EXHIBIT 7.1
VOTING AGREEMENT
This VOTING AGREEMENT dated as of March 26, 1997 is made and entered
into by and among The Hearst Corporation, a Delaware corporation ("Parent"),
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Argyle Television Investors, L.P., a Delaware limited partnership (the
"Stockholder"), and ATI General Partner, L.P., a Delaware limited partnership
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(the "General Partner").
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WHEREAS, Parent, HAT Merger Sub, Inc. ("Merger Sub"), HAT Contribution
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Sub, Inc. ("Parent's Sub") and Argyle Television, Inc., a Delaware corporation
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(the "Company"), propose to enter into an Agreement and Plan of Merger of even
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date herewith (as the same may be amended or supplemented, the "Merger
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Agreement") providing for the contribution of certain assets by Parent and
Parent's Sub to the Company and the merger of Merger Sub with and into the
Company (the "Merger");
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WHEREAS, the Stockholder owns in the aggregate 6.6 million shares of
Series C Common Stock, par value $0.01 per share, of the Company (the "Series C
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Common Stock"); such shares of Series C Common Stock, as such shares may be
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adjusted by any stock dividend, stock split, recapitalization, combination or
exchange of shares, merger, consolidation, reorganization or other change or
transaction of or by the Company, being referred to herein as the "Subject
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Shares";
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WHEREAS, the Series C Common Stock is convertible into Series A Common
Stock, par value $0.01 per share, of the Company (the "Series A Common Stock");
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WHEREAS, the Stockholder intends to form a new limited partnership
(the "Foreign Partnership"), pursuant to Section 14.1 of the Amended and
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Restated Agreement of Limited Partnership of the Stockholder, dated May 10, 1995
(the "Limited Partnership Agreement"), for the purpose of holding those shares
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of Series C Common Stock attributable to its current foreign limited partners
(the "Foreign Shares");
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WHEREAS, the General Partner is the sole general partner of the
Stockholder;
WHEREAS, The Bear ▇▇▇▇▇▇▇ Companies Inc. ("Bear ▇▇▇▇▇▇▇"), is a party
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to a certain Letter Agreement dated June 7, 1995, (the "Letter Agreement") with
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the General Partner, Argyle Television Partners, L.P., ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇ which entitles Bear ▇▇▇▇▇▇▇ to withdraw their
interest in the Subject Shares (upon their conversion to Series A Common Stock)
from the Stockholder;
WHEREAS, the General Partner has obtained from Bear ▇▇▇▇▇▇▇ a written
waiver of paragraph 2 of the Letter Agreement;
WHEREAS, the General Partner and the Stockholder have adopted a plan
of liquidation of the Stockholder (the "Liquidation Plan") providing for the
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distribution of the Series
A Common Stock to the partners of the Stockholder in accordance with the terms
of the Stockholder's Limited Partnership Agreement;
WHEREAS, although the Stockholder desires to effectuate the
Liquidation Plan as soon as practicable, as a condition to its willingness to
enter into the Merger Agreement, Parent has requested that the Stockholder enter
into this Agreement; and
WHEREAS, on behalf of all the partners of the Stockholder, the General
Partner and the Stockholder have agreed that they will not effectuate the
Liquidation Plan until immediately after the Company Stockholder Approval (as
defined in the Merger Agreement);
NOW, THEREFORE, to induce Parent to enter into, and in consideration
of its entering into, the Merger Agreement, and in consideration of the mutual
covenants and agreements set forth in this Agreement, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Representations and Warranties of the Stockholder and General
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Partner. The Stockholder and General Partner hereby represent and warrant to
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Parent as follows:
(a) Authority. Each of the Stockholder and General Partner is a
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limited partnership duly formed and is in good standing and existing
under the laws of the State of Delaware. Each of the Stockholder and
General Partner has full power and authority to enter into this
Agreement and to perform its obligations hereunder and consummate the
transactions contemplated hereby. This Agreement has been duly and
validly authorized, executed and delivered by each of the Stockholder
and General Partner and constitutes a legal, valid and binding
obligation of each of the Stockholder and General Partner enforceable
against the Stockholder and General Partner in accordance with its
terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
the enforcement of creditors' rights generally and by general
equitable principles (regardless of whether such enforceability is
considered in a proceeding in equity or law).
(b) Non-Contravention. The execution and delivery of this
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Agreement by each of the Stockholder and General Partner do not, and
the performance by each of the Stockholder and General Partner of its
obligations hereunder and the consummation of the transactions
contemplated hereby will not, conflict with, result in any violation
of, constitute (with or without notice or lapse of time or both) a
default under, result in or give to any person any right of payment or
reimbursement, termination, cancellation, modification or acceleration
of, or result in the creation or imposition of any lien upon any
assets or properties of the Stockholder under, any of the terms,
conditions or provisions of (i) the certificate of limited partnership
and agreement of limited partnership of each of the Stockholder and
General Partner, or (ii) subject to taking the action described in
paragraph (c) of this Section, (x) any statute, law, rule, regulation
or ordinance, or any judgment, decree, order, writ, permit or license,
of any court, tribunal,
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arbitrator, authority, agency, commission, official or other
instrumentality of the United States or any domestic, state, county,
city or other political subdivision (a "Governmental or Regulatory
--------------------------
Authority"), applicable to each of the Stockholder and General Partner
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or any of its respective assets or properties, or (y) any note, bond,
mortgage, security agreement, indenture, license, franchise, permit,
concession, contract, lease or other instrument, obligation or
agreement of any kind (together, "Contracts") to which each of the
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Stockholder and General Partner is a party or by which either the
Stockholder or General Partner or any of its respective assets or
properties is bound.
(c) Approvals and Consents. Except for the filing and approval
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of a premerger notification report by the Stockholder under the ▇▇▇▇-
▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of 1976, as amended, and the
rules and regulations thereunder (the "HSR Act") with respect to the
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conversion of the Subject Shares required by Section 3(c), filings
pursuant to Section 13(d) and 13(g) of the Securities Exchange Act of
1934, as amended, and the filing of this Agreement with the Federal
Communications Commission (the "FCC") pursuant to Section 73.3613 of
the FCC rules and regulations, no consent, approval or action of,
filing with or notice to any Governmental or Regulatory Authority is
necessary or required for the execution and delivery of this Agreement
by the Stockholder or General Partner, the performance by the
Stockholder or General Partner of its respective obligations hereunder
or the consummation of the transactions contemplated hereby.
(d) Subject Shares. The Stockholder has good and marketable
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title to the Subject Shares, free and clear of all liens, claims,
security interests, proxies, voting trusts or agreements,
understanding or arrangements or any other encumbrances whatsoever;
other than restrictions on transfer imposed by the registration
requirements of the Securities Act of 1933, as amended, and applicable
state securities laws. The Stockholder has the sole voting power and
sole power to issue instructions with respect to the matters set forth
in Section 3.
2. Representations and Warranties of the Parent. The Parent hereby
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represents and warrants to the Stockholder and General Partner as follows:
(a) Authority. The Parent is a corporation duly formed and is in
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good standing and existing under the laws of the State of Delaware.
The Parent has full power and authority to enter into this Agreement
and to perform its obligations hereunder and consummate the
transactions contemplated hereby. This Agreement has been duly and
validly authorized, executed and delivered by the Parent and
constitutes a legal, valid and binding obligation of the Parent
enforceable against the Parent in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and by general equitable
principles (regardless of whether such enforceability is considered in
a proceeding in equity or law).
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3. Covenants of the Stockholder and General Partner. Subject to
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Section 4, the Stockholder and General Partner hereby covenant and agree with
Parent as follows:
(a) Transfer of Foreign Shares. As soon as practicable after the
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date of this Agreement, the Stockholder shall transfer the Foreign
Shares to the Foreign Partnership.
(b) Joinder in the Agreement: Foreign Partnership.
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Simultaneously with the transfer of the Foreign Shares to the Foreign
Partnership, the Stockholder shall cause the Foreign Partnership to
execute and deliver to Parent a Voting Agreement, in the form attached
hereto as Exhibit A.
(c) Regulatory Filings; Conversion. As soon as practicable after
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the date of this Agreement, the Stockholder shall (i) take all actions
necessary to make the filings required of the Stockholder or its
affiliates under the HSR Act in order for the Stockholder to convert
all of the Subject Shares (other than the Foreign Shares) into shares
of Series A Common Stock pursuant to the Company's certificate of
incorporation, (ii) comply at the earliest practicable date with any
request for additional information received by the Stockholder from
the Federal Trade Commission (the "FTC") or the Antitrust Division of
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the Department of Justice (the "Antitrust Division") pursuant to the
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HSR Act and (iii) cooperate with the Company in connection with its
filings under the HSR Act and in connection with resolving any
investigation or other inquiry concerning such conversion commenced by
either the FTC, or the Antitrust Division or state attorneys general.
Upon the expiration or termination of the applicable waiting period
under the HSR Act, or as soon as practicable thereafter, the
Stockholder shall so convert the Subject Shares (other than the
Foreign Shares) from Series C Common Stock into Series A Common Stock.
(d) Withdrawals. Following the conversion of the Subject Shares
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(other than the Foreign Shares) from Series C Common Stock into Series
A Common Stock, the General Partner shall withhold its consent to the
withdrawal by any limited partner in the Stockholder of such limited
partner's interest in the Stockholder, pursuant to Section 5.3(b) of
the Limited Partnership Agreement.
(e) Vote for Merger. At any meeting of stockholders of the
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Company called to vote upon the amendment to the Company's Certificate
of Incorporation set forth in the Merger Agreement, the Merger and the
Merger Agreement or at any adjournment thereof or in any other
circumstances upon which a vote, consent or other approval with
respect to such amendment to the Company's Certificate of
Incorporation, the Merger and the Merger Agreement is sought, the
Stockholder shall vote (or cause to be voted) the Subject Shares, and
any other voting securities of the Company, owned by Stockholder
whether issued heretofore or hereafter, that the Stockholder owns or
has the right to vote, in favor of such amendment to the Company's
Certificate of Incorporation, the Merger, the adoption by the Company
of the Merger Agreement and the approval of the terms
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thereof and each of the other transactions contemplated by the Merger
Agreement, provided that the terms of the Merger Agreement shall not
have been amended to adversely affect the Stockholder.
(f) Vote Against Acquisition Proposals. At any meeting of
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stockholders of the Company or at any adjournment thereof or in any
other circumstances upon which the Stockholder's vote, consent or
other approval is sought, the Stockholder shall vote (or cause to be
voted) the Subject Shares, and any other voting securities of the
Company, owned by Stockholder whether issued heretofore or hereafter,
that the Stockholder owns or has the right to vote, except as
otherwise agreed in writing in advance by the Parent, against (i) any
proposal or offer with respect to any direct or indirect (A)
acquisition or purchase of fifteen percent (15%) or more of any
Company common stock outstanding, (B) acquisition or purchase of any
equity securities of any Material Subsidiary (as defined below), (C)
acquisition or purchase of all or any significant portion of the
assets of the Company or any Material Subsidiary, or (D) any merger,
consolidation, business combination, recapitalization, liquidation,
dissolution or similar transaction involving the Company or any of its
Material Subsidiaries (any such proposal or offer being hereinafter
referred to as an "Acquisition Proposal"), (ii) any change in the
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majority of the persons who constitute the Board of Directors of the
Company or (iii) any change in the present capitalization of the
Company or any amendment of the Company's certificate of incorporation
or by-laws or other proposal or transaction involving the Company or
any of its subsidiaries, which change, amendment or other proposal or
transaction would in any manner impede, frustrate, prevent or nullify
the amendment of the Company's Certificate of Incorporation set forth
in the Merger Agreement, the Merger, the Merger Agreement or any of
the other transactions contemplated by the Merger Agreement or which
could result in any of the conditions to the Parent's obligations
under the Merger Agreement not being fulfilled. For purposes of this
Agreement, "Material Subsidiary" means any direct or indirect
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"Significant Subsidiary" of the Company as that term is defined in
Rule 405 of the rules and regulations promulgated under the Securities
Act of 1933, as amended, or any Subsidiary (as defined below) of the
Company that either owns or operates a television broadcast station or
a license, permit or other authorization required by the Federal
Communications Commission in connection with the operation of its
business. In addition, "Subsidiary" means any corporation or other
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organization whether incorporated or unincorporated, of which more
than fifty percent (50%) of either the equity interest in, or voting
control of, such corporation or other organization is, directly or
indirectly through Subsidiaries or otherwise, beneficially owned by
the Company.
(g) Transfers. Except as set forth in Section 3(a) with respect
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to the Foreign Shares and Section 3(j), the Stockholder agrees not to
(i) sell, transfer, pledge, assign or otherwise dispose of, or enter
into any contract, option or other arrangement with respect to the
sale, transfer, pledge, assignment or other disposition of, the
Subject Shares to any person other than pursuant to the
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amendment of the Company's Certificate of Incorporation set forth in
the Merger Agreement, the Merger and the Merger Agreement or (ii)
enter into any voting arrangement, whether by proxy, voting
arrangement, voting agreement or otherwise with respect to the Subject
Shares.
(h) Each certificate evidencing the Subject Shares shall bear a
legend as follows:
THE SECURITIES REPRESENTED HEREBY ARE SUBJECT TO RESTRICTIONS ON
TRANSFER AND VOTING CONTAINED IN A VOTING AGREEMENT DATED AS OF
MARCH 26, 1997, A COPY OF WHICH IS ON FILE AT THE PRINCIPAL
OFFICE OF THE COMPANY.
(i) No Solicitations. Neither the Stockholder, the General
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Partner nor any of their respective officers, directors, employees,
agents, counsel, accountants, financial advisors, investment bankers,
consultants and other representatives (collectively,
"Representatives"), directly or indirectly, shall initiate, solicit,
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encourage, accept or take any other action knowingly to facilitate,
any inquiries or the making of, or participate in any discussions or
negotiations regarding, any Acquisition Proposal. In the event that
the Stockholder, the General Partner or any of their respective
Representatives receives from any person an Acquisition Proposal, the
Stockholder shall promptly advise, orally and in writing, such Person
of the terms of this Section 3(i), and shall promptly advise Parent of
such Acquisition Proposal and shall thereafter keep Parent reasonably
and promptly informed of all material facts and circumstances relating
to said Acquisition Proposal and the Stockholder's actions relating
thereto.
(j) Permitted Transfers. Notwithstanding anything contained in
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this Agreement to the contrary, the Stockholder may distribute the
Subject Shares (but only if they shall have been converted into shares
of Series A Common Stock) to the partners of the Stockholder following
the Company Stockholder Approval.
4. Termination. The covenants and agreements of the Stockholder and
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the General Partner contained in Section 3 shall terminate upon the earliest of
(i) the Effective Time (as defined in the Merger Agreement), or (ii) the
termination of the Merger Agreement in accordance with its terms.
5. General Provisions.
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(a) Expenses. All costs and expenses incurred in connection with
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this Agreement and the transactions contemplated hereby shall be paid
by the party incurring such expense.
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(b) Amendments. This Agreement may not be amended except by an
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instrument in writing signed by each of the parties hereto.
(c) Notice. All notices and requests and other communications
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hereunder must be in writing and will be deemed to have been given
only if delivered personally or by facsimile transmission or mailed
(first class postage prepaid) to the parties at the following
addresses or facsimile numbers:
(i) if to Parent, to:
The Hearst Corporation
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
with a copy to:
▇▇▇▇▇▇ & ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
(ii) if to the Stockholder or the General Partner, to
Argyle Television Investors, L.P.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇
with a copy to:
▇▇▇▇▇ ▇▇▇▇▇▇▇ Rain ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇, Esq.
All such notices, requests and other communications will (i) if
delivered personally to the address as provided in this Section, be
deemed given upon
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delivery, (ii) if delivered by facsimile transmission to the facsimile
number as provided in this Section, be deemed given upon receipt, and
(iii) if delivered by mail in the manner described above to the
address as provided in this Section, be deemed given upon receipt (in
each case regardless of whether such notice, request or other
communication is received by any other person to whom a copy of such
notice is to be delivered pursuant to this Section). Any party from
time to time may change its address, facsimile number or other
information for the purpose of notices to that party by giving notice
specifying such change to the other parties hereto.
(d) Entire Agreement. This Agreement supersedes all prior
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discussions and agreements among the parties hereto with respect to
the subject matter hereof, and contains the sole and entire agreement
among the parties hereto with respect to the subject matter hereof.
(e) No Third Party Beneficiary. The terms and provisions of this
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Agreement are intended solely for the benefit of each party hereto and
their respective successors or permitted assigns, and it is not the
intention of the parties to confer third-party beneficiary rights upon
any other person.
(f) No Assignment; Binding Effect. Neither this Agreement nor
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any right, interest or obligation hereunder may be assigned by any
party hereto without the prior written consent of the other parties
hereto and any attempt to do so will be void. Subject to the
preceding sentence, this Agreement is binding upon, inures to the
benefit of and is enforceable by the parties hereto and their
respective successors and assigns.
(g) Headings. The headings used in this Agreement have been
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inserted for convenience of reference only and do not define or limit
the provisions hereof.
(h) Severability. If any provision of this Agreement is held to
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be illegal, invalid or unenforceable under any present or future law,
and if the rights or obligations of any party hereto under this
Agreement will not be materially and adversely affected thereby, (i)
such provision will be fully severable, (ii) this Agreement will be
construed and enforced as if such illegal, invalid or unenforceable
provision had never comprised a part hereof, (iii) the remaining
provisions of this Agreement will remain in full force and effect and
will not be affected by the legal, invalid or unenforceable provision
or by its severance herefrom and (iv) in lieu of such illegal, invalid
or unenforceable provision, there will be added automatically as a
part of this Agreement a legal, valid and enforceable provision as
similar in terms to such illegal, invalid or unenforceable provision
as may be possible.
(i) No Waiver. The failure of any party hereto to exercise any
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right, power or remedy provided under this Agreement or otherwise
available in respect hereof at law or in equity, or to insist upon
compliance by any other party hereto
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with its obligations hereunder, and any custom or practice of the
parties at variance with the terms hereof shall not constitute a
waiver by such party of its right to exercise any such or other right,
power or remedy or to demand such compliance.
(j) Counterparts. This Agreement may be executed in any number
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of counterparts, each of which will be deemed an original, but all of
which together will constitute one and the same instrument.
(k) Governing Law. This Agreement shall be governed by and
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construed in accordance with the laws of the State of Delaware
applicable to a contract executed performed in such State without
giving effect to the conflicts of laws principles thereof.
6. Enforcement. The parties agree that irreparable damage would
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occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached.
It is accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement in any Federal court located in the
State of Delaware or in a Delaware state court, this being in addition to any
other remedy to which they are entitled at law or in equity. In addition, each
of the parties hereto (i) consents to submit such party to the personal
jurisdiction of any Federal court located in the State of Delaware or any
Delaware state court in the event any dispute arises out of this Agreement or
any of the transactions contemplated hereby, (ii) agrees that such party will
not attempt to deny or defeat such personal jurisdiction by motion or other
request for leave from any such court, (iii) agrees that such party will not
bring any action relating to this Agreement or any of the transactions
contemplated hereby in any court other than a Federal court sitting in the State
of Delaware or a Delaware state court and (iv) waives any right to trial by jury
with respect to any claim or proceeding related to or arising out of this
Agreement or any of the transactions contemplated hereby.
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IN WITNESS WHEREOF, each party hereto has caused this Agreement to be
signed by its officer or representative thereunto duly authorized as of the date
first above written.
THE HEARST CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Executive Vice President
ARGYLE TELEVISION INVESTORS, L.P.
By: ATI General Partner, L.P.
a Delaware limited partnership
By: Argyle Television Partners, L.P.
the sole general partner
By: Argyle Communications, Inc.
the sole general partner
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
ATI GENERAL PARTNER, L.P.
By: Argyle Television Partners, L.P.
a Delaware limited partnership
By: Argyle Communications, Inc.
the sole general partner
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
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EXHIBIT A
VOTING AGREEMENT
This VOTING AGREEMENT dated as of . , 1997 is made and entered into by
and among The Hearst Corporation, a Delaware corporation ("Parent"), [FOREIGN
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PARTNERSHIP, L.P.], a Delaware limited partnership (the "Stockholder"), and ATI
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General Partner, L.P., a Delaware limited partnership (the "General Partner").
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WHEREAS, Parent, HAT Merger Sub, Inc. ("Merger Sub"), HAT Contribution
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Sub, Inc. ("Parent's Sub") and Argyle Television, Inc., a Delaware corporation
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(the "Company"), propose to enter into an Agreement and Plan of Merger of even
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date herewith (as the same may be amended or supplemented, the "Merger
------
Agreement") providing for the contribution of certain assets by Parent and
Parent's Sub to the Company and the merger of Merger Sub with and into the
Company (the "Merger");
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WHEREAS, the Stockholder owns in the aggregate . shares of Series C
Common Stock, par value $0.01 per share, of the Company (the "Series C Common
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Stock"); such shares of Series C Common Stock, as such shares may be adjusted by
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any stock dividend, stock split, recapitalization, combination or exchange of
shares, merger, consolidation, reorganization or other change or transaction of
or by the Company, being referred to herein as the "Subject Shares";
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WHEREAS, the Series C Common Stock is convertible into Series A Common
Stock, par value $0.01 per share, of the Company (the "Series A Common Stock");
---------------------
WHEREAS, the General Partner is the sole general partner of the
Stockholder;
WHEREAS, immediately prior to the execution of this Agreement, the
Series C Common Stock was owned by Argyle Television Investors, L.P., a Delaware
limited partnership (the "Former Stockholder");
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WHEREAS, the General Partner and the Former Stockholder have adopted a
plan of liquidation of the Former Stockholder (the "Liquidation Plan") providing
----------------
for the distribution of the Series A Common Stock to the partners of the Former
Stockholder in accordance with the terms of the Former Stockholder's Limited
Partnership Agreement;
WHEREAS, the Liquidation Plan is equally applicable to the
Stockholder;
WHEREAS, although the Stockholder desires to effectuate the
Liquidation Plan as soon as practicable, as a condition to its willingness to
enter into the Merger Agreement, Parent has requested that the Stockholder enter
into this Agreement; and
WHEREAS, on behalf of all the partners of the Stockholder, the General
Partner and the Stockholder have agreed that they will not effectuate the
Liquidation Plan until immediately after the Company Stockholder Approval (as
defined in the Merger Agreement);
NOW, THEREFORE, to induce Parent to enter into, and in consideration
of its entering into, the Merger Agreement, and in consideration of the mutual
covenants and agreements set forth in this Agreement, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Representations and Warranties of the Stockholder and General
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Partner. The Stockholder and General Partner hereby represent and warrant to
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Parent as follows:
(a) Authority. Each of the Stockholder and General Partner is a
---------
limited partnership duly formed and is in good standing and existing
under the laws of the State of Delaware. Each of the Stockholder and
General Partner has full power and authority to enter into this
Agreement and to perform its obligations hereunder and consummate the
transactions contemplated hereby. This Agreement has been duly and
validly authorized, executed and delivered by each of the Stockholder
and General Partner and constitutes a legal, valid and binding
obligation of each of the Stockholder and General Partner enforceable
against the Stockholder and General Partner in accordance with its
terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
the enforcement of creditors' rights generally and by general
equitable principles (regardless of whether such enforceability is
considered in a proceeding in equity or law).
(b) Non-Contravention. The execution and delivery of this
-----------------
Agreement by each of the Stockholder and General Partner do not, and
the performance by each of the Stockholder and General Partner of its
obligations hereunder and the consummation of the transactions
contemplated hereby will not, conflict with, result in any violation
of, constitute (with or without notice or lapse of time or both) a
default under, result in or give to any person any right of payment or
reimbursement, termination, cancellation, modification or acceleration
of, or result in the creation or imposition of any lien upon any
assets or properties of the Stockholder under, any of the terms,
conditions or provisions of (i) the certificate of limited partnership
and agreement of limited partnership of each of the Stockholder and
General Partner, or (ii) subject to taking the action described in
paragraph (c) of this Section, (x) any statute, law, rule, regulation
or ordinance, or any judgment, decree, order, writ, permit or license,
of any court, tribunal, arbitrator, authority, agency, commission,
official or other instrumentality of the United States or any
domestic, state, county, city or other political subdivision (a
"Governmental or Regulatory Authority"), applicable to each of the
------------------------------------
Stockholder and General Partner or any of its respective assets or
properties, or (y) any note, bond, mortgage, security agreement,
indenture, license, franchise, permit, concession, contract, lease or
other instrument, obligation or agreement of any kind (together,
"Contracts") to which each of the Stockholder and General Partner is a
---------
party or by which either the Stockholder or General Partner or any of
its respective assets or properties is bound.
A-2
(c) Approvals and Consents. Except for the filing and approval
----------------------
of a premerger notification report by the Stockholder under the ▇▇▇▇-
▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of 1976, as amended, and the
rules and regulations thereunder (the "HSR Act") with respect to the
-------
conversion of the Subject Shares required by Section 3(a), filings
pursuant to Section 13(d) and 13(g) of the Securities Exchange Act of
1934, as amended, and the filing of this Agreement with the Federal
Communications Commission (the "FCC") pursuant to Section 73.3613 of
the FCC rules and regulations, no consent, approval or action of,
filing with or notice to any Governmental or Regulatory Authority is
necessary or required for the execution and delivery of this Agreement
by the Stockholder or General Partner, the performance by the
Stockholder or General Partner of its respective obligations hereunder
or the consummation of the transactions contemplated hereby.
(d) Subject Shares. The Stockholder has good and marketable
--------------
title to the Subject Shares, free and clear of all liens, claims,
security interests, proxies, voting trusts or agreements,
understanding or arrangements or any other encumbrances whatsoever;
other than restrictions on transfer imposed by the registration
requirements of the Securities Act of 1933, as amended, and applicable
state securities laws. The Stockholder has the sole voting power and
sole power to issue instructions with respect to the matters set forth
in Section 3.
2. Representations and Warranties of the Parent. The Parent hereby
--------------------------------------------
represents and warrants to the Stockholder and General Partner as follows:
(a) Authority. The Parent is a corporation duly formed and is in
---------
good standing and existing under the laws of the State of Delaware.
The Parent has full power and authority to enter into this Agreement
and to perform its obligations hereunder and consummate the
transactions contemplated hereby. This Agreement has been duly and
validly authorized, executed and delivered by the Parent and
constitutes a legal, valid and binding obligation of the Parent
enforceable against the Parent in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and by general equitable
principles (regardless of whether such enforceability is considered in
a proceeding in equity or law).
3. Covenants of the Stockholder and General Partner. Subject to
------------------------------------------------
Section 4, the Stockholder and General Partner hereby covenant and agree with
Parent as follows:
(a) Regulatory Filings; Conversion. As soon as practicable after
------------------------------
the date of this Agreement, the Stockholder shall (i) take all actions
necessary to make the filings required of the Stockholder or its
affiliates under the HSR Act in order for the Stockholder to convert
all of the Subject Shares into shares of Series A Common Stock
pursuant to the Company's certificate of incorporation, (ii) comply at
the earliest practicable date with any request for additional
information received
A-3
by the Stockholder from the Federal Trade Commission (the "FTC") or
---
the Antitrust Division of the Department of Justice (the "Antitrust
---------
Division") pursuant to the HSR Act and (iii) cooperate with the
--------
Company in connection with its filings under the HSR Act and in
connection with resolving any investigation or other inquiry
concerning such conversion commenced by either the FTC, or the
Antitrust Division or state attorneys general. Upon the expiration or
termination of the applicable waiting period under the HSR Act, or as
soon as practicable thereafter, the Stockholder shall so convert the
Subject Shares from Series C Common Stock into Series A Common Stock.
(b) Withdrawals. Following the conversion of the Subject Shares
-----------
from Series C Common Stock to Series A Common Stock, the General
Partner shall withhold its consent to the withdrawal by any limited
partner in the Stockholder of such limited partner's interest in the
Stockholder, pursuant to Section 5.3 of the Limited Partnership
Agreement.
(c) Vote for Merger. At any meeting of stockholders of the
---------------
Company called to vote upon the amendment to the Company's Certificate
of Incorporation set forth in the Merger Agreement, the Merger and the
Merger Agreement or at any adjournment thereof or in any other
circumstances upon which a vote, consent or other approval with
respect to such amendment to the Company's Certificate of
Incorporation, the Merger and the Merger Agreement is sought, the
Stockholder shall vote (or cause to be voted) the Subject Shares, and
any other voting securities of the Company, owned by Stockholder
whether issued heretofore or hereafter, that the Stockholder owns or
has the right to vote, in favor of such amendment to the Company's
Certificate of Incorporation, the Merger, the adoption by the Company
of the Merger Agreement and the approval of the terms thereof and each
of the other transactions contemplated by the Merger Agreement,
provided that the terms of the Merger Agreement shall not have been
amended to adversely affect the Stockholder.
(d) Vote Against Acquisition Proposals. At any meeting of
----------------------------------
stockholders of the Company or at any adjournment thereof or in any
other circumstances upon which the Stockholder's vote, consent or
other approval is sought, the Stockholder shall vote (or cause to be
voted) the Subject Shares, and any other voting securities of the
Company, owned by Stockholder whether issued heretofore or hereafter,
that the Stockholder owns or has the right to vote, except as
otherwise agreed in writing in advance by the Parent, against (i) any
proposal or offer with respect to any direct or indirect (A)
acquisition or purchase of fifteen percent (15%) or more of any
Company common stock outstanding, (B) acquisition or purchase of any
equity securities of any Material Subsidiary (as defined below), (C)
acquisition or purchase of all or any significant portion of the
assets of the Company or any Material Subsidiary, or (D) any merger,
consolidation, business combination, recapitalization, liquidation,
dissolution or similar transaction involving the Company or any of its
Material Subsidiaries (any such proposal or offer being hereinafter
referred to as an "Acquisition Proposal"),
--------------------
A-4
(ii) any change in the majority of the persons who constitute the
Board of Directors of the Company or (iii) any change in the present
capitalization of the Company or any amendment of the Company's
certificate of incorporation or by-laws or other proposal or
transaction involving the Company or any of its subsidiaries, which
change, amendment or other proposal or transaction would in any manner
impede, frustrate, prevent or nullify the amendment of the Company's
Certificate of Incorporation set forth in the Merger Agreement, the
Merger, the Merger Agreement or any of the other transactions
contemplated by the Merger Agreement or which could result in any of
the conditions to the Parent's obligations under the Merger Agreement
not being fulfilled. For purposes of this Agreement, "Material
--------
Subsidiary" means any direct or indirect "Significant Subsidiary" of
----------
the Company as that term is defined in Rule 405 of the rules and
regulations promulgated under the Securities Act of 1933, as amended,
or any Subsidiary (as defined below) of the Company that either owns
or operates a television broadcast station or a license, permit or
other authorization required by the Federal Communications Commission
in connection with the operation of its business. In addition,
"Subsidiary" means any corporation or other organization whether
-----------
incorporated or unincorporated, of which more than fifty percent (50%)
of either the equity interest in, or voting control of, such
corporation or other organization is, directly or indirectly through
Subsidiaries or otherwise, beneficially owned by the Company.
(e) Transfers. Except as set forth in Section 3(h), the
---------
Stockholder agrees not to (i) sell, transfer, pledge, assign or
otherwise dispose of, or enter into any contract, option or other
arrangement with respect to the sale, transfer, pledge, assignment or
other disposition of, the Subject Shares to any person other than
pursuant to the Merger and the Merger Agreement or (ii) enter into any
voting arrangement, whether by proxy, voting arrangement, voting
agreement or otherwise with respect to the Subject Shares.
(f) Each certificate evidencing the Subject Shares shall bear a
legend as follows:
THE SECURITIES REPRESENTED HEREBY ARE SUBJECT TO
RESTRICTIONS ON TRANSFER AND VOTING CONTAINED IN A
VOTING AGREEMENT DATED AS OF MARCH 26, 1997, A
COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICE
OF THE COMPANY.
(g) No Solicitations. Neither the Stockholder, the General
----------------
Partner nor any of their respective officers, directors, employees,
agents, counsel, accountants, financial advisors, investment bankers,
consultants and other representatives (collectively,
"Representatives"), directly or indirectly, shall initiate, solicit,
---------------
encourage, accept or take any other action knowingly to facilitate,
any inquiries or the making of, or participate in any discussions or
negotiations regarding, any
A-5
Acquisition Proposal. In the event that the Stockholder, the General
Partner or any of their respective Representatives receive from any
person an Acquisition Proposal, the Stockholder shall promptly advise,
orally and in writing, such Person of the terms of this Section 3(g),
and shall promptly advise Parent of such Acquisition Proposal and
shall thereafter keep Parent reasonably and promptly informed of all
material facts and circumstances relating to said Acquisition Proposal
and the Stockholder's actions relating thereto.
(h) Permitted Transfers. Notwithstanding anything contained in
-------------------
this Agreement to the contrary, the Stockholder may distribute the
Subject Shares (but only if they shall have been converted into shares
of Series A Common Stock) to the partners of the Stockholder following
the Company Stockholder Approval.
4. Termination. The covenants and agreements of the Stockholder and
-----------
the General Partner contained in Section 3 shall terminate upon the earliest of
(i) the Effective Time (as defined in the Merger Agreement), or (ii) the
termination of the Merger Agreement in accordance with its terms.
5. General Provisions.
------------------
(a) Expenses. All costs and expenses incurred in connection with
--------
this Agreement and the transactions contemplated hereby shall be paid
by the party incurring such expense.
(b) Amendments. This Agreement may not be amended except by an
----------
instrument in writing signed by each of the parties hereto.
(c) Notice. All notices and requests and other communications
------
hereunder must be in writing and will be deemed to have been given
only if delivered personally or by facsimile transmission or mailed
(first class postage prepaid) to the parties at the following
addresses or facsimile numbers:
(i) if to Parent, to:
The Hearst Corporation
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
A-6
with a copy to:
▇▇▇▇▇▇ & ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
(ii) if to the Stockholder or the General Partner, to
[FOREIGN PARTNERSHIP, L.P.]
__________________________
__________________________
__________________________
Telephone:
Facsimile:
Attention:
with a copy to:
▇▇▇▇▇ ▇▇▇▇▇▇▇ Rain ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇, Esq.
All such notices, requests and other communications will (i) if
delivered personally to the address as provided in this Section, be
deemed given upon delivery, (ii) if delivered by facsimile
transmission to the facsimile number as provided in this Section, be
deemed given upon receipt, and (iii) if delivered by mail in the
manner described above to the address as provided in this Section, be
deemed given upon receipt (in each case regardless of whether such
notice, request or other communication is received by any other person
to whom a copy of such notice is to be delivered pursuant to this
Section). Any party from time to time may change its address,
facsimile number or other information for the purpose of notices to
that party by giving notice specifying such change to the other
parties hereto.
(d) Entire Agreement. This Agreement supersedes all prior
----------------
discussions and agreements among the parties hereto with respect to
the subject matter hereof, and contains the sole and entire agreement
among the parties hereto with respect to the subject matter hereof.
A-7
(e) No Third Party Beneficiary. The terms and provisions of this
--------------------------
Agreement are intended solely for the benefit of each party hereto and
their respective successors or permitted assigns, and it is not the
intention of the parties to confer third-party beneficiary rights upon
any other person.
(f) No Assignment; Binding Effect. Neither this Agreement nor
-----------------------------
any right, interest or obligation hereunder may be assigned by any
party hereto without the prior written consent of the other parties
hereto and any attempt to do so will be void. Subject to the
preceding sentence, this Agreement is binding upon, inures to the
benefit of and is enforceable by the parties hereto and their
respective successors and assigns.
(g) Headings. The headings used in this Agreement have been
--------
inserted for convenience of reference only and do not define or limit
the provisions hereof.
(h) Severability. If any provision of this Agreement is held to
------------
be illegal, invalid or unenforceable under any present or future law,
and if the rights or obligations of any party hereto under this
Agreement will not be materially and adversely affected thereby, (i)
such provision will be fully severable, (ii) this Agreement will be
construed and enforced as if such illegal, invalid or unenforceable
provision had never comprised a part hereof, (iii) the remaining
provisions of this Agreement will remain in full force and effect and
will not be affected by the legal, invalid or unenforceable provision
or by its severance herefrom and (iv) in lieu of such illegal, invalid
or unenforceable provision, there will be added automatically as a
part of this Agreement a legal, valid and enforceable provision as
similar in terms to such illegal, invalid or unenforceable provision
as may be possible.
(i) No Waiver. The failure of any party hereto to exercise any
---------
right, power or remedy provided under this Agreement or otherwise
available in respect hereof at law or in equity, or to insist upon
compliance by any other party hereto with its obligations hereunder,
and any custom or practice of the parties at variance with the terms
hereof shall not constitute a waiver by such party of its right to
exercise any such or other right, power or remedy or to demand such
compliance.
(j) Counterparts. This Agreement may be executed in any number
------------
of counterparts, each of which will be deemed an original, but all of
which together will constitute one and the same instrument.
(k) Governing Law. This Agreement shall be governed by and
-------------
construed in accordance with the laws of the State of Delaware
applicable to a contract executed performed in such State without
giving effect to the conflicts of laws principles thereof.
A-8
6. Enforcement. The parties agree that irreparable damage would
-----------
occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached.
It is accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement in any Federal court located in the
State of Delaware or in a Delaware state court, this being in addition to any
other remedy to which they are entitled at law or in equity. In addition, each
of the parties hereto (i) consents to submit such party to the personal
jurisdiction of any Federal court located in the State of Delaware or any
Delaware state court in the event any dispute arises out of this Agreement or
any of the transactions contemplated hereby, (ii) agrees that such party will
not attempt to deny or defeat such personal jurisdiction by motion or other
request for leave from any such court, (iii) agrees that such party will not
bring any action relating to this Agreement or any of the transactions
contemplated hereby in any court other than a Federal court sitting in the State
of Delaware or a Delaware state court and (iv) waives any right to trial by jury
with respect to any claim or proceeding related to or arising out of this
Agreement or any of the transactions contemplated hereby.
A-9
IN WITNESS WHEREOF, each party hereto has caused this Agreement to be
signed by its officer or representative thereunto duly authorized as of the date
first above written.
THE HEARST CORPORATION
By:______________________________________
Name:
Title:
[FOREIGN PARTNERSHIP, L.P.]
By: ATI General Partner, L.P.
a Delaware limited partnership
By: Argyle Television Partners, L.P.
the sole general partner
By: Argyle Communications, Inc.
the sole general partner
By:________________________
Name:
Title:
ATI GENERAL PARTNER, L.P.
By: Argyle Television Partners, L.P.
a Delaware limited partnership
By: Argyle Communications, Inc.
the sole general partner
By:_________________________
Name:
Title:
A-10