any unexercised options are automatically canceled. In this case, Mr. Allen, or,
at his option, Charter Communications Holding Company will have the right for
ninety days after termination to purchase all membership units held by the
optionee for a purchase price equal to the exercise price at which the optionee
acquired the membership units, or the optionee's purchase price for the
membership units if they were not acquired on the exercise of an option.
In the event of an optionee's death or disability, all vested options may
be exercised until the earlier of their expiration and one year after the date
of the optionee's death or disability. Any options not so exercised will
automatically be canceled.
Upon termination for any other reason, all unvested options will
immediately be canceled and the optionee will not be entitled to any payment.
All vested options will be automatically canceled if not exercised within ninety
days after termination.
LIMITATION OF DIRECTORS' LIABILITY AND INDEMNIFICATION MATTERS
Charter Communications, Inc.'s restated certificate of incorporation will
limit the liability of directors to the maximum extent permitted by Delaware
law. The Delaware General Corporation Law provides that a corporation may
eliminate or limit the personal liability of a director for monetary damages for
breach of fiduciary duty as a director, except for liability for:
(1) any breach of the director's duty of loyalty to the corporation and its
(2) acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law;
(3) unlawful payments of dividends or unlawful stock purchases or
(4) any transaction from which the director derived an improper personal
Charter Communications, Inc.'s bylaws provide that Charter Communications,
Inc. shall indemnify all persons whom it may indemnify pursuant thereto to the
fullest extent permitted by law.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers or persons controlling Charter
Communications, Inc. pursuant to the foregoing provisions, we have been informed
that in the opinion of the Securities and Exchange Commission, such
indemnification is against public policy as expressed in the Securities Act and
is therefore unenforceable.