of a particular series of Securities established as contemplated hereunder. interest, when used with respect to an Original Issue Discount Security which by its terms bears interest only after maturity or upon default in any other payment due on such Security, means interest payable after maturity or upon such a default, as the case may be. Interest Payment Date means the date, if any, specified in the Securities of any series or a coupon representing an installment of interest as the fixed date on which an installment of interest on the Securities of that series or such coupon is due and payable. Leverage Ratio with respect to the Restricted Group means, as of the date of and after giving effect to any designation of an Unrestricted Subsidiary as a Restricted Subsidiary and/or any designation of a Restricted Subsidiary as an Unrestricted Subsidiary, in each case in accordance with Section 4.03, the ratio of (1) the aggregate outstanding principal amount of all Funded Debt of the Restricted Group as of such date to (2) the product of four times the Restricted Group Cash Flow for the most recent full fiscal quarter for which financial information is available on such date. Lien means any mortgage, pledge, lien, security interest, or other similar encumbrance. Maximum Funded Debt Amount means, as of any date of determination thereof, that amount which is equal to the product of (i) eight and (ii) the product of (x) the Restricted Group Cash Flow for the most recent full fiscal quarter for which financial information is available on such date and (y) four. Officer means the Chairman of the Board, the President, any Vice President, the Treasurer or the Secretary of the Company. Officers' Certificate means a certificate signed by two Officers or by an Officer and an Assistant Treasurer or an Assistant Secretary of the Company and delivered to the Trustee. See Sections 11.04 and 11.05. Opinion of Counsel means a written opinion from legal counsel who is acceptable to the Trustee. The counsel may be an employee of or counsel to the Company or the Trustee. See Sections 11.04 and 11.05. 8 original issue discount of any debt security, including any Original Issue Discount Security, means the difference between the principal amount of such debt security and the initial issue price of such debt security (as set forth, in the case of an Original Issue Discount Security, on the face of such Security). Original Issue Discount Security means any Security which provides for an amount less than the principal amount thereof to be due and payable upon acceleration of the maturity thereof pursuant to Section 6.02. outstanding, when used with respect to Securities of any series, means as of the date of determination, all such Securities theretofore authenticated and delivered under this Indenture, except: (i) Securities theretofore cancelled by the Trustee or delivered to the Trustee for cancellation; (ii) Securities for whose payment, redemption or purchase the Trustee or any Paying Agent (other than the Company) holds in trust or the Company (acting as its own Paying Agent) has set aside and segregated in trust on a maturity date, redemption date or, if so specified with respect to the Securities of any series pursuant to Section 2.02 on a date (or, if so specified, on the Business Day following a date) on which Securities of such series are to be purchased by the Company pursuant to any provision thereof providing for such purchase at the option of the Holder or the Company, money (or securities if permitted by the terms of such Securities) sufficient to pay Securities and any coupons appertaining thereto payable on that date; (iii) Securities with respect to which the Company has terminated its obligations pursuant to Section 8.01 hereof; provided, however, that such Securities shall continue to be outstanding for all purposes related to those obligations that survive such termination as provided in Section 8.01 unless and until they cease to be outstanding in accordance with clauses (i) or (ii) above or clause (iv) below; and (iv) Securities which have been paid pursuant to Section 2.09 or in exchange for or in lieu of which other Securities have been authenticated and delivered pursuant to this Indenture, other than any such Securities in respect of which there shall have been presented to the Trustee proof satisfactory to it that such Securities are held by a bona fide purchaser in whose hands such Securities are valid obligations of the Company; provided, however, that in determining whether the Holders of the requisite principal amount of outstanding Securities have given any request, demand, authorization, direction, notice, consent or waiver or taken any other action hereunder or whether a quorum is present at a meeting of Holders, and for the purpose of making the calculations required by TIA (S) 313, (x) the principal amount of an Original Issue Discount Security that shall be deemed to be outstanding for such purposes shall be the amount of the principal thereof that would be due and payable as of the date of such determination upon a declaration of acceleration of the maturity thereof pursuant to Section 6.02, and (y) the principal amount of a Security denominated in a foreign currency or currencies or composite currency shall be the U.S. Dollar equivalent, determined as of the date of original issuance of such Security, of the principal amount of such Security (or, in the case of an Original Issue Discount Security, the U.S. Dollar equivalent as of such date of original issuance of such Security of the amount determined as provided in clause (x) above). Subject to the provisions of Section 11.06, a Security does not cease to be outstanding because the Company or one of its Affiliates holds the Security. Parent means Tele-Communications, Inc., a Delaware corporation, and any successor thereof. Parent Stock means the Tele-Communications, Inc. Series A TCI Group Common Stock, $1.00 par value, of the Parent as it exists on the date of this Indenture and any other capital stock into which such Series A TCI Group Common Stock may thereafter have been changed. place of payment means, when used with respect to any Security, the place or places where, subject to the provisions of Section 4.01, the principal of, or interest on, or any Additional Amounts with respect to such Security are payable as specified as contemplated by Section 2.02. 9 Predecessor Securities means, with respect to any Security, every previous Security evidencing all or a portion of the same debt as that evidenced by such particular Security, and, for the purpose of this definition, any Security authenticated and delivered under Section 2.09 in exchange for or in lieu of a mutilated, lost, destroyed or wrongfully-taken Security or a Security to which a mutilated, lost, destroyed or wrongfully-taken coupon appertains shall be deemed to evidence the same debt as the mutilated, lost, destroyed or wrongfully-taken Security or the Security to which the mutilated, lost, destroyed or wrongfully-taken coupon appertains, as the case may be. principal of a debt security, including any Security, means the amount (including, without limitation, if and to the extent applicable, any premium and, in the case of an Original Issue Discount Security, any accrued original issue discount, but excluding interest) that is payable with respect to such debt security as of any date and for any purpose (including, without limitation, in connection with any sinking fund, upon any redemption at the option of the Company, upon any purchase or exchange at the option of the Company or the holder of such debt security and upon any acceleration of the maturity of such debt security). principal amount of a debt security, including any Security, means (except as otherwise provided in the last sentence of the definition of "Funded Debt" in this Section 1.01) the principal amount as set forth on the face of such debt security. Principal Property means, as of any date of determination, any property or assets owned by any Restricted Subsidiary other than (l) any such property which, in the good faith opinion of the Board of Directors, is not of material importance to the business conducted by the Company and its Restricted Subsidiaries taken as a whole and (2) any shares of any class of stock or any other security of any Unrestricted Subsidiary. Property means all assets and properties of the Company and its Subsidiaries (real, personal, tangible, intangible or mixed), including any shares of capital stock or indebtedness of, or other interests (including partnership interests) in, a Subsidiary owned by the Company or a Subsidiary. Registered Security means any Security issued pursuant to this Indenture which is registered in the security register. Regular Record Date means the date, if any, specified in the Registered Securities of any series as the record date for the determination of Securityholders to whom interest is payable on the next succeeding Interest Payment Date. Restricted Group means, as of any date of determination, the Company and the Restricted Subsidiaries as of such date after giving effect to any designations being made on such date in accordance with Section 4.03. Restricted Group Cash Flow for any period means the Restricted Group Net Income (as defined below) for such period, plus (A) the sum (without duplication) of the aggregate of each of the following items of the Company and the Restricted Subsidiaries for such period to the extent taken into account as charges to Restricted Group Net Income for such period: (i) interest expense, (ii) income tax expense, (iii) depreciation and amortization expense and other noncash charges, (iv) extraordinary or non-recurring items and (v) after-tax losses on sales of assets outside of the ordinary course of business not otherwise included in extraordinary items in accordance with generally accepted accounting principles, minus (B) the sum (without duplication) of the aggregate of each of the following items of the Company and the Restricted Subsidiaries for such period to the extent taken into account as credits to Restricted Group Net Income for such period: (i) noncash credits, (ii) extraordinary or non-recurring items, and (iii) after-tax gains on sales of assets outside of the ordinary course of business not otherwise included in extraordinary items in accordance with generally accepted accounting principles. For purposes of this definition, (1) "Restricted Group Net Income" for any period means the aggregate of the net income (loss) for such period of the Company and the Restricted Subsidiaries, determined on a consolidated basis in accordance with generally accepted accounting principles; provided, however, that (i) the 10 net income (loss) of any person accounted for by the equity method of accounting and the net income (loss) of any Unrestricted Subsidiary shall be excluded, except that the net income of any such person or Unrestricted Subsidiary shall be included to the extent of the amount of dividends or distributions paid by such person or Unrestricted Subsidiary to the Company or a Restricted Subsidiary during such period, and (ii) except as otherwise provided in clause (2) below, the net income (loss) of any other person acquired by the Company or any Restricted Subsidiary in a transaction accounted for as a pooling of interests for any period prior to the date of such acquisition shall be excluded; and (2) if the Company or any Restricted Subsidiary consummated any acquisition or disposition of assets during the period for which Restricted Group Cash Flow is being calculated, or consummated any acquisition or disposition of assets subsequent to such period and on or prior to the date as of which the Leverage Ratio or Maximum Funded Debt Amount, as applicable, is to be determined, then, in each such case, the Restricted Group Cash Flow for such period shall be calculated on a pro forma basis as if such acquisition or disposition had occurred at the beginning of such period. Restricted Property means, as of any date of determination, any Principal Property and any shares of stock of a Restricted Subsidiary owned by the Company or a Restricted Subsidiary. Restricted Subsidiary means, as of any date of determination, a corporation a majority of whose voting stock is owned by the Company and/or one or more Restricted Subsidiaries, which corporation has been, or is then being, designated a Restricted Subsidiary in accordance with Section 4.03, unless and until designated an Unrestricted Subsidiary in accordance with Section 4.03. SEC means the Securities and Exchange Commission. Securities means the Securities that are issued from time to time in one or more series under this Indenture as such Securities are amended or supplemented from time to time. Series B Stock means the Tele-Communications, Inc. Series B TCI Group Common Stock, $1.00 par value, of the Parent as it exists on the date of this Indenture and stock of any other class into which such Series B TCI Group Common Stock may thereafter have been changed. Subsidiary means any corporation, association, partnership or other business entity of which a majority of the total voting power of the capital stock or other interests (including partnership interests) entitled (without regard to the occurrence of a contingency) to vote in the election of directors, managers, or trustees thereof is at the time owned or controlled, directly or indirectly, by (i) the Company, (ii) the Company and one or more of its Subsidiaries or (iii) one or more Subsidiaries of the Company. TIA means the Trust Indenture Act of 1939 (15 U.S. Code (S)(S)77aaa-77bbbb) as in effect on the date of this Indenture, except as provided in Section 9.03. Total Consolidated Assets means the total assets (real, personal, tangible, intangible and mixed) that would be shown on a balance sheet of the Company and its Subsidiaries prepared in accordance with generally accepted accounting principles consistently applied, as of any date selected by the Company not more than 45 days prior to the taking of the action for the purpose of which Total Consolidated Assets is to be determined. Trustee means the party named as such in this Indenture until a successor replaces it and thereafter means the successor and if at any time there is more than one such party, "Trustee" as used with respect to the Securities of any series shall mean the Trustee with respect to Securities of that series. Trust Officer means any officer or assistant officer in the corporate trust department of the Trustee assigned by the Trustee to administer its corporate trust matters. United States, except as otherwise provided in or pursuant to this Indenture, means the United States of America (including the States and the District of Columbia), its territories, its possessions and other areas subject to its jurisdiction. 11 United States Alien, except as otherwise provided in or pursuant to this Indenture, means any person who, for United States Federal income tax purposes, is a foreign corporation, a non-resident alien individual, a non- resident fiduciary of a foreign estate or trust, or a foreign partnership. Unrestricted Subsidiary means, as of any date of determination, any Subsidiary of the Company that is not a Restricted Subsidiary. Section 1.02. Other Definitions.
TERM DEFINED IN SECTION Act...................................................... 11.15 Average Market Price..................................... 10.11 Bankruptcy Law........................................... 6.01 Code..................................................... 9.01 Conversion Agent......................................... 2.05 current market price..................................... 10.11 Custodian................................................ 6.01 Determination Date....................................... 10.11 Event of Default......................................... 6.01 Ex-Dividend Date......................................... 10.11 Legal Holiday............................................ 11.08 Paying Agent............................................. 2.05 Permitted Liens.......................................... 4.04(b) Registrar................................................ 2.05
Section 1.03. Incorporation by Reference of Trust Indenture Act. Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by reference in and made a part of this Indenture. The following TIA terms used in this Indenture have the following meanings: Commission means the SEC. indenture securities means the Securities. indenture security holder means a Securityholder. indenture to be qualified means this Indenture. indenture trustee or institutional trustee means the Trustee. obligor on the indenture securities means the Company and any other obligor thereon. All other TIA terms used in this Indenture that are defined by the TIA, defined by TIA reference to another statute or defined by SEC rule have the meanings assigned to them. Section 1.04. Rules of Construction. Unless the context otherwise requires: (1) a term has the meaning assigned to it; (2) an accounting term not otherwise defined has the meaning assigned to it in accordance with generally accepted accounting principles in effect on the date of this Indenture; (3) "or" is not exclusive; and (4) words in the singular include the plural, and in the plural include the singular. 12 ARTICLE TWO The Securities Section 2.01. Forms Generally. The Securities of each series may be issued as Registered Securities without coupons attached, or Bearer Securities with or without coupons attached, or both, and may be issued in whole or in part in the form of one or more global Securities as shall be specified as contemplated by Section 2.02. In the absence of any contrary provisions with respect to the Securities of any series, the Securities shall be issued as Registered Securities and shall not be issuable upon the exercise of warrants. Bearer Securities shall be issued with coupons attached unless otherwise provided with respect to the Securities of any series as contemplated by Section 2.02. The Securities of each series (including any temporary global Securities) and related coupons, if any, shall be in one of the forms established from time to time by or pursuant to a resolution of the Board of Directors or in or pursuant to one or more indentures supplemental hereto, which shall set forth the information required by Section 2.02. The Securities and coupons, if any, shall have such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture or by a resolution of the Board of Directors and may have such notations, legends or endorsements as the Company may deem appropriate and as are not inconsistent with the provisions of this Indenture, or as may be required by law, stock exchange rule or usage. The Company shall approve the form or forms of Securities and any coupons appertaining thereto and any notation, legend or endorsement on them. If the form or forms of Securities of any series or coupons are established by action taken pursuant to a resolution of the Board of Directors or indenture supplemental hereto, a copy of an appropriate record of such action shall be certified by the Secretary or an Assistant Secretary of the Company and delivered to the Trustee at or prior to the delivery of the written order of the Company contemplated by Section 2.04 for the authentication and delivery of such Securities or coupons. Subject to Section 2.05, the form of the Trustee's certificate of authentication to be borne by the Securities shall be substantially as follows: CERTIFICATE OF AUTHENTICATION This is one of the Securities of the series designated herein referred to in the within-mentioned Indenture. THE BANK OF NEW YORK as Trustee By __________________________________ Authorized Officer Section 2.02. Amount Unlimited; Issuable in Series The aggregate principal amount of Securities which may be authenticated and delivered under this Indenture is unlimited. The Securities may be issued in one or more series. There shall be established in or pursuant to a resolution of the Board of Directors or established in or pursuant to one or more indentures supplemental hereto, prior to the issuance of Securities of any series: (1) the title of Securities of the series (which shall distinguish Securities of the series from all other Securities); (2) any limit upon the aggregate principal amount of Securities of the series which may be authenticated and delivered under this Indenture (except for Securities authenticated and delivered upon 13 registration of transfer of, or in exchange for, or in lieu of, other Securities of the series pursuant to Sections 2.08, 2.09, 2.11, 3.07 or 9.05 and except for any Securities which pursuant to Section 2.04 are deemed not to have been authenticated and delivered hereunder); (3) (A) whether Securities of the series are issuable as Registered Securities, as Bearer Securities or alternatively as Bearer Securities and Registered Securities, and whether the Bearer Securities are to be issuable with coupons, without coupons or both; (B) any restrictions applicable to the offer, sale or delivery of Bearer Securities and the terms upon which Bearer Securities of the series may be exchanged for Registered Securities of the series and vice versa (if permitted by applicable laws and regulations); (C) whether any of the Securities of the series are to be issuable in global form and, if so, (i) the identity of the depositary with respect to any such global Security and (ii) whether beneficial owners of interests in any such global Security may exchange such interests for Securities of the same series and of like tenor and of any authorized form and denomination, and, if so, the circumstances under which and the manner in which any such exchanges may occur, if other than as specified in Section 2.08; (D) if any of the Securities of the series are to be issuable as Bearer Securities or in global form, the date as of which any such Bearer Security or global Security shall be dated (if other than the date of original issuance of the first of such Securities to be issued); and (E) if Securities of the series are to be issuable in definitive form (whether upon original issue, upon exchange of a temporary Security of such series, or in exchange for a beneficial ownership interest in a permanent global Security) only upon receipt of certain certificates or other documents or satisfaction of other conditions, or if Securities of the series are initially issuable in temporary global form and if owners of beneficial interests therein may exchange such interest for an interest in a permanent global Security only upon receipt of certain certificates or other documents or satisfaction of other conditions, then the form and/or terms of such certificates, documents or conditions; (4) (A) the person to whom any interest on any Registered Security of the series shall be payable, if other than the person in whose name that Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest; (B) the manner in which, or the person to whom, any interest on any Bearer Security of the series shall be payable, if otherwise than upon presentation and surrender of the coupons appertaining thereto as they severally mature; and (C) if any Securities of the series are to be issuable as Bearer Securities, the extent to which, or the manner in which, and the terms and conditions (including certification requirements) upon which, any interest in respect of any portion of a temporary Bearer Security in global form payable in respect of an Interest Payment Date prior to the exchange of such temporary global Security for a permanent global Security or for definitive Securities of the series will be paid to any clearing organization with respect to the portion of such temporary global Security held for its account and, in such event, the terms and conditions (including certification requirements) upon which any such interest payment received by a clearing organization will be credited to the persons entitled to interest payable on such Interest Payment Date, and any other requirements in addition to or in lieu of those provided herein relating to the payment of interest on or any Additional Amounts in respect of Bearer Securities; (5) the date or dates (and whether fixed or extendible) on which the principal of Securities of the series is payable; (6) the rate or rates at which Securities of the series shall bear interest, or the method of determining the same, if any, the date or dates from which such interest shall accrue, or the method of determining the same, if any, the Interest Payment Dates on which any such interest shall be payable and the Regular Record Date for any interest payable on any Registered Securities on any Interest Payment Date, whether and under what circumstances Additional Amounts on Securities of the series or any of them shall be payable, and the basis upon which interest will be calculated if other than that of a 360-day year of twelve 30-day months; (7) the place or places where, subject to Section 4.01, the principal of, any interest on or any Additional Amounts payable in respect of Securities of the series shall be payable, any Registered Securities of the series may be surrendered for registration of transfer, any Securities of the series may be surrendered for exchange and notices and demands to or upon the Company in respect of the Securities of the series and this Indenture may be served; 14 (8) any provisions relating to the issuance of Securities of such series at an original issue discount (including, without limitation, the issue price thereof, the rate or rates at which such original issue discount shall accrue, if any, and the date or dates from or to which or period or periods during which such original issue discount shall accrue at such rate or rates); (9) the price or prices at which, the period or periods within which and the terms and conditions upon which Securities of the series may be redeemed or otherwise purchased, in whole or in part, at the option of the Company, pursuant to any sinking fund or otherwise (including, without limitation, the form or method of payment thereof if other than in cash); (10) the obligation, if any, of the Company to redeem, purchase or repay Securities of the series pursuant to any sinking fund or analogous provisions or at the option of a Securityholder thereof and the price or prices at which and the period or periods within which and the terms and conditions upon which Securities of the series shall be redeemed, purchased or repaid, in whole or in part, pursuant to such obligation (including, without limitation, the form or method of payment thereof if other than in cash); (11) the currency or currencies, including composite currencies, in which payment of the principal of, any interest on and any Additional Amounts payable in respect of the Securities of the series shall be payable, or in which the Securities of the series shall be denominated, if other than Dollars; (12) if the principal of, any interest on or any Additional Amounts payable in respect of the Securities of the series is to be payable, at the election of the Company or a Securityholder, in a currency or currencies, including composite currencies, other than that in which the Securities of such series are denominated or stated to be payable, the terms and conditions upon which such election may be made and the method for determining amounts payable; (13) if the amount of payments of principal of or interest on the Securities of the series may be determined with reference to an index, formula or other method or methods (which index, formula, method or methods may be based, without limitation, on one or more currencies, commodities, equity indices or other indices), the terms and conditions upon which and the manner in which such amounts shall be determined and paid or payable; (14) the denominations in which any Registered Securities of the series shall be issuable, if other than denominations of $1,000 and any integral multiple thereof, and the denominations in which Bearer Securities of the series shall be issuable if other than denomination of $5,000; (15) if other than the principal amount thereof, the portion of the principal amount of Securities of the series which shall be payable upon acceleration of the maturity thereof pursuant to Section 6.02 or provable in bankruptcy pursuant to Section 6.09, or, if applicable, which is convertible in accordance with Article Ten; (16) any Events of Default with respect to the Securities of a particular series in lieu of or in addition to those set forth herein and the remedies therefor; (17) the obligation, if any, of the Company to permit the conversion of Securities of such series into Parent Stock and the terms and conditions upon which such conversion shall be effected (including, without limitation, the initial conversion price or rate, the conversion period and any other provision in addition to or in lieu of those set forth in this Indenture relative to such obligation); (18) if any Securities of the series are to be issuable upon the exercise of warrants, this shall be so established and (if established by resolution of the Board of Directors) so set forth, as well as the time, manner and place for such Securities to be authenticated and delivered; (19) if there is more than one Trustee, the identity of the Trustee and, if not the Trustee, the identity of each Registrar, Paying Agent or Conversion Agent with respect to the Securities of the series; and (20) any other terms of a particular series (including, without limitation, if applicable, any designation of Restricted Subsidiaries pursuant to Section 4.03), including any terms which may be required by or advisable under United States or applicable foreign laws or regulations or advisable in connection with the marketing or remarketing of Securities of that series, and any other provisions expressing or referring to the 15 terms and conditions upon which the Securities of that series are to be issued under this Indenture, which terms and provisions are not in conflict with the provisions of this Indenture; provided, however, that the addition to or subtraction from or variation of Articles Four, Five, Six, Eight and Ten (and Sections 1.01 and 1.02, insofar as they relate to the definition of certain terms as used in such Articles) with regard to the Securities of a particular series shall not be deemed to constitute a conflict with the provisions of those Articles. All Securities of any one series and the coupons appertaining to any Bearer Securities of such series shall be substantially identical except, in the case of Registered Securities, as to denomination and except as may otherwise be provided in or pursuant to such resolution of the Board of Directors or in any such indenture supplemental hereto. Not all Securities of any one series need be issued at the same time, and, unless otherwise so provided, a series may be reopened for issuances of additional Securities of such series. If any of the terms of the Securities of a series are established by action taken pursuant to a resolution of the Board of Directors or indenture supplemental hereto, a copy of an appropriate record of such action shall be certified by the Secretary or an Assistant Secretary of the Company and delivered to the Trustee with an Officers' Certificate setting forth the terms or the manner of determining the terms of the Securities of such series. With respect to Securities of a series which are not to be issued at one time, such resolution of the Board of Directors or action may provide general terms or parameters for Securities of such series and provide either that the specific terms of particular Securities of such series shall be specified in a written order of the Company or that such terms shall be determined by the Company or its agents in accordance with a written order of the Company as contemplated by the last sentence of the fourth paragraph of Section 2.04. Section 2.03. Denominations. Unless otherwise provided as contemplated by Section 2.02 with respect to any series of Securities and except as provided in Section 2.10, any Registered Securities of a series denominated in Dollars shall be issuable in denominations of $1,000 and any integral multiple thereof and any Bearer Securities of a series denominated in Dollars shall be issuable in the denomination of $5,000. Section 2.04. Execution, Authentication, Delivery and Dating. Two Officers shall sign the Securities for the Company. The Company's seal shall be reproduced on the Securities. An Officer shall sign the coupons attached to any Bearer Security for the Company. The signature of any Officer on the Securities or any coupons appertaining thereto may be manual or facsimile. If an Officer whose signature is on a Security or a coupon no longer holds that office at the time the Trustee authenticates such Security, the Security and coupon shall be valid nevertheless. A Security or coupon shall not be entitled to any benefit under this Indenture or be valid or obligatory for any purpose until the certificate of authentication on the Security is manually signed by the Trustee or on its behalf by an Authenticating Agent. The signature shall be conclusive evidence that the Security has been authenticated under this Indenture. Notwithstanding the foregoing, if any Security shall have been duly authenticated and delivered hereunder but never issued and sold by the Company, and the Company shall deliver such Security to the Trustee for cancellation as provided in Section 2.12 together with a written statement (which need not comply with Sections 11.04 and 11.05 and need not be accompanied by an Opinion of Counsel) stating that such Security has not been issued and sold by the Company, for all purposes of this Indenture such Security shall be deemed not to have been authenticated and delivered hereunder and shall not be entitled to the benefits of this Indenture. At any time and from time to time after the execution and delivery of this Indenture, the Company may deliver Securities of any series together with any coupon appertaining thereto executed by the Company to the Trustee for authentication, and the Trustee shall, subject to the provisions hereof and of such Securities, 16 authenticate said Securities and deliver said Securities and any coupons appertaining thereto to or upon the written order of the Company, signed by two Officers or by an Officer and an Assistant Treasurer of the Company, without any further action by the Company. Unless otherwise specified as contemplated by Section 2.02, no Bearer Security shall be mailed or otherwise delivered to any location in the United States. Further, a Bearer Security (including a permanent global Bearer Security) may be delivered only if all applicable certification and other requirements specified as contemplated by Section 2.02 with respect to the Securities of or within such series have been satisfied with respect to such Bearer Security (or, if applicable, a Predecessor Security). Except as permitted by Section 2.09, the Trustee shall not authenticate and deliver any Bearer Security unless all appurtenant coupons for interest then matured have been detached and cancelled. If not all the Securities of a series are to be issued at one time and if the resolution of the Board of Directors or indenture supplemental hereto establishing such series as contemplated by Sections 2.01 and 2.02 shall so permit, the written order of the Company may set forth procedures acceptable to the Trustee for the issuance of such Securities and for determining the form or terms of particular Securities of such series including, but not limited to, interest rate, maturity date, date of issuance and date from which interest shall accrue. If the form or forms or terms of Securities of the series and any related coupons have been established in or pursuant to one or more resolutions of the Board of Directors or indentures supplemental hereto as permitted by Sections 2.01 and 2.02, in authenticating such Securities, and accepting the additional responsibilities under this Indenture in relation to such Securities, the Trustee shall be entitled to receive, and (subject to Section 7.01) shall be fully protected in relying upon, an Opinion of Counsel stating, (1) if the form or forms of such Securities and any coupons have been established by or pursuant to a resolution of the Board of Directors or indenture supplemental hereto, that such form or forms have been established in conformity with the provisions of this Indenture; (2) if the terms of such Securities and any coupons have been established by or pursuant to a resolution of the Board of Directors or indenture supplemental hereto, that such terms have been established in conformity with the provisions of this Indenture; and (3) that such Securities together with any coupons appertaining thereto, when authenticated and delivered by the Trustee and issued by the Company in the manner and subject to any conditions specified in such Opinion of Counsel, will constitute valid and legally binding obligations of the Company, enforceable in accordance with their terms, subject to bankruptcy, insolvency, fraudulent conveyance, reorganization and other laws of general applicability relating to or affecting the enforcement of creditors' rights, to general equitable principles and to such other qualifications as such counsel shall conclude do not materially affect the rights of Holders of such Securities and any coupons; provided, however, that, with respect to Securities of a series which are not to be issued at one time, the Trustee shall be entitled to receive such Opinion of Counsel only once at or prior to the time of the first authentication of Securities of such series and that the opinions described in clauses (2) and (3) above may state, respectively, (a) that, when the terms of such Securities and any coupons shall have been established pursuant to a written order of the Company or pursuant to such procedures as may be specified from time to time by a written order of the Company, all as contemplated by and in accordance with a resolution of the Board of Directors or an Officers' Certificate pursuant to a resolution of the Board of Directors or indenture supplemental hereto, as the case may be, such terms will have been established in conformity with the provisions of this Indenture; and (b) that such Securities and any coupons appertaining thereto, when (i) executed by the Company, (ii) completed, authenticated and delivered by the Trustee in accordance with this Indenture, (iii) issued and delivered by the Company and (iv) paid for, all as contemplated by and in accordance with the aforesaid written order of the Company or specified procedures, as the case may be, and in the manner and subject to any conditions specified in such Opinion of Counsel, will constitute valid and legally binding obligations of the Company, enforceable in accordance with their terms, subject to bankruptcy, insolvency, fraudulent conveyance, reorganization and other laws of general applicability relating to or affecting the enforcement of creditors' rights, to general equitable principles and to such other qualifications as such counsel shall conclude do not materially affect the rights of Holders of such Securities and any coupons. 17 Notwithstanding the provisions of Sections 2.01, 2.02, 11.04 and this Section, if all the Securities of a series are not to be originally issued at one time, the resolution of the Board of Directors or indenture supplemental hereto, the certified copy of the record of action taken pursuant to such resolution or supplemental indenture, the Officers' Certificate, the written order of the Company and any other documents otherwise required pursuant to such Sections need not be delivered at or prior to the time of authentication of each Security of such series if such documents are delivered at or prior to the authentication upon original issuance of the first Security of such series to be issued, provided, however, that any subsequent request by the Company to the Trustee to authenticate Securities of such series shall constitute a representation and warranty by the Company that as of the date of such request, the statements made in the Officers' Certificate delivered pursuant to Section 11.04 at or prior to authentication of the first such Security shall be true and correct on the date thereof as if made on and as of the date thereof. The Trustee shall have the right to decline to authenticate and make available for delivery any Securities together with any coupons appertaining thereto under this Section if the issuance of such Securities pursuant to this Indenture will alter the Trustee's own rights, duties or immunities under the Securities and this Indenture or otherwise in a manner which is not reasonably acceptable to the Trustee. With respect to Securities of a series which are not all issued at one time, the Trustee may conclusively rely, as to the authorization by the Company of any of such Securities and any coupons, the form and terms thereof and the legality, validity, binding effect and enforceability thereof, upon the Opinion of Counsel, Officers' Certificate and other documents delivered pursuant to Sections 2.01, 2.02, 11.04 and this Section, as applicable, at or prior to the time of the first authentication of Securities of such series unless and until such opinion, certificate or other documents have been superseded or revoked. In connection with the authentication and delivery of Securities of a series and any coupons which are not all issued at one time, the Trustee shall be entitled to assume that the Company's instructions to authenticate and deliver such Securities do not violate any rules, regulations or orders of any governmental agency or commission having jurisdiction over the Company. Each Registered Security shall be dated the date of its authentication and each Bearer Security (including any temporary Bearer Security in global form) shall be dated as of the date specified as contemplated by Section 2.02. Section 2.05. Registrar, Paying Agent, Conversion Agent and Authenticating Agent. The Company shall maintain an office or agency where Registered Securities of each series may be presented for registration of transfer or for exchange ("Registrar"), an office or agency where Securities of each series may be presented for payment ("Paying Agent") and an office or agency where Securities of each series that is convertible may be presented for conversion ("Conversion Agent") and (but without duplication) such offices or agencies in such locations and for such purposes as may be required as contemplated by Section 4.01. The Registrar shall keep a register of the Registered Securities of each series issued hereunder and of their transfer and exchange. The Company may have one or more co-Registrars (provided that there shall be only one register, which shall be maintained by the principal Registrar), one or more additional paying agents and one or more additional conversion agents with respect to any series. The term "Paying Agent" includes any additional paying agent and the term "Conversion Agent" includes any additional conversion agent. The Company shall enter into an appropriate agency agreement with any Agent not a party to this Indenture. The agreement shall implement the provisions of this Indenture that relate to such Agent. The Company shall promptly notify the Trustee of the name and address of any such Agent. If the Company fails to maintain a Registrar, Paying Agent or Conversion Agent, the Trustee shall act as such. The Company initially appoints the Trustee Registrar and Paying Agent for each series and Conversion Agent for any series that is convertible. 18 The Trustee may appoint an Authenticating Agent or Agents with respect to one or more series of Securities which shall be authorized to act on behalf of the Trustee to authenticate Securities of such series issued upon original issue or upon exchange, registration of transfer or partial redemption thereof or pursuant to Section 2.09 and Securities so authenticated shall be entitled to the benefits of this Indenture and shall be valid and obligatory for all purposes as if authenticated by the Trustee hereunder. Wherever reference is made in this Indenture to the authentication and delivery of Securities by the Trustee or the Trustee's certificate of authentication, such reference shall be deemed to include authentication and delivery on behalf of the Trustee by an Authenticating Agent and a certificate of authentication executed on behalf of the Trustee by an Authenticating Agent. Each Authenticating Agent shall be acceptable to the Company and shall at all times be a corporation organized and doing business under the laws of the United States of America, any State thereof or the District of Columbia, authorized under such laws to act as Authenticating Agent, having a combined capital and surplus of not less than $50,000,000 and subject to supervision or examination by Federal or State authority. If such Authenticating Agent publishes reports of condition at least annually pursuant to law or to the requirements of said supervising or examining authority, then, for the purposes of this Section, the combined capital and surplus of such Authenticating Agent shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time an Authenticating Agent shall cease to be eligible in accordance with the provisions of this Section, such Authenticating Agent shall resign immediately in the manner and with the effect specified in this Section. Any corporation into which an Authenticating Agent may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which such Authenticating Agent shall be a party, or any corporation succeeding to all or substantially all the corporate agency or corporate trust business of such Authenticating Agent, shall continue to be an Authenticating Agent, provided such corporation shall be otherwise eligible under this Section, without the execution or filing of any paper or any further act on the part of the Trustee or such Authenticating Agent. An Authenticating Agent may resign at any time by giving written notice thereof to the Trustee and to the Company. The Trustee may at any time terminate the agency of an Authenticating Agent by giving written notice thereof to such Authenticating Agent and to the Company. Upon receiving such a notice of resignation or upon such a termination, or in the case at any time such Authenticating Agent shall cease to be eligible in accordance with the provisions of this Section, the Trustee may appoint a successor Authenticating Agent which shall be acceptable to the Company and shall give written notice of such appointment to all Holders of Securities of the series with respect to which such Authenticating Agent will serve in the manner and to the extent provided in Section 11.02. Any successor Authenticating Agent upon acceptance of its appointment hereunder shall become vested with all the rights, powers and duties of its predecessor hereunder, with like effect as if originally named as an Authenticating Agent. No successor Authenticating Agent shall be appointed unless eligible under the provisions of this Section. The Company agrees to pay to each Authenticating Agent from time to time reasonable compensation for its services under this Section. If an appointment of an Authenticating Agent with respect to one or more series is made pursuant to this Section, the Securities of such series may have endorsed thereon, in addition to or in lieu of the Trustee's certificate of authentication, an alternative certificate of authentication in the following form: 19 CERTIFICATE OF AUTHENTICATION This is one of the Securities of the series designated herein and referred to in the within-mentioned Indenture. THE BANK OF NEW YORK, as Trustee By: _________________________________ As Authenticating Agent By: _________________________________ Authorized Signatory Section 2.06. Paying Agent to Hold Money and Securities in Trust. Prior to each due date of a principal payment in respect of any Security, the Company shall deposit with the Paying Agent a sum of money or securities sufficient to make such payment when so becoming due. Each Paying Agent shall hold in trust for the benefit of Securityholders of the relevant series or the Trustee all money and securities held by the Paying Agent for the payment of any amount in respect of the Securities of such series, and shall notify the Trustee of any default by the Company in making any such payment. If the Company or a Subsidiary acts as Paying Agent, it shall segregate such money and securities and hold them as a separate trust fund. The Company at any time may require a Paying Agent to pay all money and securities held by it to the Trustee and account for any funds or securities disbursed. Upon doing so, the Paying Agent shall have no further liability for the money or securities. Section 2.07. Securityholder Lists. The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Securityholders. If the Trustee is not the Registrar, the Company shall furnish to the Trustee on or before either (1) April 1 and October 1 in each year in the case of Original Issue Discount Securities of any series which by their terms do not bear interest prior to maturity (other than upon a default in any payment upon such a Security) or (2) the Interest Payment Date for Securities of any other series, but in no event less frequently than semi- annually, and at such other times as the Trustee may request in writing a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of Securityholders included in the security register. Section 2.08. Transfer and Exchange. Upon presentation for registration of transfer of a Registered Security of any series at the office or agency of the Company maintained for such purposes in a place of payment for such series, the Company shall execute and the Trustee shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Registered Securities of the same series of any authorized denominations and of a like aggregate principal amount, bearing a number not contemporaneously outstanding and containing identical terms and provisions. Notwithstanding any other provision of this Section, unless and until it is exchanged in whole or in part for Securities in definitive form, a global Security representing all or a portion of the Securities of or within a series may not be transferred except as a whole by the depositary for such series to a nominee of such depositary or by a nominee of such depositary to such depositary or another nominee of such depositary or by such depositary or any such nominee to a successor depositary for such series or a nominee of such successor depositary. At the option of the Holder, Registered Securities of any series (other than a global Security, except as provided below or as otherwise specified as contemplated by Section 2.02) may be exchanged for other Registered Securities of the same series of any authorized denominations and of a like aggregate principal 20 amount and containing identical terms and provisions, upon surrender of the Securities to be exchanged at any such office or agency. Whenever any Securities are so surrendered for exchange, the Company shall execute, and the Trustee shall authenticate and deliver, the Securities which the Holder making the exchange is entitled to receive. Unless otherwise specified with respect to any series of Securities as contemplated by Section 2.02, Bearer Securities may not be delivered by the Trustee in exchange for Registered Securities. If so provided pursuant to Section 2.02 with respect to the Securities of any series, at the option of the Holder, Bearer Securities of such series (other than a global Security, except as provided below or as otherwise specified as contemplated by Section 2.02) may be exchanged for Registered Securities of such series containing identical terms of any authorized denominations and of a like aggregate principal amount, upon surrender of the Bearer Securities to be exchanged at any office or agency maintained by the Company for such purpose in a place of payment for such series, with all unmatured coupons and all matured coupons in default thereto appertaining. If the Holder of a Bearer Security is unable to produce any unmatured coupon or coupons or matured coupon or coupons in default, such exchange may be effected if the Bearer Securities are accompanied by payment in funds acceptable to the Company in an amount equal to the face amount of such missing coupon or coupons, or the surrender of such missing coupon or coupons may be waived by the Company and the Trustee if there is furnished to them such security or indemnity as they may require to save each of them and any Paying Agent harmless. If thereafter the Holder of such Security shall surrender to any Paying Agent any such missing coupon in respect of which such a payment shall have been made, such Holder shall be entitled to receive the amount of such payment, provided, however, that, except as otherwise provided in Section 4.01, interest represented by coupons shall be payable only upon presentation and surrender of those coupons at an office or agency located outside the United States. Notwithstanding the foregoing, in case a Bearer Security of any series is surrendered at any such office or agency for such series in exchange for a Registered Security of the same series and like tenor after the close of business at such office or agency (i) on any Regular Record Date and before the opening of business at such office or agency on the relevant Interest Payment Date, or (ii) on any special record date and before the opening of business at such office or agency on the related date for payment of defaulted interest, such Bearer Security shall be surrendered without the coupon relating to such Interest Payment Date or proposed date of payment, as the case may be, and interest or defaulted interest, as the case may be, will not be payable on such Interest Payment Date or proposed date of payment, as the case may be, in respect of the Registered Security issued in exchange for such Bearer Security, but will be payable only to the Holder of such coupon in accordance with the provisions of this Indenture. Whenever any Securities are so surrendered for exchange pursuant to the immediately preceding paragraph, the Company shall execute, and the Trustee shall authenticate and deliver, the Securities which the Holder making the exchange is entitled to receive. Except as otherwise provided with respect to the Securities of any series as contemplated by Section 2.02, a global Security may be exchanged only as provided below in this Section. If at any time the depositary with respect to a global Security representing all or a portion of the Securities of or within a series notifies the Company that it is unwilling, unable or ineligible to continue as such depositary, the Company shall appoint a successor depositary with respect to such Securities. Unless otherwise provided with respect to a series of Securities as contemplated by Section 2.02, if a successor depositary is not so appointed by the Company within 90 days after the Company receives such notice, the Company will execute and the Trustee, upon receipt of a written order of the Company as contemplated by Section 2.04 for the authentication and delivery of definitive Securities of such series (or, if such written order has previously been delivered, then upon receipt of written instructions from the person or persons specified in such written order), will authenticate and deliver Securities of such series in definitive form equal in aggregate principal amount to the principal amount of the global Security or Securities representing such series in exchange for such global Security or Securities. The Company may at any time and in its sole discretion determine that the Securities of any series issued in the form of one or more global Securities shall no longer be represented by such global Security or Securities. In 21 such event the Company will execute and the Trustee, upon receipt of a written order of the Company as contemplated by Section 2.04 for the authentication and delivery of definitive Securities of such series (or, if such written order has previously been delivered, then upon receipt of written instructions from the person or persons specified in such written order), will authenticate and deliver Securities of such series in definitive form equal in aggregate principal amount to the principal amount of the global Security or Securities representing such series in exchange for such global Security or Securities. If a global Security is otherwise exchangeable as specified by the Company pursuant to Section 2.02(3) with respect to a series of Securities, the depositary with respect to a global Security representing all or a portion of the Securities of or within such series may surrender such global Security to the Trustee, as the Company's agent for such purpose, to be exchanged in whole or in part for Securities of such series in definitive form in the manner and under the circumstances so specified and on such terms as are acceptable to the Company and such depositary. In such event, the Company shall execute and the Trustee shall authenticate and deliver or make available for delivery: (i) to each person specified by such depositary a new Security or Securities of the same series and of like tenor, of any authorized form and denomination as requested by such person in aggregate principal amount equal to and in exchange for such person's beneficial interest in the global Security; and (ii) unless endorsement of the surrendered global Security as contemplated by Section 2.10 or another procedure is specified for the Securities of such series as contemplated by Section 2.02, to such depositary a new global Security in a denomination equal to the difference, if any, between the principal amount of the surrendered global Security and the aggregate principal amount of Securities delivered pursuant to clause (i) above in exchange for beneficial interests in such surrendered global Security. In any exchange provided for in any of the preceding three paragraphs, the Company will execute and the Trustee will authenticate and deliver Securities (a) in definitive registered form in authorized denominations if the Securities of such series are issuable as Registered Securities, (b) in definitive bearer form in authorized denominations if the Securities of such series are issuable as Bearer Securities or (c) as either Registered or Bearer Securities, if the Securities of such series are issuable in either form; provided, however, that no definitive Bearer Security shall be delivered in exchange for a portion of a global Security except in compliance with the conditions set forth in Section 2.04 or specified with respect to the Securities of such series as contemplated by Section 2.02 (including certification requirements and requirements with respect to delivery outside the United States). Upon the exchange of a global Security for Securities in definitive form, such global Security shall be cancelled by the Trustee, unless endorsement of the surrendered global Security as contemplated by Section 2.10 or another procedure is specified for the Securities of such series as contemplated by Section 2.02. Registered Securities issued in exchange for a global Security pursuant to this Section shall be registered in such names and in such authorized denominations as the depositary for such global Security, pursuant to instructions from its direct or indirect participants or otherwise, shall instruct the Trustee. The Trustee shall deliver such Registered Securities to the persons in whose names such Securities are so registered. Subject to the proviso clause of the immediately preceding paragraph, the Trustee shall deliver Bearer Securities issued in exchange for a global Security pursuant to this Section to the persons, and in such authorized denominations, as the depositary for such global Security, pursuant to instructions from its direct or indirect participants or otherwise, shall instruct the Trustee. If a Registered Security is issued in exchange for any portion of a global Security after the close of business at the office or agency where such exchange occurs (i) on any Regular Record Date and before the opening of business at such office or agency on the relevant Interest Payment Date, or (ii) on any special record date and before the opening of business at such office or agency on the related date for payment of defaulted interest, interest or defaulted interest, as the case may be, will not be payable on such Interest Payment Date or proposed date for payment, as the case may be, in respect of such Registered Security, but will be payable on such Interest Payment Date or proposed date for payment, as the case may be, only to the person to whom interest in respect of such portion of such global Security is payable in accordance with the provisions of this Indenture. 22 All Securities issued upon any registration of transfer or exchange of Securities shall be the valid obligations of the Company, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Securities surrendered upon such registration of transfer or exchange. Every Registered Security presented or surrendered for registration of transfer or for exchange shall be duly endorsed, or be accompanied by a written instrument of transfer in form satisfactory to the Company and the Registrar duly executed, by the Holder thereof or his attorney duly authorized in writing. No service charge shall be made for any registration of transfer or exchange of Securities, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto. The Company shall not be required to issue, register the transfer of or exchange Securities of any series during a period beginning at the opening of business 15 days before any selection of Securities of that series to be redeemed and ending at the close of business on (A) if Securities of the series are issuable only as Registered Securities, the date of the mailing of the relevant notice of redemption and (B) if Securities of the series are issuable as Bearer Securities, the date of the first publication of the relevant notice of redemption or, if Securities of such series are also issuable as Registered Securities and there is no publication, the date of the mailing of the relevant notice of redemption. Further, the Company shall not be required to register the transfer of or exchange any Security selected for redemption or purchase (except, in the case of Securities to be redeemed or purchased in part, the portion thereof not to be redeemed or purchased), and the Company shall not be required to issue, register the transfer of or exchange any Security in respect of which a notice requiring the purchase or redemption thereof by the Company at the option of the Holder has been given and not withdrawn by the Holder thereof in accordance with the terms of such Securities (except, in the case of Securities to be so purchased or redeemed in part, the portion thereof not to be so purchased or redeemed); provided, however, that a Bearer Security so selected for redemption or purchase or in respect of which a notice requiring the purchase or redemption thereof by the Company at the option of the Holder has been given and not so withdrawn may, if so provided with respect to the Securities of such series as contemplated by Section 2.02, be exchanged for a Registered Security of that series and like tenor, provided that such Registered Security shall simultaneously be surrendered for redemption or purchase, as the case may be, with written instructions for payment consistent with the provisions of this Indenture. Section 2.09. Replacement Securities. If (i) a mutilated Security or a Security with a mutilated coupon appertaining to it is surrendered to the Trustee or (ii) the Company and the Trustee receive evidence to their satisfaction that a Security or coupon appertaining thereto has been lost, destroyed or wrongfully taken, and there is delivered to the Company and the Trustee such security or indemnity as may be required by them to save each of them and any Agent harmless, then, in the absence of notice to the Company or the Trustee that such Security or coupon has been acquired by a bona fide purchaser, and if the Trustee's requirements are met, the Company shall execute and upon its written request the Trustee shall authenticate and deliver, in exchange for any such mutilated Security or Security with a mutilated coupon appertaining to it or to which a lost, destroyed or wrongfully-taken coupon appertains (with all appurtenant coupons not lost, destroyed or wrongfully taken) or in lieu of any such lost, destroyed or wrongfully-taken Security, a new Security of the same series containing identical terms and of like principal amount and bearing a number not contemporaneously outstanding, with coupons corresponding to the coupons, if any, appertaining to the surrendered Security or to the lost, destroyed or wrongfully-taken Security or to the Security to which such lost, destroyed or wrongfully-taken coupon appertains, as applicable, provided, however, that delivery of a Bearer Security shall occur only outside the United States. In case any such mutilated, lost, destroyed or wrongfully-taken Security or coupon has become or is about to become due and payable, or is about to be purchased by the Company pursuant to any provision of the Securities of such series providing for the purchase thereof at the option of the Holder or the Company, the Company in its discretion may, instead of issuing a new Security, pay or purchase such Security or pay such coupon, as applicable; 23 provided, however, that payment of principal of, any interest on or any Additional Amounts with respect to any Bearer Securities shall, except as otherwise provided in Section 4.01, be payable only at an office or agency for Securities of such series located outside the United States and, unless otherwise provided in or pursuant to this Indenture, any interest on Bearer Securities and any Additional Amounts with respect to such interest shall be payable only upon presentation and surrender of the coupons appertaining thereto. Upon the issuance of any new Security under this Section, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee) connected therewith. Every new Security, with any coupons appertaining thereto, issued pursuant to this Section in lieu of any lost, destroyed or wrongfully-taken Security, or in exchange for a Security to which a lost, destroyed or wrongfully-taken coupon appertains, shall constitute a separate obligation of the Company, whether or not the lost, destroyed or wrongfully-taken Security and coupons appertaining thereto or the lost, destroyed or wrongfully-taken coupon shall be at any time enforceable by anyone, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Securities of such series and any coupons, if any, duly issued hereunder. The provisions of this Section, as amended or supplemented pursuant to this Indenture with respect to particular Securities or generally, shall be exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, lost, destroyed or wrongfully-taken Securities or coupons. Section 2.10. Securities in Global Form. If the Company shall establish pursuant to Section 2.02 that the Securities of or within a series are to be issued in whole or in part in global form, then the Company shall execute, and the Trustee shall, in accordance with Section 2.04 and the written order of the Company contemplated thereby, authenticate and deliver one or more global Securities in temporary or permanent form that (i) shall be registered, if in registered form, in the name of the depositary for such global Security or Securities or the nominee of such depositary, (ii) shall be delivered by the Trustee to such depositary or pursuant to such depositary's instructions, and (iii) shall bear a legend substantially to the following effect: "Unless and until it is exchanged in whole or in part for Securities in definitive form, this Security may not be transferred except as a whole by the depositary to a nominee of the depositary or by a nominee of the depositary to the depositary or another nominee of the depositary or by the depositary or any such nominee to a successor depositary or a nominee of such successor depositary." Each depositary designated pursuant to Section 2.02 for a global Security in registered form must be, to the extent required by applicable law or regulation, a clearing agency registered under the Securities Exchange Act of 1934, as amended, and any other applicable statute or regulation, at the time of its designation and at all times that it serves as depositary. Notwithstanding clause (14) of Section 2.02 and the provisions of Section 2.03, any such global Security shall represent such of the outstanding Securities of such series as shall be specified therein and may provide that it shall represent the aggregate amount of outstanding Securities of such series from time to time endorsed thereon and that the aggregate amount of outstanding Securities represented thereby may from time to time be increased or decreased to reflect exchanges. Any endorsement of a Security in global form to reflect the amount, or any increase or decrease in the amount, or changes in the rights of Holders, of outstanding Securities represented thereby shall be made in such manner and upon instructions given by such person or persons as shall be specified therein or in the written order of the Company to be delivered to the Trustee pursuant to Section 2.04. Subject to the provisions of Section 2.04 and, if applicable, Section 2.11, the Trustee shall deliver and redeliver any Security in permanent global form in the manner and upon instructions given by the person or persons specified therein or in the applicable written order of the Company. If a written order of the Company pursuant to Section 2.04 has been, or simultaneously is, delivered, any instructions with respect to a Security in global form shall be in writing but need not comply with Sections 11.04 and 11.05 and need not be accompanied by an Opinion of Counsel. 24 The provisions of the last sentence of the third paragraph of Section 2.04 shall apply to any Security represented by a Security in global form if such Security was never issued and sold by the Company and the Company delivers to the Trustee the Security in global form together with written instructions (which need not comply with Sections 11.04 and 11.05 and need not be accompanied by an Opinion of Counsel) with regard to the reduction in the principal amount of Securities represented thereby, together with the written statement contemplated by the last sentence of the third paragraph of Section 2.04. Section 2.11. Temporary Securities. Pending the preparation of a permanent global Security or definitive Securities of any series, the Company may execute and the Trustee, upon the written order of the Company pursuant to Section 2.04, shall authenticate and deliver temporary Securities. Temporary Securities of any series shall be in authorized denominations and substantially of the tenor of the definitive Securities of that series in lieu of which they are issued, in registered form or, if authorized, in bearer form with one or more coupons or without coupons, but may have variations that the Company considers appropriate for temporary Securities. In the case of Securities of any series, such temporary Securities may be in global form. If temporary Securities of any series are issued, the Company will cause definitive Securities of that series to be prepared without unreasonable delay. Except as otherwise specified as contemplated by Section 2.02 with respect to Securities of a series issuable as Bearer Securities, (a) after the preparation of definitive Securities of such series, the temporary Securities of such series shall be exchangeable for definitive Securities of such series upon surrender of the temporary Securities of such series at the office or agency of the Company maintained for such purpose in a place of payment for such series, without charge to the Holder, and (b) upon surrender for cancellation of any one or more temporary Securities of any series (accompanied by any unmatured coupons appertaining thereto) the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor a like aggregate principal amount of definitive Securities of authorized denominations of the same series and containing identical terms and provisions; provided, however, that, unless otherwise specified as contemplated by Section 2.02, no definitive Bearer Security shall be delivered in exchange for a temporary Registered Security and provided, further, that neither a beneficial interest in a permanent global Security in bearer form nor a definitive Bearer Security shall be delivered in exchange for a temporary Security except in compliance with all applicable conditions set forth in Section 2.04 or specified as contemplated by Section 2.02 (including certification requirements and requirements with respect to delivery outside the United States). Until so exchanged, the temporary Securities of any series shall, except as otherwise specified as contemplated by Section 2.02 (including with respect to the payment of interest on temporary Securities), in all respects be entitled to the same benefits under this Indenture as definitive Securities of the same series and of like tenor authenticated and delivered hereunder. Section 2.12. Cancellation. The Company at any time may deliver Securities and all coupons, if any, appertaining thereto to the Trustee (or to an other person for delivery to the Trustee) for cancellation, including Securities authenticated which the Company has not issued and sold. The Company and each Agent shall forward to the Trustee for cancellation any Securities and coupons surrendered to them for transfer, exchange, payment, redemption, purchase by the Company pursuant to any provision thereof providing for such purchase at the option of the Holder, or conversion. The Trustee and no one else shall cancel all Securities and coupons surrendered for transfer, exchange, payment, redemption, purchase, conversion or cancellation, and may dispose of cancelled Securities and coupons as the Company directs, provided, however, that the Trustee shall not be required to destroy such cancelled Securities. Except as otherwise provided in the resolution of the Board of Directors or indenture supplemental hereto establishing such series as contemplated by Section 2.02, the Company may not issue new Securities of a series to replace Securities of the same series that it has paid or that have been delivered to the Trustee for cancellation. Section 2.13. Payment of Interest; Defaulted Interest. Unless otherwise provided with respect to the Securities of any series as contemplated by Section 2.02, interest (except defaulted interest) on any Registered Security of any series which is payable on any Interest 25 Payment Date shall be paid to the Holder in whose name that Security (or one or more Predecessor Securities) is registered on the security register at the close of business on the Regular Record Date for such interest payment. At the option of the Company, payment of interest on any Registered Security may be made (i) by check mailed to the address of the person entitled thereto as such address appears in the security register, or (ii) if so specified with respect to the Securities of such series as contemplated by Section 2.02, by wire transfer to an account designated by such person. Unless otherwise provided with respect to the Securities of any series as contemplated by Section 2.02, if the Company defaults in a payment of interest on the Registered Securities of any series on any Interest Payment Date, it shall pay the defaulted interest to the persons who are Securityholders of such series at the close of business on a subsequent special record date. The Company shall fix the record date and payment date. At least 15 days before the record date, the Company shall mail to each Securityholder of such series a notice that states the record date, the payment date and the amount of defaulted interest to be paid. The Company shall notify the Trustee in writing of the amount of defaulted interest proposed to be paid on each Registered Security of such series and the date of the proposed payment, and at the same time the Company shall deposit with the Paying Agent an amount of money equal to the aggregate amount proposed to be paid in respect of such defaulted interest or shall make arrangements satisfactory to the Paying Agent for such deposit prior to the date of the proposed payment. The Company may pay defaulted interest in any other lawful manner. Unless otherwise provided with respect to the Registered Securities of any series as contemplated by Section 2.02, in the case of any Registered Security of any series which is converted after any Regular Record Date and on or prior to the next succeeding Interest Payment Date (other than any Registered Security which is due and payable prior to such Interest Payment Date), interest which is due and payable on such Interest Payment Date shall be payable on such Interest Payment Date notwithstanding such conversion, and such interest shall be paid to the Holder in whose name that Registered Security is registered at the close of business on such Regular Record Date. If any Bearer Security of a series is surrendered in exchange for a Registered Security of such series at an office or agency maintained by the Company for such purpose in a place of payment for such series after the close of business at such office or agency (i) on any Regular Record Date and before the opening of business at such office or agency on the relevant Interest Payment Date or (ii) on any special record date and before the opening of business at such office or agency on the related date for payment of defaulted interest, such Bearer Security shall be surrendered without the coupon relating to such Interest Payment Date or proposed date of payment, as the case may be, and interest or defaulted interest, as the case may be, will not be payable on such Interest Payment Date or proposed date of payment, as the case may be, in respect of the Registered Security issued in exchange for such Bearer Security, but will be payable only to the Holder of such coupon when due in accordance with the provisions of this Indenture. Unless otherwise specified with respect to the Securities of any series pursuant to Section 2.02, any interest due on any Bearer Security on or before the maturity thereof, and any Additional Amounts payable with respect to such interest, shall be payable only upon presentation of the coupons appertaining thereto for such interest as they severally mature. Unless otherwise specified with respect to the Securities of any series pursuant to Section 2.02, at the option of the Company, payment of interest on any Bearer Security may be made by check (provided the same is not mailed to an address inside the United States) or by wire transfer to an account located outside the United States maintained by the payee. Section 2.14. Persons Deemed Owners. Prior to due presentment of a Registered Security for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the person in whose name such Registered Security is registered as the owner of such Registered Security for the purpose of receiving payment of principal of, and (subject to Sections 2.08 and 2.13) interest on and any Additional Amounts with respect to, such Registered Security and for all other purposes whatsoever, whether or not any payment with respect to such Registered Security shall be overdue, and neither the Company, nor the Trustee or any agent of the Company or the Trustee shall be affected by notice to the contrary. 26 Title to any Bearer Security and any coupons appertaining thereto shall pass by delivery. The Company, the Trustee and any agent of the Company or the Trustee may treat the bearer of any Bearer Security or the bearer of any coupon as the absolute owner of such Security or coupon for the purpose of receiving payment thereof or on account thereof and all other purposes whatsoever, whether or not any payment with respect to such Security or coupon shall be overdue, and neither the Company, nor the Trustee or any agent of the Company or the Trustee shall be affected by notice to the contrary. No holder of any beneficial interest in any global Security held on its behalf by a depositary shall have any rights under this Indenture with respect to such global Security, and such depositary (or its nominee, if such global Security is in registered form and is registered in the name of a nominee) may be treated by the Company, the Trustee, and any agent of the Company or the Trustee as the owner of such global Security for all purposes whatsoever; provided, however, that, if so specified as contemplated by Section 2.02, the Company, the Trustee and any agent of the Company or the Trustee shall, to the extent so specified, treat the clearing organization or organizations for whose account a portion of a permanent global Security in bearer form is held by the depositary thereof as the owner of the applicable portion of such global Security. None of the Company, the Trustee, any Paying Agent or the Registrar will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests of a global Security or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests. Notwithstanding the foregoing, with respect to any global Security, nothing herein shall prevent the Company, the Trustee, or any agent of the Company or the Trustee, from giving effect to any written certification, proxy or other authorization furnished by any depositary, as a Holder, with respect to such global Security or impair, as between such depositary and owners of beneficial interests in such global Security, the operation of customary practices governing the exercise of the rights of such depositary (or its nominee) as Holder of such global Security. ARTICLE THREE Redemption Section 3.01. Applicability of Article. Securities of any series which are redeemable before their stated maturity at the election of the Company or through the operation of any sinking fund for the retirement of Securities of such series shall be redeemable in accordance with their terms and (except as otherwise specified as contemplated by Section 2.02 for Securities of any series) in accordance with this Article. Section 3.02. Notices to Trustee. If the Company elects to redeem all or less than all the Securities of any series, it shall notify the Trustee of the redemption date, the principal amount of Securities to be redeemed, the specific provision of the Securities pursuant to which the Securities being called for redemption are being redeemed and the redemption price. In the case of any redemption of Securities prior to the expiration of any restriction on such redemption provided in the terms of such Securities or elsewhere in this Indenture, the Company shall furnish the Trustee with an Officers' Certificate evidencing compliance with such restriction. If the Company wants to make any permitted optional sinking fund payment, it shall notify the Trustee of the principal amount of the Securities to be redeemed. The Company (1) may deliver outstanding Securities of a series (other than any previously called for redemption), together in the case of any Bearer Securities of such series with all unmatured coupons appertaining thereto, and (2) may apply as a credit Securities of a series which (i) have been redeemed or otherwise purchased either at the election of the Company pursuant to the terms of such Securities or through the application of permitted optional sinking fund payments pursuant to the terms of such Securities or (ii) have been converted 27 pursuant to the terms of such Securities, in each case in satisfaction of all or any part of any sinking fund payment required to be made pursuant to the terms of the Securities of such series as provided for by the terms of such series; provided that such Securities have not been previously so credited. Such Securities shall be received and credited for such purpose by the Trustee at the redemption price specified in such Securities for redemption through operation of the sinking fund and the amount of such sinking fund payment shall be reduced accordingly. The Company shall notify the Trustee of its intention to so reduce the amount of such sinking fund payment, the amount of the reduction and the basis for it. The Company shall deliver to the Trustee with such notice any Securities to be credited for such purpose that it has not previously delivered to the Trustee for cancellation. The Company shall give each notice and Officers' Certificate provided for in this Section at least 60 days before the redemption date (unless a shorter notice shall be satisfactory to the Trustee or is otherwise specified as contemplated by Section 2.02 for Securities of any series). Section 3.03. Selection of Securities to be Redeemed. Except as otherwise specified as contemplated by Section 2.02 for Securities of any series, if less than all the Securities of any series are to be redeemed, the particular Securities to be redeemed shall be selected from Securities of the same series outstanding not previously called for redemption by lot or by such method as the Trustee considers fair and appropriate (and in such manner as complies with applicable requirements of any stock exchange on which Securities of such series are listed) and which may provide for the selection for redemption of portions (equal to the minimum authorized denomination for Securities of that series or any integral multiple thereof) of the principal amount of Securities of such series that have denominations larger than the minimum authorized denomination for Securities of that series. Provisions of this Indenture that apply to Securities called for redemption also apply to portions of Securities called for redemption. If any Security selected for partial redemption is converted in part after such selection but before the termination of the conversion right with respect to the portion of the Security so selected, the converted portion of such Security shall be deemed (so far as may be practicable) to be the portion selected for redemption. Section 3.04. Notice of Redemption. At least 30 days but not more than 60 days before a redemption date (unless a shorter notice is specified as contemplated by Section 2.02 for the Securities of any series), the Company shall provide a notice of redemption in the manner provided in Section 11.02 to the Holders of Securities. The notice shall identify the Securities (including CUSIP number, if any, and, in the case of partial redemption, the principal amount of the Securities) to be redeemed and shall state: (1) the redemption date; (2) the redemption price and method of payment, if other than in cash; (3) if applicable, the then current conversion price or rate; (4) the name and address of the Paying Agent and, if applicable, the Conversion Agent; (5) if applicable, that the right of the Holder to convert Securities called for redemption shall terminate at the close of business on the fifteenth day prior to the redemption date (or such other day as may be specified as contemplated by Section 2.02 for Securities of any series); (6) if applicable, that Holders who want to convert Securities called for redemption must satisfy the requirements for conversion contained in such Securities; (7) that Securities called for redemption must be surrendered (together in the case of Bearer Securities with all coupons appertaining thereto, if any, maturing after the redemption date) to the Paying Agent to collect the redemption price; 28 (8) that interest, if any (or original issue discount, if Original Issue Discount Securities) on Securities called for redemption ceases to accrue on and after the redemption date, unless the Company defaults in making such redemption payment; and (9) that the redemption is for a sinking fund or at the election of the Company, whichever is the case. A notice of redemption published as contemplated by Section 11.02 need not identify particularly Registered Securities to be redeemed. At the Company's request, the Trustee shall give the notice of redemption in the Company's name and at the Company's expense, provided that the Company shall have furnished to the Trustee the Officers' Certificate and Opinion of Counsel required pursuant to Section 11.04 at least 15 days prior to the date that the Trustee is required to take any action in connection with a redemption. Section 3.05. Effect of Notice of Redemption. Once notice of redemption is provided, Securities of the series called for redemption become due and payable on the redemption date and at the redemption price therein specified and on and after such date (unless the Company shall default in the payment of the redemption price and accrued interest, if any) such Securities shall cease to bear interest, if any (and original issue discount, if such Securities are Original Issue Discount Securities, shall cease to accrue) and the coupons for such interest appertaining to any Bearer Securities so to be redeemed, except to the extent provided below, shall be void. Upon surrender of any such Security for redemption in accordance with said notice, together with all coupons, if any, appertaining thereto maturing after the redemption date, such Security shall be paid by the Company at the redemption price, together with the accrued interest to the redemption date, provided, however, that installments of interest on Bearer Securities whose stated maturity is on or prior to the redemption date shall be payable only at an office or agency maintained by the Company in a place of payment located outside the United States (except as otherwise provided in Section 4.01) and, unless otherwise specified as contemplated by Section 2.02, only upon presentation and surrender of the coupons for such interest, and, provided, further, that unless otherwise specified as contemplated by Section 2.02, installments of interest on Registered Securities whose stated maturity is on or prior to the redemption date shall be payable to the Holders of such Securities, or one or more Predecessor Securities, registered as such at the close of business on the relevant Regular Record Date or special record date, as the case may be, according to their terms and the provisions of Section 2.13. If any Bearer Security surrendered for redemption shall not be accompanied by all appurtenant coupons maturing after the redemption date, such Security may be paid after deducting from the redemption price an amount equal to the face amount of all such missing coupons, or the surrender of such missing coupon or coupons may be waived by the Company and the Trustee if there be furnished to them such security or indemnity as they may require to save each of them and any Paying Agent harmless. If thereafter the Holder of such Security shall surrender to the Trustee or any Paying Agent any such missing coupon in respect of which a deduction shall have been made from the redemption price, such Holder shall be entitled to receive the amount so deducted; provided, however, that interest represented by coupons shall be payable only at an office or agency located outside the United States (except as otherwise provided in Section 4.01) and, unless otherwise specified as contemplated by Section 2.02, only upon presentation and surrender of those coupons. If any Security called for redemption shall not be so paid upon surrender thereof for redemption, the principal shall, until paid, bear interest from the redemption date at the rate prescribed therefor in the Security. Section 3.06. Deposit of Redemption Price. Unless otherwise provided as contemplated by Section 2.02 with respect to any series of Securities, on or before 10 a.m., New York time, on the redemption date, the Company shall deposit with the Paying Agent money in immediately available funds (or securities if permitted by the terms of such Securities) sufficient to pay the redemption price of, and (except if the redemption date is an Interest Payment Date) accrued interest, if any, on 29 all Securities to be redeemed on that date other than Securities or portions thereof called for redemption on that date which are delivered by the Company to the Trustee for cancellation. The Paying Agent shall return to the Company any money (or securities) not required for that purpose because of conversion of Securities. Section 3.07. Securities Redeemed in Part. Any Registered Security that is to be redeemed only in part shall be surrendered at a place of payment therefor (with, if the Company, the Registrar or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company, the Registrar and the Trustee duly executed by, the Holder thereof or his attorney duly authorized in writing), and the Company shall execute, and the Trustee shall authenticate and deliver to the Holder of such Security without service charge, a new Registered Security or Registered Securities of the same series, containing identical terms and provisions, of any authorized denomination as requested by such Holder in aggregate principal amount equal to and in exchange for the unredeemed portion of the principal amount of the Security so surrendered, and, otherwise specified as contemplated by Section 2.02, if a global Security is so surrendered, the Company shall execute, and the Trustee shall authenticate and deliver to the depositary for such global Security, without service charge, a new global Security in a denomination equal to an in exchange for the unredeemed portion of the principal amount of the global Security so surrendered. Section 3.08. Conversion Arrangement on Call for Redemption. In connection with any redemption of Securities, the Company may arrange for the purchase and conversion of any Securities called for redemption by an agreement with one or more investment bankers or other purchasers to purchase such Securities by paying to the Trustee in trust for the Securityholders, on or before the close of business on the redemption date, an amount in cash not less than the redemption price, together with interest, if any, accrued to the redemption date, of such Securities. Notwithstanding anything to the contrary contained in this Article Three, the obligation of the Company to pay the redemption price of such Securities, including all accrued interest, if any, shall be deemed to be satisfied and discharged to the extent such amount is so paid by such purchasers. If such an agreement is entered into, any Securities not duly surrendered for conversion by the Holders thereof may, at the option of the Company, be deemed, to the fullest extent permitted by law, acquired by such purchasers from such Holders and (notwithstanding anything to the contrary contained in Article Ten) surrendered by such purchasers for conversion, all as of immediately prior to the close of business on the last day on which Securities of such series called for redemption may be converted in accordance with this Indenture and the terms of such Securities, subject to payment of the above amount as aforesaid. The Trustee shall hold and pay to the Holders whose Securities are selected for redemption any such amount paid to it in the same manner as it would moneys deposited with it by the Company for the redemption of Securities. Without the Trustee's prior written consent, no arrangement between the Company and such purchasers for the purchase and conversion of any Securities shall increase or otherwise affect any of the powers, duties, responsibilities or obligations of the Trustee as set forth in this Indenture, and the Company agrees to indemnify the Trustee from, and hold it harmless against, any loss, liability or expense arising out of or in connection with any such arrangement for the purchase and conversion of any Securities between the Company and such purchasers, including the costs and expenses incurred by the Trustee in the defense of any claim or liability arising out of or in connection with the exercise or performance of any of its powers, duties, responsibilities or obligations under this Indenture. ARTICLE FOUR Covenants Section 4.01. Payment of Securities; Maintenance of Office or Agency. The Company shall pay the principal of and any interest on the Securities of each series in accordance with the terms of the Securities of such series, any coupons appertaining thereto, and this Indenture. 30 To the extent enforceable under applicable law, the Company shall pay interest on overdue principal at the rate borne by the Securities of such series (unless a different rate is specified as contemplated by Section 2.02 for Securities of such series). If Securities of a series are issuable only as Registered Securities, the Company will maintain in each place of payment for such series an office or agency where Securities of that series may be presented or surrendered for payment, where Securities of that series may be surrendered for registration of transfer or exchange and where notices and demands to or upon the Company in respect of the Securities of that series and this Indenture may be served. If Securities of a series are issuable as Bearer Securities, the Company will maintain (A) in the Borough of Manhattan, The City of New York, an office or agency where any Registered Securities of that series may be presented or surrendered for payment, where any Registered Securities of that series may be surrendered for registration of transfer, where Securities of that series may be surrendered for exchange, where notices and demands to or upon the Company in respect of the Securities of that series and this Indenture may be served and where Bearer Securities of that series and related coupons may be presented or surrendered for payment in the circumstances described in the following paragraph (and not otherwise), (B) subject to any laws or regulations applicable thereto, in a place of payment for that series which is located outside the United States, an office or agency where Securities of that series and related coupons may be presented and surrendered for payment (including payment of any Additional Amounts payable on Securities of that series); provided, however, that if the Securities of that series are listed on The International Stock Exchange of the United Kingdom and the Republic of Ireland, the Luxembourg Stock Exchange or any other stock exchange located outside the United States and such stock exchange shall so require, the Company will maintain a Paying Agent for the Securities of that series in London, Luxembourg or any other required city located outside the United States, as the case may be, so long as the Securities of that series are listed on such exchange, and (C) subject to any laws or regulations applicable thereto, in a place of payment for that series located outside the United States an office or agency where any Registered Securities of that series may be surrendered for registration of transfer, where Securities of that series may be surrendered for exchange and where notices and demands to or upon the Company in respect of the Securities of that series and this Indenture may be served. The Company will give prompt written notice to the Trustee and the Holders of the location, and any change in the location, of any such office or agency. If at any time the Company shall fail to maintain any such required office or agency in respect of any series of Securities or shall fail to furnish the Trustee with the address thereof, such presentations and surrenders of Securities of that series may be made and notices and demands may be made or served at the corporate trust office of the Trustee, except that Bearer Securities of that series and the related coupons shall be presented and surrendered for payment (including payment of any additional amounts payable on Bearer Securities of that series) at The Bank of New York, 46 Berkeley Street, London W1X 6AA, England, and the Company hereby appoints the same as its agency to receive such respective presentations, surrenders, notices and demands. No payment of principal of or interest on Bearer Securities shall be made at any office or agency of the Company in the United States or by check mailed to any address in the United States or by transfer to an account maintained with a bank located in the United States, provided, however, that, if the Securities of a series are denominated and payable in Dollars, payment of principal of and interest on any Bearer Security (including any Additional Amounts payable on Securities of such series) shall be made at the office of the Company's Paying Agent in the Borough of Manhattan, The City of New York, if (but only if) payment in Dollars of the full amount of such principal of or interest on or additional amounts, as the case may be, at all offices or agencies outside the United States maintained for that purpose by the Company in accordance with this Indenture is illegal or effectively precluded by exchange controls or other similar restrictions. The Company may also from time to time designate one or more other offices or agencies where the Securities of one or more series may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided, however, that no such designation or rescission shall in any manner relieve the Company of its obligation to maintain an office or agency in accordance with the requirements set forth above for Securities of any series for such purposes. The Company will give prompt written notice to the Trustee and the Holders of any such designation or rescission and of any change in the location of any such other office or agency. 31 If any Securities of a series provide for the payment of Additional Amounts, the Company will pay to the Holder of any such Security of such series or any coupon appertaining thereto Additional Amounts as provided therein. Whenever in this Indenture there is mentioned, in any context, the payment of the principal of or interest on or in respect of, any Security of any series or payment of any related coupon or the net proceeds received on the sale or exchange of any Security of any series, such mention shall be deemed to include mention of the payment of Additional Amounts provided for in the terms of such Securities and this Section to the extent that, in such context, Additional Amounts are, were or would be payable in respect thereof pursuant to such terms and this Section and express mention of the payment of Additional Amounts (if applicable) in any provisions hereof shall not be construed as excluding Additional Amounts in those provisions hereof where such express mention is not made. Except as otherwise provided with respect to the Securities of any series as contemplated by Section 2.02, if the Securities of a series provide for the payment of Additional Amounts, at least 10 days prior to the first Interest Payment Date with respect to that series of Securities (or if the Securities of that series will not bear interest prior to the maturity thereof, the first day on which a payment of principal is made), and at least 10 days prior to each date of payment of principal or interest if there has been any change with respect to the matters set forth in the below-mentioned Officers' Certificate, the Company will furnish the Trustee and the principal Paying Agent or Paying Agents, if other than the Trustee, with an Officers' Certificate instructing the Trustee and such Paying Agent or Paying Agents whether such payment of principal or interest on the Securities of that series shall be made to Holders of Securities of that series or any related coupons who are United States Aliens without withholding for or on account of any tax, assessment or other governmental charge described in the Securities of that series. If any such withholding shall be required, then such Officers' Certificate shall specify by country the amount, if any, required to be withheld on such payments to such Holders of Securities or coupons and the Company will pay to the Trustee or such Paying Agent the Additional Amounts required by the terms of such Securities and this Section. The Company covenants to indemnify the Trustee and any Paying Agent for, and to hold them harmless against, any loss, liability or expense reasonably incurred without negligence or bad faith on their part arising out of or in connection with actions taken or omitted by any of them in reliance on any Officers' Certificate furnished pursuant to this Section. Section 4.02. Limitation on Restricted Subsidiary Funded Debt. As long as any Securities of a series entitled to the benefit of this covenant are outstanding the Company will not permit any Restricted Subsidiary to incur or assume any Funded Debt if immediately after the incurrence or assumption of such Funded Debt, the aggregate outstanding principal amount of all Funded Debt of the Restricted Subsidiaries would exceed fifteen percent (15%) of the Maximum Funded Debt Amount. Notwithstanding the foregoing, any Restricted Subsidiary may incur Funded Debt to extend, refinance, renew or replace Funded Debt of such Restricted Subsidiary, provided that the principal of the Funded Debt so incurred does not exceed the principal of the Funded Debt extended, refinanced, renewed or replaced thereby immediately prior to such extension, refinancing, renewal or replacement, plus any premium, accrued and unpaid interest or capitalized interest payable thereon, reasonable fees incurred in connection therewith, and the amount of any prepayment premium necessary to accomplish any refinancing. Section 4.03. Designation of Restricted Subsidiaries. As long as any Securities of a series entitled to the benefit of this covenant are outstanding, with respect to the Securities of any series, the Company may designate an Unrestricted Subsidiary as a Restricted Subsidiary or designate a Restricted Subsidiary as an Unrestricted Subsidiary at any time, provided that (1) immediately after giving effect to such designation, the Leverage Ratio of the Restricted Group is not greater than 8.0:1 and the Company and the Restricted Subsidiaries are in compliance with Sections 4.02 and 4.04, and (2) an Officers' Certificate with respect to such designation is delivered to the Trustee within 75 days after the end of the fiscal quarter of the Company in which such designation is made (or, in the case of a designation made during the last fiscal quarter of any fiscal year of the Company, within 120 days after the end of such fiscal year), which 32 Officers' Certificate shall state the effective date of such designation; the Company shall make the initial designation of Restricted Subsidiaries with respect to the Securities of any series, and deliver the required Officers' Certificate with respect thereto to the Trustee, on or prior to the date of initial issuance of Securities of such series. Section 4.04. Limitation on Liens. (a) As long as any Securities of a series entitled to the benefit of this covenant are outstanding, the Company will not, and will not permit any Subsidiary to, create, incur or assume any Lien, except for Permitted Liens, on any Property to secure the payment of Funded Debt of the Company or any Subsidiary if, immediately after the creation, incurrence or assumption of such Lien, the aggregate outstanding principal amount of all Funded Debt of the Company and the Subsidiaries that is secured by Liens (other than Permitted Liens) on Property would exceed ten percent (10%) of Total Consolidated Assets, unless in any such case the Company makes effective provision whereby the Securities (together with, if the Company shall so determine, any other Funded Debt ranking equally with the Securities, whether then existing or thereafter created) are secured equally and ratably with (or prior to) such Funded Debt (but only for so long as such Funded Debt is so secured). (For the purpose of providing such equal and ratable security the principal amount of the Securities means that principal amount or portion thereof that could be declared to be due and payable pursuant to Section 6.02 on the date of the creation, incurrence or assumption of the Lien and the extent of such equal and ratable security will be adjusted as and when said principal amount or portion thereof changes over time pursuant to Section 6.02 and any other provision of this Indenture or such Securities.) (b) The provisions of Section 4.04(a) shall not apply to the creation, incurrence or assumption of the following Liens ("Permitted Liens"): (1) Any Lien which arises out of a judgment or award against the Company or any Subsidiary with respect to which the Company or such Subsidiary at the time shall be prosecuting an appeal or proceeding for review (or with respect to which the period within which such appeal or proceeding for review may be initiated shall not have expired) and with respect to which it shall have secured a stay of execution pending such appeal or proceedings for review or with respect to which the Company or such Subsidiary shall have posted a bond and established adequate reserves (in accordance with generally accepted accounting principles) for the payment of such judgment or award; (2) Liens on assets or property of a person existing at the time such person is merged into or consolidated with the Company or any Subsidiary or becomes a Subsidiary; provided, that such Liens were in existence prior to the contemplation of such merger, consolidation or acquisition and do not secure any Property of the Company or any Subsidiary other than the property and assets subject to the Liens prior to such merger, consolidation or acquisition; (3) with respect to Securities of any series, Liens existing on the date of original issuance of such Securities; (4) Liens securing Funded Debt (including in the form of Capitalized Lease Obligations and purchase money indebtedness) incurred for the purpose of financing the cost (including without limitation the cost of design, development, site acquisition, construction, integration, manufacture or acquisition) of real or personal Property (tangible or intangible) which is incurred contemporaneously therewith or within 60 days thereafter; provided (i) such Liens secure Funded Debt in an amount not in excess of the cost of such Property (plus an amount equal to the reasonable fees and expenses incurred in connection with the incurrence of such Funded Debt) and (ii) such Liens do not extend to any Property of the Company or any Subsidiary other than the Property for which such Funded Debt was incurred; (5) Liens to secure the performance of statutory obligations, surety or appeal bonds, performance bonds or other obligations of a like nature incurred in the ordinary course of business; 33 (6) Liens to secure the Securities; (7) Liens granted in favor of the Company or any Subsidiary; and (8) Any Lien representing the extension, refinancing, renewal or replacement (or successive extensions, refinancings, renewals or replacements) of Liens referred to in clauses (2), (3), (4), (5), (6) and (7) above, provided that the principal of the Funded Debt secured thereby does not exceed the principal of the Funded Debt secured thereby immediately prior to such extension, renewal or replacement, plus any accrued and unpaid interest or capitalized interest payable thereon, reasonable fees and expenses incurred in connection therewith, and the amount of any prepayment premium necessary to accomplish any refinancing; provided, that such extension, renewal or replacement shall be limited to all or a part of the Property (or interest therein) subject to the Lien so extended, renewed or replaced (plus improvements and construction on such Property). Section 4.05. SEC Reports. The Company shall file with the Trustee within 15 days after it files them with the SEC copies of the annual reports and of the information, documents and other reports (or copies of such portions of any of the foregoing as the SEC may by rules and regulations prescribe) which the Company is required to file with the SEC pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. The Company also shall comply with the other provisions of TIA (S) 314(a). Section 4.06. Compliance Certificate. The Company shall, within 120 days after the end of each fiscal year of the Company, commencing with the first fiscal year following the issuance of Securities of any series under this Indenture, file with the Trustee a certificate of the principal executive officer, principal financial officer or principal accounting officer of the Company covering the period from the date of issuance of such Securities to the end of the fiscal year in which such Securities were issued, in the case of the first such certificate, and covering the preceding fiscal year in the case of each subsequent certificate, and stating whether or not, to the knowledge of the signer, the Company has complied with all conditions and covenants on its part contained in this Indenture, and, if the signer has obtained knowledge of any default by the Company in the performance, observance or fulfillment of any such condition or covenant, specifying each such default and the nature thereof. For the purpose of this Section 4.06, compliance shall be determined without regard to any grace period or requirement of notice provided pursuant to the terms of this Indenture. The certificate need not comply with Section 11.05. The Company shall deliver to the Trustee within 120 days after the end of each fiscal year of the Company a written statement signed by the Company's independent auditors stating (1) that their audit examination has included a review of the terms of this Indenture and the Securities as they relate to accounting matters, and (2) whether, in connection with their audit examination, any Event of Default has come to their attention and if such an Event of Default has come to their attention, specifying the nature and period of existence thereof. Section 4.07. Corporate Existence. Subject to the provisions of Section 5.01 hereof, the Company will do or cause to be done all things necessary to preserve and keep in full force and effect its corporate existence. Section 4.08. Waiver of Certain Covenants. The Company may omit in any particular instance to comply with any term, provision or condition set forth in Sections 4.02 to 4.04, inclusive, with respect to the Securities of any series if before the time for such compliance the Holders of at least a majority in principal amount of the outstanding Securities of such series shall either waive such compliance in such instance or generally waive compliance with such term, provision or condition, but no such waiver shall extend to or affect such term, provision or condition except to the extent so 34 expressly waived, and, until such waiver shall become effective, the obligations of the Company and the duties of the Trustee in respect of any such term, provision or condition shall remain in full force and effect. Section 4.09. No Lien Created. This Indenture and the Securities do not create a Lien, charge or encumbrance on any property of the Company or any Subsidiary. Section 4.10. Calculation of Original Issue Discount. The Company shall file with the Trustee promptly at the end of each calendar year a written notice specifying the amount of original issue discount (including daily rates and accrual periods) accrued on outstanding Securities as of the end of such year. ARTICLE FIVE Successor Corporation Section 5.01. When Company May Merge, etc. The Company shall not consolidate with or merge into, or transfer its properties and assets substantially as an entirety to, another corporation unless (1) the successor corporation, which shall be a corporation organized and existing under the laws of the United States or a State thereof, assumes by supplemental indenture all the obligations of the Company under the Securities and any coupons appertaining thereto and this Indenture, and (2) immediately after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing. Thereafter, unless otherwise specified as contemplated by Section 2.02 for the Securities of any series and any related coupons, all such obligations of the predecessor corporation shall terminate. ARTICLE SIX Defaults and Remedies Section 6.01. Events of Default. An "Event of Default" with respect to Securities of any series means each one of the events specified below in this Section 6.01, unless it is either inapplicable to a particular series or is specifically deleted or modified as contemplated by Section 2.02 for the Securities of such series, and any other events as may be specified as contemplated by Section 2.02 for the Securities of such series: (1) the Company defaults in the payment of any interest on any Security of that series when the same becomes due and payable and the default continues for a period of 30 days; (2) the Company defaults in the payment of the principal of any Security of that series when the same becomes due and payable at maturity, upon redemption (including default in the making of any mandatory sinking fund payment), upon purchase by the Company at the option of the Holder pursuant to the terms of such Security or otherwise; (3) the Company fails to comply with any of its other agreements in Securities of that series or this Indenture (other than an agreement which has expressly been included in this Indenture solely for the benefit of Securities of any series other than that series or is expressly made inapplicable to the Securities of such series as contemplated by Section 2.02) and the default continues for the period and after the notice specified below; (4) the happening of an event of default as defined in any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any Debt of the Company (including an Event of Default under this Indenture with respect to Securities of any series other than that series), whether 35 now existing or hereafter created, which event of default shall have resulted in Debt of the Company becoming or being declared due and payable prior to the date on which it would otherwise have become due and payable if the aggregate principal amount (or, if applicable, with an issue price plus accrued original issue discount) of such Debt is in excess of five percent (5%) of the aggregate principal amount of the Company's Funded Debt then outstanding, unless, within the period and after the notice specified below, such acceleration has been rescinded or annulled, such Debt has been paid or the Company shall have contested such acceleration in good faith and by appropriate proceedings and have obtained and thereafter maintained a stay of all consequences thereof that would have a material adverse effect on the Company; provided, however, that if after the expiration of such period, such event of default shall be remedied or cured by the Company or be waived by the holders of such Debt in any manner authorized by such mortgage, indenture or instrument or shall otherwise cease to exist, then the Event of Default hereunder by reason thereof shall, without further action by the Company, the Trustee or any Holder, be deemed cured and not continuing; (5) the Company pursuant to or within the meaning of any Bankruptcy Law: (A) commences a voluntary case or consents to the commencement of a case against it, (B) consents to the entry of an order for relief against it in an involuntary case, (C) consents to the appointment of a Custodian of it or for all or substantially all of its property, or (D) makes a general assignment for the benefit of its creditors; (6) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that: (A) is for relief against the Company in an involuntary case or adjudicates the Company insolvent or bankrupt, (B) appoints a Custodian of the Company or for all or substantially all of its property, or (C) orders the winding up or liquidation of the Company, and the order or decree remains unstayed and in effect for 90 days; or (7) any other Event of Default provided with respect to Securities of that series occurs. The term "Bankruptcy Law" means Title 11, U.S. Code or any similar Federal or State law for the relief of debtors. The term "Custodian" means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law. A Default under clause (3) or clause (4) is not an Event of Default until the Trustee notifies the Company or the Holders of at least 25% in aggregate principal amount of the outstanding Securities of that series notify the Company and the Trustee of the Default and the Company does not cure the Default within 30 days after receipt of the notice. The notice must specify the Default, demand that it be remedied and state that the notice is a "Notice of Default." Section 6.02. Acceleration. If an Event of Default (other than an Event of Default specified in Section 6.01(5) or (6)) occurs and is continuing with respect to Securities of any series at the time outstanding, the Trustee by notice to the Company, or the Holders of at least 25% in aggregate principal amount of the outstanding Securities of that series by notice to the Company and the Trustee, may declare to be due and payable immediately (1) the principal amount (or, if Securities of that series are Original Issue Discount Securities, such portion of the principal amount as may be specified in the terms of Securities of that series) of all of the Securities of that series then outstanding and (2) interest, if any, accrued to the date of acceleration. Upon such declaration, such principal amount (or specified amount) and interest, if any, shall be due and payable immediately. If an Event of Default specified in Section 6.01(5) or (6) occurs and is continuing, (1) the principal amount (or, if the Securities of that series are Original Issue Discount Securities, such portion of the principal amount as may be specified in the terms of the Securities of that series) of all of the Securities of that series then outstanding and (2) interest, if any, accrued to the date of 36 such acceleration, shall become and be immediately due and payable without any declaration or other act on the part of the Trustee or Securityholders. The Holders of a majority in aggregate principal amount of the outstanding Securities of the series with respect to which an acceleration applies by notice to the Trustee may rescind an acceleration and its consequences with respect to such series if all existing Events of Default (other than the non- payment of the principal of and accrued interest, if any, on Securities that have become due solely by such acceleration) with respect to Securities of that series have been cured or waived and if the rescission would not conflict with any judgment or decree. In the event of a declaration of acceleration under this Indenture with respect to Securities of any series because an Event of Default set forth in Section 6.01(4) has occurred and is continuing, such declaration of acceleration shall be automatically annulled if (a) as a result of the contest by the Company in appropriate proceedings of the acceleration of the Debt which is the subject of such Event of Default the acceleration of such indebtedness is declared void ab initio, or (b) within 90 days of such declaration of acceleration under this Indenture the declaration of acceleration of the Debt which is the subject of such Event of Default has been rescinded or annulled in any manner authorized by the mortgage, indenture or instrument evidencing or creating such Debt and, in the case of this clause (b), the annulment of the declaration of acceleration under this Indenture would not conflict with any judgment or decree, and, in either case, all other existing Events of Default (other than the non-payment of the principal of and accrued interest, if any, on Securities that have become due solely by such acceleration) with respect to Securities of that series have been cured or waived. No such rescission or annulment shall affect any subsequent default or impair any right consequent thereon. Section 6.03. Other Remedies. If an Event of Default with respect to Securities of any series occurs and is continuing, the Trustee may pursue any available remedy by proceeding at law or in equity to collect the payment of the whole amount which then shall have become due and remain unpaid for principal or interest, if any, on the Securities of that series and any related coupons or to enforce the performance of any provision of the Securities of that series or this Indenture. The Trustee may maintain a proceeding even if it does not possess any of the Securities of that series or any related coupons or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder of Securities or related coupons, if any, in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. No remedy is exclusive of any other remedy. All available remedies are cumulative. Section 6.04. Waiver of Existing Defaults. Subject to Section 9.02, the Holders of a majority in aggregate principal amount of the outstanding Securities of any series by notice to the Trustee may waive on behalf of the Holders of all the Securities of such series and any related coupons an existing Default or Event of Default and its consequences. When a Default or Event of Default is waived, it is cured and stops continuing. Section 6.05. Control by Majority. The Holders of a majority in aggregate principal amount of the outstanding Securities of any series may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on it, with respect to the Securities of such series. The Trustee, however, may refuse to follow any direction that conflicts with law or this Indenture, that is unduly prejudicial to the rights of another Securityholder or that would involve the Trustee in personal liability. 37 Section 6.06. Limitation on Suits. No Holder of any Security of any series or any related coupons shall have the right to pursue any remedy with respect to this Indenture or the Securities unless: (1) the Holder gives to the Trustee written notice of a continuing Event of Default with respect to the Securities of that series; (2) the Holders of at least 25% in aggregate principal amount of the outstanding Securities of that series make a written request to the Trustee to pursue the remedy; (3) such Holder or Holders offer and provide to the Trustee indemnity satisfactory to the Trustee against any loss, liability or expense; (4) the Trustee does not comply with the request within 60 days after receipt of the request and the offer of indemnity; and (5) no direction inconsistent with such written request has been given to the Trustee during such 60-day period by the Holders of a majority in aggregate principal amount of the outstanding Securities of such series. A Securityholder of any series may not use this Indenture to prejudice the rights of another Securityholder of such series or to obtain a preference or priority over another Securityholder of such series, except in the manner herein provided and for the equal and ratable benefit of all Securityholders of such series. Section 6.07. Rights of Holders to Receive Payment and to Convert. Notwithstanding any other provision of this Indenture, the right of any Holder of a Security or a coupon to receive payment of principal of and (subject to Sections 2.08 and 2.13) interest, if any, on the Security or payment on such coupon, on or after the respective due dates with respect to such payments expressed in such Security or coupon, and, if applicable, to convert such Security on the terms and subject to the conditions applicable to Securities of such series, or to bring suit for the enforcement of any such payment on or after such respective dates or of such right to convert, if any, shall not be impaired or affected without the consent of the Holder. Section 6.08. Collection Suit by Trustee. If an Event of Default specified in Section 6.01(1) or (2) occurs and is continuing with respect to the Securities of any series, the Trustee may recover judgment in its own name and as trustee of an express trust against the Company for the whole amount which then shall have become due and remain unpaid for principal and interest, if any, on the Securities of such series and any related coupons. Section 6.09. Trustee May File Proofs of Claim. The Trustee may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee and the Securityholders (including the Holders of any coupons) allowed in any judicial proceedings relative to the Company, its creditors or its property and to collect and receive money, property or securities payable or deliverable on any such claims and to distribute the same. Section 6.10. Priorities. Any money collected by the Trustee pursuant to this Article shall be applied in the following order, at the date or dates fixed by the Trustee and, in the case of the distribution of such money on account of principal or interest, upon presentation of the Securities or coupons, or both, as the case may be, and the notation thereon of the payment if only partially paid and upon surrender thereof if fully paid: First: to the Trustee for amounts due under Section 7.07; Second: to the payment of amounts due and unpaid for principal and interest, if any, on the Securities and coupons in respect of which such money has been collected, ratably, without preference or priority of 38 any kind, according to the amounts which then shall have become due and payable on such Securities and coupons for principal and interest, respectively; and Third: to the Company. Section 6.11. Undertaking for Costs. In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys' fees and expenses, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section 6.07 or a suit by Holders of more than 10% in aggregate principal amount of the outstanding Securities of any series. ARTICLE SEVEN Trustee All the provisions of this Article Seven apply to the Trustee acting in all its appointed capacities pursuant to this Indenture unless any provision specifically applies to the Trustee only in its capacity as Trustee. Section 7.01. Duties of Trustee. (a) If an Event of Default with respect to Securities of any series has occurred and is continuing, the Trustee shall with respect to such series exercise such of the rights and powers vested in it by this Indenture with respect to such series and use the same degree of care and skill in their exercise as a prudent man would exercise or use under the circumstances in the conduct of his own affairs. (b) With respect to Securities of any series, except during the continuance of an Event of Default with respect to Securities of such series: (1) The Trustee need perform only those duties that are specifically set forth in this Indenture or the TIA and no others. (2) In the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture. The Trustee, however, in the case of any such certificates or opinions which by any provision hereof are specifically required to be furnished to the Trustee, shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein). (c) The Trustee may not be relieved from liability for its own negligent action, its own negligent failure to act or its own willful misconduct, except that: (1) This paragraph does not limit the effect of paragraph (b) of this Section. (2) The Trustee shall not be liable for any error of judgment made in good faith by a Trust Officer, unless it is proved that the Trustee was negligent in ascertaining the pertinent facts. (3) The Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.05. (d) Every provision of this Indenture that in any way relates to the Trustee is subject to paragraphs (a), (b) and (c) of this Section. 39 (e) No provision of this Indenture shall require the Trustee to expend or risk its own funds or incur any liability. The Trustee may refuse to perform any duty or exercise any right or power unless it receives indemnity satisfactory to it against any loss, liability or expense. (f) The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Company. Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law. Section 7.02. Rights of Trustee. (a) The Trustee may conclusively rely on any document believed by it to be genuine and to have been signed or presented by the proper person. The Trustee need not investigate any fact or matter stated in the document. (b) Before the Trustee acts or refrains from acting, it may consult with counsel or require an Officers' Certificate, an Opinion of Counsel and/or an accountant's certificate. The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on the Certificate, Opinion, or accountant's certificate. (c) The Trustee may act through agents and counsel and shall not be responsible for the misconduct or negligence of any agent or counsel appointed with due care. (d) The Trustee shall not be liable for any action it takes or omits to take in good faith which it believes to be authorized or within its rights or powers. Section 7.03. Individual Rights of Trustee. The Trustee in its individual or any other capacity may become the owner or pledgee of Securities and coupons and may otherwise deal with the Company or its Affiliates with the same rights it would have if it were not Trustee. Any Agent may do the same with like rights. The Trustee, however, must comply with Sections 7.10 and 7.11. Section 7.04. Trustee's and Authenticating Agent's Disclaimer. Neither the Trustee nor any Authenticating Agent makes any representation as to the validity or adequacy of this Indenture or the Securities or the coupons, if any, appertaining thereto; neither shall be accountable for the Company's use of the proceeds from the Securities; and neither shall be responsible for any statement in the Indenture or the Securities or any coupons other than its certificate of authentication. Section 7.05. Notice of Defaults. If a Default occurs and is continuing with respect to Securities of any series and if it is known to a Trust Officer of the Trustee, the Trustee shall transmit by mail to the Holders of Securities of such series in the manner and to the extent provided in TIA (S) 313(c) notice of the Default within 90 days after it occurs or as soon as reasonably practicable thereafter. Except in the case of a default in payment of principal of or interest on any Security of such series or any related coupons (including default in the making of any mandatory sinking fund or mandatory repurchase payment), the Trustee may withhold the notice if and so long as a committee of its Trust Officers in good faith determines that withholding the notice is in the interests of Securityholders of such series. Section 7.06. Reports by Trustee to Holders. Within 60 days after each May 15 beginning with the May 15 following the date on which Securities are originally issued under this Indenture, the Trustee shall transmit by mail to the Holders of Securities, in the manner and to the extent provided in TIA (S) 313(c), a brief report dated as of such May 15 that complies with TIA (S) 313(a). The Trustee also shall comply with TIA (S) 313(b). A copy of each report at the time of its mailing to Securityholders shall be filed by the Company with the SEC and each stock exchange on which the Securities are listed. 40 The Company will promptly notify the Trustee if and when the Securities are listed on or delisted from any stock exchange. Section 7.07. Compensation and Indemnity. The Company shall pay to the Trustee such compensation as shall have been agreed upon in writing. The Trustee's compensation shall not be limited by any law on compensation of a trustee of an express trust. The Company shall reimburse the Trustee upon request for all reasonable out- of-pocket expenses incurred by it. Such expenses shall include the reasonable compensation and expenses of the Trustee's agents and counsel. The Company shall indemnify the Trustee against any loss or liability incurred by it arising out of or in connection with the acceptance or administration of this trust and its duties hereunder. The Trustee shall notify the Company promptly of any claim asserted against the Trustee for which it may seek indemnity. Failure of the Trustee to so notify the Company shall not relieve the Company of its obligations hereunder. The Company shall have the right to elect to defend the claim and the Trustee shall cooperate in the defense. The Trustee may have separate counsel and the Company shall pay the reasonable fees and expenses of such counsel. The Company need not pay for any settlement made without its written consent. The Company need not reimburse any expense or indemnify against any loss or liability incurred by the Trustee through the Trustee's negligence or bad faith. To secure the Company's payment obligations in this Section, the Trustee shall have a lien prior to the Securities on all money or property held or collected by the Trustee, except that held in trust to pay principal of or interest on particular Securities. When the Trustee incurs expenses or renders services after an Event of Default specified in Section 6.01(5) or (6) occurs, the expenses and the compensation for the services are intended to constitute expenses of administration under any Bankruptcy Law. Section 7.08. Replacement of Trustee. The Trustee may resign at any time with respect to the Securities of one or more series by so notifying the Company. The Holders of a majority in aggregate principal amount of the outstanding Securities of any series may remove the Trustee with respect to the Securities of such series by so notifying the removed Trustee and may appoint a successor Trustee with the Company's consent. The Company shall remove the Trustee if: (1) the Trustee fails to comply with Section 7.10; (2) the Trustee is adjudged a bankrupt or an insolvent; (3) a receiver or other public officer takes charge of the Trustee or its property; or (4) the Trustee becomes incapable of acting. The Company may remove the Trustee at any time with respect to the Securities of any series upon delivery to the Trustee of a resolution of the Board of Directors to such effect, provided that contemporaneously therewith no Default with respect to the Securities of such series shall have occurred and be continuing. If the Trustee resigns or is removed, or if a vacancy exists in the office of Trustee for any reason, with respect to the Securities of one or more series, the Company shall promptly appoint a successor Trustee or Trustees (it being understood that any such successor Trustee may be appointed with respect to the Securities of one or more or all of such series and that at any time there shall be only one Trustee with respect to the Securities of any particular series). A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Immediately after that, the retiring Trustee shall transfer all property held by it as Trustee to the successor Trustee (subject to the lien, if any, provided for in Section 7.07), the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of 41 the Trustee under this Indenture. A successor Trustee shall give notice in the manner provided in Section 11.02 of its succession to each Securityholder. If a successor Trustee with respect to the Securities of any series does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company or the Holders of a majority in aggregate principal amount of the outstanding Securities of such series may petition, at the expense of the Company, any court of competent jurisdiction for the appointment of a successor Trustee. If the Trustee fails to comply with Section 7.10, any Securityholder may petition any court of competent jurisdiction for the removal of the Trustee with respect to all Securities and the appointment of a successor Trustee. Section 7.09. Successor Trustee by Merger, etc. If the Trustee consolidates with, merges or converts into, or transfers all or substantially all of its corporate trust assets to, another corporation or national banking association, the successor corporation or national banking association without any further act shall be the successor Trustee. Section 7.10. Eligibility; Disqualification. This Indenture shall always have a Trustee who satisfies the requirements of TIA (S) 310(a). The Trustee shall always have a combined capital and surplus of at least $50,000,000 as set forth in its most recent published annual report of condition. With respect to the Securities of each series, the Trustee shall comply with TIA (S) 310(b). In determining whether the Trustee has a conflicting interest as defined in TIA (S) 310(b) with respect to the Securities of any series, there shall be excluded from such determination this Indenture with respect to Securities of any particular series of Securities other than that series. Nothing herein shall prevent the Trustee from filing with the SEC the application referred to in the second to last paragraph of TIA (S) 310(b). Section 7.11. Preferential Collection of Claims Against Company. The Trustee shall comply with TIA (S) 311(a), excluding any creditor relationship listed in TIA (S) 311(b). A Trustee who has resigned or been removed shall be subject to TIA (S) 311(a) to the extent indicated. ARTICLE EIGHT Discharge of Indenture Section 8.01. Termination of Company's Obligations. The Company may terminate all of its obligations under the Securities of any series and all coupons, if any, appertaining thereto, and this Indenture with respect to the Securities of such series if either (1) all Securities of such series and all coupons, if any, appertaining thereto, previously authenticated and delivered (other than (i) destroyed, lost or wrongfully-taken Securities or coupons which have been replaced or paid as provided in Section 2.09, (ii) Securities or coupons for whose payment money (or, if permitted by the terms of such Securities, securities) has theretofore been held in trust and thereafter repaid to the Company, as provided in Section 8.03, (iii) coupons appertaining to Bearer Securities surrendered for exchange for Registered Securities and maturing after such exchange whose surrender is not required or has been waived as provided in Section 2.08, and (iv) coupons appertaining to Bearer Securities called for redemption and maturing after the relevant redemption date, whose surrender has been waived as provided in Section 3.05; or (2) the Company irrevocably deposits in trust with the Trustee money or Government Obligations sufficient to pay the principal of and interest, if any, on all Securities of such series and all coupons, if any, appertaining thereto previously authenticated and delivered, and not theretofore cancelled or delivered to the Trustee for cancellation (other than any such Security or coupon referenced in subclauses (i), (ii), (iii) or (iv) of clause (1) above), to maturity or redemption, as the case may be. 42 The Company's obligations in Sections 2.05, 2.06, 2.07, 2.08, 2.09, 4.01, 7.07, 7.08, 8.01, 8.03 and Article Ten of this Indenture, however, shall survive until the Securities of such series are no longer outstanding. Thereafter the Company's obligations in Sections 7.07 and 8.03 shall survive. Notwithstanding the satisfaction and discharge of this Indenture with respect to the Securities of any series, if money or Government Obligations shall have been deposited with the Trustee pursuant to clause (2) of this Section, the obligations of the Trustee under Section 8.02 and the second sentence of Section 8.03 shall survive. After a deposit and if all other conditions thereto are met, the Trustee for the Securities of such series and the coupons, if any, appertaining thereto, shall be required to execute an instrument acknowledging satisfaction and discharge of this Indenture with respect to such Securities, except for those surviving obligations specified above; provided, however, that the Trustee shall not be required to execute such instrument until the expiration of ninety days after the date of a deposit. In order to have money available on a payment date to pay the principal of or interest, if any, on the Securities, the Government Obligations shall be payable as to principal or interest on or before such payment date in such amounts as will provide the necessary money. U.S. Government Obligations shall not be callable at the issuer's option. Section 8.02. Application of Trust Fund. The Trustee shall hold in trust money and Government Obligations deposited with it pursuant to Section 8.01. It shall apply the deposited money and the money from the Government Obligations through the Paying Agent and in accordance with the provisions of the Securities, the coupons and this Indenture to the payment of principal of and interest, if any, on the Securities and related coupons, if any, for the payment of which such money or Government Obligations has been deposited with the Trustee. The Company shall pay, and indemnify the Trustee against, any tax, fee or other charge imposed on or assessed against the Government Obligations deposited pursuant to Section 8.01 or the principal and interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders of outstanding Securities. Section 8.03. Repayment to Company. The Trustee and the Paying Agent shall promptly pay to the Company upon written request any excess money or securities held by them at any time. The Trustee and the Paying Agent shall pay to the Company upon written request any money or securities held by them for the payment of principal or interest, if any, that remains unclaimed for two years; provided, however, that the Trustee and the Paying Agent, before being required to make any such payment may at the expense of the Company cause to be published once, in an Authorized Newspaper in each place of payment, notice that such money remains unclaimed and that, after a date specified therein, which date shall not be less than 30 days from such date of such publication, any unclaimed balance of such money then remaining will be paid to the Company. After that, Holders entitled to the money or securities must look to the Company for payment unless an applicable abandoned property law designates another person. ARTICLE NINE Amendments, Supplements and Waivers Section 9.01. Without Consent of Holders. The Company and the Trustee may amend or supplement this Indenture or the Securities of any series without notice to or consent of any Holder of Securities or coupons or the Holder of any coupons: (1) to cure any ambiguity, defect or inconsistency; (2) to comply with Sections 5.01 and 10.16; 43 (3) to secure the Securities pursuant to the requirements of Section 4.04, including to provide for the receipt and holding of any security to which the Holders are entitled under Section 4.04, and to release such security and the Lien of the Holders in accordance with the provisions of Section 4.04; (4) to establish the form or terms of Securities of any series and any related coupons as permitted by Sections 2.01 and 2.02; (5) to add to the covenants of the Company for the benefit of the Holders of all or any series of Securities (and if such covenants are to be for the benefit of less than all series of Securities, stating that such covenants are expressly being included solely for the benefit of such series) or to surrender any right or power herein conferred upon the Company; (6) to add any additional Events of Default (and if such Events of Default are to be applicable to less than all series of Securities, stating that such Events of Default are expressly being included solely to be applicable to such series); (7) to change or eliminate any of the provisions of this Indenture, provided that, except as otherwise contemplated by Section 2.02(20), any such change or elimination shall become effective only when there is no Security outstanding of any series created prior thereto which is entitled to the benefit of such provision; (8) to add to or change any of the provisions of this Indenture to provide that Bearer Securities may be registrable as to principal, to change or eliminate any restrictions on the payment of principal of or interest on Bearer Securities, to permit Bearer Securities to be issued in exchange for Registered Securities, or to permit Bearer Securities to be issued in exchange for Bearer Securities of other authorized denominations or to facilitate or permit the issuance of Securities in uncertificated form (so long as any "registration-required obligation" within the meaning of Section 163(f)(2) of the Internal Revenue Code of 1986, as amended (the "Code") is in registered form for purposes of the Code) provided, that any such action shall not adversely affect the interests of Holders of Securities of any series or any related coupons in any material respect; (9) to make any change that, in the opinion of the Board of Directors, does not materially adversely affect the rights of any Securityholder or the Holder of any coupon; or (10) to comply with any requirement of the SEC in connection with the qualification of this Indenture under the TIA. Section 9.02. With Consent of Holders. The Company and the Trustee may amend or supplement this Indenture or the Securities of any series without notice to any Holder of Securities or coupons but with the consent of the Holders of a majority in aggregate principal amount of the outstanding Securities of each series affected by such amendment or supplement, by Act of said Holders delivered to the Trustee. The Holders of a majority in aggregate principal amount of the outstanding Securities of any series, by Act of said Holders delivered to the Trustee, may on behalf of the Holders of all Securities of such series and any related coupons waive compliance by the Company with any provision of this Indenture or of Securities of such series without any notice to any Holder of Securities or coupons. Without the consent of the Holder of each outstanding Security affected thereby, however, an amendment, supplement or waiver, including a waiver pursuant to Section 6.04, may not: (1) reduce the amount of Securities of any series whose Holders must consent to an amendment, supplement or waiver; (2) reduce the rate of or extend the time for payment of interest on any Security (or, in the case of an Original Issue Discount Security, reduce the rate of accrual of original issue discount); (3) reduce the principal of (or any premium payable upon the redemption of) or extend the fixed maturity of any Security (or, in the case of an Original Issue Discount Security, reduce the portion of the principal amount that would be due and payable upon acceleration of the maturity thereof pursuant to Section 6.02); 44 (4) change the amount or time of any payment required by any sinking fund provisions of the Securities of any series; (5) make any change that materially adversely affects the right of a Holder to require the Company to purchase a Security in accordance with the terms thereof and this Indenture; (6) waive a default in the payment of principal of or interest, if any, on any Security; (7) make any Security payable in money or securities other than that stated in the Security; (8) make any change that materially adversely affects the right to convert any Security or that increases the conversion price or reduces the conversion rate of any Security; or (9) change any obligation of the Company to maintain an office or agency in the places and for the purposes specified in Section 4.01. It shall not be necessary for the Act of the Holders under this Section to approve the particular form of any proposed supplement or amendment, but it shall be sufficient if such Act approves the substance thereof. An amendment to or supplement of this Indenture which changes or eliminates any covenant or other provision of this Indenture which has expressly been included solely for the benefit of one or more particular series of Securities, or which modifies the rights of the Holders of Securities of such series with respect to such covenant or other provision, shall be deemed not to affect the rights under this Indenture of the Holders of Securities of any other series. Section 9.03. Compliance with Trust Indenture Act. Every amendment to or supplement of this Indenture or the Securities shall comply with the TIA as then in effect. Section 9.04. Effect of Amendments and Supplements. Upon the execution of any amendment or supplement authorized pursuant to this Article, this Indenture shall be modified in accordance therewith, and such amendment or supplement shall form a part of this Indenture for all purposes; and every Holder of Securities theretofore or thereafter authenticated and delivered hereunder and of any coupon appertaining thereto shall be bound thereby. Section 9.05. Notation on or Exchange of Securities. If an amendment, supplement or waiver changes the terms of a Security, the Trustee may require the Holder of the Security to deliver it to the Trustee. The Trustee may place an appropriate notation on the Security about the changed terms and return it to the Holder. Alternatively, if the Company or the Trustee so determines, the Company in exchange for the Security shall issue and the Trustee shall authenticate a new Security that reflects the changed terms. Section 9.06. Trustee to Sign Amendments, etc. The Trustee shall sign any amendment, supplement or waiver authorized pursuant to this Article if the amendment, supplement or waiver does not adversely affect the rights, duties, immunities or liabilities of the Trustee. If it does, the Trustee may but need not sign it. The Company may not sign an amendment or supplement until the Board of Directors approves it. In executing, or accepting the additional trusts created by, any supplemental indenture permitted by this Article or the modification thereby of the trusts created by this Indenture, the Trustee shall be entitled to receive, and shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of such supplemental indenture is authorized or permitted by this Indenture. 45 ARTICLE TEN Conversion Section 10.01. Applicability of Article. Securities of any series which are convertible into Parent Stock at the option of the Holder shall be convertible in accordance with their terms and (except as otherwise specified as contemplated by Section 2.02 for Securities of any series) in accordance with this Article. Each reference in this Article to "a Security" or "the Securities" refers to the Securities of the particular series that is convertible into Parent Stock. If more than one series of Securities with conversion privileges are outstanding at any time, the provisions of this Article shall be applied separately to each such series. Section 10.02. Conversion Privilege. A Holder of a Security of any authorized denomination of any series may convert it into Parent Stock, at any time during the period specified on the Securities of that series, at the conversion price or conversion rate in effect on the conversion date, except that, with respect to any Security (or portion thereof) called for redemption, such right shall (except as otherwise provided in Section 3.08) terminate at the close of business on the fifteenth day prior to the date fixed for redemption of such Security (or portion thereof) (or such other day as may be specified as contemplated by Section 2.02 for Securities of such series), unless the Company shall default in payment of the amount due upon redemption thereof. The initial conversion price or conversion rate in respect of a series of Securities shall be as specified on the Securities of that series. The conversion price or conversion rate will be subject to adjustment on the terms set forth in Sections 10.07 through 10.13 or such other or different terms, if any, as may be specified as contemplated by Section 2.02 for Securities of such series. A Holder may convert any Security in full and may convert a portion of a Security if the portion to be converted and the remaining portion of such Security are in denominations issuable for that series of Securities. Provisions of this Indenture that apply to conversion of all of a Security also apply to conversion of a portion of it. Section 10.03. Conversion Procedure. To convert a Security of any series, a Holder must satisfy the requirements for conversion contained on the Securities of that series. The date on which the Holder satisfies all those requirements is the conversion date. As soon as practicable after the conversion date, the Company shall, or shall cause the Parent to, deliver to the Holder through the Conversion Agent a certificate for the number of shares of Parent Stock deliverable upon the conversion and cash or its check in lieu of any fractional share. The person in whose name the certificate is registered becomes a stockholder of record on the conversion date and the rights of the Holder of the Securities so converted as a Holder thereof cease as of such date. If the Holder converts more than one Security of any series at the same time, the number of full shares issuable upon the conversion shall be based on the total principal amount of the Securities of such series so converted. Upon surrender of a Security of any series that is converted in part, the Trustee shall authenticate for the Holder a new Security of that series equal in principal amount to the unconverted portion of the Security surrendered. If the last day on which a Security may be converted is a Legal Holiday in a place where a Conversion Agent is located, the Security may be surrendered to that Conversion Agent on the next succeeding day that is not a Legal Holiday. The Company will not be required to deliver, or cause the Parent to deliver, certificates for shares of Parent Stock upon conversion while the Parent's stock transfer books are closed for a meeting of stockholders or for 46 the payment of dividends or for any other purpose, but certificates for shares of Parent Stock shall be delivered as soon as the stock transfer books shall again be opened. Registered Securities of any series surrendered for conversion during the period from the close of business on any Regular Record Date next preceding any Interest Payment Date for such series to the opening of business on such Interest Payment Date shall (except in the case of Securities or portions thereof which have been called for redemption on a redemption date within such period) be accompanied by payment in funds acceptable to the Company of an amount equal to the interest payable on such Interest Payment Date on the principal amount of Registered Securities being surrendered for conversion; provided, that no such payment need be made if there shall exist, at the time of conversion, a default in the payment of interest on the Securities of such series. The funds so delivered to the Conversion Agent shall be paid to the Company on or after such Interest Payment Date unless the Company shall default on the payment of the interest due on such Interest Payment Date, in which event such funds shall be paid to the Holder who delivered the same. Except as provided in the preceding sentence and subject to the penultimate paragraph of Section 2.13, no payment or adjustment shall be made upon any conversion on account of any interest accrued on the Registered Securities surrendered for conversion or on account of any dividends on the Parent Stock issued upon conversion. If Bearer Securities of a series are convertible into Parent Stock, then such Securities, to be converted, shall be surrendered, together with all unmatured coupons and all matured coupons in default appertaining thereto, at the place and in the manner specified for Bearer Securities of said series as contemplated by Section 2.02. Section 10.04. Fractional Shares. No fractional share of Parent Stock shall be issued upon conversion of a Security. Instead, the Company will deliver cash or its check for the current market value of a fractional share. The current market value of a fractional share is determined as follows: Multiply the current market price of a full share on the last full trading day prior to the conversion date by the fraction (rounded to the nearest 1/100 of a share) and round the result to the nearest whole cent. Section 10.05. Taxes on Conversion. If a Holder of a Security converts it, the Company shall pay any documentary, stamp or similar issue or transfer tax due on the delivery of shares of Parent Stock upon the conversion. The Holder, however, shall pay any such tax which is due because the shares are issued in a name other than the Holder's name. Section 10.06. Reservation of Parent Stock, Etc. The Company shall cause the Parent to, from time to time as may be necessary, reserve out of Parent's authorized but unissued Parent Stock or Parent Stock held in treasury enough shares of Parent Stock to permit the conversion of all outstanding Securities. All shares of Parent Stock which may be delivered upon conversion of the Securities shall be validly issued, fully paid and non-assessable and shall be free from any preemptive rights. In order that shares of Parent Stock may be validly delivered upon conversion of the Securities, the Company will, and will cause the Parent to, endeavor to comply with all applicable Federal and State securities laws and will endeavor to cause such shares to be listed on each national securities exchange or other stock market on which other shares of the Parent Stock is listed. Section 10.07. Adjustment for Change in Parent Capital Stock. If the Parent: (1) pays a dividend or makes a distribution on the Parent Stock in shares of Parent Stock; (2) subdivides the outstanding shares of Parent Stock into a greater number of shares; 47 (3) combines the outstanding shares of Parent Stock into a smaller number of shares; (4) pays a dividend or makes a distribution on Parent Stock in shares of its capital stock other than Parent Stock; or (5) issues by reclassification of its shares of Parent Stock any shares of its capital stock, then the conversion privilege and the conversion price or conversion rate in effect immediately prior to the opening of business on the record date for such dividend or distribution or the effective date of such subdivision, combination or reclassification shall be adjusted so that the Holder of any Security thereafter converted may receive the number of shares of capital stock of the Parent which such Holder would have owned immediately following such action if such Holder had converted the Security immediately prior to such time. Such adjustment shall be made successively whenever any event listed above shall occur. For a dividend or distribution, the adjustment shall become effective immediately after the record date for the dividend or distribution. For a subdivision, combination or reclassification, the adjustment shall become effective immediately after the effective date of the subdivision, combination or reclassification. If after an adjustment a Holder of a Security upon conversion of it may receive shares of two or more classes of capital stock of the Parent, the conversion prices of the classes of capital stock (after giving effect to such allocation of the adjusted conversion price between or among the classes of capital stock as the Board of Directors shall determine to be appropriate) or the conversion rate, as the case may be, shall thereafter be subject to adjustment on terms comparable to those applicable to Parent Stock in this Indenture. Any shares of Parent Stock issuable in payment of a dividend shall be deemed to have been issued immediately prior to the time of the record date for such dividend for purposes of calculating the number of outstanding shares of Parent Stock under Sections 10.08 and 10.09 below. Section 10.08. Adjustment for Rights Issue. If the Parent issues any rights or warrants to all holders of shares of Parent Stock entitling them for a period expiring within 45 days after the record date mentioned below to purchase shares of Parent Stock (or Convertible Securities) at a price per share (or having a conversion price per share, after adding thereto an allocable portion of the exercise price of the right or warrant to purchase such Convertible Securities, computed on the basis of the maximum number of shares of Parent Stock issuable upon conversion of such Convertible Securities) less than the Average Market Price on the Determination Date, the conversion price or rate shall be adjusted so that it shall equal the price or rate determined by multiplying the conversion price or dividing the conversion rate, as the case may be, in effect immediately prior to the opening of business on that record date by a fraction, of which the numerator shall be the number of shares of Parent Stock outstanding on such record date plus the number of shares of Parent Stock which the aggregate offering price of the total number of shares of Parent Stock so offered (or the aggregate conversion price of the Convertible Securities to be so offered, after adding thereto the aggregate exercise price of the rights or warrants to purchase such Convertible Securities) would purchase at such Average Market Price and of which the denominator shall be the number of shares of Parent Stock outstanding on such record date plus the number of additional shares of Parent Stock offered for subscription or purchase (or into which the Convertible Securities so offered are convertible). Shares of Parent Stock owned by or held for the account of the Parent shall not be deemed outstanding for the purpose of any such adjustment. For purposes of this Section 10.08, the number of shares of Parent Stock outstanding on any record date shall be deemed to include (i) the maximum number of shares of Parent Stock the issuance of which would be necessary to effect the full exercise, exchange or conversion of all Convertible Securities outstanding on such record date which are then exercisable, exchangeable or convertible at a price equal to or less than the Average Market Price per share of Parent Stock, if all of such Convertible Securities were deemed to have been exercised, exchanged or converted immediately prior to the opening of business on such record date and (ii) if the Series B 48 Stock is convertible into Parent Stock, the maximum number of shares of Parent Stock the issuance of which would be necessary to effect the full conversion of all shares of Series B Stock outstanding on such record date, if all of such shares of Series B Stock were deemed to have been converted immediately prior to the opening of business on such record date. The adjustment shall be made successively whenever any such rights or warrants are issued, and shall become effective immediately after the record date for the determination of stockholders entitled to receive the rights or warrants. If all of the shares of Parent Stock (or all of the Convertible Securities) subject to such rights or warrants have not been issued when such rights or warrants expire (or, in the case of rights or warrants to purchase Convertible Securities which have been exercised, all of the shares of Parent Stock issuable upon conversion of such Convertible Securities have not been issued prior to the expiration of the conversion right thereof), then the conversion price or conversion rate shall promptly be readjusted to the conversion price or conversion rate which would then be in effect had the adjustment upon the issuance of such rights or warrants been made on the basis of the actual number of shares of Parent Stock (or Convertible Securities) issued upon the exercise of such rights or warrants (or the conversion of such Convertible Securities). No adjustment shall be made under this Section 10.08 if the adjusted conversion price would be higher than, or the adjusted conversion rate would be less than, the conversion price or conversion rate, as the case may be, in effect prior to such adjustment. Section 10.09. Adjustments for Other Distributions. If the Parent distributes to all holders of shares of Parent Stock any assets or debt securities or any rights or warrants to purchase securities, the conversion price or conversion rate shall be adjusted by multiplying the conversion price or dividing the conversion rate, as the case may be, in effect immediately prior to the opening of business on the record date mentioned below by a fraction, of which the numerator shall be the total number of shares of Parent Stock outstanding on such record date multiplied by the Average Market Price on the Determination Date, less the fair market value (as determined by the Board of Directors) on such record date of said assets or debt securities or rights or warrants so distributed, and of which the denominator shall be the total number of shares of Parent Stock outstanding on such record date multiplied by such Average Market Price. For purposes of this Section 10.09, the number of shares of Parent Stock outstanding on any record date shall be deemed to include (i) the maximum number of shares of Parent Stock the issuance of which would be necessary to effect the full exercise, exchange or conversion of all Convertible Securities outstanding on such record date which are then exercisable, exchangeable or convertible at a price equal to or less than the Average Market Price, if all of such Convertible Securities were deemed to have been exercised, exchanged or converted immediately prior to the opening of business on such record date and (ii) if the Series B Stock is convertible into Parent Stock, the maximum number of shares of Parent Stock the issuance of which would be necessary to effect the full conversion of all shares of Series B Stock outstanding on such record date, if all of such shares of Series B Stock were deemed to have been converted immediately prior to the opening of business on such record date. The adjustment shall be made successively whenever any such distribution is made, and shall become effective immediately after the record date for the determination of stockholders entitled to receive the distribution. Shares of Parent Stock owned by or held for the account of the Parent shall not be deemed outstanding for the purpose of any such adjustment. No adjustment shall be made under this Section 10.09 if the adjusted conversion price would be higher than, or the adjusted conversion rate would be less than, the conversion price or conversion rate, as the case may be, in effect prior to such adjustment. This Section does not apply to cash dividends or distributions. Also, this Section does not apply to dividends or distributions referred to in Section 10.07 or to rights or warrants referred to in Section 10.08. 49 Section 10.10. Voluntary Adjustment. The Company at any time may reduce the conversion price or increase the conversion rate, temporarily or otherwise, by any amount but in no event shall such adjusted conversion price or conversion rate result in shares of Parent Stock being issuable upon conversion of the Securities if converted at the time of such adjustment at an effective conversion price per share less than the par value of the Parent Stock at the time such adjustment is made. A voluntary adjustment of the conversion price or conversion rate pursuant to this Section 10.10 does not change or adjust the conversion price or conversion rate otherwise in effect for purposes of Section 10.07, 10.08 or 10.09. If an event requiring an adjustment to the conversion price or conversion rate pursuant to Section 10.07, 10.08 or 10.09 occurs at any time that a voluntary adjustment to the conversion price or conversion rate is in effect pursuant to this Section 10.10, then the adjustment required by the applicable of Section 10.07, 10.08 or 10.09 shall be made to the conversion price or conversion rate that would otherwise have been in effect as of the relevant date specified in such Section had no voluntary adjustment pursuant to this Section 10.10 been made, and for purposes of applying such Section, any such voluntary adjustment shall be disregarded. If such adjustment would result in a lower conversion price or a higher conversion rate, as the case may be, than the conversion price or conversion rate as voluntarily adjusted by the Company, then such lower conversion price or higher conversion rate shall be the conversion price or conversion rate, as the case may be. Section 10.11. Certain Definitions. For the purposes of this Article, the following terms have the following meanings: "Average Market Price" of a share of Parent Stock on the Determination Date for any issuance of rights or warrants or any distribution in respect of which the Average Market Price is being calculated means the average of the daily current market prices of the Parent Stock for the shortest of: (i) the period of 30 consecutive trading days commencing 45 trading days before such Determination Date, (ii) the period commencing on the date next succeeding the first public announcement of the issuance of rights or warrants or the distribution in respect of which the Average Market Price is being calculated and ending on the last full trading day before such Determination Date, and (iii) the period, if any, commencing on the date next succeeding the Ex-Dividend Date with respect to the next preceding issuance of rights or warrants or distribution for which an adjustment is required by the provisions of Section 10.07(4), 10.08 or 10.09, and ending on the last full trading day before such Determination Date. If the record date for an issuance of rights or warrants or a distribution for which an adjustment is required by the provisions of Section 10.07(4), 10.08 or 10.09 (the "preceding adjustment event") precedes the record date for the issuance or distribution in respect of which the Average Market Price is being calculated and the Ex-Dividend Date for such preceding adjustment event is on or after the Determination Date for the issuance or distribution in respect of which the Average Market Price is being calculated, then the Average Market Price shall be adjusted by deducting therefrom the fair market value (on the record date for the issuance or distribution in respect of which the Average Market Price is being calculated), as determined by the Board of Directors, of the capital stock, rights, warrants, assets or debt securities issued or distributed in respect of each share of Parent Stock in such preceding adjustment event. Further, in the event that the Ex-Dividend Date (or in the case of a subdivision, combination or reclassification, the effective date with respect thereto) with respect to a dividend, subdivision, combination or reclassification to which Section 10.07(1), (2), (3) or (5) applies occurs during the period applicable for calculating the Average Market Price, then the Average Market Price shall be calculated for such period in a manner determined by the Board of Directors to reflect the impact of such dividend, subdivision, combination or reclassification on the current market price of the Parent Stock during such period. 50 "current market price" of a share of Parent Stock on any day means the last reported sale price, regular way (or, if no sale price is reported, the average of the high and low bid prices), on such day on the Nasdaq Stock Market or as quoted by the National Quotation Bureau Incorporated, or if the Parent Stock is listed on an exchange, on the principal exchange on which the Parent Stock is listed. In the event that no such quotation is available for any day, the Board of Directors shall be entitled to determine the current market price on the basis of such quotations as it considers appropriate. "Determination Date" for any issuance of rights or warrants or any distribution to which Section 10.08 or 10.09 applies means the earlier of (i) the record date for the determination of stockholders entitled to receive the rights or warrants or the distribution to which such Section applies and (ii) the Ex-Dividend Date for such rights, warrants or distribution. "Ex-Dividend Date" means the date on which "ex-dividend" trading commences for a dividend, an issuance of rights or warrants or a distribution to which any of Sections 10.07, 10.08 and 10.09 applies in the over-the-counter market or on the principal exchange on which the Parent Stock is then quoted or listed. Section 10.12. When Adjustment May Be Deferred. In any case in which this Article shall require that an adjustment shall become effective immediately after a record date for an event, the Company may defer until the occurrence of such event (i) issuing to the Holder of any Security converted after such record date and before the occurrence of such event the additional shares of Parent Stock issuable upon such conversion by reason of the adjustment required by such event over and above the shares of Parent Stock issuable upon such conversion before giving effect to such adjustment and (ii) paying to such Holder cash or its check in lieu of any fractional interest to which he is entitled pursuant to Section 10.04; provided, however, that the Company shall deliver to such Holder a due bill or other appropriate instrument evidencing such Holder's rights to receive such additional shares of Parent Stock, and such cash, upon the occurrence of the event requiring such adjustment. Section 10.13. When Adjustment Is Not Required. No adjustments in the conversion price or conversion rate need be made unless the adjustment would require an increase or decrease of at least one percent (1%) in the initial conversion price or conversion rate. Any adjustment which is not made shall be carried forward and taken into account in any subsequent adjustment. All calculations under this Article shall be made to the nearest cent or to the nearest 1/100th of a share, as the case may be. No adjustment in the conversion price or conversion rate shall be made because the Parent issues, in exchange for cash, property or services, shares of Parent Stock, or any securities convertible into or exchangeable for shares of Parent Stock, or securities carrying the right to purchase shares of Parent Stock or such convertible or exchangeable securities. No adjustment in the conversion price or conversion rate need be made under this Article for sales of shares of Parent Stock pursuant to a Parent plan providing for reinvestment of dividends or interest or in the event the par value of the Parent Stock is changed. No adjustment in the conversion price or conversion rate need be made for a transaction referred to in Section 10.07, 10.08 or 10.09 if Securityholders are to participate in the transaction on a basis and with notice that the Board of Directors determines to be fair and appropriate in light of the basis and notice on which holders of Parent Stock participate in the transaction; provided that the basis on which the Securityholders are to participate in the transaction shall not be deemed to be fair if it would require the conversion of Securities at any time prior to the expiration of the conversion period specified for such Securities. To the extent the Securities become convertible into cash, no adjustment need be made thereafter as to the cash. Interest will not accrue on the cash. 51 Section 10.14. Notice of Adjustment. Whenever the conversion price or conversion rate is adjusted, the Company shall promptly give notice of the adjustment to Securityholders in accordance with Section 11.02 hereof and file with the Trustee an Officers' Certificate briefly stating the new conversion price or conversion rate, the date it becomes effective, the facts requiring the adjustment and the manner of computing it. The certificate shall be conclusive evidence that the adjustment is correct. Section 10.15. Notice of Certain Transactions. If: (1) the Parent takes any action which would require an adjustment in the conversion price or conversion rate; (2) the Parent consolidates or merges with, or transfers all or substantially all of its assets to, another corporation, and stockholders of the Parent must approve the transaction; or (3) there is a dissolution or liquidation of the Parent, a Holder of a Security may want to convert it into shares of Parent Stock prior to the record date for, or the effective date of, the transaction so that he may receive the rights, warrants, securities or assets which a holder of shares of Parent Stock on that date may receive. Therefore, the Company shall give to the Securityholders and the Trustee in accordance with Section 11.02 a notice stating the proposed record or effective date, as the case may be. Failure to give the notice or any defect in it shall not affect the validity of any transaction referred to in clause (1), (2) or (3) of this Section. Section 10.16. Consolidation, Merger or Sale of the Parent. If the Parent is a party to a transaction described in Section 5.01 or a merger which reclassifies or changes its outstanding Parent Stock, the Company shall take such actions as may be necessary, in the good faith opinion of the Board of Directors, to ensure that (i) the Holder of a Security may convert it into the kind and amount of securities or cash or other assets which he would have owned immediately after the consolidation, merger or transfer if he had converted the Security immediately before the effective date of such transaction, assuming (to the extent applicable) that such Holder failed to exercise any rights of election with respect thereto and received per share of Parent Stock the kind and amount of securities, cash or assets received per share by a plurality of the non-electing shares and (ii) the kind and amount of securities into which the Securities become convertible as a result of the consolidation, merger or transfer are subject to adjustments which are as nearly equivalent as may be practical to the adjustments provided for in this Article. The Company shall give to each Securityholder in accordance with Section 11.02 a notice describing the actions so taken. If this Section applies, Sections 10.07, 10.08 and 10.09 shall not apply. Section 10.17. Company Determination Final. Any determination which the Board of Directors must make pursuant to Section 10.07, 10.09, 10.11, 10.13 or 10.16 is conclusive and binding on the Holders. Section 10.18. Trustee's and Conversion Agent's Disclaimer. Neither the Trustee nor any Conversion Agent has any duty to determine when an adjustment under this Article should be made, how it should be made or what it should be. Neither the Trustee nor the Conversion Agent has any duty to determine whether any actions taken by the Company in accordance with Section 10.16 are sufficient. Neither the Trustee nor any Conversion Agent makes any representation as to the validity or value of any securities or assets issued upon conversion of Securities. Neither the Trustee nor any Conversion Agent shall be responsible for the Company's failure to comply with this Article. 52 Section 10.19. Simultaneous Adjustments. In the event that this Article Ten requires adjustments to the conversion price or conversion rate under more than one of Sections 10.07(4), 10.08 or 10.09, and the record dates for the distributions giving rise to such adjustments shall occur on the same date, then such adjustments shall be made by applying, first, the provisions of Section 10.07, second, the provisions of Section 10.09 and, third, the provisions of Section 10.08. ARTICLE ELEVEN Miscellaneous Section 11.01. Trust Indenture Act Controls. If any provision of this Indenture limits, qualifies or conflicts with the duties imposed by any of TIA (S)(S) 310 to 317, inclusive, through operation of TIA (S) 318(c), such imposed duties shall control. Section 11.02. Notices. Any notice or communication (including any Act of Holders) shall be sufficiently given if in writing and delivered in person or mailed by first- class mail addressed as follows: If to the Company: TCI Communications, Inc. Terrace Tower II 5619 DTC Parkway Englewood, Colorado 80111-3000 Attention: Bernard W. Schotters, Executive Vice President and Treasurer If to the Trustee: The Bank of New York 101 Barclay Street, Floor 21W New York, New York 10286 Attention: Corporate Trust Administration The Company or the Trustee by notice to the other may designate additional or different addresses for subsequent notices or communications. Except as otherwise expressly provided herein or otherwise specified with respect to any series of Securities issuable as Bearer Securities pursuant to Section 2.02, where this Indenture provides for notice to Holders of Securities of any event: (1) such notice shall be sufficiently given to Holders of Registered Securities if in writing and mailed, first-class postage prepaid, to each Holder of a Registered Security affected by such event, at his address as it appears in the security register, not later than the latest date, and not earlier than the earliest date, prescribed for the giving of such notice; and (2) such notice shall be sufficiently given to Holders of Bearer Securities if published in an Authorized Newspaper in the City of New York and in such other city or cities as may be specified in such Securities on a Business Day at least twice, the first such publication to be not earlier than the earliest date, and not later than the latest date, prescribed for the giving of such notice (except that, for purposes of Section 2.05, notice of the appointment of a successor Authenticating Agent shall be sufficiently given to Holders of Bearer Securities if published as provided herein at least once). In case by reason of the suspension of regular mail service or by reason of any other cause it shall be impracticable to give such notice to Holders of Registered Securities by mail, then such notification as shall be 53 made with the approval of the Trustee shall constitute a sufficient notification for every purpose hereunder. In any case where notice to Holders of Registered Securities is given by mail, neither the failure to mail such notice, nor any defect in any notice so mailed, to any particular Holder of a Registered Security shall affect the sufficiency of such notice with respect to other Holders of Registered Securities or the sufficiency of any notice to Holders of Bearer Securities given as provided herein. In case by reason of the suspension of publication of any Authorized Newspaper or Authorized Newspapers or by reason of any other cause it shall be impracticable to publish any notice to Holders of Bearer Securities as provided above, then such notification to Holders of Bearer Securities as shall be given with the approval of the Trustee shall constitute sufficient notice to such Holders for every purpose hereunder. Neither the failure to give notice by publication to Holders of Bearer Securities as provided above, nor any defect in any notice so published, shall affect the sufficiency of any notice to Holders of Registered Securities given as provided herein. Where this Indenture provides for notice in any manner, such notice may be waived in writing by the person entitled to receive such notice, either before or after the event, and such waiver shall be equivalent of such notice. Waivers of notice by Holders of Securities shall be filed with the Trustee, but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver. Except for a notice to the Trustee, which is deemed given only when received, if a notice or communication is mailed in the manner provided above, it is duly given, whether or not the addressee receives it. Any notice or communication published in the manner provided above shall be deemed to have been given on the date of publication or, if published more than once, on the date of the first such publication. Any notice or communication required or permitted under this Indenture shall be in the English language, except that any published notice may be in the official language of the country of publication. Section 11.03. Communication by Holders with Other Holders. Securityholders may communicate pursuant to TIA (S) 312(b) with other Securityholders with respect to their rights under this Indenture or the Securities. The Company, the Trustee, the Registrar and anyone else shall have the protection of TIA (S) 312(c). Section 11.04. Certificate and Opinion as to Conditions Precedent. Upon any request or application by the Company to the Trustee to take any action under this Indenture, the Company shall furnish to the Trustee: (1) an Officers' Certificate stating that, in the opinion of the signers, all conditions precedent (including any covenants compliance with which constitutes a condition precedent), if any, provided for in this Indenture relating to the proposed action have been complied with; and (2) an Opinion of Counsel stating that, in the opinion of such counsel, all such conditions precedent (including any covenants compliance with which constitutes a condition precedent) have been complied with. Section 11.05. Statements Required in Certificate or Opinion. Each Officers' Certificate or Opinion of Counsel with respect to compliance with a condition or covenant provided for in this Indenture other than certificates provided pursuant to Section 4.07 shall include: (1) a statement that the person making such certificate or opinion has read such covenant or condition; (2) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based; (3) a statement that, in the opinion of such person, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and 54 (4) a statement as to whether or not, in the opinion of such person, such condition or covenant has been complied with. Section 11.06. When Treasury Securities Disregarded. In determining whether the Holders of the required aggregate principal amount of outstanding Securities of any series have given any request, demand, authorization, direction, notice, consent or waiver or taken any other action hereunder, Securities of such series owned by the Company or by any Affiliate of the Company shall be disregarded and deemed not to be outstanding, except that for the purpose of determining whether the Trustee shall be protected in relying on such request, demand, authorization, direction, notice, consent, waiver or action, only Securities of such series which the Trustee actually knows are so owned shall be so disregarded. Securities so owned that have been pledged in good faith may be regarded as outstanding if the pledgee establishes to the satisfaction of the Trustee the pledgee's right to so act with respect to such Securities and that the pledgee is not the Company or any Affiliate of the Company. Section 11.07. Rules by Trustee and Agents. Subject to Section 11.15 and Article Twelve, the Trustee may make reasonable rules for action by or a meeting of Securityholders of all series or any series. The Registrar, Paying Agent or Conversion Agent may make reasonable rules for its functions. Section 11.08. Legal Holidays. A "Legal Holiday" with respect to any place of payment or conversion or other location is a Saturday, a Sunday or a day on which banking institutions or trust companies in that place of payment, conversion or other location are not authorized or required to be open. If a payment date or the last day to convert a Security is a Legal Holiday at a place of payment or conversion, payment or conversion may be made at that place on the next succeeding day that is not a Legal Holiday, and no interest or original issue discount, as the case may be, shall accrue for the intervening period. Section 11.09. Governing Law. The internal laws of the State of New York shall govern this Indenture, the Securities and coupons. Section 11.10. No Adverse Interpretation of Other Agreements. This Indenture may not be used to interpret another indenture, loan or debt agreement of the Company or a Subsidiary. Any such indenture, loan or debt agreement may not be used to interpret this Indenture. Section 11.11. No Recourse Against Others. No past, present or future director, officer, employee or stockholder, as such, of the Company or the Trustee or any successor of either thereof shall have any liability for any obligations of the Company or the Trustee under the Securities or any coupons appertaining thereto or this Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation and all such liability is hereby waived and released. Such waiver and release are part of the consideration for the issue of the Securities. Section 11.12. Successors. All agreements of the Company in this Indenture and the Securities shall bind its successor. All agreements of the Trustee in this Indenture shall bind its successor. Section 11.13. Duplicate Originals. The parties may sign any number of copies of this Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. 55 Section 11.14. Table of Contents, Headings, etc. The table of contents and the titles and headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not to be considered a part hereof, and shall in no way modify or restrict any of the terms or provisions hereof. Section 11.15. Acts of Holders. (a) Any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be given or taken by Holders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Holders in person or by an agent duly appointed in writing. If Securities of a series are issuable as Bearer Securities, any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be given or taken by Holders of Securities of such series may, alternatively, be embodied in and evidenced by the record of Holders of Securities of such series voting in favor thereof, either in person or by proxies duly appointed in writing, at any meeting of Holders of Securities of such series duly called and held in accordance with the provisions of Article Twelve, or a combination of such instruments and any such record. Except as herein otherwise expressly provided, such action shall become effective when such instrument or instruments or record or both are delivered to the Trustee and, where it is hereby expressly required, to the Company. Such instrument or instruments and any such record (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the "Act" of the Holders signing such instrument or instruments and so voting at any such meeting. Proof of execution of any such instrument or of a writing appointing any such agent, or of the holding by any person of a Security, shall be sufficient for any purpose of this Indenture and (subject to Section 7.01) conclusive in favor of the Trustee and the Company and any agent of the Trustee or the Company, if made in the manner provided in this Section. The record of any meeting of Holders of Securities shall be proved in the manner provided in Section 12.06. (b) The fact and date of the execution by any person of any such instrument or writing may be proved by the affidavit of a witness of such execution or by a certificate of a notary public or other officer authorized by law to take acknowledgments of deeds. Where such execution is by a signer acting in a capacity other than his individual capacity, such certificate or affidavit shall also constitute sufficient proof of his authority. The fact and date of the execution of any such instrument or writing, or the authority of the person executing the same, may also be proved in any other manner which the Trustee deems sufficient. (c) The ownership, principal amount and serial numbers of outstanding Registered Securities held by any person, and the date of holding the same, shall be proved by the security register. (d) The ownership, principal amount and serial numbers of outstanding Bearer Securities held by any person, and the date of holding the same, may be proved by the production of such Bearer Securities or by a certificate executed, as depositary, by any trust company, bank, banker or other depositary, wherever situated, if such certificate shall be deemed by the Trustee to be satisfactory, showing that at the date therein mentioned such person had on deposit with such depositary or exhibited to it, the Bearer Securities therein described, or such facts may be proved by the certificate or affidavit of the person holding such Bearer Securities, if such certificate or affidavit is deemed by the Trustee to be satisfactory. The Trustee and the Company may assume that such ownership of any Bearer Securities continues until (1) another certificate or affidavit bearing a later date issued in respect of the same Bearer Security is produced, or (2) such Bearer Security is produced to the Trustee by some other person or (3) such Bearer Security is surrendered in exchange for a Registered Security or (4) such Bearer Security is no longer outstanding. The ownership, principal amount and serial numbers of outstanding Bearer Securities held by any person, and the date of holding the same, may also be proved in any other manner which the Trustee deems sufficient. (e) If the Company shall solicit from the Holders of any Registered Securities any request, demand, authorization, direction, notice, consent, waiver or other Act, the Company may at its option (but is not obligated to), by or pursuant to a resolution of the Board of Directors, fix in advance a record date for the determination of Holders of Registered Securities entitled to give such request, demand, authorization, direction, notice, consent, 56 waiver or other Act. Notwithstanding TIA (S) 316(c), such record date shall be the record date specified in or pursuant to such resolution of the Board of Directors, which shall be a date not earlier than 30 days prior to the first solicitation of Holders generally in connection therewith and not later than the date such solicitation is completed. If such a record date is fixed, such request, demand, authorization, direction, notice, consent, waiver or other Act may be given before or after such record date, but only the Holders of Registered Securities of record at the close of business on such record date shall be deemed to be Holders for the purpose of determining whether Holders of the requisite proportion of outstanding Securities have authorized or agreed or consented to such request, demand, authorization, direction, notice, consent, waiver or other Act, and for that purpose the outstanding Securities shall be computed as of such record date; provided that no such authorization, agreement or consent by the Holders of Registered Securities shall be deemed effective unless it shall become effective pursuant to the provisions of this Indenture not later than eleven months after the record date. (f) Any request, demand, authorization, direction, notice, consent, waiver or other action by the Holder of any Security shall bind such Holder and every future Holder of the same Security and the Holder of every Security issued upon the registration of transfer thereof or in exchange therefor or in lieu thereof in respect of anything done, omitted or suffered to be done by the Trustee, any Agent or the Company in reliance thereon, whether or not notation of such action is made upon such Security. ARTICLE TWELVE Meetings of Holders of Securities Section 12.01. Purposes for which Meetings may be Called. If Securities of a series are issuable as Bearer Securities, a meeting of Holders of Securities of such series may be called at any time and from time to time pursuant to this Article to make, give or take any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be made, given or taken by Holders of Securities of such series. Section 12.02. Call, Notice and Place of Meetings. (a) The Trustee may at any time call a meeting of Holders of Securities of any series for any purpose specified in Section 12.01, to be held at such time and at such place in the Borough of Manhattan, the City of New York, or in London as the Trustee shall determine. Notice of every meeting of Holders of Securities of any series, setting forth the time and the place of such meeting and in general terms the action proposed to be taken at such meeting, shall be given, in the manner provided in Section 11.02, not less than 21 nor more than 180 days prior to the date for the meeting. (b) In case at any time the Company pursuant to a resolution of the Board of Directors or the Holders of at least 10% of the aggregate principal amount of outstanding Securities of any series shall have requested the Trustee to call a meeting of the Holders of Securities of such series for any purpose specified in Section 12.01, by written request setting forth in reasonable detail the action proposed to be taken at the meeting, and the Trustee shall not have made the first publication of the notice of such meeting within 21 days after receipt of such request or shall not thereafter proceed to cause the meeting to be held as provided herein, the Company or the Holders of Securities of such series in the amount above specified, as the case may be, may determine the time and the place in the Borough of Manhattan, the City of New York, or in London for such meeting and may call such meeting for such purposes by giving notice thereof as provided in subsection (a) of this Section. Section 12.03. Persons Entitled to Vote at Meetings. To be entitled to vote at any meeting of Holders of Securities of any series, a person shall be (1) a Holder of one or more outstanding Securities of such series, or (2) a person appointed by an instrument in writing as proxy for a Holder or Holders of one or more outstanding Securities of such series by such Holder or Holders. 57 The only persons who shall be entitled to be present or to speak at any meeting of Holder of Securities of any series shall be the persons entitled to vote at such meeting and their counsel, any representatives of the Trustee and its counsel and any representatives of the Company and its counsel. Section 12.04. Quorum; Action. The persons entitled to vote a majority of the aggregate principal amount of the outstanding Securities of a series shall constitute a quorum for a meeting of Holders of Securities of such series. In the absence of a quorum within 30 minutes of the time appointed for any such meeting, the meeting shall, if convened at the request of Holders of Securities of such series, be dissolved. In any other case the meeting may be adjourned for a period of not less than 10 days as determined by the chairman of the meeting prior to the adjournment of such meeting. In the absence of a quorum at any such adjourned meeting, such adjourned meeting may be further adjourned for a period of not less than 10 days as determined by the chairman of the meeting prior to the adjournment of such adjourned meeting. Notice of the reconvening of any adjourned meeting shall be given as provided in Section 12.02(a), except that such notice shall be given only once not less than five days prior to the date on which the meeting is scheduled to be reconvened. Except as limited by the third sentence of Section 9.02, any resolution presented to a meeting or adjourned meeting duly reconvened at which a quorum is present as aforesaid may be adopted by the affirmative vote of the Holders of a majority in aggregate principal amount of the outstanding Securities of that series; provided, however, that, except as limited by the third sentence and of Section 9.02, any resolution with respect to any request, demand, authorization, direction, notice, consent, waiver or other action which this Indenture expressly provides may be made, given or taken by the Holders of a specified percentage, which is less than a majority, in aggregate principal amount of the outstanding Securities of a series, may be adopted at a meeting or an adjourned meeting duly reconvened at which a quorum is present as aforesaid, by the affirmative vote of the Holders of such specified percentage in aggregate principal amount of the outstanding Securities of that series. Any resolution passed or decision taken at any meeting of Holders of Securities of any series duly held in accordance with this Section shall be binding on all the Holders of Securities of such series and the related coupons, whether or not present or represented at the meeting. Notwithstanding the foregoing provisions of this Section 12.04, if any action is to be taken at a meeting of Holders of Securities of any series with respect to any request, demand, authorization, direction, notice, consent, waiver or other action that this Indenture expressly provides may be made, given or taken by the Holders of a specified percentage in aggregate principal amount of all outstanding Securities affected thereby, or of the Holders of such series and one or more additional series: (i) there shall be no minimum quorum requirement for such meeting; and (ii) the principal amount of the outstanding Securities of such series that vote in favor of such request, demand, authorization, direction, notice, consent, waiver or other action shall be taken into account in determining whether such request, demand, authorization, direction, notice, consent, waiver or other action has been made, given or taken under this Indenture. Section 12.05. Determination of Voting Rights; Conduct and Adjournment of Meetings. (a) Notwithstanding any other provisions of this Indenture, the Trustee may make such reasonable regulations as it may deem advisable for any meeting of Holders of Securities of a series in regard to proof of the holding of Securities of such series and of the appointment of proxies and in regard to the appointment and duties of inspectors of votes, the submission and examination of proxies, certificates and other evidence of the right to vote and such other matters concerning the conduct of the meeting as it shall deem appropriate. Except as otherwise permitted or required by any such regulations, the holding of Securities shall be proved in the manner specified in Section 11.15 and the appointment of any proxy shall be proved in the manner specified in Section 11.15 or by having the signature of the person executing the proxy witnessed or guaranteed by any trust 58 company, bank or banker authorized by Section 11.15 to certify to the holding of Bearer Securities. Such regulations may provide that written instruments appointing proxies, regular on their face, may be presumed valid and genuine without the proof specified in Section 11.15 or other proof. (b) The Trustee shall by an instrument in writing, appoint a temporary chairman of the meeting, unless the meeting shall have been called by the Company or by Holders of Securities as provided in Section 12.02(b), in which case the Company or the Holders of Securities of the series calling the meeting, as the case may be, shall in like manner appoint a temporary chairman. A permanent chairman and a permanent secretary of the meeting shall be elected by vote of the persons entitled to vote a majority of the aggregate principal amount of the outstanding Securities of such series represented at the meeting. (c) At any meeting each Holder of a Security of such series or proxy shall be entitled to one vote for each $1,000 principal amount of the outstanding Securities of such series held or represented by him, provided, however, that no vote shall be cast or counted at any meeting in respect of any Security challenged as not outstanding and ruled by the chairman of the meeting to be not outstanding. The chairman of the meeting shall have no right to vote, except as a Holder of a Security of such series or proxy. (d) Any meeting of Holders of Securities of any series duly called pursuant to Section 12.02 at which a quorum is present may be adjourned from time to time by persons entitled to vote a majority of the aggregate principal amount of the outstanding Securities of such series represented at the meeting and the meeting may be held as so adjourned without further notice. Section 12.06. Counting Votes and Recording Action of Meetings. The vote upon any resolution submitted to any meeting of Holders of Securities of any series shall be by written ballots on which shall be subscribed the signatures of the Holders of Securities of such series or of their representatives by proxy and the principal amount and serial numbers of the outstanding Securities of such series held or represented by them. The permanent chairman of the meeting shall appoint two inspectors of votes who shall count all votes cast at the meeting for or against any resolution and who shall make and file with the secretary of the meeting their verified written reports in duplicate of all votes cast at the meeting. A record, at least in duplicate, of the proceedings of each meeting of Holders of Securities of any series shall be prepared by the secretary of the meeting and there shall be attached to said record the original reports of the inspectors of votes on any vote by ballot taken thereat and affidavits by one or more persons having knowledge of the facts setting forth a copy of the notice of the meeting and showing that said notice was given as provided in Section 12.02 and, if applicable, Section 12.04. Each copy shall be signed and verified by the affidavits of the permanent chairman and secretary of the meeting and one such copy shall be delivered to the Company, and another to the Trustee to be preserved by the Trustee, the latter to have attached thereto the ballots voted at the meeting. Any record so signed and verified shall be conclusive evidence of the matters therein stated. 59 Signatures Dated: February 24, 1998 TCI Communications, Inc. /s/ Bernard W. Schotters By __________________________________ (Seal) Dated: February 24, 1998 The Bank of New York, Trustee /s/ Walter N. Gitlin By __________________________________ Walter N. Gitlin Vice President (Seal) EX-4.2 5 FORM OF 7 1/8 % SENIOR NOTES FORM OF EXHIBIT 4.2 TCI COMMUNICATIONS, INC. 7-1/8 SENIOR NOTE DUE FEBRUARY 15, 2028 1. Interest. TCI Communications, Inc. (the "Company"), a Delaware corporation, promises to pay interest on the principal amount of this Note (as defined below) at the rate per annum shown above. The Company will pay interest semiannually on February 15 and August 15 of each year, commencing August 15, 1998. Interest on this Note will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from February 24, 1998. Interest will be computed on the basis of a 360-day year of twelve 30-day months. 2. Method of Payment. The Company will pay interest on this Note (except defaulted interest) to the persons who are registered holders of this Note at the close of business on the first day of the month in which such interest payment occurs. Holders must surrender Notes to a Paying Agent to collect premium, if any, and principal payments. The Company will pay principal, premium, if any, and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts. The Company may, however, pay principal, premium, if any, and interest by its check payable in such money. It may mail an interest check to a holder's registered address. 3. Paying Agent and Registrar. Initially, The Bank of New York ("Trustee"), at 101 Barclay Street, New York, New York 10286, will act as Paying Agent and Registrar. The Company may change any Paying Agent, Registrar or co-Registrar without notice. The Company or any of its Subsidiaries may act as Paying Agent, Registrar or co-Registrar. 4. Indenture. This Note is one of a duly authorized issue of Securities of the Company (the "Notes"), issued and to be issued in one or more series under an Indenture dated as of February 19, 1998 (the "Indenture") between the Company and the Trustee. The terms of the Notes include those stated in the Indenture and those made part of the Indenture by the Trust Indenture Act of 1939, as amended (15 U.S. Code $$77aaa-77bbbb) (the "Act"). The Notes are subject to all such terms, and Noteholders are referred to the Indenture and the Act for a statement of them. All terms used in this Note which are defined in the Indenture shall have the meanings assigned to them in the Indenture. This Note is one of the series designated on the face hereof. The Notes of this series are general unsecured obligations of the Company limited to $300,000,000 in aggregate principal amount. 5. No Redemption. The Notes may not be redeemed by the Company prior to maturity, and are not entitled to the benefits of a sinking fund. 6. Denominations, Transfer, Exchange. The Notes are in registered form without coupons in denominations of $1,000 and integral multiples of $1,000. A holder may transfer or exchange Notes in accordance with the Indenture. The Registrar may require a holder, among other things, to furnish appropriate endorsements and transfer documents and to pay any taxes and fees required by law or permitted by the Indenture. 7. Persons Deemed Owners. The registered holder of a Note may be treated as the owner of it for all purposes. 8. Unclaimed Money. If money for the payment of principal, premium, if any, or interest remains unclaimed for two years, the Trustee or Paying Agent will pay the money back to the Company at its request. After that, holders entitled to the money must look to the Company for payment unless an abandoned property law designates another person. 9. Amendment, Supplement, Waiver. Subject to certain exceptions, the Indenture or the Securities of any series may be amended or supplemented, and any past default or compliance with any provision may be waived insofar as the Securities of any series are concerned, with the consent of the holders of a majority in principal amount of the outstanding Securities of such series. Without the consent of any Securityholder, the Company and the Trustee may amend or supplement the Indenture or the Securities of any series to cure any ambiguity, defect, or inconsistency or to provide for uncertificated Securities in addition to certificated Securities or to make certain other specified changes or any change that does not materially adversely affect the rights of any Securityholder. 10. Successor Corporation. When a successor corporation assumes all the obligations of its predecessor under the Notes and the Indenture, the predecessor corporation will be released from those obligations. 11. Defaults and Remedies. An Event of Default is: default for 30 days in payment of any interest on any Note; default in payment of principal or premium, if any, on any Note; failure by the Company, for 30 days after receipt of notice from the Trustee or the holders of at least 25% in principal amount of the outstanding Notes, to comply with any of its other agreements in the Indenture (other than an agreement which has expressly been included in the Indenture solely for the benefit of Securities of any series other than this series) or the Notes; acceleration of Debt of the Company (including Securities of any other series) representing in excess of five percent (5%) of the aggregate principal amount of the Company's Funded Debt then outstanding unless, within 30 days after receipt of notice by the Company from the Trustee or the holders of at least 25% in principal amount of the outstanding Notes, such acceleration has been rescinded or annulled, such Debt has been paid or the Company shall have contested such acceleration in good faith and by appropriate proceedings and have obtained and thereafter maintained a stay of all consequences thereof that would have a material adverse effect on the Company; and certain events of bankruptcy or insolvency. If an Event of Default with respect to the Notes shall occur and be continuing, the principal of, and the premium, if any, and accrued interest on, the Notes may be declared or may become due and payable in the manner and with the effect provided in the Indenture. In the event of a declaration of acceleration under the Indenture with respect to the Notes because an Event of Default has occurred due to the acceleration of Debt of the Company representing in excess of five percent (5%) of the aggregate principal amount of the Company's Funded Debt, such declaration of acceleration under the Indenture shall be automatically annulled if (a) as a result of the contest by the Company in appropriate proceedings of the acceleration of such Debt such acceleration is declared void ab initio, or (b) within 90 days of the declaration of acceleration under the Indenture the declaration of acceleration of such Debt has been rescinded or annulled in any manner authorized by the mortgage, indenture or instrument evidencing or creating such Debt and, in the case of this clause (b), the annulment of the declaration of acceleration under the Indenture would not conflict with any judgment or decree, and, in either case, all other existing Events of Default (other than the non-payment of the principal of and accrued interest, if any, on Securities of any series that have become due solely by such acceleration) with respect to the Notes have been cured or waived. Noteholders may not enforce the Indenture or the Notes except as provided in the Indenture. The Trustee may require indemnity satisfactory to it before it enforces the Indenture or the Notes. Subject to certain limitations, holders of a majority in principal amount of the outstanding Notes of this series may direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Noteholders notice of any continuing default (except a default in payment of principal, premium, if any, or interest) if it determines that withholding notice is in their interests. The Company is required to file periodic reports with the Trustee as to the absence of default. 12. Trustee Dealings with Company. The Trustee in its individual or any other capacity may make loans to, accept deposits from, and perform services for the Company or its Affiliates, and may otherwise deal with the Company or its Affiliates, as if it were not Trustee. 13. No Recourse Against Others. A director, officer, employee, or stockholder, as such, of the Company or the Trustee shall not have any liability for any obligations of the Company or the Trustee under the Notes or the Indenture or for any claim based on, in respect of, or by reason of such obligations or their creation. Each Noteholder by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for the issue of the Note. 14. Authentication. This Note shall not be valid until the Trustee signs the certificate of authentication on the other side of this Note. 15. Abbreviations. Customary abbreviations may be used in the name of a holder of a Note or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= custodian) and U/G/M/A (= Uniform Gifts to Minors Act). Additional abbreviations may be used though not in the above list. The Company will furnish to any holder of a Note upon written request and without charge a copy of the Indenture. Requests may be made to: Bernard W. Schotters, Executive Vice President and Treasurer, TCI Communications, Inc., 5619 DTC Parkway, Englewood, Colorado 80111-3000. ASSIGNMENT FORM If you the holder want to assign this Note, fill in the form below and have your signature guaranteed: For value received, I or we assign and transfer this Note to (Insert assignee's social security or tax ID number) (Print or type assignee's name, address, and zip code) and irrevocably appoint agent to transfer this Note on the books of the Company. The agent may substitute another to act for him. Dated: Your signature: (Sign exactly as your name appears on the other side of this Note) Signature Guarantee: REGISTEREDREGISTEREDNUMBER$TCI COMMUNICATIONS, INC. 7-1/8 % SENIOR NOTE DUE FEBRUARY 15, 2028 CUSIP 872287 AL 1 R TCI COMMUNICATIONS, INC., a Delaware corporation, promises to pay to or registered assigns the principal sum of DOLLARS on February 15, 2028 INTEREST Payment Dates: February 15 and August 15, commencing August 15, 1998. Record Dates: February 1 and August 1. DATED: TCI COMMUNICATIONS, INC. BY PRESIDENT SECRETARY [TCI Communications, Inc. Corporate Seal] CERTIFICATE OF AUTHENTICATION: The undersigned certifies that this is one of the Securities of the series designated herein referred to in the within-mentioned Indenture. The Bank of New York, as Trustee BY AUTHORIZED OFFICER EX-5.1 6 OPINION DATED 2/24/98 OF BAKER & BOTTS, L.L.P. [LETTERHEAD OF BAKER AND BOTTS, L.L.P.] EXHIBIT 5.1 February 24, 1998 TCI Communications, Inc. Terrace Tower II 5619 DTC Parkway Englewood, Colorado 80111 Gentlemen: Reference is made to the Registration Statement on Form S-3, Commission File No. 333- 44745 (as amended, the "Registration Statement") filed by TCI Communications, Inc., a Delaware corporation (the "Company"), and Tele-Communications, Inc., a Delaware corporation (the "Parent"), in connection with the offering from time to time of (i) senior, senior subordinated or subordinated debt securities of the Company (the "Debt Securities"), (ii) shares of Series Preferred Stock of the Parent, which may be issued in the form of depositary shares evidenced by depositary receipts if the Parent elects to issue fractional interests in shares of a series of Series Preferred Stock, (iii) shares of Tele-Communications, Inc. Series A TCI Group Common Stock, par value $1.00 per share, of the Parent ("Series A TCI Group Common Stock"), (iv) shares of Series A TCI Group Common Stock issuable upon conversion of Debt Securities of the Company or upon conversion of Series Preferred Stock of the Parent, and (v) any guarantees of the Parent with respect to Debt Securities of the Company, for an aggregate initial offering price of up to $3 billion (or the equivalent thereof denominated in one or more foreign currencies or currency units). On February 19, 1998, the Company entered into an underwriting agreement (the "Underwriting Agreement") with Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Goldman, Sachs & Co., Salomon Brothers Inc, Bear, Stearns & Co. Inc., Credit Suisse First Boston Corporation and Lehman Brothers Inc. (collectively, the "Underwriters") pursuant to which the Company agreed to sell to the Underwriters, subject to the conditions stated in the Underwriting Agreement, $300,000,000 aggregate principal amount of a series of the Company's senior Debt Securities designated as its "7 1/8% Senior Notes due February 15, 2028" (the "Notes"). In connection herewith, we have examined, among other things, copies of the Restated Certificate of Incorporation and By-laws of the Company, each as amended, certified to our satisfaction; the Underwriting Agreement; the Indenture, dated as of February 19, 1998 (the "Indenture"), between the Company and The Bank of New York, as Trustee (the "Trustee"); the form of the Notes; copies of records of proceedings of the Company's Board of Directors, including TCI Communications, Inc. February 24, 1998 Page 2 committees thereof, certified to our satisfaction; the Company Order, dated February 24, 1998, addressed to the Trustee (the "Company Order"); and such other documents, records, certificates and questions of law as we deemed necessary or appropriate for the purpose of this opinion. In rendering the opinions expressed herein, we have assumed: (i) the authenticity of all documents submitted to us as original documents and the conformity to authentic original documents of all documents submitted to us as certified, conformed or reproduction copies; (ii) that the signatures on all documents examined by us are genuine; and (iii) that the Indenture and the Underwriting Agreement have been duly and validly authorized, executed and delivered by, and constitute the valid and binding obligations of, the parties thereto other than the Company. In addition, we have relied upon the truth and correctness of certificates of public officials and statements and certificates of officers and representatives of the Company. Based upon the foregoing, we are of the opinion that the Notes have been duly authorized and, when duly executed by the proper officers of the Company, completed, authenticated and delivered by the Trustee in accordance with the Indenture and issued and sold to the Underwriters pursuant to the terms of the Underwriting Agreement, the Notes will be legal, valid and binding obligations of the Company entitled to the benefits of the Indenture and enforceable in accordance with their terms, except (A) as such enforceability may be limited by bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium and other laws affecting creditors' rights generally, and (B) that the remedy of specific performance and injunctive and other forms of equitable relief are subject to certain equitable defenses and to the discretion of the court before which any proceeding therefor may be brought. Except as stated above, we express no opinion with respect to any other matter. We hereby consent to the filing of this opinion as Exhibit 5.1 to the Company's Current Report on Form 8-K, dated February 24, 1998, and to the reference to us under the heading "Validity of the Notes" in the Prospectus Supplement, dated February 19, 1998, to the Prospectus, dated February 19, 1998, forming a part of the Registration Statement and to the incorporation of this opinion by reference into the Registration Statement. In giving the foregoing consent, we do not admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended, or the rules and regulations of the Securities and Exchange Commission promulgated thereunder. TCI Communications, Inc. February 24, 1998 Page 3 Jerome H. Kern, a special counsel to Baker & Botts, L.L.P., is a director of the Parent. Certain partners of Baker & Botts, L.L.P. and Mr. Kern hold shares, restricted shares and/or options to purchase shares of the common stock of the Parent. Very truly yours, /s/ Baker & Botts, L.L.P. ------------------------------ BAKER & BOTTS, L.L.P. EX-5.2 7 OPINION DATED 2/24/98 OF BAKER & BOTTS L.L.P. [LETTERHEAD OF BAKER BOTTS, L.L.P.] EXHIBIT 5.2 February 24, 1998 TCI Communications, Inc. Terrace Tower II 5619 DTC Parkway Englewood, Colorado 80111-3000 Gentlemen: Reference is made to the Registration Statement on Form S-3, Commission File No. 333- 44745 (as amended, the "Registration Statement") filed by TCI Communications, Inc., a Delaware corporation (the "Company"), and Tele-Communications, Inc., a Delaware corporation (the "Parent"), in connection with the proposed offering from time to time of (i) senior, senior subordinated or subordinated debt securities of the Company (the "Debt Securities"), (ii) shares of Series Preferred Stock of the Parent, which may be issued in the form of depositary shares evidenced by depositary receipts if the Parent elects to issue fractional interests in shares of a series of Series Preferred Stock, (iii) shares of Tele-Communications, Inc. Series A TCI Group Common Stock, par value $1.00 per share, of the Parent ("Series A TCI Group Common Stock"), (iv) shares of Series A TCI Group Common Stock issuable upon conversion of Debt Securities of the Company or upon conversion of Series Preferred Stock of the Parent, and (v) any guarantees of the Parent with respect to Debt Securities of the Company, for an aggregate initial offering price of up to $3 billion (or the equivalent thereof denominated in one or more foreign currencies or currency units). On February 24, 1998, the Company entered into a Distribution Agreement with Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Credit Suisse First Boston Corporation, Lehman Brothers Inc. and Salomon Brothers Inc (collectively, the "Agents") relating to the offer of sale from time to time of up to $750,000,000 (or the equivalent thereof denominated in one or more foreign currencies or currency units) aggregate principal amount of a series of the Company's senior Debt Securities designated as its "Medium-Term Notes, Series D" (the "Medium-Term Notes"). In connection herewith, we have examined, among other things, copies of the Restated Certificate of Incorporation and By-Laws of the Company, each as amended, certified to our satisfaction; the Distribution Agreement; the Indenture, dated as of February 19, 1998, between the Company and The Bank of New York, as Trustee (the "Indenture"); copies of records of proceedings TCI Communications, Inc. February 24, 1998 Page 2 of the Company's Board of Directors, including committees thereof (the "Board Resolutions"), certified to our satisfaction, with respect to the filing of the Registration Statement, the execution and delivery of the Distribution Agreement and the Indenture, the establishment in accordance with the Indenture of the Medium-Term Notes as a series of senior Debt Securities, and actions taken or to be taken in connection with the issuance and delivery of senior Debt Securities of such series, including the establishment of certain terms thereof; the Company Order, dated February 24, 1998, addressed to the Trustee (the "Company Order"); the form of fixed rate Medium-Term Note and the form of floating rate Medium-Term Note (collectively, the "Notes") approved by the Board Resolutions; and such other documents, records, certificates and questions of law as we deemed necessary or appropriate for the purpose of this opinion. In rendering the opinions expressed herein, we have assumed: (i) the authenticity of all documents submitted to us as original documents and the conformity to authentic original documents of all documents submitted to us as certified, conformed or reproduction copies; (ii) that the signatures on all documents examined by us are genuine; (iii) that the Indenture has been duly and validly authorized, executed and delivered by the Trustee, and constitutes the valid and binding obligation thereof; (iv) that the Notes, prior to delivery against payment therefor pursuant to the Distribution Agreement, will be executed by the proper officers of the Company, completed, authenticated and delivered by the Trustee in accordance with the Indenture, and issued by the Company, all as contemplated by and in accordance with the Company Order and the procedures specified therein; and (v) that the terms of the Notes as described in each pricing supplement to the Prospectus (as defined below) in the form filed with the Securities and Exchange Commission (the "Commission") pursuant to Rule 424(b) under the Securities Act of 1933, as amended (the "Act"), will conform in all respects to the terms contained in the written instructions from the proper officers of the Company to the Trustee pursuant to the Company Order. In addition, we have relied upon the truth and correctness of certificates of public officials and statements and certificates of officers and representatives of the Company. Based upon the foregoing, we are of the opinion that when the Notes have been (a) duly executed by the proper officers of the Company, (b) completed, authenticated and delivered by the Trustee in accordance with the Indenture, (c) issued and delivered by the Company and (d) paid for, all as contemplated by and in accordance with the Company Order, the procedures specified therein and the Distribution Agreement, the Notes will be legal, valid and binding obligations of the Company entitled to the benefits of the Indenture and enforceable in accordance with their terms, except (A) as such enforceability may be limited by bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium and other laws affecting creditors' rights generally, and (B) that the remedy of specific performance and injunctive and other forms of equitable relief are subject to TCI Communications, Inc. February 24, 1998 Page 3 certain equitable defenses and to the discretion of the court before which any proceeding therefor may be brought. Except as stated above, we express no opinion with respect to any other matter. We are furnishing this opinion to you solely in connection with the offering, issuance and sale of the Notes in the manner described in the Company's prospectus, dated February 19, 1998, forming a part of the Registration Statement (the "Basic Prospectus"), and the related prospectus supplement, dated February 24, 1998, in the form to be filed with the Commission pursuant to Rule 424(b) under the Act (the Basic Prospectus as supplemented by such prospectus supplement being referred to herein as the "Prospectus") and subject to your taking any other necessary actions in connection therewith including the filing with the Commission of one or more pricing supplements to the Prospectus, and this opinion is not to be relied upon, circulated, quoted, or otherwise referred to for any other purpose without our prior written consent. We hereby consent to the filing of this opinion as Exhibit 5.2 to the Company's Current Report on Form 8-K, dated February 24, 1998, and to the incorporation by reference of this opinion into the Registration Statement. In giving the foregoing consent, we do not admit that we are in the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the Commission promulgated thereunder. Jerome H. Kern, a special counsel to Baker & Botts, L.L.P., is a director of the Parent. Certain partners of Baker & Botts, L.L.P. and Mr. Kern hold shares, restricted shares and/or options to purchase shares of the common stock of the Parent. Very truly yours, /s/ Baker & Botts, L.L.P. ------------------------------ BAKER & BOTTS, L.L.P. -----END PRIVACY-ENHANCED MESSAGE-----