STOCKHOLDERS' AGREEMENT
Stockholders' Agreement, dated October 10, 1996, by and among TCI
▇▇▇▇▇▇ Preferred, Inc., a Colorado corporation ("TCITP"), Liberty
Broadcasting, Inc. ("LBI") and Communication Capital Corp. ("CCC" and,
together with LBI and TCITP, the "TCITP Stockholders"), R.E. ▇▇▇▇▇▇, III
("▇▇▇▇▇▇"), ▇▇▇▇▇▇ Outdoor, Inc. ("TOI") and ▇▇▇▇▇▇ Partners, L.P., a
Georgia limited partnership ("TP" and, together with ▇▇▇▇▇▇, the "Turner
Stockholders"), and TW Inc., a Delaware corporation, which promptly
following the date hereof will change its name to Time Warner Inc.
("Holdco").
Each of the TCITP Stockholders and the Turner Stockholders is or
may become a beneficial owner of shares of capital stock of Holdco. The
▇▇▇▇▇▇ Stockholders, Holdco and the TCITP Stockholders desire to enter into
the arrangements set forth in this Agreement regarding future dispositions
of shares of Holdco capital stock which the ▇▇▇▇▇▇ Stockholders or the
TCITP Stockholders now or may in the future beneficially own.
Therefore, in consideration of the premises and the mutual
benefits to be derived hereunder and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties
hereby agree as follows:
1. Definitions: The following terms in this Agreement shall have the
respective meanings listed below:
Affiliate: With respect to any Person, any other Person which
directly or indirectly Controls, is under common Control with or is
Controlled by such first Person. The term "affiliated" (whether or not
capitalized) shall have a correlative meaning. For purposes of this
Agreement (i) the ▇▇▇▇▇▇ Foundation, Inc. (the "▇▇▇▇▇▇ Foundation"), the
R.E. ▇▇▇▇▇▇ Charitable Remainder Unitrust No. 2 (the "▇▇▇▇▇▇ Unitrust") and
any other Charitable Transferee or Qualified Trust shall be deemed not to
be Affiliates of any ▇▇▇▇▇▇ Stockholder and (ii) (A) no TCITP Affiliate
shall be deemed to be an Affiliate of any ▇▇▇▇▇▇ Affiliate, or vice versa,
and (B) no TCITP Affiliate or ▇▇▇▇▇▇ Affiliate shall be deemed to be an
Affiliate of any Holdco Affiliate, or vice versa.
Affiliated Group: With respect to any Stockholder, the group
consisting of such Stockholder and all Controlled Affiliates of such
Stockholder.
Agreement: This Agreement as the same may be amended from time to
time in accordance with its terms.
Appraised Value: As defined in Section 4.1 hereof.
The "beneficial owner" of any security means a direct or indirect
beneficial owner of such security within the meaning of Rule 13d-3 under
the Exchange Act, as in effect on and as interpreted by the Commission
through the date of this Agreement, and the terms (whether or not
capitalized) "beneficially own," "beneficially owned" and "owned
beneficially" shall have correlative meanings; provided, however, that any
Person who at any time beneficially owns any Option or Convertible Security
shall also be deemed to beneficially own the Underlying Securities, whether
or not such Option or Convertible Security then is or within 60 days will
be exercisable, exchangeable or convertible.
Board of Directors: The Board of Directors of Holdco.
Bona Fide Offer: As defined in Section 3.1 hereof.
Broker Transactions: "Broker's transactions" within the meaning
of paragraph (g) of Rule 144 of the General Rules and Regulations under the
Securities Act.
Charitable Transfer: Any Disposition of Covered Securities by a
▇▇▇▇▇▇ Stockholder to the ▇▇▇▇▇▇ Foundation, any other Charitable
Transferee, the ▇▇▇▇▇▇ Unitrust or any other Qualified Trust that is not an
Exempt Transfer pursuant to clause (vii) of the definition of Exempt
Transfer; provided, however, that any such transferee shall, by a written
instrument in form and substance reasonably satisfactory to TCITP, agree to
be bound by the provisions of this Agreement with respect to the Covered
Securities that are the subject of such Charitable Transfer to the same
extent as the ▇▇▇▇▇▇ Stockholder making such Disposition.
Charitable Transferee: Any charitable organization described in
Section 501(c)(3) of the Code.
Code: The Internal Revenue Code of 1986, as amended.
Commission: The Securities and Exchange Commission, or any other
Federal agency at the time administering the Securities Act or the Exchange
Act.
Common Stock: The common stock, par value $.01 per share, of
Holdco or any other shares of capital stock of Holdco into which the Common
Stock may be reclassified or changed.
Contract: Any agreement, contract, commitment, indenture, lease,
license, instrument, note, bond or security.
Control: As to any Person, the possession, directly or
indirectly, of the power to direct or cause the direction of the management
and policies of such Person (whether through ownership of securities,
partnership interests or other ownership interests, by contract, or
otherwise). The terms "Controlled," "Controlling" and similar variations
shall have correlative meanings.
Controlled Affiliate: When used with respect to a specified
Person, means each Affiliate of such Person which is Controlled by such
Person and which is not Controlled by or under common Control with any
other Person (except one or more other Controlled Affiliates of such
specified Person); provided, however, that for purposes of any provision of
this Agreement which requires any Stockholder to cause one or more of its
Controlled Affiliates to take or refrain from taking any action (including
any action relating to the Disposition of any Covered Securities) or which
otherwise purports to be applicable to any Covered Securities owned or held
by one or more Controlled Affiliates of such Stockholder, no Affiliate of
such Stockholder which otherwise would be a Controlled Affiliate of such
Stockholder shall be deemed to be a Controlled Affiliate of such
Stockholder unless such Stockholder possesses, directly or indirectly, the
power to direct decisions regarding such action or the Disposition of such
Covered Securities.
Convertible Securities: Evidences of indebtedness, shares of
stock or other securities or obligations which are convertible into or
exchangeable, with or without payment of additional consideration in cash
or property, for any Holdco Shares, either immediately or upon the
occurrence of a specified date or a specified event, the satisfaction of or
failure to satisfy any condition or the happening or failure to happen of
any other contingency.
Covered Securities: Any and all Holdco Shares, Convertible
Securities and Options.
Current Market Price: As to any share of Common Stock at any
date, the average of the daily closing prices for shares of the Common
Stock for the 5 consecutive trading days ending on the trading day
immediately before the day in question. The closing price for such shares
for each day shall be the last reported sale price or, in case no such
reported sale takes place on such day, the average of the reported closing
bid and asked prices, in either case on the principal United States
securities exchange on which such shares are listed or admitted to trading,
or if they are not listed or admitted to trading on any such exchange, the
last reported sale price (or the average of the quoted closing bid and
asked prices if no sale is reported) as reported on the Nasdaq Stock
Market, or any comparable system, or if such shares are not quoted on the
Nasdaq Stock Market, or any comparable system, the average of the closing
bid and asked prices as furnished by any member of the National Association
of Securities Dealers, Inc. selected by Holdco.
Defensive Provision: (i) any control share acquisition,
interested stockholder, business combination or other similar antitakeover
statute (including the Delaware Statute) applicable to Holdco, (ii) any
provision of the Restated Certificate of Incorporation or Bylaws of Holdco
(including Article V of such Restated Certificate of Incorporation), and
(iii) any plan or agreement to which Holdco is a party, whether now or
hereafter existing, which would constitute a "poison pill" or similar
antitakeover device (including any Rights Plan).
Delaware Statute: Section 203 of the Delaware General Corporation
Law or any successor statutory provision.
Disadvantageous Result: (i) The breach or violation of any
Restriction applicable to any member of the Group of such Stockholder or
its Affiliates, (ii) any member of the Group of such Stockholder or its
Affiliates becoming subject to any Restriction to which it was not
previously subject, or (iii) the occurrence of any Rights Plan Triggering
Event.
Disposition: When used with respect to any Covered Security, any
sale, assignment, alienation, gift, exchange, conveyance, transfer,
hypothecation or other disposition whatsoever, whether voluntary or
involuntary and whether direct or indirect, of such Covered Security or of
dispositive control over such Covered Security. "Disposition" shall not
include (i) a transfer of voting control of a Covered Security to the
extent required to avoid imposition of any prohibition, restriction,
limitation or condition on or requirement under any Requirement of Law or
Defensive Provision having any of the effects described in clauses (A) and
(B) of the definition of Restriction herein, or (ii) delivery of a
revocable proxy in the ordinary course of business. The term "dispose"
(whether or not capitalized) shall mean to make a Disposition. Without
limiting the generality of the foregoing:
(i) any redemption, purchase or other acquisition in any
manner (whether or not for any consideration) by Holdco of any
Covered Securities shall be deemed to be a Disposition of such
Covered Securities; and
(ii) none of the conversion or exchange of a Convertible
Security, the exercise of any Option or the failure to convert or
exchange a Convertible Security or to exercise any Option prior to
the expiration of the right of conversion, exchange or exercise
shall be deemed to be a Disposition of such Convertible Security
or such Option.
For purposes of this Agreement any Disposition of any Option or
Convertible Security shall also constitute a Disposition of the Underlying
Securities.
Effective Time: "Effective Time of the Merger", as defined in the
Merger Agreement.
Encumbrance: As defined in Section 3.1(f) hereof.
Exchange Act: The Securities Exchange Act of 1934, as amended, or
any successor Federal statute, and the rules and regulations of the
Commission promulgated thereunder, as from time to time in effect.
Exempt Transfer: Any Disposition that falls within any one of the
following clauses: (i) An exchange or conversion of Covered Securities
which occurs by operation of law in connection with a merger, consolidation
of Holdco with or into another corporation, or a recapitalization,
reclassification or similar event that has been duly authorized and
approved by the required vote of the Board of Directors and the
stockholders of Holdco pursuant to the Restated Certificate of
Incorporation of Holdco and the law of the jurisdiction of incorporation of
Holdco; (ii) any surrender by a Stockholder to Holdco of Covered Securities
upon redemption by Holdco of such Covered Securities pursuant to any right
or obligation under the express terms of such Covered Securities that is
made on a proportionate basis from all holders of such Covered Securities
and is not at the option of such Stockholder; (iii) any Permitted Pledge
and any transfer of such pledged Covered Securities to the Pledgee upon
default of the obligations secured by such pledge; (iv) any transfer solely
from one member of the Affiliated Group of a Stockholder to another member
of the Affiliated Group of a Stockholder; (v) any transfer by a Stockholder
who is an individual to (A) a spouse, (B) any other member of his immediate
family (i.e., parents, children, including those adopted before the age of
18, grandchildren, brothers, sisters, and the spouses or children of the
foregoing), (C) Qualified Trust or (D) a custodian under the Uniform Gifts
to Minors Act or similar fiduciary for the exclusive benefit of his
children during their lives; (vi) subject to Section 4, any transfer to the
legal representatives of a Stockholder who is an individual upon his death
or adjudication of incompetency or by any such legal representatives to any
Person to whom such Stockholder could have transferred such Covered
Securities pursuant to any clause of this definition; (vii) a transfer by
the ▇▇▇▇▇▇ Stockholders of up to an aggregate of 12 million shares (less
the product of (A) the number of shares of Class A Common Stock and Class B
Common Stock of TBS that are the subject of a Disposition (as such term is
defined in the TBS Shareholders' Agreement) effected by ▇▇▇▇▇▇ that is
contemplated by Section 3(a) of the TBS Shareholders' Agreement after
September 22, 1995, and (B) the Common Conversion Number (as defined in the
Merger Agreement)) of Common Stock (appropriately adjusted to take into
account any stock split, reverse stock split, reclassification,
recapitalization, conversion, reorganization, merger or other change in
such Common Stock) to any Charitable Transferee if, in the written opinion
of legal counsel reasonably acceptable to TCITP, requiring such Charitable
Transferee to become a party to this Agreement would limit by a material
amount the amount of the deduction for federal income tax purposes that
would be available to the applicable ▇▇▇▇▇▇ Stockholder in the absence of
such requirement, and any subsequent transfer by any such Charitable
Transferee of any such shares; (viii) any exchange, conversion or transfer
of Covered Securities pursuant to Section 4.1 of the LMC Agreement; and
(ix) any sale or transfer permitted by and made in accordance with Section
3 or 4 hereof; provided, however, that no Disposition pursuant to clause
(iii), (iv), (v) or (vi) shall be an Exempt Transfer, unless each Person to
whom any such Disposition is made, unless already a party to this Agreement
and bound by such provisions or a Controlled Affiliate of a party to this
Agreement who is bound by such provisions, shall by a written instrument
become a party to this Agreement bound by all of the provisions hereof
applicable to the Stockholder making such Disposition.
Exercise Notice: Either an Other Stockholder Exercise Notice or a
Holdco Exercise Notice, as the context requires.
Fast-Track Offer Notice: As defined in Section 3.3(a) hereof.
Fast-Track Sale: Any sale of shares of Common Stock for the
account of any Stockholder which meets all of the following requirements as
of the date a Fast-Track Offer Notice is given with respect thereto
pursuant to Section 3.3:
(i) such Stockholder has a bona fide intention to sell such
shares of Common Stock within a period of 115 days after such date
and such sale is not being undertaken as a result of any offer to
buy, bid or request, invitation or solicitation to sell made by
any Person (other than any such offer, bid, request, invitation or
solicitation from a registered broker-dealer or investment banker
not intended to circumvent the provisions of Section 3.1);
(ii) the Common Stock is registered under Section 12(b) or
12(g) of the Exchange Act and is listed for trading on a national
securities exchange registered under the Exchange Act or traded in
the over-the-counter market and quoted in an automated quotation
system of the National Association of Securities Dealers, Inc.;
(iii) such sale is to be effected through Broker
Transactions or pursuant to a registration statement covering such
shares in effect at the date of the Fast-Track Offer Notice; and
(iv) the following sum does not exceed $100 million:
(A) the aggregate Current Market Price of the shares
of Common Stock to be sold (determined as of the
date a Fast-Track Offer Notice with respect thereto
is given pursuant to Section 3.3), plus
(B) the aggregate sale price of all shares of Common
Stock sold pursuant to Section 3.3 by any member or
former member of the same Group as such Stockholder
during the 90 days immediately preceding the date of
such Fast Track Offer Notice, plus
(C) without duplication, the aggregate Current
Market Price, determined as of the date specified in
subclause (A) of this clause (iv), of all shares of
Common Stock as to which any Fast-Track Offer Notice
is given by any other Stockholder who is a member of
the same Group as such Stockholder within two
business days before or two business days after such
date.
Fast-Track Shares: As defined in Section 3.3(a) hereof.
Free to Sell Date: As defined in Section 3.1(j) hereof.
FTC: The Federal Trade Commission.
FTC Consent Decree: The Agreement Containing Consent Order (the
"ACCO") dated as of August 14, 1996, as amended on September 4, 1996 among
Old TW, TCI, TBS, LMC and the FTC which contemplates the issuance of an
Order, together with such Order and the Interim Agreement attached as
Exhibit I to the ACCO, in each case as the same may be amended from time to
time hereafter.
Governmental Authority: Any nation or government, any state or
other political subdivision thereof and any court, commission, agency or
other body exercising executive, legislative, judicial or regulatory
functions.
Group: Either the TCITP Stockholders considered collectively as a
group or the ▇▇▇▇▇▇ Stockholders considered collectively as a group, as the
context requires.
Holdco: As defined in the opening paragraphs of this Agreement.
Holdco Affiliates: Holdco and Affiliates of Holdco.
Holdco Elected Shares: In the case of any Offer Notice, any
Subject Shares covered thereby as to which Holdco exercises its right of
purchase pursuant to Section 3.1(e).
Holdco Exercise Notice: As defined in Section 3.1(e).
Holdco Shares: Any and all shares of capital stock of Holdco of
any class or series, whether now or hereafter authorized or existing.
Holdco Stockholders Agreement: Any stockholders' agreement between
Holdco and any one or more of the ▇▇▇▇▇▇ Stockholders in effect on the date
hereof.
Initial Trigger: As of a given time, for either Stockholder, with
respect to the Subject Shares covered by any Offer Notice or Tender Notice,
the greatest number of such Subject Shares as may then be acquired by such
Stockholder (or its Affiliates) without causing a Disadvantageous Result.
Involuntary Event: As defined in Section 4.1 hereof.
Judgment: Any order, judgment, writ, decree, award or other
determination, decision or ruling of any court, judge, justice or
magistrate, any other Governmental Authority or any arbitrator.
LMC Agreement: The Second Amended and Restated LMC Agreement dated
as of September 22, 1995, among Old TW, Holdco, LMC Parent and certain
subsidiaries of LMC Parent.
LMC Parent: Liberty Media Corporation, a Delaware corporation.
Merger Agreement: The Amended and Restated Agreement and Plan of
Merger dated as of September 22, 1995, among Old TW, Holdco, TW Acquisition
Corp., a Georgia corporation, Time Warner Acquisition Corp., a Delaware
corporation, and TBS, as amended by Amendment No. 1 thereto dated as of
August 8, 1996.
Offer Notice: As defined in Section 3.1(a) hereof.
Old TW: The Delaware corporation known on September 22, 1995 as
Time Warner Inc.
Old TW Rights Plan: The Rights Agreement dated as of January 20,
1994, between Old TW and Chemical Bank, as Rights Agent.
Options: Any options, warrants or other rights (except Convertible
Securities), however denominated, to subscribe for, purchase or otherwise
acquire any Holdco Shares or Convertible Securities, with or without
payment of additional consideration in cash or property, either immediately
or upon the occurrence of a specified date or a specified event or the
satisfaction or failure to satisfy any condition or the happening or
failure to happen of any other contingency.
Other Stockholder: With respect to a ▇▇▇▇▇▇ Stockholder, the
"Other Stockholder" shall be TCITP, and with respect to a TCITP
Stockholder, the "Other Stockholder" shall be ▇▇▇▇▇▇.
Other Stockholder Elected Shares: As defined in Section 3.1(e)
hereof.
Other Stockholder Exercise Notice: As defined in Section 3.1(e)
hereof.
Other Stockholder Group: With respect to any Other Stockholder,
the Group of which such Other Stockholder is a member.
Permitted Pledge: A bona fide pledge of Covered Securities by a
Stockholder to a financial institution to secure borrowings permitted by
applicable law; provided that such financial institution agrees in writing
to be bound by the provisions of Sections 2, 3 and 4 of this Agreement to
the same extent and with the same effect as such Stockholder and the
borrowings so secured are with full recourse against other assets of such
Stockholder or other collateral.
Per-Share Offer Consideration: As defined in Section 3.1(a)
hereof.
Person: Any individual, corporation, limited liability company,
general or limited partnership, joint venture, association, joint stock
company, trust, unincorporated business or organization, governmental
authority or other legal entity or legal person, whether acting in an
individual, fiduciary or other capacity. The term "Person" also includes
any group of two or more Persons formed for any purpose.
Prospective Purchaser: As defined in Section 3.1 hereof.
Public Sale: Any sale to the public for the account of any
Stockholder, (i) in Broker Transactions, (ii) otherwise pursuant to Rule
144 or (iii) through a registered offering pursuant to an effective
registration statement under the Securities Act which in any case meets
both of the following requirements (to the extent applicable) as of the
date an Offer Notice is given:
(A) such Stockholder has a bona fide intention to sell such
shares of Common Stock as promptly as practicable after all
applicable requirements of the Securities Act are satisfied, and
such sale is not being undertaken as a result of any offer to buy,
bid or request, invitation or solicitation to sell made by any
Person (other than any such offer, bid, request, invitation or
solicitation from a registered broker-dealer or investment banker
not intended to circumvent the provisions of Section 3.1); and
(B) in the case of a registered offering, such shares either
have been registered under the Securities Act or such Stockholder
has the immediate right to require Holdco to register such shares
under the Securities Act.
Purchase Price: As defined in Section 3.1(a) hereof.
Purchase Right: As defined in Section 3.1(c) hereof.
Purchased Shares: When used with reference to a Purchaser
which is the Other Stockholder, the Other Stockholder Elected Shares, and
when used with respect to a Purchaser which is a Holdco Affiliate, the
Holdco Elected Shares.
Purchaser: The term "Purchaser" means TCITP, in the case of
any purchase of TCITP Elected Shares pursuant to any Other Stockholder
Exercise Notice, ▇▇▇▇▇▇, in the case of any purchase of ▇▇▇▇▇▇ Elected
Shares pursuant to any Other Stockholder Exercise Notice, and Holdco, in
the case of any purchase of Holdco Elected Shares pursuant to any Holdco
Exercise Notice.
Qualified Trust: Any trust described in Section 664 of the
Code of which a Stockholder, members of his family or a Charitable
Transferee (and no other persons) are income beneficiaries.
Related Party: As to any Person, any Affiliate of such
Person and, if such Person is a natural person, such Person's parents,
children, siblings and spouse, the parents and siblings of such Person's
spouse and the spouses of such Person's children who become parties to this
Agreement.
Requirement of Law: With respect to any Person, all federal,
state and local laws, rules, regulations, Judgments, injunctions and orders
of a court or other Governmental Authority or an arbitrator, applicable to
or binding upon such Person, any of its property or any business conducted
by it or to which such Person, any of its assets or any business conducted
by it is subject.
Restriction: Any prohibition, restriction, limitation or
condition on or requirement under any Defensive Provision or Requirement of
Law, including the FTC Consent Decree, (A) that (i) limits the ability of
any Stockholder to acquire additional Holdco Shares or hold or dispose of
any Holdco Shares or to participate in any material right or benefit
otherwise available or to be distributed to security holders of the same
class as the Holdco Shares, generally, or requires such Stockholder to
Dispose of any Holdco Shares, (ii) reduces or otherwise limits the ability
to exercise the voting or other rights of all or a portion of the Holdco
Shares beneficially owned by such Stockholder below that applicable to
Holdco Shares generally, or (iii) limits the ability of any Stockholder to
consummate any merger, consolidation, business combination or other
transaction with, Holdco or any of its subsidiaries or other Affiliates or
substantially increases the cost of consummation or (B) under which the
acquisition or ownership of additional Holdco Shares (i) would result in a
material violation of applicable law, (ii) would require the discontinuance
of any material business or activity or the divestiture of any material
portion of any business or property, or (iii) would make the continuation
of any such business or activity or the ownership of such property illegal
or subject to material damages or penalties.
Rights: The rights issued to the holders of record of the
Common Stock pursuant to any Rights Plan, having the rights and privileges,
and subject to the terms and conditions, set forth in such Rights Plan, and
any other security or right which may be issued or granted in exchange or
substitution therefor or in replacement or upon exercise thereof.
Rights Plan: Any stockholder rights plan or other form of
"poison pill" adopted by Holdco and in effect at any time during the term
of this Agreement, as amended or modified from time to time.
Rights Plan Trigger: As of a given time, for either
Stockholder, with respect to the Subject Shares covered by any Offer Notice
or Tender Notice, the greatest number of such Subject Shares as may then be
acquired by such Stockholder (or its Affiliates) without causing a Rights
Plan Triggering Event; provided, however, that if at such time there shall
be no Rights Plan in effect, the Rights Plan Trigger shall be equal to the
total number of Subject Shares covered by such Offer Notice or Tender
Notice.
Rights Plan Triggering Event: Any event under any Rights
Plan analogous (in terms of its effects under such Rights Plan) to one of
the following events under the Old TW Rights Plan:
(i) any member of either Group becoming an "Acquiring
Person" within the meaning of the Old TW Rights Plan or
(ii) the Rights becoming transferable separately from shares
of the Common Stock;
in any such case, in the event of a dispute, as determined in accordance
with Section 3.1(d).
Sale Agreement: As defined in Section 3.1(f) hereof.
Securities Act: The Securities Act of 1933, as amended, and
the rules and regulations of the Commission promulgated thereunder, as from
time to time in effect.
Selling Stockholder: As defined in Section 3.1 hereof.
Stockholder: Any TCITP Stockholder or ▇▇▇▇▇▇ Stockholder.
Subject Shares: As defined in Section 3.1 hereof.
TBS: ▇▇▇▇▇▇ Broadcasting System, Inc.
TBS Shareholders' Agreement: The Shareholders' Agreement
dated as of June 3, 1987, among TBS, ▇▇▇▇▇▇ and the Original Investors
named therein.
TCITP: As defined in the opening paragraphs of this
Agreement.
TCITP Affiliates: TCITP and the Affiliates of TCITP.
TCITP Stockholders: TCITP and all Controlled Affiliates of
TCITP, in each case so long as such Person is or is required to be a party
to this Agreement or is the beneficial owner of any TCITP Holdco Shares.
TCITP Holdco Shares: Any and all Covered Securities of which
any TCITP Stockholder becomes the direct or indirect beneficial owner at
the Effective Time or thereafter.
Tendering Stockholder: As defined in Section 3.4(a) hereof.
Tender Notice: As defined in Section 3.4(a) hereof.
Tender Shares: As defined in Section 3.4(a) hereof.
TOI: As defined in the opening paragraphs of this Agreement.
TP: As defined in the opening paragraphs of this Agreement.
▇▇▇▇▇▇: As defined in the opening paragraphs of this
Agreement.
▇▇▇▇▇▇ Affiliates: The ▇▇▇▇▇▇ Stockholders and the
Affiliates of the ▇▇▇▇▇▇ Stockholders.
▇▇▇▇▇▇ Stockholders: ▇▇▇▇▇▇ and all Affiliates of ▇▇▇▇▇▇, in
each case so long as such Person is the beneficial owner of any Covered
Securities, the ▇▇▇▇▇▇ Foundation, the ▇▇▇▇▇▇ Unitrust or any other
Charitable Transferee if such entity is required to become a party to this
Agreement as a result of a Charitable Transfer (provided, however, that any
such entity shall be deemed a ▇▇▇▇▇▇ Stockholder only with respect to
▇▇▇▇▇▇ Holdco Shares acquired by such entity in a Charitable Transfer) and
any ▇▇▇▇▇▇ Related Party who is required to become a party to this
Agreement pursuant to the terms hereof.
▇▇▇▇▇▇ Holdco Shares: Any and all Covered Securities of
which any ▇▇▇▇▇▇ Stockholder becomes the direct or indirect beneficial
owner at the Effective Time or thereafter; provided, however, that Covered
Securities beneficially owned by the ▇▇▇▇▇▇ Foundation or the ▇▇▇▇▇▇
Unitrust immediately after the Effective Time shall not be ▇▇▇▇▇▇ Holdco
Shares.
Underlying Securities: When used with reference to any
Option or Convertible Security as of any time, the Covered Securities
issuable or deliverable upon exercise, exchange or conversion of such
Option or Convertible Security (whether or not such Option or Convertible
Security is then exercisable, exchangeable or convertible). In the case of
an Option to acquire a Convertible Security, the Underlying Securities of
such Option shall include the Underlying Securities of such Convertible
Security.
2. Restrictions on Dispositions of Covered Securities. No
▇▇▇▇▇▇ Stockholder shall Dispose of any ▇▇▇▇▇▇ Holdco Shares, except in an
Exempt Transfer or a Charitable Transfer. No TCITP Stockholder shall
Dispose of any TCITP Holdco Shares, except in an Exempt Transfer. Any
purported Disposition of Covered Securities in violation of this Agreement
shall be null and void and of no force or effect, and, if Holdco has actual
knowledge of such violation, Holdco shall (and shall direct each registrar
and transfer agent, if any, for the Covered Securities to) refuse to
register or record any such purported Disposition on its transfer and
registration books and records or to otherwise recognize such purported
Disposition. Subject to Section 4, if any Involuntary Event affecting any
Stockholder shall occur, such Stockholder's legal representatives, heirs,
successors or transferees, as the case may be, and all Covered Securities
beneficially owned by them shall be bound by all the terms and provisions
of this Agreement. The ▇▇▇▇▇▇ Stockholders shall, and shall cause each
Related Party of ▇▇▇▇▇▇ to, comply with the provisions of this Agreement
intended to be applicable to the ▇▇▇▇▇▇ Stockholders or any ▇▇▇▇▇▇ Holdco
Shares. The TCITP Stockholders shall, and shall cause each Related Party of
each TCITP Stockholder to, comply with the provisions of this Agreement
intended to be applicable to the TCITP Stockholders or any TCITP Holdco
Shares.
3. Right of First Refusal:
3.1 If any Stockholder (the "Selling Stockholder") desires
to accept an offer (other than with respect to a Public Sale or a
Fast-Track Sale, consistent with the definitions thereof, or a tender or
exchange offer to which Section 3.4 is applicable) (a "Bona Fide Offer")
from a Person which is not a Related Party of such Selling Stockholder (the
"Prospective Purchaser") to purchase any or all of the Covered Securities
beneficially owned by such Selling Stockholder (the "Subject Shares"), such
Selling Stockholder shall, in accordance with the following procedures,
terms and conditions, first offer to sell the Subject Shares to the Other
Stockholder for consideration (subject to subsections (g) and (h) of this
Section 3.1) and on terms no more favorable to the Selling Stockholder than
those which would apply if the Selling Stockholder accepted the Bona Fide
Offer:
(a) The Selling Stockholder shall deliver to the
Other Stockholder a written notice (the "Offer Notice", which term shall
include any Offer Notice delivered pursuant to Section 3.2(a)) which shall
(i) state the number of shares or other appropriate unit of Covered
Securities of each class, series or other type that comprise the Subject
Shares; (ii) identify the Prospective Purchaser; and (iii) state the
aggregate purchase price to be paid by the Prospective Purchaser for the
Subject Shares (the "Purchase Price") and the kind and amount of
consideration proposed to be paid or delivered by the Prospective Purchaser
for the Subject Shares of each class, series or other type and the amount
thereof allocable to each share or other appropriate unit of the Subject
Shares of that class, series or other type (the "Per-Share Offer
Consideration" for the Covered Securities of that class, series or other
type), the timing and manner of the payment or other delivery thereof and
any other material terms of such Bona Fide Offer. The Selling Stockholder
shall deliver a copy of the Offer Notice to Holdco at the same time it is
delivered to the Other Stockholder.
(b) The Offer Notice shall be accompanied by a true
and complete copy of the Bona Fide Offer.
(c) If an Offer Notice is given by a Selling
Stockholder, the Other Stockholder shall have the right (the "Purchase
Right"), exercisable in the manner hereinafter provided, to require the
Selling Stockholder to sell to the Other Stockholder the number or other
amount of the Subject Shares determined in accordance with this Section
3.1(c). If there is no Defensive Provision or Requirement of Law in effect
at the time any Offer Notice is given that imposes any Restriction on the
Other Stockholder (or that would impose a Restriction if the Other
Stockholder were to exercise the Purchase Right as to all the Subject
Shares), the Other Stockholder may exercise the Purchase Right only as to
all, but not less than all of the Subject Shares. If there are one or more
Defensive Provisions or Requirements of Law in effect at the time such
Offer Notice is given that impose any Restriction on the Other Stockholder
(or that would impose such a Restriction if the Other Stockholder were to
exercise the Purchase Right as to all the Subject Shares), the Other
Stockholder may exercise the Purchase Right only as to a number of Subject
Shares that is greater than or equal to the Initial Trigger relating to the
Other Stockholder at such time and less than or equal to the Rights Plan
Trigger relating to the Other Stockholder at such time. For purposes of
this Section 3.1(c), the Initial Trigger and the Rights Plan Trigger will
be determined as provided in Section 3.1(d).
(d) Commencing not later than the second business day
after an Offer Notice is given if there are one or more Defensive
Provisions in effect at such time, the Selling Stockholder and the Other
Stockholder shall consult with each other and Holdco in an effort to agree
with respect to the Initial Trigger and the Rights Plan Trigger, and upon
request Holdco will provide the Stockholders with information relating
thereto pursuant to Section 3.5. If agreement is not reached by the Selling
Stockholder and the Other Stockholder on or prior to the fifth business day
after the Offer Notice was given, then, within two business days after such
fifth business day, the Selling Stockholder and the Other Stockholder shall
jointly designate an independent law firm of recognized national standing,
which firm will be directed to submit a written report regarding its
conclusions as to the Initial Trigger and the Rights Plan Trigger within 5
business days (which report shall include, if requested, such law firm's
conclusion as to whether any specified event under a Rights Plan
constitutes a Rights Plan Triggering Event). The number of Subject Shares
as to which the Other Stockholder may exercise the Purchase Right shall be
determined as follows:
(i) upon such law firm rendering a written report
within such 5 business day period as to the Initial Trigger
and the Rights Plan Trigger, if the Other Stockholder
elects to exercise its Purchase Right, the Other
Stockholder may exercise such Purchase Right only as to a
number of Subject Shares equal to or greater than the
Initial Trigger and less than or equal to the Rights Plan
Trigger, as such amounts shall be specified in such report;
and
(ii) if such law firm does not render a written
report as to the Initial Trigger and the Rights Plan
Trigger within such 5 business day period, if the Other
Stockholder elects to exercise its Purchase Right, the
Other Stockholder may exercise such Purchase Right only as
to a number of Subject Shares equal to or greater than the
Initial Trigger and less than or equal to the Rights Plan
Trigger, as determined by such Other Stockholder.
If any law firm is so retained, Holdco, the Other Stockholder and the
Selling Stockholder shall provide such law firm with such information as
may be reasonably requested in connection with the preparation of such
report and shall otherwise cooperate with each other and such law firm with
the goal of allowing such law firm to render such report as promptly as
reasonably practicable. Each of Holdco, the Other Stockholder and the
Selling Stockholder shall be responsible for the payment of one-third of
the fees and disbursements of such law firm, except that if, at the time
such law firm is retained, Holdco waives its right to purchase any Subject
Shares covered by the current Offer Notice, Holdco shall not be responsible
for any such fees and disbursements, which shall in such case be borne
equally by the Selling Stockholder and the Other Stockholder. If the
Selling Stockholder and the Other Stockholder are unable to agree upon the
selection of an independent law firm within the two business day period
provided for in this Section 3.1(d), either such Stockholder may apply to
the American Arbitration Association (or another nationally-recognized
organization that provides alternative dispute resolution services) to
appoint an independent law firm to prepare and submit the report provided
for in this Section 3.1(d), and any law firm so appointed shall constitute
the law firm contemplated by this Section 3.1(d). Anything contained herein
to the contrary notwithstanding, no determination relating to the Initial
Trigger, the Rights Plan Trigger or any Rights Plan Triggering Event
pursuant to this Section 3.1(d) shall be binding upon Holdco in the absence
of a written instrument signed by Holdco agreeing to such determination (it
being understood that Holdco has no obligation to provide the Stockholders
with any such written instrument).
(e) If the Other Stockholder desires to exercise the
Purchase Right with respect to any Subject Shares covered by any Offer
Notice, it shall do so by a written notice (an "Other Stockholder Exercise
Notice") delivered to the Selling Stockholder by the Other Stockholder
prior to 5:00 P.M., New York City time, on the eighth business day
following the receipt of an Offer Notice or, if there is any dispute as to
the Initial Trigger or the Rights Plan Trigger, within 3 business days
after the resolution of such dispute. The Other Stockholder Exercise Notice
shall state the aggregate number or other appropriate amount of each class,
series or other type of the Subject Shares to be purchased (the "Other
Stockholder Elected Shares"). A copy of the Other Stockholder Exercise
Notice shall be sent to Holdco at the same time it is given to the Selling
Stockholder. If an Other Stockholder Exercise Notice is given within such
period but, in accordance with Sections 3.1(c) and 3.1(d), such Other
Stockholder Exercise Notice specifies that only a portion of the Subject
Shares are elected to be purchased (a "Partial Exercise Notice), then the
Selling Stockholder shall have the right, exercisable by written notice to
each of the Other Stockholder and Holdco given within five business days
after the Partial Exercise Notice was given, to terminate the Offer Notice
and abandon the proposed sale pursuant to the Bona Fide Offer, in which
case the provisions of this Section 3.1 shall be reinstated with respect to
any and all proposed future Dispositions of the same or any Subject Shares
pursuant to any subsequent Bona Fide Offer by the same or any other
Prospective Purchaser. If no Other Stockholder Exercise Notice is delivered
within the applicable number of business days, or if an Other Stockholder
Exercise Notice is delivered but the number of Other Stockholder Elected
Shares is less than the number of Covered Securities that are the subject
of such Offer Notice and the Selling Stockholder does not exercise its
right to terminate the Offer Notice and abandon the proposed sale pursuant
to the preceding sentence, Holdco shall have the right, exercisable by a
written notice (a "Holdco Exercise Notice") given to the Selling
Stockholder by Holdco prior to 5:00 P.M., New York City time, on the second
business day following the expiration of such period of 8 or 3 business
days, as the case may be, to elect to purchase all, but not less than all
of the Subject Shares which are not Other Stockholder Elected Shares, in
accordance with the procedures, terms and conditions set forth below in
this Section 3.1 and for a consideration (subject to subsections (g) and
(h) of this Section 3.1) and on terms no more favorable to the Selling
Stockholder than those which would apply if the Selling Stockholder
accepted the Bona Fide Offer with respect to the Holdco Elected Shares. A
copy of the Holdco Exercise Notice shall be sent to the Other Stockholder
at the same time it is given to the Selling Stockholder. The Selling
Stockholder shall have the right to condition the closing of the sale of
the Other Stockholder Elected Shares to the Other Stockholder upon the
closing of the sale of any Holdco Elected Shares and the closing of the
sale of any Holdco Elected Shares on the closing of the sale of the Other
Stockholder Elected Shares.
(f) If an Exercise Notice is given in accordance with
Section 3.1(e), within 5 business days thereafter the Purchaser and the
Selling Stockholder shall enter into a binding agreement (the "Sale
Agreement") for the sale of the Purchased Shares to the Purchaser, which
agreement shall contain such representations, warranties, covenants and
conditions no less favorable to the Selling Stockholder than the terms
contemplated by the Bona Fide Offer, except with respect to the kind and
number or other amount of Subject Shares to be purchased and the aggregate
purchase price payable in the event that the Purchased Shares constitute
fewer than all the Subject Shares. The Sale Agreement shall provide for the
closing of the purchase and sale of the Purchased Shares to be held at the
offices of the Selling Stockholder at 11:00 a.m. local time on the 60th day
after the Offer Notice was given (subject to extension in accordance with
Sections 3.1(i) and 5.1) or at such other place or on such earlier date as
the parties to the Sale Agreement may agree. At such closing, the Purchaser
shall (subject to subsections (e), (g) and (h) of this Section 3.1)
purchase the Purchased Shares for cash by wire transfer of immediately
available funds in an account at a bank designated by the Selling
Stockholder, such designation to be made no less than three days prior to
closing. At the closing, the Selling Stockholder shall deliver the
certificates and other evidences of the Purchased Shares to the Purchaser,
against payment in full for the Purchased Shares, free and clear of any
pledge, claim, lien, option, restriction, charge, shareholders' agreement,
voting trust or other encumbrance of any nature whatsoever to which the
Purchased Shares are subject in the hands of the Selling Stockholder other
than restrictions on transfer arising under federal and state securities
laws and claims, restrictions, options and encumbrances arising under this
Agreement (an "Encumbrance"). Without limiting the generality of the
immediately preceding sentence, if such Purchased Shares are Other
Stockholder Elected Shares and if the Other Stockholder is TCITP, such
Purchased Shares shall be free and clear of all Encumbrances existing or
arising under any Holdco Stockholders Agreement, and Holdco shall release
all such Encumbrances upon the closing of the purchase and sale of such
Purchased Shares pursuant hereto. The certificates evidencing the Purchased
Shares will be in proper form for transfer, with appropriate stock powers
executed in blank attached and documentary or transfer tax stamps affixed.
The Selling Stockholder shall execute such other documents as shall be
necessary to effectuate the sale of the Purchased Shares and such
additional documents as may be contemplated by the Bona Fide Offer or as
may reasonably be requested by any purchaser. The Other Stockholder may
assign any or all of its rights, and delegate any or all of its
obligations, under any Sale Agreement to which it is a party with respect
to the purchase and sale of any or all of the Other Stockholder Elected
Shares to any Controlled Affiliate of the Other Stockholder, provided that
no such assignment or delegation shall release the Other Stockholder from
its obligations thereunder without the written consent of the Selling
Stockholder. Holdco may assign any or all of its rights, and delegate any
or all of its obligations, under any Sale Agreement to which it is a party
or otherwise with respect to the purchase and sale of any or all of the
Holdco Elected Shares to any Controlled Affiliate of Holdco, provided that
no such assignment or delegation shall release Holdco from its obligations
thereunder without the written consent of the Selling Stockholder.
(g) Subject to Section 3.1(h), if the Bona Fide Offer
contemplated that the Purchase Price for the Subject Shares proposed to be
Disposed of by the Selling Stockholder would be paid, in whole or in part,
other than in cash, then the Purchaser shall pay for its Purchased Shares
in cash in lieu of such other consideration in an amount equal to the fair
market value of such other consideration as agreed by the Selling
Stockholder and the Other Stockholder. In the event of any disagreement
between the Other Stockholder and the Selling Stockholder as to the fair
market value of any non-cash consideration payable to the Selling
Stockholder, then at the request of either such party given within 5
business days following the delivery of the Offer Notice such determination
shall be conclusively made by a panel of appraisers, one of whom shall be
selected by the Other Stockholder, the second of whom shall be selected by
the Selling Stockholder and the third of whom shall be selected by the
first two appraisers. The Other Stockholder and the Selling Stockholder
shall each designate their appraiser within 3 business days after receipt
of any request for appraisal, and such appraisers shall designate the third
appraiser within 3 business days thereafter. Each appraiser shall submit
its determination of the fair market value of such non-cash consideration
to the Other Stockholder, Holdco and the Selling Stockholder within 5
business days after the panel is empaneled and such fair market value shall
be the average of the two closest valuations (or the middle valuation, if
the highest and lowest valuation differ from the middle valuation by an
equal amount). Each appraiser appointed shall be a nationally recognized
investment banking, appraisal or accounting firm which is not directly or
indirectly a Related Party of any party to this Agreement or any
Prospective Purchaser and which has no interest (other than the receipt of
customary fees) in the event giving rise to the need for the appraisal.
Each of the Other Stockholder and the Selling Stockholder shall be
responsible for the payment of one-half of the costs of such appraisal.
(h) If the Bona Fide Offer contemplated that any part
of the Purchase Price for any Subject Shares would be paid in debt
securities, each purchaser of any of such Subject Shares may, in its
discretion, elect to pay the equivalent portion of its allocable share of
the Purchase Price for the Purchased Shares through the issuance of debt
securities with substantially similar terms in an amount the fair market
value of which is equal to the fair market value of the equivalent portion
of the debt securities specified in the Bona Fide Offer, in each case as
agreed by such purchaser and the Selling Stockholder or, failing such
agreement, as determined in accordance with the appraisal procedures
specified in Section 3.1(g), taking into consideration relevant credit
factors relating to the Prospective Purchaser and such purchaser and the
marketability and liquidity of such debt securities.
(i) All time periods specified in subsection (e) or
(f) of this Section 3.1 shall be extended for a number of days equal to the
number of days in the period from the date the request for appraisal is
made pursuant to subsection (g) or (h) of this Section 3.1 or Section 4 (as
the case may be) through and including the date of submission of the last
to be submitted of the required appraisals. Each of the Other Stockholder,
the Selling Stockholder and Holdco shall be responsible for the payment of
one-third of the costs of each appraisal pursuant to subsection (h) of this
Section 3.1 (including the fees of all appraisers appointed in accordance
with subsection (h) of this Section 3.1), except that, if, at the time such
appraisal is requested, Holdco waives its right to purchase any Subject
Shares covered by the current Offer Notice, Holdco shall not be responsible
for any such fees and disbursements, which shall in such case be borne
equally by the Selling Stockholder and the Other Stockholder.
(j) The Selling Stockholder shall have the right to
sell Subject Shares to the Prospective Purchaser only in the following
circumstances:
(i) If neither an Other Stockholder Exercise Notice nor a
Holdco Exercise Notice is given in accordance with Section 3.1(e)
within the applicable time period specified therein (as such
period may be extended pursuant to subsection (i) of this Section
3.1), the Selling Stockholder shall have the right (within the
period specified below in this subsection) to sell all but not
less than all of the Subject Shares to the Prospective Purchaser,
and in such case the "Free to Sell Date" shall be the business day
following the expiration of the last to expire of all time periods
provided for in Section 3.1(e).
(ii) If an Other Stockholder Exercise Notice is given but
the number of Other Stockholder Elected Shares is less than the
number of Covered Securities that are subject to the relevant
Offer Notice, and if no Holdco Exercise Notice is given in
accordance with Section 3.1(e) within the applicable time period
specified therein (as such period may be extended pursuant to
subsection (i) of this Section 3.1), then the Selling Stockholder
shall have the right (within the period specified below in this
subsection) to sell all, but not less than all of the Subject
Shares which are not Other Stockholder Elected Shares to the
Prospective Purchaser, and in such case the "Free to Sell Date"
shall be the earlier of the fifth business day following the date
the Other Stockholder Exercise Notice was given and the date that
Holdco notifies the Selling Stockholder that it has determined not
to purchase any such Subject Shares.
(iii) If an Other Stockholder Exercise Notice is given but a
Sale Agreement for the Other Stockholder Elected Shares is not
executed by the Purchaser and tendered to the Selling Stockholder
for execution within the 5 business day period specified in the
first sentence of Section 3.1(f) (as such period may be extended
pursuant to subsection (i) of this Section 3.1), then the Selling
Stockholder shall have the right (within the period specified
below in this subsection) to sell all, but not less than all of
the Subject Shares to the Prospective Purchaser, and in such case
the "Free to Sell Date" shall be the business day after expiration
of such 5 business day period.
(iv) If a Holdco Exercise Notice is given but a Sale
Agreement for the Holdco Elected Shares is not executed by the
Purchaser and tendered to the Selling Stockholder for execution
within the 5 business day period specified in the first sentence
of Section 3.1(f) (as such period may be extended pursuant to
subsection (i) of this Section 3.1), then the Selling Stockholder
shall have the right (within the period specified below in this
subsection) to sell all, but not less than all of the Holdco
Elected Shares to the Prospective Purchaser, and in such case the
"Free to Sell Date" shall be the business day after the expiration
of such 5 business day period.
(v) If a Sale Agreement for either Other Stockholder Elected
Shares or Holdco Elected Shares is executed by the Purchaser and
the Selling Stockholder, but the closing of the purchase and sale
thereunder shall not occur by the latest date for such closing
determined in accordance with Sections 3.1(f), 3.1(i) and 5.1 for
any reason other than a breach or violation by the Selling
Stockholder of any of such Selling Stockholder's representations,
warranties, covenants or agreements that are a condition to such
closing, then the Selling Stockholder shall have the right (within
the period specified below in this subsection) to sell all, but
not less than all of such Other Stockholder Elected Shares or the
Holdco Elected Shares covered by such Sale Agreement to the
Prospective Purchaser, and in such case the "Free to Sell Date"
shall be the business day after such latest date for such closing
as so determined.
(vi) If between the date an Other Stockholder Election
Notice is given with respect to any Other Stockholder Elected
Shares and the closing of the purchase and sale of such Other
Stockholder Elected Shares, there shall be any amendment or
modification adverse to the Other Stockholder of any Defensive
Provision in effect on the date the Other Stockholder Election
Notice was given, adoption of any other Defensive Provision
adverse to the Other Stockholder, waiver adverse to the Other
Stockholder of any term or provision of or exercise adverse to the
Other Stockholder of any other discretionary right or power under
any Defensive Provision (whether then or thereafter in effect),
any reorganization, transfer of assets, consolidation, merger,
share exchange, dissolution, issue or sale of securities or any
other action or event which in the opinion of the Other
Stockholder would, if such purchase and sale were consummated,
have a Disadvantageous Result, then notwithstanding any other
provision of this Agreement or any provision of any Sale Agreement
to which any member of the Other Stockholder Group may be a party
and without any liability or obligation to the Selling
Stockholder, Holdco, any other party to this Agreement or any
Prospective Purchaser, the Other Stockholder may, by written
notice given to the Selling Stockholder and Holdco within five
business days after the Other Stockholder acquires actual
knowledge of such action or event, rescind the Other Stockholder
Election Notice and any Sale Agreement to which any member of the
Other Stockholder Group may be a party and abandon the purchase
and sale of the Other Stockholder Elected Shares pursuant thereto.
In such event, the Selling Stockholder shall have the right to
sell all or any portion of the Subject Shares to the Prospective
Purchaser and the "Free to Sell Date" shall be the business day
following receipt by the Selling Stockholder of such written
notice of abandonment.
Any sale of Subject Shares to the Prospective Purchaser permitted by this
Section shall be for the Purchase Price (or a greater price), payable in
the manner specified in the Bona Fide Offer, and otherwise on terms and
conditions no more favorable to the Prospective Purchaser than those
contained in the Bona Fide Offer; provided, however, that if such Subject
Shares constitute fewer than all the Subject Shares, the purchase price
therefor shall be equal to or greater than the portion of the Purchase
Price allocable to such Subject Shares (determined by multiplying each
share or other appropriate unit of such Subject Shares of each class,
series or other type by the Per-Share Offer Consideration for the Subject
Shares of that class, series or other type). In the event that (i) the
Prospective Purchaser has not entered into a binding agreement with the
Selling Stockholder for the purchase of such Subject Shares within the
30-day period following the Free to Sell Date or (ii) the Prospective
Purchaser has not purchased such Subject Shares within the time period
which would be applicable to a purchase thereof by a Purchaser under the
second sentence of Section 3.1(f) as if calculated from the Free to Sell
Date (except that the 60-day period referred to therein shall be construed
as a 120-day period for this purpose), then, in either such case, the
Selling Stockholder's right to sell Subject Shares to the Prospective
Purchaser pursuant to this Section 3.1(j) shall expire and the provisions
of this Section 3.1 shall be reinstated with respect to any and all
proposed future Dispositions of the same or any other Subject Shares
pursuant to any subsequent Bona Fide Offer by the same or any other
Prospective Purchaser.
3.2 Public Sales.
(a) If any Stockholder at any time intends to effect
a Public Sale of Covered Securities (other than a Fast-Track Sale), such
Stockholder may deliver to the Other Stockholder an Offer Notice pursuant
to Section 3.1 offering to sell such Covered Securities to the Other
Stockholder at a price equal to the aggregate Current Market Price thereof
on the date on which such Offer Notice is given. A copy of such Offer
Notice shall be sent to Holdco at the same time it is given to the Other
Stockholder. If any such Offer Notice with respect to any Covered
Securities is given, the Stockholder giving the Offer Notice shall have all
rights and obligations of a "Selling Stockholder" under Section 3.1 and
each of the Other Stockholder and Holdco shall have all of their respective
rights and obligations provided for in Section 3.1, in each case with the
same effect as if such Covered Securities were "Subject Shares" proposed to
be sold by the Selling Stockholder to a Prospective Purchaser for
"Per-Share Offer Consideration" consisting of cash in an amount equal to
the Current Market Price of the Covered Securities on the date such Offer
Notice is given and for a "Purchase Price" equal to the total Current
Market Price on such date of all such Subject Shares, and as if the other
terms of the Public Sale were the terms of the "Bona Fide Offer" made by
such assumed Prospective Purchaser, except that subsections (g), (h) and
(i) of Section 3.1 shall not apply and the provisions of subsection (j) of
Section 3.1 shall apply only as modified by subsection (b) of this Section
3.2.
(b) Subject Shares covered by any Offer Notice given
pursuant to this Section 3.2 may be sold (after full compliance with this
Section 3.2 and the applicable provisions of Section 3.1) by the Selling
Stockholder at any available price in a Public Sale of the type described
in such Offer Notice, provided that such sale or sales are completed within
the period of 120 days after the applicable Free to Sell Date; provided,
however, that if the issuer of any Covered Securities exercises any right
to delay the filing or effectiveness of a registration statement relating
to such Covered Securities or to suspend sales under such registration
statement, then the period shall be extended by the number of days in any
such delay or suspension period. If any Subject Shares covered by such
Offer Notice which such Selling Stockholder becomes obligated under this
Section 3.2 to sell to one or more purchasers or their permitted assignees
are not, for any reason, sold to such Persons within any applicable period
determined pursuant to Section 3.1, or if any such Subject Shares which
such Selling Stockholder is entitled, pursuant to the first sentence of
this Section 3.2(b), to sell in the Public Sale are not so sold within the
period provided in such sentence, then in each case the right of such
Selling Stockholder to sell such unsold Subject Shares shall terminate and
such Subject Shares shall thereafter continue to be subject to the
restriction on Dispositions of Covered Securities contained in Section 2.
3.3 Fast-Track Sales.
(a) Any Stockholder who proposes to make a Fast-Track
Sale may deliver to each of the Other Stockholder and Holdco a written
notice (the "Fast-Track Offer Notice") to such effect which states the
number of shares of Common Stock proposed to be sold (the "Fast-Track
Shares"). The delivery of any such notice shall constitute the offer by
such Stockholder to sell to the Other Stockholder, Holdco or both all or
such portion of the Fast-Track Shares as it or they may have the right to
purchase in accordance with this Section 3.3 at a price payable in cash
equal to the aggregate Current Market Price thereof on the date on which
such Fast-Track Offer Notice is given.
(b) The Other Stockholder shall have the right to
elect to purchase (or to designate any one or more of the members of the
Other Stockholder Group as purchasers of) all or any number of the
Fast-Track Shares. The Other Stockholder and Holdco shall consult with each
other in an effort to resolve any questions as to the Initial Trigger and
the Rights Plan Trigger; provided, that if the Other Stockholder and Holdco
cannot resolve such issue, then the Other Stockholder shall have the right
to purchase only the number of Fast-Track Shares that Holdco shall specify.
Anything contained herein to the contrary notwithstanding, no determination
relating to the Initial Trigger or the Rights Plan Trigger pursuant to this
Section 3.3(b) shall be binding upon Holdco in the absence of a written
instrument signed by Holdco agreeing to such determination (it being
understood that Holdco has no obligation to provide the Other Stockholder
with any such written instrument). If the Other Stockholder desires to
exercise its purchase right under this Section 3.3, it shall do so by a
written notice specifying the number of the Fast-Track Shares to be
purchased and identifying the purchasers thereof, given to the Stockholder
who gave the Fast-Track Offer Notice prior to 5:00 P.M., New York City
time, on the third business day following the receipt by the Other
Stockholder of the Fast-Track Offer Notice (provided that any Fast-Track
Offer Notice received on a day that is not a business day or after 12 noon,
New York City time, on a business day, shall be deemed to have been
received on the next following business day). Holdco shall have the right
to elect to purchase any or all of the Fast-Track Shares that the Other
Stockholder does not elect to purchase or have one or more other members of
the Other Stockholder Group purchase in accordance with the immediately
preceding sentence, which right shall be exercisable by a written notice
specifying the number of such Fast-Track Shares to be purchased, which
notice shall be given by Holdco to the Stockholder proposing to sell such
Fast-Track Shares and the Other Stockholder prior to 5:00 P.M., New York
City time, on the fifth business day following the receipt by the Other
Stockholder and Holdco of the Fast-Track Offer Notice. If any such notice
is given by either the Other Stockholder or Holdco, the closing of the
purchase and sale of the Fast-Track Shares covered thereby shall be held at
the offices in the continental United States of the Other Stockholder or
Holdco (as the case may be) specified in such notice, 11:00 A.M., New York
City time, on the fourth business day after such notice was given or at
such other place or date as the Stockholder selling the Fast-Track Shares
and the purchasers thereof may agree, and such closing date shall not be
subject to extension pursuant to Section 5.1 or otherwise unless such
selling Stockholder and such purchasers agree to such extension. At such
closing, the purchasers shall purchase such Fast-Track Shares for cash by
wire transfer of immediately available funds in an account at a bank
designated by the selling Stockholder, such designation to be made no less
than three business days prior to closing, against delivery at the closing
by the selling Stockholder of the certificates evidencing the Fast-Track
Shares to be sold to such purchasers, in proper form for transfer, with
appropriate stock powers executed in blank attached and documentary or
transfer tax stamps affixed. Such delivery of such certificates shall
constitute the representation and warranty of such selling Stockholder that
upon such delivery, such selling Stockholder duly transferred good and
marketable title to the shares evidenced thereby, clear of any Encumbrance.
Without limiting the generality of the immediately preceding sentence, if
the Other Stockholder is TCITP, such purchased Fast-Track Shares shall be
free and clear of all Encumbrances existing or arising under any Holdco
Stockholders Agreement, and Holdco shall release all such Encumbrances upon
the closing of the purchase and sale thereof. The purchase price payable
for each Fast-Track Share purchased pursuant to this Section 3.3 shall be
the Current Market Price determined as of the date the Fast-Track Offer
Notice was given.
(c) Any Fast-Track Shares not purchased pursuant to
Section 3.3(b) may be sold by the selling Stockholder at any available
price in one or more Fast-Track Sales within the 90-day period following
the twelfth business day after the receipt by both Holdco and the Other
Stockholder of the Fast-Track Offer Notice, and if all Fast-Track Shares
for any reason are not sold within such period either pursuant to Section
3.3(b) or in one or more Fast-Track Sales, then the right to sell such
Fast-Track Shares shall terminate and such Fast-Track Shares shall
thereafter continue to be subject to the restrictions on Dispositions of
Covered Securities contained in Section 2.
3.4 Tender or Exchange Offer Sales.
(a) If any Person shall make a tender or exchange
offer to acquire any Covered Securities, and if any Stockholder (a
"Tendering Stockholder") intends to tender any Covered Securities, such
Tendering Stockholder shall give the Other Stockholder written notice (the
"Tender Notice") of such intention not later than ten calendar days prior
to the latest time by which securities must be tendered in order to be
accepted pursuant to such offer as such date may from time to time be
extended (the "Tender Date"), specifying the Covered Securities proposed to
be tendered (the "Tender Shares"), together with copies of all written
materials by which such offer is being made. A copy of such Tender Notice
shall be sent to Holdco at the same time it is given to the Other
Stockholder.
(b) Any Tender Notice given by any Tendering
Stockholder shall constitute an offer by such Tendering Stockholder to sell
to the Other Stockholder the Tender Shares. The Other Stockholder shall
have the right to elect to purchase (or to designate any one or more of the
members of the Other Stockholder Group as purchasers of) all or any number
of the Tender Shares in accordance with this Section 3.4. The Other
Stockholder and Holdco shall consult with each other in an effort to
resolve any questions as to the Initial Trigger and the Rights Plan
Trigger, but the rights of the Other Stockholder under this Section 3.4
shall not be affected by the failure of Holdco to concur in any conclusion
of the Other Stockholder with respect to any such matter. Anything
contained herein to the contrary notwithstanding, no determination relating
to the Initial Trigger or the Rights Plan Trigger pursuant to this Section
3.4(b) shall be binding upon Holdco in the absence of a written instrument
signed by Holdco agreeing to such determination (it being understood that
Holdco has no obligation to provide the Other Stockholder with any such
written instrument). If the Other Stockholder desires to exercise its
purchase right under this Section 3.4, it shall do so by a written notice
specifying the number of the Tender Shares to be purchased and identifying
the purchasers thereof, given to the Tendering Stockholder at least three
business days prior to the Tender Date. If any such notice is given by the
Other Stockholder, the closing of the purchase and sale of the Tender
Shares covered thereby shall be held at the offices of the Other
Stockholder within the continental United States specified in such notice
at 11:00 A.M., New York City time, on a date specified in such notice that
is not later than two business days prior to the Tender Date, or at such
other place or date as the Tendering Stockholder and the Other Stockholder
may agree, and such closing date shall not be subject to extension pursuant
to Section 5.1 or otherwise unless the Tendering Stockholder and the Other
Stockholder agree to such extension. At such closing, the purchasers
identified by the Other Stockholder shall purchase such Tender Shares for
cash by wire transfer of immediately available funds to an account at a
bank designated by the Tendering Stockholder in the Tender Notice, against
delivery at the closing by the Tendering Stockholder of the certificates or
other instruments evidencing the Tender Shares to be sold to such
purchasers, in proper form for transfer, with appropriate stock powers
executed in blank attached and documentary or transfer tax stamps affixed.
Such delivery of such certificates shall constitute the representation and
warranty of such Tendering Stockholder that upon such delivery, such
Tendering Stockholder duly transferred good and marketable title to the
shares evidenced thereby, free and clear of any Encumbrance. Without
limiting the generality of the immediately preceding sentence, such
purchased Tender Shares shall be free and clear of all Encumbrances
existing or arising under any Holdco Stockholders Agreement, and Holdco
shall release all such Encumbrances upon the closing of the purchase and
sale thereof. The total purchase price to be paid by such purchasers for
such Tender Shares shall be (i) if such tender or exchange offer is
consummated, the purchase price that the Tendering Stockholder would have
received if it had tendered such Tender Shares and all such Tender Shares
had been purchased in such tender or exchange offer, including any
increases in the price paid by the offeror after exercise by the Other
Stockholder of its right of first refusal under this Section 3.4 or after
the closing of the purchase of Tender Shares pursuant to such exercise,
(ii) if such tender or exchange offer is not consummated, the highest price
offered pursuant thereto, or (iii) if any other tender or exchange offer is
commenced prior to the expiration or termination of such tender or exchange
offer, the highest price offered in either such tender or exchange offers
in each case with any offered securities or other property except cash to
be valued as provided in Section 3.4(c).
(c) If the consideration offered in such tender or
exchange offer consists, in whole or in part, of securities or other
property except cash, then the purchasers identified by the Other
Stockholder shall pay for the Tender Shares cash in lieu of such other
consideration in an amount equal to the fair market value of such other
consideration as agreed by the Tendering Stockholder and the Other
Stockholder. In the event the Tendering Stockholder and the Other
Stockholder do not agree as to the fair market value of any such non-cash
consideration by the beginning of the second business day after the Offer
Notice is given, then such determination shall be conclusively made by a
panel of appraisers, one of whom shall be selected by the Other
Stockholder, the second of whom shall be selected by the Tendering
Stockholder and the third of whom shall be selected by the first two
appraisers. The Other Stockholder and the Tendering Stockholder shall each
designate their appraiser within three business days after such Offer
Notice is given, and such appraisers shall designate the third appraiser
within three business days thereafter. Each appraiser shall submit its
determination of the fair market value of such non-cash consideration
within three business days after the panel is empaneled and such fair
market value shall be the average of the two closest valuations (or the
middle valuation, if the highest and lowest valuation differ from the
middle valuation by an equal amount). Each appraiser appointed shall be a
nationally recognized investment banking, appraisal or accounting firm
which is not directly or indirectly a Related Party of any party to this
Agreement or the Person making the tender or exchange offer and which has
no interest (other than the receipt of customary fees) in the event giving
rise to the need for the appraisal. Each of the Other Stockholder and the
Tendering Stockholder shall be responsible for the payment of one-half of
the costs of such appraisal.
(d) If the Other Stockholder does not exercise its
right of first refusal under this Section 3.4 by giving a notice of
exercise in accordance with Section 3.4(b) or, having given such notice,
fails to purchase and pay for (or have one or more of its designees
purchase and pay for) such Tender Shares on or prior to the business day
prior to the Tender Date, then the Tendering Stockholder shall be free to
accept the tender or exchange offer with respect to which the Tender Notice
was given or any other tender or exchange offer commenced during the
pendency of the tender or exchange offer with respect to which the Tender
Notice was given.
3.5 Holdco to Provide Certain Information. If requested at
any time or from time to time by any Stockholder, Holdco shall promptly
provide to such Stockholder in writing (i) all information which such
Stockholder reasonably may request for the purpose of determining whether,
based on the facts set forth by such Stockholder in such request, any
acquisition of beneficial ownership by such Stockholder or the Other
Stockholder would result in the occurrence of a Disadvantageous Result
under or in respect of any Defensive Provision and (ii) such other
non-confidential information known to Holdco as such Stockholder may
reasonably request regarding (A) the number of Covered Securities issued
and outstanding at any time, (B) the number of Covered Securities owned of
record by any person at any time, or (C) the terms and conditions of any
Defensive Provision.
3.6 Certain Actions by Holdco. In the event that Holdco
shall (i) amend or modify any Defensive Provision in effect on the date
hereof, or (ii) adopt any Defensive Provision after the date hereof, or
(iii) purchase, redeem or otherwise acquire any outstanding Covered
Securities, directly or indirectly through any Controlled Affiliate of
Holdco, and the result of any such action is to reduce the Initial Trigger
or the Rights Plan Trigger with respect to any Stockholder Group, then, in
the case of any Offer Notice or Tender Notice delivered after such action,
if such action shall have had the effect of reducing the number of Subject
Shares covered by such Offer Notice that may then be purchased by the Other
Stockholder pursuant to this Agreement, Holdco shall have no right under
this Agreement to purchase any Subject Shares covered by such Offer Notice.
4. Involuntary Event; Death or Incapacity.
4.1 In the event that (i) any Stockholder shall be
adjudicated bankrupt or insolvent or file a voluntary petition for
bankruptcy (or an involuntary petition for bankruptcy shall have been filed
against any Stockholder and the same shall not have been dismissed within
60 days after the date of filing), or file a pleading in any court of
record admitting his inability to pay his debts as they become due, or make
a general assignment for the benefit of creditors, or (ii) a receiver,
administrator, guardian, legal committee or other legal custodian of any
Stockholder's property shall be appointed (other than in connection with
his death or incapacity) and not discharged within 60 days, or (iii) a writ
of attachment or levy or other similar court order shall prevent any
Stockholder from exercising his or its right to vote or Dispose of any of
his or its Covered Securities and such writ or levy is not dismissed (or
such court order is not reversed) within 60 days, then such Stockholder
shall promptly notify the Other Stockholder of the occurrence of any such
event (the "Involuntary Event"). Simultaneously with the delivery of any
such notice required by this Section 4.1, such Stockholder shall deliver an
Offer Notice to such Other Stockholder pursuant to Section 3.1, offering to
sell all Covered Securities beneficially owned by such Stockholder to such
Other Stockholder at the Appraised Value. Each Stockholder giving such an
Offer Notice shall have, in respect of such Offer Notice, all rights and
obligations under Section 3.1 of a Selling Stockholder, except that if such
Stockholder is a ▇▇▇▇▇▇ Stockholder, for so long as such ▇▇▇▇▇▇ Stockholder
is subject to the restrictions on transfer contained in the Holdco
Stockholders' Agreement, it shall not be entitled to sell any Covered
Securities to any Person other than the Purchasers, if any; each Other
Stockholder and Holdco shall have, in respect of such Offer Notice, all
rights and obligations under Section 3.1 which are provided for therein in
the case of any Offer Notice given pursuant thereto. For the purpose
hereof, the term "Appraised Value" means the fair market value of the
Covered Securities to be sold as determined by appraisal in the same manner
as provided in Section 3.1(h) with respect to appraisals of non-cash
consideration. Each of such Stockholder, the Other Stockholder and Holdco
shall be responsible for the payment of one-third of the costs of such
appraisal, except that, if, at the time such appraisal is requested, Holdco
waives its right to purchase any Subject Shares covered by the current
Offer Notice, Holdco shall not be responsible for any such fees and
disbursements, which shall in such case be borne equally by such
Stockholder and the Other Stockholder. All time periods specified in
subsection (e) or (f) of Section 3.1 shall be extended for a number of days
equal to the number of days in the period from the delivery of the Offer
Notice pursuant to this Section 4.1 through and including the date of
submission of the last to be submitted of the required appraisals.
4.2 Any Sale Agreement entered into by any Stockholder and
the Purchaser pursuant to an Offer Notice required by Section 4.1 shall
provide that the closing of the sale of the Covered Securities to be sold
and purchased thereunder may be postponed for such period as may be
necessary to effect the purchase of such Covered Securities free from any
claims of a trustee in bankruptcy, any garnishee or any court order. In the
event that any Covered Securities subject to such Offer Notice are not
purchased for any reason, such Covered Securities shall continue to be
subject to this Agreement.
4.3 In the event of ▇▇▇▇▇▇'▇ incapacity or death, his legal
representative or the executor or administrator of his estate, as the case
may be, shall be bound by all the terms and provisions of this Agreement as
fully as if such representative, executor or administrator were a party
hereto and his or its name were substituted for ▇▇▇▇▇▇'▇ name herein and
shall be entitled to exercise ▇▇▇▇▇▇'▇ rights and required to perform his
obligations hereunder.
5. Regulatory Approvals; Certain Representations, Warranties
and Covenants.
5.1 Regulatory Approvals. If any sale of Covered Securities
to any Stockholder, Holdco or any permitted assignee of any Stockholder or
Holdco in accordance with Section 3.1, 3.2 or 4 requires, as a condition to
the legal and valid transfer thereof to such Purchaser, any consent,
approval, waiver, or authorization of, notice to or filing with, any
Governmental Authority or the expiration of any waiting period imposed by
applicable law and if Section 3.1, 3.2 or 4 (as the case may be) provides
for the closing of such sale to be held before some fixed or ascertainable
date, then such date shall be extended for the period of time during which
efforts to obtain each such consent, approval, waiver, or authorization, to
give such notice or make such filing and to obtain the termination of each
such waiting period at the earliest reasonably practicable time are
diligently being made; provided, however, that in no event shall the
extension of any such closing date pursuant to this Section 5.1 exceed 90
days. Each party shall (and shall cause such party's Controlled Affiliates
to) reasonably cooperate with the other parties in obtaining any such
consent, approval, waiver, or authorization, to give any such notice or
make any such filing and in obtaining the termination of any such waiting
period at the earliest practicable time.
5.2 Representation and Warranty of Holdco. Holdco represents
and warrants to each of TCITP and ▇▇▇▇▇▇ that, other than the Old TW Rights
Plan, the provisions of TW's Restated Certificate of Incorporation and
By-laws and the Delaware Statute, there were no Defensive Provisions in
effect on September 22, 1995; provided, however, that no representation is
made as to the laws of any jurisdiction other than Delaware.
6. Legend on Stock Certificates; No Recordation of Transfer.
6.1 Each certificate or instrument representing Covered
Securities directly or indirectly beneficially owned by any Stockholder
shall bear the following legend until such time as the shares represented
thereby are no longer subject to this Agreement:
"THE SALE, TRANSFER, ASSIGNMENT, PLEDGE OR ENCUMBRANCE OF THE
SECURITIES REPRESENTED HEREBY ARE SUBJECT TO THE TERMS AND
CONDITIONS OF A STOCKHOLDERS' AGREEMENT DATED AS OF OCTOBER 10,
1996, AMONG R.E. ▇▇▇▇▇▇, III, TCI ▇▇▇▇▇▇ PREFERRED, INC., ▇▇▇▇▇▇
PARTNERS, L.P., TIME WARNER INC. AND CERTAIN OTHER PERSONS. A COPY
OF SUCH AGREEMENT IS ON FILE AT THE OFFICES OF TIME WARNER INC.
Holdco shall not be responsible for placing the above legend on any
certificate representing Covered Securities, except to the extent that it
has actual knowledge that such certificate has been issued in the name of
any Stockholder.
6.2 Holdco agrees not to knowingly effect a transfer of any
Covered Securities which to Holdco's actual knowledge are directly or
indirectly beneficially owned by any Stockholder on its books except as
permitted by the terms of this Agreement. A copy of this Agreement shall be
filed with the Secretary of Holdco.
7. Representations and Warranties; Certain Additional
Covenants.
7.1 Certain Representations and Covenants of the TCITP
Stockholders. Each of the TCITP Stockholders represent and warrant to the
▇▇▇▇▇▇ Stockholders and Holdco as follows:
(a) Neither such TCITP Stockholder nor any of its
Controlled Affiliates that hold Holdco Shares is a party to or
bound by, any Contract, Requirement of Law or Judgment, other than
Requirements of Law referred to in Section 7.3(d), that does or
may prevent, impede or delay the due and punctual performance by
any such Person of its agreements, obligations and commitments
contained in this Agreement, and such TCITP Stockholder will not
enter into or permit any of its Controlled Affiliates to enter
into any such Contract or take any other voluntary action or
voluntarily omit to take any action that would have any such
effect.
(b) Except for this Agreement and except for any
Permitted Pledge in effect as of the date hereof, there is no
option, warrant, right, call, proxy, or Contract that directly or
indirectly provides for the sale, pledge or other Disposition of
any of such TCITP Holdco Shares or any interest therein or any
rights with respect thereto, relates to the voting, Disposition or
control of any thereof or obligates or may obligate such TCITP
Stockholder or any of its Controlled Affiliates to grant, offer or
enter into any of the foregoing.
No breach or violation of any of the foregoing representations, warranties
or covenants shall result or be deemed to result directly or indirectly
from or by reason of any Contract between TCITP and any of its Affiliates
and Holdco and any of its Affiliates, directors or officers, whether now
existing or hereafter entered into, nor from or by reason of the execution,
delivery or performance of or action taken or omitted to be taken pursuant
to the terms of any such Contract or the consummation of any transaction
contemplated thereby, nor from or by reason of any option, warrant, right,
call, proxy or other right granted, covenant made or obligation incurred
under any such Contract that directly or indirectly provides for the sale,
pledge or other Disposition of any of the TCITP Holdco Shares or any
interest therein or any rights with respect thereto.
7.2 Certain Representations and Covenants of the ▇▇▇▇▇▇
Stockholders. Each of the ▇▇▇▇▇▇ Stockholders represents and warrants to
the TCITP Stockholders and Holdco as follows:
(a) Neither such ▇▇▇▇▇▇ Stockholder nor any of his or
its Controlled Affiliates that hold Holdco Shares is a party to or
bound by, any Contract, Requirement of Law or Judgment, other than
any Requirements of Law referred to in Section 7.3(d), that does
or may prevent, impede or delay the due and punctual performance
by any such Person of his or its agreements, obligations and
commitments contained in this Agreement, and such ▇▇▇▇▇▇
Stockholder will not enter into or permit any of his or its
Controlled Affiliates to enter into any such Contract or take any
other voluntary action or voluntarily omit to take any action that
would have any such effect.
(b) Except for this Agreement and any Holdco
Stockholders Agreement and except for any Permitted Pledge in
effect as of the date hereof, there is no option, warrant, right,
call, proxy, or Contract that directly or indirectly provides for
the sale, pledge or other Disposition of any of such ▇▇▇▇▇▇ Holdco
Shares or any interest therein or any rights with respect thereto,
relates to the voting, Disposition or control of any thereof or
obligates or may obligate such ▇▇▇▇▇▇ Stockholder or any of his or
its Controlled Affiliates to grant, offer or enter into any of the
foregoing. Each of the ▇▇▇▇▇▇ Stockholders has delivered to TCITP
a true and complete copy of each Holdco Stockholders Agreement to
which it is a party, if any, as amended through and in effect on
the date of this Agreement.
No ▇▇▇▇▇▇ Stockholder shall permit the amendment of any Holdco Stockholders
Agreement to which it is a party in any manner that would have any effect
referred to in Section 7.2(a).
7.3 Representations and Warranties of Each Party. Each
party, severally and not jointly, represents and warrants to each of the
other parties as follows:
(a) If such party is a corporation or partnership, such
party has all requisite corporate power and authority or partnership power
and authority (as the case may be) to execute, deliver and perform its
obligations under this Agreement and to consummate the transactions
contemplated hereby. The execution, delivery and performance by such party
of, and the consummation of the transactions contemplated by, this
Agreement have been duly and validly authorized by all necessary corporate
action or partnership action (as the case may be) on the part of such
party.
(b) If such party is a natural person (whether acting
individually or in a fiduciary capacity), such party has full legal
capacity, right, power and authority to execute, deliver and perform his or
her obligations under this Agreement and to consummate the transactions
contemplated hereby.
(c) This Agreement has been duly executed and delivered by
such party. This Agreement constitutes a legal, valid and binding
obligation of such party enforceable in accordance with its terms, except
that (i) such enforceability may be subject to bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium or other similar laws now
or hereafter in effect relating to creditors' rights and (ii) such
enforceability may be subject to general principles of equity (regardless
of whether enforcement is considered in a proceeding in equity or at law).
(d) The execution, delivery and performance of this
Agreement by such party do not, either with or without the giving of notice
or the passage of time or both, (i) assuming compliance with the
requirements referred to in clause (ii) of this sentence, violate or
conflict with any Requirement of Law or Judgment applicable to such party,
(ii) except for (A) requirements, if any, arising out of any required
pre-merger notification and related filings with the FTC and the Antitrust
Division of the Department of Justice pursuant to the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇
Antitrust Improvements Act of 1976, as amended, (B) requirements, if any,
arising out of the rules and regulations adopted by the Federal
Communications Commission, and (C) requirements, if any, arising out of the
FTC Consent Decree, require the consent or authorization of or waiver by or
filing with any Governmental Authority or (iii) conflict with, result in
the breach of any provision of, result in the modification or termination
of, require the consent or authorization of or waiver by or filing with any
other parties to, or result in the creation or imposition of any
Encumbrance pursuant to, or constitute a default under, any material
agreement, permit, indenture, note, lease, license or franchise or any
other material instrument to which such party is a party or by which such
party's properties or assets are bound or from which such party derives
benefit. For purposes of this Section 7.3(d), the word "party" includes (i)
in the case of Holdco, Holdco and its Affiliates, and (ii) in the case of
any ▇▇▇▇▇▇ Stockholder, such ▇▇▇▇▇▇ Stockholder and his or its Related
Parties.
8. No Assignment.
This Agreement shall inure to the benefit of and be binding
upon the parties hereto and their respective successors and permitted
assigns and, in the event of the incapacity or death of any ▇▇▇▇▇▇
Stockholder who is a natural person, his legal representatives, the
executor or administrator of his estate, and his heirs and beneficiaries,
as provided in Section 4 hereof. Except as specifically provided herein,
this Agreement and the rights and obligations of the parties hereunder may
not be assigned or delegated, in whole or in part. Without prejudice to the
rights of Holdco under any other provision of this Agreement, none of the
provisions of Section 2 (other than the third sentence of Section 2) of
this Agreement are intended to be for the benefit of or enforceable by
Holdco, and Holdco shall not have any right, remedy or claim against any
Stockholder by reason of any breach or violation thereof.
9. Specific Performance. The parties hereto acknowledge that
the benefits to them under this Agreement are unique, that they are willing
to enter into this Agreement only upon performance by each other of all of
their obligations hereunder and that monetary damage would not afford
adequate remedy for failure to perform any such obligations hereunder.
Accordingly, the parties hereby consent to specific performance of their
obligations hereunder and waive any requirement for securing or posting of
any bond in connection with the obtaining of any injunctive or other
equitable relief to enforce their rights hereunder.
10. Termination, Amendment and Waiver. This Agreement shall
terminate as to all parties on the first to occur of (i) the date on which
no TCITP Stockholder beneficially owns any Covered Securities (otherwise
than by reason of any Disposition made in violation of this Agreement),
(ii) the date on which no ▇▇▇▇▇▇ Stockholder beneficially owns any Covered
Securities (otherwise than by reason of any Disposition made in violation
of this Agreement) and (iii) any date of termination agreed to by TCITP and
▇▇▇▇▇▇. If, by reason of one or more Dispositions, the number of Holdco
Shares directly or indirectly beneficially owned by the TCITP Stockholders,
as a group, or the ▇▇▇▇▇▇ Stockholders, as a group, is less than one-third
of the number of the shares beneficially owned by such Group immediately
after the Effective Time (which number, in the case of the TCITP
Stockholders, shall be calculated after giving effect to the exchange
required by Section 4.1 of the LMC Agreement and, as to each Group, shall
be appropriately adjusted to take into account any stock split, reverse
stock split, reclassification, recapitalization, conversion,
reorganization, merger or other change in such Holdco Shares) then such
group shall no longer have any right of first refusal under Section 3 or
Section 4, but shall continue to be subject to all obligations and
restrictions arising under this Agreement with respect to all Covered
Securities which the members of that group continue to beneficially own.
This Agreement may be amended by the parties hereto only by an instrument
in writing signed by each party; provided, however, that execution of any
such amendment by or on behalf of Holdco shall not be required unless such
amendment adversely affects the rights or obligations of Holdco hereunder.
Any term or provisions of this Agreement may be waived in writing at any
time by the party which is entitled to the benefits thereof.
11. General Provisions
11.1 All periods of time referred to in this Agreement
(other than references to business days ) shall include all Saturdays,
Sundays or State of New York holidays provided that if the date or last
date to perform the act or give any notice with respect to this Agreement
shall fall on a Saturday, Sunday or State of New York holiday, such act or
notice may be timely performed or given if performed or given on the next
succeeding day which is not a Saturday, Sunday or State of New York
holiday.
11.2 All notices, requests, consents and other
communications required or permitted hereunder shall be in writing and
shall be deemed effectively given or delivered upon confirmed facsimile
transmission, personal delivery or the day following delivery to a courier
service which guarantees overnight delivery of such notice or five (5) days
after deposit with the U.S. Post Office, by registered or certified mail,
return receipt requested, postage prepaid, and, in the case of courier or
mail delivery, addressed to the intended recipient at his or its address as
shown on Schedule I attached hereto or such other address as a party may
specify in writing.
11.3 This Agreement constitutes the entire agreement and
understanding of the parties relating to the subject matter hereof, and
supersedes all prior agreements, whether oral or written, relating to the
subject matter hereof (it being understood that this Section 11.3 is not
intended to obviate the respective rights and obligations of ▇▇▇▇▇▇, Holdco
and the other parties thereto under the Investors Agreement (No. 1) dated
as of the same date as this Agreement among Holdco, ▇▇▇▇▇▇, ▇▇▇ and TP).
11.4 Any provision hereof which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof or thereof, and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
11.5 The headings of the articles and sections contained in
this Agreement are solely for the purpose of reference, are not part of the
agreement of the parties and shall not affect the meaning or interpretation
of this Agreement. The definitions in Section 1 and elsewhere in this
Agreement shall apply equally to both the singular and plural forms of the
terms defined. Whenever the context may require, any pronoun shall include
the corresponding masculine, feminine and neuter forms. The words
"include", "includes" and "including" shall be deemed to be followed by the
phrase "without limitation". The words "herein", "hereof" and "hereunder"
and words of similar import refer to this Agreement in its entirety and not
to any part hereof unless the context shall otherwise require. All
references herein to Sections, Exhibits and Schedules shall be deemed
references to and Sections of, and Exhibits and Schedules to, this
Agreement unless the context shall otherwise require. Unless otherwise
expressly provided herein or unless the context shall otherwise require,
any references as of any time to the "Certificate of Incorporation",
"Restated Certification of Incorporation", "Articles of Incorporation",
"charter", "organizational or governing documents" or "By-laws" of any
Entity, to any agreement (including this Agreement) or other Contract,
instrument or document or to any statute or regulation or any specific
section or other provision thereof are to it as amended and supplemented
through such time (and, in the case of a statute or regulation or specific
section or other provision thereof, to any successor of such statute,
regulation, section or other provision). Unless otherwise expressly
provided herein or unless the context shall otherwise require, any
provision of this Agreement using a defined term (by way of example and
without limitation, such as "Controlled Affiliate") which is based on a
specified characteristic, qualification, feature, relationship or status
shall, as of any time, refer only to such Persons who have the specified
characteristic, qualification, feature, relationship or status as of that
particular time.
11.6 This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but which together
shall constitute but one and the same instrument.
11.7 This Agreement and the validity, interpretation and
performance of the terms and provisions hereof shall be governed by, and
construed in accordance with, the laws of the State of New York, without
regard to the provisions thereof relating to choice or conflict of laws,
except to the extent that the laws of the jurisdiction of incorporation of
Holdco shall be mandatorily applicable.
11.8 TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, EACH
PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY (I) SUBMITS, FOR ITSELF
AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF ANY NEW YORK STATE OR
FEDERAL COURT SITTING IN NEW YORK CITY (AND OF ANY APPELLATE COURT TO WHICH
AN APPEAL OF ANY JUDGMENT, ORDER, DECREE OR DECISION OF ANY SUCH COURT MAY
BE TAKEN) IN ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT RENDERED
IN ANY SUCH SUIT, ACTION OR PROCEEDING, (II) WAIVES ANY OBJECTION WHICH IT
MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH SUIT, ACTION
OR PROCEEDING IN ANY SUCH COURT, INCLUDING ANY CLAIM THAT ANY SUCH SUIT,
ACTION OR PROCEEDING HAS BEEN BROUGHT IN AN INCONVENIENT FORUM AND (III)
WAIVES ALL RIGHTS TO A TRIAL BY JURY IN ANY SUCH SUIT, ACTION OR
PROCEEDING.
IN WITNESS WHEREOF, the parties have executed this
Stockholders' Agreement in two or more counterparts as of the day and year
first above written.
TCI ▇▇▇▇▇▇ PREFERRED, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
_____________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Executive Vice President
LIBERTY BROADCASTING, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
_____________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Executive Vice President
COMMUNICATION CAPITAL CORP.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
_____________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Executive Vice President
/s/ R. E. ▇▇▇▇▇▇
__________________________
R. E. ▇▇▇▇▇▇, III
▇▇▇▇▇▇ OUTDOOR, INC.
By: /s/ R. E. ▇▇▇▇▇▇
______________________________
Name: R. E. ▇▇▇▇▇▇, III
Title: President
▇▇▇▇▇▇ PARTNERS, L.P.
By: /s/ R. E. ▇▇▇▇▇▇
______________________________
Name: R. E. ▇▇▇▇▇▇,III
Title: General Partner
TW INC. (which promptly following the date hereof is
changing its name to Time Warner Inc.)
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
_______________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Vice President