EXHIBIT 10.1
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PARENTS AGREEMENT
among
VIACOM INC.,
TELE-COMMUNICATIONS, INC.
and
TCI COMMUNICATIONS, INC.
Dated as of July 24, 1995
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1
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
Section 1.1 Definitions................................................ 1
ARTICLE II
THE EXCHANGE OFFER
Section 2.1 Exchange Offer............................................. 7
Section 2.2 Number of Shares of Class A Common Stock................... 10
Section 2.3 Exchange Offer Mechanics................................... 10
Section 2.4 Recapitalization........................................... 12
ARTICLE III
OTHER AGREEMENTS
Section 3.1 Execution of Other Agreements.............................. 12
Section 3.2 Amendments of Implementation Agreement..................... 12
Section 3.3 Designation of Agent for PCI Group......................... 12
Section 3.4 Prohibited Transactions.................................... 13
Section 3.5 No Inconsistent Terms...................................... 13
Section 3.6 Operation of the Business.................................. 13
Section 3.7 Right of First Offer....................................... 13
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF VI
Section 4.1 Corporate Existence and Power.............................. 14
Section 4.2 Corporate Authorization.................................... 14
Section 4.3 Governmental Authorization................................. 14
Section 4.4 Consents................................................... 14
Section 4.5 Non-Contravention.......................................... 15
Section 4.6 Binding Effect............................................. 15
Section 4.7 Finders' Fees.............................................. 15
Section 4.8 Exchange Offer............................................. 15
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ARTICLE V
REPRESENTATIONS AND WARRANTIES OF TCI AND TCI SUB
Section 5.1 Corporate Existence and Power............................. 16
Section 5.2 Corporate Authorization................................... 16
Section 5.3 Governmental Authorization................................ 16
Section 5.4 Consents.................................................. 16
Section 5.5 Non-Contravention......................................... 16
Section 5.6 Binding Effect............................................ 17
Section 5.7 Finders' Fees............................................. 17
ARTICLE VI
CONDITIONS PRECEDENT
Section 6.1 Conditions to OBligations of VI........................... 17
Section 6.2 Further Condition......................................... 18
ARTICLE VII
TERMINATION
Section 7.1 Termination............................................... 19
Section 7.2 Effect of Termination..................................... 20
ARTICLE VIII
MISCELLANEOUS
Section 8.1 Expenses.................................................. 20
Section 8.2 Headings.................................................. 21
Section 8.3 Notices................................................... 21
Section 8.4 Assignment................................................ 21
Section 8.5 Entire Agreement.......................................... 22
Section 8.6 Amendment; Waiver......................................... 22
Section 8.7 Counterparts.............................................. 22
Section 8.8 Governing Law............................................. 22
Section 8.9 Severability.............................................. 22
Section 8.10 Consent to Jurisdiction................................... 22
Section 8.11 Third Person Beneficiaries................................ 23
Section 8.12 Specific Performance...................................... 23
Section 8.13 Survival.................................................. 23
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EXHIBITS
Exhibit A - Exchange Offer Conditions
Exhibit B - Implementation Agreement
SCHEDULES
Schedule 5.4 - Consents Required by Contracts of TCI and TCI Sub
PARENTS AGREEMENT
Parents Agreement, dated as of July 24, 1995 (this "Agreement"), among
Viacom Inc., a Delaware corporation ("VI"), Tele-Communications, Inc., a
Delaware corporation ("TCI"), and TCI Communications, Inc., a Delaware
corporation ("TCI Sub").
WHEREAS, Viacom International Inc., a Delaware corporation ("Old VII"), is
a wholly-owned subsidiary of VI; and
WHEREAS, VI desires to make an exchange offer to its shareholders pursuant
to which shares of VI Common Stock would be exchanged for Class A Common Stock
of Old VII; and
WHEREAS, it is the intent of VI that prior to the consummation of the
Exchange Offer Old VII will (i) convey all of the Non-Cable Assets to New VII
and (ii) distribute its shares in New VII to VI; and
WHEREAS, TCI Sub desires to purchase from Old VII shares of Class B Common
Stock of Old VII immediately following the Exchange Time; and
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein between the parties referred to above, the parties hereto
hereby agree as follows:
ARTICLE I
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DEFINITIONS
Section 1.1 Definitions. For purposes of this Agreement the following
terms, when used in capitalized form, shall have the following meanings (and
such meanings shall be equally applicable to both the singular and plural forms
of the terms defined herein):
"Affiliate" shall have the meaning specified in the Implementation
Agreement.
"Aggregate Loan Amount" shall have the meaning set forth in Section
6.1(vi).
"Agreement" shall mean this Parents Agreement, including the Exhibits and
Schedules hereto.
"Amended and Restated Certificate of Incorporation" shall have the meaning
specified in the Implementation Agreement.
"Anticipated Commencement Date" shall have the meaning specified in Section
2.3(ii).
"Assumption of Liabilities" shall have the meaning specified in the
Implementation Agreement.
2
"Bill of Sale" shall have the meaning specified in the Implementation
Agreement.
"Business Day" shall have the meaning specified in the Implementation
Agreement.
"Cable Division Subsidiary" shall have the meaning specified in the
Implementation Agreement.
"Cash Collateral Account" shall have the meaning specified in the
Subscription Agreement.
"Class A Common Stock" shall mean the Class A Common Stock, par value $100,
of Old VII, after giving effect to the filing of the Amended and Restated
Certificate of Incorporation with the Secretary of State of Delaware.
"Communications Act" shall have the meaning specified in the Implementation
Agreement.
"Consented Subscribers" shall have the meaning specified in the
Subscription Agreement.
"Conversion Ratio" shall have the meaning specified in Section 2.3(ii).
"Conversion Ratio Spread" shall have the meaning specified in Section
2.3(ii).
"Conveyance of Assets" shall have the meaning specified in the
Implementation Agreement.
"Estimated Asset Value" shall have the meaning specified in the
Implementation Agreement.
"Estimated Exchange Date Basic Subscribers" shall have the meaning
specified in the Subscription Agreement.
"Exchange Date" shall mean the date on which the Exchange Time occurs.
"Exchange Offer" shall mean an offer by VI to exchange Class A Common Stock
for VI Common Stock on the basis set forth in Article II and subject to the
Exchange Offer Conditions.
"Exchange Offer Commencement Date" shall mean the date on which the
Exchange Offer commences in accordance with the 1934 Act.
"Exchange Offer Conditions" shall mean the conditions set forth on Exhibit
A.
"Exchange Ratio" shall have the meaning specified in Section 2.3.
3
"Exchange Time" shall mean, if the Exchange Offer is consummated, the first
Business Day following announcement of the proration factor (which in no event
shall be more than ten (10) Business Days after the Expiration Date), in
accordance with the terms and conditions of the Exchange Offer and applicable
SEC rules and regulations, at which time VI shall exchange share certificates of
Class A Common Stock for share certificates of VI Common Stock pursuant to the
Exchange Offer.
"Expiration Date" shall mean the date on which the Expiration Time occurs
in accordance with its terms.
"Expiration Time" shall mean the time at which the Exchange Offer finally
expires.
"FCC Authorizations" shall have the meaning specified in the Implementation
Agreement.
"Final Exchange Ratio" shall have the meaning specified in Section 2.3(i).
"Force Majeure Event" means any event described in paragraph (e) of the
Exchange Offer Conditions.
"Force Majeure Notice" shall have the meaning specified in Section 2.1(e).
"Governmental Authority" shall have the meaning specified in the
Implementation Agreement.
"HSR Act" shall have the meaning specified in the Implementation Agreement.
"Implementation Agreement" shall mean the Implementation Agreement, dated
as of the date hereof, between New VII and Old VII, in the form of Exhibit B.
"Inconsistent Terms" shall mean, with respect to the Loans or Loan
Documentation, terms or conditions thereof that (i) are inconsistent with the
terms of the Transaction Documents or the Preferred Stock or (ii) would require
the grant of any security interest in an asset of VI or any of its Affiliates
(other than (x) a grant by Old VII of a security interest in the Cash Collateral
Account prior to the Exchange Time, (y) the pledge by Old VII or any Cable
Division Subsidiary of stock in a Cable Division Subsidiary that is effective
upon (but not before) the release of all funds to Old VII from the Cash
Collateral Account or (z) pursuant to Section 2.17 of the Implementation
Agreement, in each case consistent with the terms of the Transaction Documents).
"InterMedia" shall mean InterMedia Partners IV, L.P., a California limited
partnership.
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"Intraday Price" shall mean, with respect to a day, the weighted average of
the sale prices for all trades of shares of VI Class B Common Stock on such
date, as reported by the ADP Financial Information Services reporting service.
"Legal Requirement" shall have the meaning specified in the Implementation
Agreement.
"Loan Documentation" shall have the meaning specified in the Subscription
Agreement.
"Loan Proceeds" shall have the meaning specified in the Subscription
Agreement.
"Loans" shall have the meaning specified in the Subscription Agreement.
"Local Authority" shall have the meaning specified in the Implementation
Agreement.
"Local Authorizations" shall have the meaning specified in the
Implementation Agreement.
"Minimum Condition" shall mean the condition that a number of shares of VI
Common Stock shall have been validly tendered and not withdrawn prior to the
expiration of the Exchange Offer that is sufficient to enable VI to exchange the
Number of Shares to be Exchanged at the Final Exchange Ratio in accordance with
the terms and conditions of the Exchange Offer.
"ML&Co." shall have the meaning specified in Section 2.3(ii).
"NASDAQ" shall mean the electronic inter-dealer quotation system operated
by NASDAQ, Inc., a subsidiary of the National Association of Securities Dealers,
Inc.
"Negotiation Period" shall have the meaning specified in Section 3.7.
"New VII" means Viacom International Services Inc., a Delaware corporation.
"1933 Act" shall mean the Securities Act of 1933, as amended, and the rules
and regulations promulgated thereunder, as amended.
"1934 Act" shall mean the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated thereunder, as amended.
"Non-Cable Assets" shall have the meaning specified in the Implementation
Agreement.
"Non-Cable FCC Authorizations" shall have the meaning specified in the
Implementation Agreement.
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"Number of Shares to be Exchanged" shall have the meaning specified in
Section 2.2.
"Offered Business" shall have the meaning specified in Section 3.7.
"Offering Materials" means the Offering Circular/Prospectus relating to the
Exchange Offer included in the Registration Statement and each of the other
documents mailed to stockholders of VI in connection with the Exchange Offer
and, if a TCI Registration Statement is required pursuant to Section 2.1(b) to
be declared effective prior to the commencement of the Exchange Offer, the
Prospectus relating to the TCI Stock issuable upon conversion of the Preferred
Stock included in such TCI Registration Statement.
"Offer Period" shall have the meaning specified in Section 3.7.
"Old VII" shall have the meaning specified in the preamble of this
Agreement.
"PCI Group" shall have the meaning specified in the Implementation
Agreement.
"PCI Subsidiaries" shall have the meaning specified in the Implementation
Agreement.
"Person" shall have the meaning specified in the Implementation Agreement.
"Preferred Stock" shall mean the Series A Senior Cumulative Exchangeable
Preferred Stock of Old VII, having the rights and privileges set forth in the
term sheet set forth as Exhibit K to the Implementation Agreement, and having a
yield and conversion ratio determined in accordance with Section 2.3 and having
such other terms as are customary for such securities and consistent with such
term sheet.
"Price Notice" shall have the meaning specified in Section 3.7.
"RCS" shall mean RCS Pacific, L.P., a California limited partnership.
"Registration Statement" shall have the meaning specified in Section 2.1.
"SEC" shall mean the Securities and Exchange Commission.
"Share Purchase Closing" shall have the meaning specified in the
Implementation Agreement.
"Spread" shall have the meaning specified in Section 2.3.
"Subscription Agreement" shall mean a Subscription Agreement, dated as of
the date hereof, among Old VII, TCI and TCI Sub, provided that the definition of
Subscription Agreement shall not include any amendment thereto entered into from
and after the Exchange Time without the written consent of VI (which consent may
be withheld for any reason).
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"TCI Information" shall have the meaning specified in Section 2.1(f).
"TCI Registration Statement" shall have the meaning specified in Section
2.1(b).
"TCI Stock" shall mean (i) the Class A Common Stock, $1.00 par value per
share, of TCI, or (ii) if the "Liberty Media Group Stock Proposal" (as such term
is defined in the proxy statement/prospectus of TCI dated June 29, 1995) is
adopted by the stockholders of TCI and the Distribution (as so defined)
contemplated thereby is made, the Series A TCI Group Common Stock, $1.00 par
value per share, of TCI.
"TCI Sub" shall have the meaning specified in the preamble of this
Agreement.
"Tiebreaker Investment Bank" shall have the meaning specified in Section
2.3(ii).
"Transaction" shall mean the Conveyance of Assets, the Assumption of
Liabilities, the Loans, the Exchange Offer, the sale of the Shares (as such term
is defined in the Subscription Agreement) and all other transactions
contemplated by the Transaction Documents.
"Transaction Documents" shall mean this Agreement, the Implementation
Agreement, the Subscription Agreement, the Bill of Sale and any other
agreements, documents, instruments and certificates dated as of the date hereof
and executed and delivered by TCI or any of its Affiliates, on the one hand, and
VI or any of its Affiliates, on the other hand, in connection with the
transactions contemplated by the foregoing.
"VI" shall have the meaning specified in the preamble of this Agreement.
"VI Class B Common Stock" shall mean the Class B Common Stock, par value
$0.01, of VI.
"VI Common Stock" means the Class A Common Stock, par value $0.01 per share
of VI, and the VI Class B Common Stock.
"WP&Co." shall have the meaning specified in Section 2.3(ii).
ARTICLE II
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THE EXCHANGE OFFER
Section 2.1 Exchange Offer. (a) VI shall (i) cause Old VII to prepare and
file with the SEC as promptly as practicable following the date hereof a
registration statement on Form S-4 (or another appropriate form) under the 1933
Act with respect to the Exchange Offer (the "Registration Statement"); (ii) use
its commercially reasonable efforts to have the Registration Statement declared
effective by the SEC under the 1933 Act; and (iii) take all such action as may
be required under state blue sky or securities laws in connection with the
Exchange Offer.
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(b) TCI agrees to prepare and file with the SEC, and use its commercially
reasonable efforts to cause to be declared effective (which, if required by the
SEC, shall be prior to the commencement of the Exchange Offer), a registration
statement under the 1933 Act which will permit the exchange of TCI Stock for
shares of Preferred Stock upon conversion thereof to be made in compliance with
the 1933 Act and the rules and regulations of the SEC promulgated thereunder
(the "TCI Registration Statement").
(c) Subject to the fulfillment of the conditions set forth in Section 6.1,
promptly after both the Registration Statement and the TCI Registration
Statement (if required pursuant to Section 2.1(b) to be declared effective prior
to the commencement of the Exchange Offer) become effective, VI shall commence
the Exchange Offer (and file with the SEC a Schedule 13E-4 under the 1934 Act
relating to the Exchange Offer), cause the Offering Materials to be mailed to
the record holders of its Common Stock and, subject to the terms and conditions
of the Exchange Offer and this Agreement, take all action necessary to
consummate the Exchange Offer. It is agreed that VI shall have no obligation to
make a recommendation to its shareholders concerning the Exchange Offer.
(d) VI shall accept for exchange, in accordance with the terms of the
Exchange Offer, shares of VI Common Stock tendered prior to the Expiration Time
and not theretofore withdrawn if all Exchange Offer Conditions shall have been
satisfied or waived by VI in accordance with the terms of the Exchange Offer. VI
agrees that it will not exercise its right to terminate the Exchange Offer as a
result of the failure of an Exchange Offer Condition without a reasonable basis
for believing that such Exchange Offer Condition has not been satisfied.
(e) VI agrees that it will not accept for exchange shares of VI Common
Stock tendered to it in the Exchange Offer and shall extend the Expiration Date
(provided that the Expiration Date has not already been extended) if it receives
written notice from TCI and TCI Sub to it prior to 5:00 P.M. on the date the
Exchange Offer is scheduled to expire that they have determined that any Force
Majeure Event has occurred (a "Force Majeure Notice"), provided that TCI and TCI
Sub must have a reasonable basis for making such a determination. In the event
that a Force Majeure Notice has been delivered to VI and no Force Majeure Event
shall exist on the subsequent Expiration Date following extension of the
Exchange Offer pursuant to Section 2.3(ii), VI may give written notice to such
effect to TCI and TCI Sub prior to 5:00 p.m. on such subsequent Expiration Date,
in which case such Force Majeure Notice shall be deemed to be withdrawn and of
no further force and effect at 8:59 A.M. on the Business Day following the date
such notice is delivered by VI.
(f) TCI and TCI Sub agree to provide VI with such information with respect
to TCI, TCI Sub, the Loans and, with respect to any period after the Exchange
Time, Old VII or any Cable Division Subsidiary, as is necessary for VI to
complete the Registration Statement in accordance with the requirements of the
1933 Act. TCI and TCI Sub covenant that the information supplied or to be
supplied by TCI or TCI Sub in writing specifically for inclusion in, and which
is included in, the Registration Statement or any amendment or supplement
thereto, or the Offering Materials, which concerns TCI, TCI Sub, or the Loans
or, with respect to any period after the Exchange Time, Old VII or any Cable
8
Division Subsidiary (the "TCI Information"), will not, at the respective times
such documents are filed and at the Expiration Time, and, in the case of the
Registration Statement or any amendment or supplement thereto, when the same
becomes effective, and, in the case of the Offering Materials, at the time of
mailing thereof to VI's stockholders, contain any untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading or necessary to correct any statement in any earlier
communication with respect to the Exchange Offer. For this purpose, any TCI
Information included in any such document will be deemed to have been so
supplied in writing specifically for inclusion therein if such document was
available for review by TCI a reasonable time before such document was filed and
not objected to in writing by TCI prior to the filing thereof. If at any time
prior to the Exchange Date any event or circumstance relating to TCI, TCI Sub or
any of their Affiliates or their officers or directors, the Loans or, with
respect to any period after the Exchange Time Old VII or any Cable Division
Subsidiary, should be discovered by TCI which should be set forth in an
amendment or supplement to the Registration Statement or Offering Materials, as
required by applicable law, TCI shall promptly inform VI. VI and its Affiliates,
officers, directors, employees, agents, successors and assigns shall be
indemnified and held harmless by TCI and TCI Sub (who shall be jointly and
severally liable) for any and all liabilities, losses, damages, claims, costs
and expenses (including, without limitation, attorneys' fees and expenses)
actually suffered or incurred by them arising out of or resulting from any
untrue statement of a material fact contained in the Registration Statement or
the Offering Materials, or any omission to state therein a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading, if the
statement or omission was made in reliance upon and in conformity with the TCI
Information.
(g) VI covenants that the information in the Registration Statement and
Offering Materials (other than the TCI Information) shall not, at the time (i)
the Registration Statement is declared effective, (ii) the Offering Materials
(or any amendment thereof or supplement thereto) is first mailed to the
shareholders of VI, and (iii) at the Expiration Time contain any untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading. If any time prior to the Exchange Date any event
or circumstance relating to VI or any of its Affiliates or its officers or
directors, should be discovered by VI which should be set forth in an amendment
or a supplement to the Registration Statement or Offering Materials, as required
by applicable law, VI shall promptly inform TCI and TCI Sub. TCI, TCI Sub and
their Affiliates, officers, directors, employees, agents, successors and assigns
shall be indemnified and held harmless by VI for any and all liabilities,
losses, damages, claims, costs and expenses (including, without limitation,
attorneys' fees and expenses) actually suffered or incurred by them arising out
of or resulting from any untrue statement of a material fact contained in the
Registration Statement or the Offering Materials, or any omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, in each case except to the extent that the statement or omission
was made in reliance upon and in conformity with the TCI Information.
9
Section 2.2 Number of Shares of Class A Common Stock. The number of shares
of Class A Common Stock that VI shall exchange for VI Common Stock in the
Exchange Offer shall be a number (the "Number of Shares to be Exchanged") equal
to (x) the Estimated Asset Value, minus $1,700,000,000 (one billion, seven
hundred million dollars), divided by (y) $100 (the par value of the Class A
Common Stock and the stated amount of the liquidation preference (before
provision for accrued and unpaid dividends) of one share of the Preferred
Stock.)
Section 2.3 Exchange Offer Mechanics.
(i) Unless otherwise agreed, the Exchange Offer shall
be a "Dutch Auction" tender offer pursuant to
which stockholders of VI who tender their shares
of VI Common Stock shall be provided with the
opportunity to state the minimum fraction of a
share or shares of Class A Common Stock (an
"Exchange Ratio") that such shareholder will
accept in exchange for each share of such VI
Common Stock accepted by VI for exchange pursuant
to the Exchange Offer. The Exchange Offer shall
state a maximum Exchange Ratio and a minimum
Exchange Ratio, provided that the maximum
Exchange Ratio times $100 shall represent a price
not less than 112.5% of the average of the
Intraday Prices for a share of VI Class B Common
Stock reported by the American Stock Exchange
during the twenty trading day period ended the
date prior to the Exchange Offer Commencement
Date. The final Exchange Ratio shall be the
smallest Exchange Ratio (within applicable SEC
rules and regulations) equal to or less than the
specified maximum Exchange Ratio (the "Final
Exchange Ratio") that would result in the issuance
of the Number of Shares to be Exchanged in
exchange for the shares of VI Common Stock validly
tendered prior to the Expiration Date, and,
subject to satisfaction of all conditions to the
Exchange Offer and to proration, VI shall accept
for exchange at the Final Exchange Ratio all
shares validly tendered and not withdrawn with
respect to which an Exchange Ratio has been
designated which is equal to or less than the
Final Exchange Ratio. If there is no such Final
Exchange Ratio, the Minimum Condition shall be
deemed not met as of such expiration date.
(ii) The terms of the Exchange Offer shall specify (a)
that the yield on the Preferred Stock to be issued
in exchange for the Class A Common Stock upon the
Share Purchase Closing shall bear a dividend yield
equal to (x) the yield on ten (10) year treasury
bonds immediately prior to the commencement of the
Exchange Offer, plus a specified spread (the
"Spread") which shall not be greater than one and
one-quarter (1.25) percentage points over such
yield or (y) such higher dividend yield as may be
specified by TCI as provided below and (b) the
conversion ratio (the "Conversion Ratio") on the
Preferred Stock for the conversion of the
10
Preferred Stock into TCI Stock, which shall be
based upon a percentage premium of twenty-five
percent (25%) (the "Conversion Ratio Spread") over
the weighted average of the sale prices for all
trades of shares of TCI Stock on NASDAQ during the
twenty (20) trading days ending on the second
Business Day (or such longer period as is required
by the 1934 Act) prior to the expiration of the
Exchange Offer. VI shall notify TCI Sub not less
than fifteen (15) Business Days prior to the
anticipated commencement date of the Exchange
Offer (the "Anticipated Commencement Date") of
such Anticipated Commencement Date. Merrill, Lynch
& Co., Incorporated ("ML&Co.") and Wasserstein,
Perella & Co. ("WP&Co.") shall use their best
efforts to agree on the Spread not later than the
fifth Business Day after the date of such notice.
In the event that ML&Co. and WP&Co. are unable to
agree on the Spread by such date, they shall
immediately notify TCI Sub and VI of their
respective positions with respect to the
appropriate Spread and Smith Barney Inc. (the
"Tiebreaker Investment Bank") shall select a
Spread, which Spread shall be within the range of
the two Spreads proposed by ML&Co. and WP&Co.
Notwithstanding the foregoing, TCI shall have the
right to specify a dividend yield that is higher
than the dividend yield that would result from the
Spread determined by ML&Co. and WP&Co. or the
Tiebreaker Investment Bank, as the case may be, by
giving VI written notice of such higher dividend
yield by the third Business Day after the date of
such determination of the Spread. Spreads shall be
determined pursuant to this Section 2.3, such
that, in the opinion of the entity proposing the
Spread, if the Preferred Stock bears a dividend
yield equal to the ten (10) year treasury bond
yield plus such Spread, the Preferred Stock would
be expected to trade at a price equal to the
liquidation preference thereof immediately
following the Exchange Date. ML&Co. and WP&Co.
shall provide the Tiebreaker Investment Bank with
full access to all significant information
employed by them, and TCI and VI shall provide
such other information that is reasonably
requested in estimating the Spread. In the event
that the Minimum Condition is not met on the first
expiration date of the Exchange Offer, VI shall,
not later than the last day permitted under the
1934 Act, extend the Exchange Offer for not less
than ten (10) Business Days nor more than fifteen
(15) Business Days (or such greater period as is
required under the 1934 Act). During the period of
the extension, TCI and VI shall negotiate in good
faith in order to determine mutually acceptable
terms and conditions for the Preferred Stock
(including, without limitation, the dividend yield
and Conversion Ratio) and the Exchange Offer
(including, without limitation, the duration of
any further extension thereof and the maximum
Exchange Ratio) that each believes in good faith
would cause the Minimum Condition to be fulfilled
at the Expiration Date of a further extension of
the Exchange Offer, and that would cause the
Preferred Stock to trade at a price equal to the
liquidation preference thereof immediately
11
following the Exchange Date. In the event that the
parties agree with respect to such terms prior to
the Expiration Date of such extension, the
Exchange Offer shall be further extended to the
extent mutually agreed and in accordance with the
requirements of the 1934 Act. In the event that
the Minimum Condition is not met at the expiration
date of the Exchange Offer after such extension,
either party shall have the right to terminate
this Agreement pursuant to Section 7.1(f).
(iii) VI shall be responsible for the fees and expenses
of WP&Co. and TCI and TCI Sub shall be responsible
for the fees and expenses of ML&Co., and each of
VI, on the one hand, and TCI and TCI Sub, on the
other hand, shall be responsible for one-half the
fees and expenses of the Tiebreaker Investment
Bank (which fees shall be negotiated in good faith
by VI and TCI Sub).
Section 2.4 Recapitalization. Subject to the fulfillment of the conditions
set forth in Section 6.1, prior to the Exchange Time, VI shall cause Old VII to
take the action contemplated by Section 2.1(c) of the Implementation Agreement
and shall cause all of the capital stock of Old VII held by VI to be
reclassified into a number of shares of Class A Common Stock equal to the Number
of Shares to be Exchanged.
ARTICLE III
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OTHER AGREEMENTS
Section 3.1 Execution of Other Agreements. (a) Concurrently with the
execution and delivery hereof, TCI and TCI Sub shall execute and deliver to Old
VII the Subscription Agreement.
(b) Concurrently with the execution and delivery hereof, VI shall cause (i)
Old VII and New VII to execute and deliver to each other the Implementation
Agreement and (ii) Old VII to execute and deliver to TCI and TCI Sub the
Subscription Agreement.
Section 3.2 Amendments of Implementation Agreement. VI agrees that prior to
the Exchange Time it shall not cause or permit Old VII or New VII to amend or
waive performance of any provision of the Implementation Agreement without the
prior written consent of TCI or TCI Sub, provided that upon the written notice
of TCI Sub delivered to VI, or upon written notice of VI delivered to TCI Sub,
in either case within ninety (90) days of the date certifications under Section
617 of the Communications Act are delivered to the Local Authorities pursuant to
Section 7.9(c)(iii) of the Subscription Agreement, to the effect that in its
reasonable judgment consents of Local Authorities are required for the
consummation of the Transaction that are not reflected on Schedule 4.9 of the
Implementation Agreement, VI shall cause Old VII and New VII to amend Schedule
4.9 of the Implementation Agreement to indicate such additional Local
Authorizations requiring the consent of the Local Authority for consummation of
the Transaction.
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Section 3.3 Designation of Agent for PCI Group. TCI and TCI Sub hereby (i)
acknowledge that the PCI Subsidiaries of Old VII which were formerly includible
in the consolidated federal income tax returns of the PCI Group intend to apply
to the Internal Revenue Service for permission to designate Paramount Pictures
Corporation or another PCI Subsidiary as the agent for the PCI Group pursuant to
Treas. Reg. ss. 1.1502-77(d) and (ii) agree to cooperate in attempting to have
such permission granted.
Section 3.4 Prohibited Transactions. TCI shall not consummate any
transaction in which all or a majority in value (as determined in good faith by
the management of TCI) of its assets are distributed without fair consideration
to its direct or indirect stockholders unless (x) the transferee of such assets
or, if such assets represent principally an equity interest in an entity, such
entity, assumes, by instrument reasonably satisfactory to VI, TCI's obligations
under the Transaction Documents to which TCI is a party and (y) the equity of
such transferee or entity has a fair market value immediately following such
transaction of at least $1,500,000,000 (one billion five hundred million
dollars).
Section 3.5 No Inconsistent Terms. TCI Sub and TCI covenant and agree with
VI that the Loan Documentation will not contain, and that the Loans will not be
made on, any Inconsistent Terms.
Section 3.6 Operation of the Business. TCI and TCI Sub shall not permit Old
VII or any Cable Division Subsidiary to engage in any transaction on the Closing
Date other than in the ordinary course of business and other than transactions,
if any, required to take place on the Closing Date by the Parents Agreement,
Implementation Agreement or Subscription Agreement.
Section 3.7 Right of First Offer. In the event this Agreement is terminated
pursuant to Section 7.1 solely as a result of the failure of the condition set
forth in Section 6.1(iv), then if at any time during the period commencing on
the date of such termination and ending on the date which is eighteen (18)
months after the date of such termination (the "Offer Period") VI intends to
sell all or substantially all of the Business, or all or substantially all of
the Bay Area System or the Puget Sound System, or all or substantially all of
the stock of any Subsidiary or Subsidiaries the assets of which consist
primarily of all or substantially all of the Business, the Bay Area System or
the Puget Sound System (in any such case, an "Offered Business"), VI shall
deliver to TCI a written notice to such effect. If TCI notifies VI in writing of
its desire to conduct negotiations regarding such sale within five Business Days
of its receipt of such notice from VI, VI and TCI shall negotiate in good faith
during the period ending on the sixtieth day after the date of such notice by VI
(the "Negotiation Period") to reach an agreement for the sale of the Offered
Business to TCI. During the Negotiation Period, VI shall notify TCI of the
amount, and material terms, of the consideration VI would be willing to accept
for a sale of the Offered Business (a "Price Notice") on one or more occasions.
If a binding agreement for a sale of the Offered Business is not reached by the
end of the Negotiation Period, for a period of 120 days following the
termination of the Negotiation Period VI may sell (or enter into a binding
agreement to sell) the Offered Business for an aggregate consideration equal to
or greater than the fair market value of the consideration set forth in the
Price Notice delivered by VI during the Negotiation Period reflecting the lowest
13
fair market value consideration, and, if such sale is consummated, TCI shall
have no further rights under this Section 3.7. If (i) at the end of such 120 day
period, a binding agreement for a sale of the Offered Business has not been
reached or (ii) such a binding agreement has been reached and is terminated
prior to its consummation during the Offer Period, VI shall not, for the
remainder of the Offer Period, if any, sell or negotiate to sell any Offered
Business without complying with the procedures set forth in this Section 3.7.
ARTICLE IV
----------
REPRESENTATIONS AND WARRANTIES OF VI
VI represents and warrants to TCI and TCI Sub that:
Section 4.1 Corporate Existence and Power. VI (i) is a corporation duly
organized, validly existing and in good standing under the laws of its
jurisdiction of organization, (ii) is authorized to transact business and is in
good standing in each state in which its ownership of assets or conduct of
business requires such qualification, and (iii) has all corporate powers
required to carry on its business as conducted on the date hereof, with such
exceptions to clauses (i), (ii) and (iii) as would not materially and adversely
affect the ability of VI to consummate the Transactions to be consummated by it.
Section 4.2 Corporate Authorization. The performance by VI of this
Agreement and the consummation by VI of the Transactions to be consummated by it
are within the corporate powers of VI and have been duly authorized by all
necessary corporate action on the part of VI. The approval of the stockholders
of VI is not required in order to consummate the Transaction.
Section 4.3 Governmental Authorization. The execution and delivery of this
Agreement by VI, and the performance by VI of this Agreement, and the
consummation by VI of the Transactions to be consummated by it pursuant hereto,
require no material action by or in respect of, or material filing with, any
Governmental Authority other than (x) compliance with any applicable
requirements of the HSR Act, the FCC Authorizations, the Non-Cable FCC
Authorizations and the Local Authorizations, (y) compliance with any applicable
requirements of the 1933 Act and the 1934 Act and state blue sky and securities
laws in connection with the Exchange Offer and (z) those that may be applicable
as a result of the regulatory status of TCI, TCI Sub or their Affiliates.
Section 4.4 Consents. Except as set forth on Schedule 4.5 to the
Implementation Agreement, no consent by any Person under any contract as to
which VI is a party or to which its assets are subject is required or necessary
for the execution and delivery of this Agreement by VI, or the performance by VI
of this Agreement, or the consummation by VI of the Transactions to be
consummated by it pursuant hereto with such exceptions as would not materially
and adversely affect the ability of VI to consummate the Transactions to be
consummated by it.
14
Section 4.5 Non-Contravention. The execution, delivery and performance of
this Agreement by VI, and the consummation by VI of the Transactions
contemplated to be consummated by it pursuant hereto, do not or before the
Exchange Date will not, (x) contravene the certificate of incorporation or
bylaws of VI or (y) subject to obtaining the consents set forth in Schedules
4.5, 4.9, 4.14 and 4.16 of the Implementation Agreement and subject to
obtaining, making or taking the actions and filings described in clauses (x),
(y) and (z) of Section 4.3, result in, or constitute a breach or default
(including any event that, with the passage of time or giving of notice, or
both, would become a breach or default) under any applicable Legal Requirement
or any judgment, injunction, order, decree, contract, license, lease, indenture,
mortgage, loan agreement, note or other agreements or instrument as to which VI
is a party or by which any of its properties may be bound, the effect of which
would be to materially and adversely impair the ability of VI to consummate the
Transactions to be consummated by it.
Section 4.6 Binding Effect. This Agreement has been duly executed and
delivered by VI, and this Agreement constitutes a valid and binding obligation
of VI, enforceable against VI in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' rights generally
or by the principles governing the availability of equitable remedies.
Section 4.7 Finders' Fees. There is no investment banker, broker, finder or
other intermediary which has been retained by or is authorized to act on behalf
of VI or any of its Affiliates who might be entitled to any fee or commission
from TCI or TCI Sub or any of their Affiliates in connection with the execution,
delivery or performance of this Agreement or the consummation of the
Transactions.
Section 4.8 Exchange Offer. The Exchange Offer shall be conducted in
compliance with the 1933 Act, the 1934 Act and any relevant state securities
laws (provided that no representation is made in this Section 4.8 as to any
non-compliance resulting from actions of TCI, TCI Sub or their Affiliates or
from information included in (or omitted from) the Offering Materials or
Registration Statement).
ARTICLE V
---------
REPRESENTATIONS AND WARRANTIES OF TCI AND TCI SUB
Each of TCI and TCI Sub jointly and severally represent and warrant to VI
that:
Section 5.1 Corporate Existence and Power. It is (i) a corporation duly
organized, validly existing and in good standing under the laws of the state of
Delaware, (ii) is authorized to transact business and is in good standing in
each state in which its ownership of assets or conduct of business requires such
qualification, and (iii) has all corporate powers required to carry on its
business as now conducted, with such exceptions as would not materially and
adversely affect its ability to consummate the Transactions to be consummated by
it.
Section 5.2 Corporate Authorization. The execution, delivery and
performance by it of this Agreement and the consummation by it of the
15
Transactions to be consummated by it are within its corporate powers and have
been duly authorized by all necessary corporate action on its part.
Section 5.3 Governmental Authorization. The execution, delivery and
performance by it of this Agreement, and the consummation by it of the
Transactions to be consummated by it, require no material action by or in
respect of, or filing with, any governmental body, agency, official or authority
other than compliance with any applicable requirements of the HSR Act, the
Non-Cable FCC Authorizations, the FCC Authorizations, and the Local
Authorizations.
Section 5.4 Consents. Except as set out in Schedule 5.4, no consent by any
Person under any contract to which it is a party or to which its assets are
subject is required or necessary for the execution, delivery and performance by
it of this Agreement or the consummation by it of the Transactions to be
consummated by it, with such exceptions as would not materially and adversely
affect its ability to consummate the Transactions to be consummated by it.
Section 5.5 Non-Contravention. The execution, delivery and performance by
it of this Agreement and the consummation by it of the Transactions contemplated
to be consummated by it pursuant hereto do not and will not (x) contravene its
certificate of incorporation or by-laws or (y) subject to obtaining, making or
taking the actions and filings described in Section 5.3, result in a, or
constitute a breach or default (including any event that, with the passage of
time or giving of notice, or both, would become a breach or default) under any
applicable Legal Requirement or any judgment, order, decree, contract, license,
lease, indenture, mortgage, loan agreement, note, security agreement or other
agreement or instrument, as to which it is a party or by which any of its
properties may be bound, the effect of which would materially and adversely
impair its ability to consummate the Transactions to be consummated by it.
Section 5.6 Binding Effect. This Agreement has been duly executed and
delivered by it and this Agreement constitutes its valid and binding obligation,
enforceable against it in accordance with its terms, except as enforceability
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium
or similar laws affecting creditors' rights generally or by the principles
governing the availability of equitable remedies.
Section 5.7 Finders' Fees. There is no investment banker, broker, finder or
other intermediary which has been retained by or is authorized to act on behalf
of TCI, TCI Sub, RCS, InterMedia or any of their Affiliates who might be
entitled to any fee or commission from VI or any of its Affiliates in connection
with the execution, delivery or performance of this Agreement or the
consummation of the Transactions.
16
ARTICLE VI
----------
CONDITIONS PRECEDENT
Section 6.1 Conditions to Obligations of VI. The obligations of VI to take
the action required to be taken by it pursuant to Sections 2.1(c) and 2.4 are
subject to the satisfaction of each of the following conditions, each of which
may be waived by VI (except that the conditions contained in clauses (vii) and
(viii) may not be waived without the prior consent of TCI Sub, such consent not
to be unreasonably withheld):
(i) HSR Act. Any applicable waiting period (and any
extension thereof) under the HSR Act shall have
expired or been terminated without the
commencement or threat of any litigation by a
Governmental Authority of competent jurisdiction
to restrain the consummation of the Exchange
Offer, Subscription Agreement or other material
action contemplated by the Transaction in any
material respect.
(ii) Consented Subscribers. The number of Consented
Subscribers shall be not less than 90% of
Estimated Exchange Date Basic Subscribers.
(iii) Absence of Injunction. No order, stay, judgment or
decree shall have been issued by any court and be
in effect restraining or prohibiting the
consummation of the Transaction in any material
respect.
(iv) Tax Matters. VI shall be satisfied with the
treatment of the Transaction for Federal income
tax purposes.
(v) Subscription Agreement. The Subscription Agreement
shall remain in full force and effect and there
shall be no condition to TCI's, TCI Sub's or Old
VII's obligations thereunder that is incapable of
being satisfied at the Expiration Time.
(vi) Loans. The Loan Documentation shall have been duly
executed and delivered by all parties thereto and
shall remain in full force and effect and VI shall
have received confirmation, in form and substance
satisfactory to it, that Old VII shall be able to
draw down Loan Proceeds in an aggregate principal
amount equal to $1,700,000,000 (one billion, seven
hundred million dollars) (the "Aggregate Loan
Amount") thereunder on the Expiration Date prior
to the Expiration Time and such Loan Proceeds that
are equal to the Aggregate Loan Amount shall be
available for transfer as a contribution to New
VII without condition (but without limiting VI's
obligation to provide the notice required for the
release of funds from the Cash Collateral Account
as specified in the definition of Cash Collateral
Account) prior to the Exchange Time as
contemplated in the Implementation Agreement.
17
(vii) FCC. All consents of the FCC listed on Schedule
4.9 of the Implementation Agreement and all
Non-Cable FCC Authorizations shall have been
obtained and shall remain in full force and
effect.
(viii) Registration Statements. The Registration
Statement and, if the effectiveness of the TCI
Registration Statement is required by the 1933 Act
or the SEC prior to the consummation of the
Exchange Offer, the TCI Registration Statement
shall have been declared effective, and no stop
order suspending the effectiveness of the
Registration Statement or, if the effectiveness of
the TCI Registration Statement is required by the
1933 Act or the SEC prior to the consummation of
the Exchange Offer, the TCI Registration
Statement, shall have been issued and no
proceeding for that purpose shall have been
initiated or threatened by the SEC.
Section 6.2 Further Condition. The obligations of VI to take the action
required to be taken by it pursuant to Section 2.4 is subject to the further
condition that VI shall have accepted shares of VI Common Stock for exchange in
the Exchange Offer in accordance with Section 2.1(d).
ARTICLE VII
-----------
TERMINATION
Section 7.1 Termination. This Agreement may be terminated at any time prior
to the Expiration Time:
(a) by written consent of VI, TCI and TCI Sub;
(b) by TCI or TCI Sub, if any condition contained
in Article VIII of the Subscription Agreement has become
incapable of satisfaction (other than if such incapacity
results from actions or omissions of TCI or TCI Sub that are
in contravention of the provisions of the Transaction
Documents);
(c) by VI, if any condition contained in Sections
6.1 or 6.2 hereof or in Article IX of the Subscription
Agreement has become incapable of satisfaction (other than
if such incapacity results from actions or omissions of VI
or its Affiliates that are in contravention of the
provisions of the Transaction Documents);
(d) by TCI or TCI Sub, (x) if the Expiration Time
has not occurred on or prior to the date that is twelve (12)
months from the date of this Agreement (other than as a
result of (i) the failure by TCI or TCI Sub to consummate
the transactions contemplated hereby when all conditions to
their obligations contained in Article VIII of the
Subscription Agreement have been satisfied or waived, (ii)
the failure by TCI or TCI Sub or their Affiliates to duly
18
comply with their covenants and obligations in the
Transaction Documents or (iii) the failure of a condition
contained in Sections 6.1 or 6.2 hereof or in Articles VIII
or IX of the Subscription Agreement resulting from actions
or omissions of TCI or TCI Sub or their Affiliates that are
in contravention of the provisions of the Transaction
Documents) or (y) if the Exchange Offer has not commenced on
or prior to the date that is eleven (11) months from the
date of this Agreement (other than as a result of the
failure of a condition contained in Section 6.1 hereof
resulting from actions or omissions of TCI or TCI Sub or
their Affiliates that are in contravention of the provisions
of the Transaction Documents);
(e) by VI, (x) if the Expiration Time has not
occurred on or prior to the date that its twelve (12) months
from the date of this Agreement (other than as a result of
(i) the failure by VI to consummate the transactions
contemplated hereby when all conditions to its obligations
contained in Section 6.1 hereof or in Article IX of the
Subscription Agreement have been satisfied or waived, (ii)
the failure by VI or its Affiliates to duly comply with
their covenants and obligations under the Transaction
Documents or (iii) the failure of a condition contained in
Sections 6.1 or 6.2 hereof or in Article VIII or IX of the
Subscription Agreement resulting from actions or omissions
of VI or its Affiliates that are in contravention of the
provisions of the Transaction Documents) or (y) if the
Exchange Offer has not commenced on or prior to the date
that is eleven (11) months from the date of this Agreement
(other than as a result of the failure of a condition
contained in Section 6.1 hereof resulting from actions or
omissions of VI or its Affiliates that are in contravention
of the provisions of the Transaction Documents); or
(f) by TCI, TCI Sub or VI if the Exchange Offer
terminates or finally expires after one extension thereof
without any shares of VI Common Stock having been accepted
for exchange by VI thereunder in accordance with Section
2.1(d).
If TCI, TCI Sub or VI terminates this Agreement pursuant to the provisions
hereof, such termination will be effected by written notice to the other parties
specifying the provision hereof pursuant to which such termination is made.
Section 7.2 Effect of Termination. (a) Upon termination of this Agreement
pursuant to Section 7.1 hereof, except as provided in clause (b) below: (i) this
Agreement will forthwith become null and void, (ii) such termination will be the
sole remedy with respect to any breach of any representation, warranty, covenant
or agreement contained herein and (iii) no party hereto or any of their
respective officers, directors, partners, employees, agents, consultants,
shareholders or principals will have any liability or obligation hereunder or
with respect hereto.
(b) The provisions of clause (a) above notwithstanding, no party will be
relieved of: (i) liability for any breach of Articles IV and V and (ii)
liability for any breach of any material covenant or agreement contained herein
or made pursuant hereto, provided, however, that no party to this Agreement
19
shall be entitled to recover consequential damages in respect of any breach of
this Agreement or any other Transaction Document. The provisions of Sections
2.1(f), 2.1(g), 2.3(iii), 3.7, 7.2, 8.1, 8.8 and 8.10 will survive termination
hereof.
ARTICLE VIII
------------
MISCELLANEOUS
Section 8.1 Expenses. Except as expressly set forth herein, the fees and
expenses (including the fees of any lawyers, accountants, investment bankers or
others engaged by such party) in connection with this Agreement and the
transactions contemplated hereby whether or not the Transaction is consummated
will be paid by the party incurring the same.
Section 8.2 Headings. The section headings herein are for convenience of
reference only, do not constitute part of this Agreement and will not be deemed
to limit or otherwise affect any of the provisions hereof. References to
Sections and Exhibits, unless otherwise indicated, are references to Sections
and Exhibits hereof.
Section 8.3 Notices. Any notice or other communication required or
permitted to be given hereunder will be in writing and will be mailed by prepaid
registered or certified mail, timely deposited with an overnight courier such as
Federal Express, or delivered against receipt, as follows:
(a) In the case of TCI and TCI Sub, to:
Tele-Communications, Inc.
Terrace Tower II
5619 DTC Parkway
Englewood, CO 80111-3000
Attention: Chief Executive Officer,
with a copy similarly addressed to the
attention of General Counsel
(b) In the case of VI to:
Viacom Inc.
1515 Broadway
New York, NY 10036
Attention: General Counsel
with a copy to:
Hughes Hubbard & Reed
One Battery Park Plaza
New York, NY 10004
Attention: Ed Kaufmann, Esq.
20
or to such other address as the party may have furnished in writing in
accordance with the provisions of this Section 8.3. Any notice or other
communication shall be deemed to have been given, made and received upon
receipt. Either party may change the address to which notices are to be
addressed by giving the other party notice in the manner herein set forth.
Section 8.4 Assignment. This Agreement and all provisions hereof will be
binding upon and inure to the benefit of the parties hereto and their respective
successors, however, neither this Agreement nor any right, interest, or
obligation hereunder may be assigned by any party hereto (other than by
operation of law) without the prior written consent of the other parties, and
any such assignment or purported assignment without such consent shall be void.
Section 8.5 Entire Agreement. This Agreement together with the other
Transaction Documents embody the entire agreement and understanding of the
parties with respect to the transactions contemplated hereby and supersede all
prior written or oral commitments, arrangements or understandings with respect
thereto.
Section 8.6 Amendment; Waiver. (a) This Agreement may only be amended or
modified in writing signed by the party against whom enforcement of any such
amendment or modification is sought.
(b) Any party hereto may, by an instrument in writing, waive compliance
with any term or provision of this Agreement on the part of such other party
hereto. The waiver by any party hereto of a breach of any term or provision of
this Agreement will not be construed as a waiver of any subsequent breach.
Section 8.7 Counterparts. This Agreement may be executed in two or more
counterparts, all of which will be considered one and the same agreement and
each of which will be deemed an original. All signatures need not be on one
counterpart.
Section 8.8 Governing Law. THIS AGREEMENT WILL BE GOVERNED BY THE LAWS OF
THE STATE OF NEW YORK (REGARDLESS OF THE LAWS THAT MIGHT BE APPLICABLE UNDER
PRINCIPLES OF CONFLICTS OF LAW) AS TO ALL MATTERS, INCLUDING BUT NOT LIMITED TO
MATTERS OF VALIDITY, CONSTRUCTION, EFFECT AND PERFORMANCE.
Section 8.9 Severability. If any one or more of the provisions of this
Agreement is held to be invalid, illegal or unenforceable, the validity,
legality or enforceability of the remaining provisions of this Agreement will
not be affected thereby, and VI, TCI and TCI Sub will use their reasonable
efforts to substitute one or more valid, legal and enforceable provisions which
insofar as practicable implement the purposes and intent hereof. To the extent
permitted by applicable law, each party waives any provision of law which
renders any provision of this Agreement invalid, illegal or unenforceable in any
respect.
Section 8.10 Consent to Jurisdiction. Each party hereby submits to the
non-exclusive jurisdiction of the courts of general jurisdiction of the States
of New York and Colorado and the federal courts of the United States of America,
21
located in the City of New York, New York, and Denver, Colorado solely in
respect of the interpretation and enforcement of the provisions of this
Agreement and hereby waives, and agrees not to assert, as a defense in any
action, suit or proceeding for the interpretation or enforcement of this
Agreement that it is not subject thereto or that such action, suit or proceeding
may not be brought or is not maintainable in such courts or that this Agreement
may not be enforced in or by such courts or that its property is exempt or
immune from execution, that the suit, action or proceeding is brought in an
inconvenient forum, or that the venue of the suit, action or proceeding is
improper. Service of process with respect thereto may be made upon any party by
mailing a copy thereof by registered or certified mail, postage prepaid, to such
party at its address as provided in Section 8.3 hereof, provided that service of
process may be accomplished in any other manner permitted by applicable law.
Section 8.11 Third Person Beneficiaries. This Agreement is not intended and
shall not be construed to confer upon any Person (other than VI, TCI and TCI
Sub) any rights or remedies hereunder.
Section 8.12 Specific Performance. VI, TCI and TCI Sub recognize that any
breach of any covenant or agreement contained in this Agreement may give rise to
irreparable harm for which money damages would not be an adequate remedy, and
accordingly agree that, in addition to other remedies, any non-breaching party
will be entitled to enforce the agreements and covenants contained herein of TCI
and TCI Sub or VI, as the case may be, by a decree of specific performance
without the necessity of proving the inadequacy as a remedy of money damages.
Section 8.13 Survival. The representations and warranties contained in or
made pursuant to this Agreement shall terminate and be of no further force on
and as of April 30, 1997.
22
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed in New York, New York, as of the day and year first above written.
VIACOM INC.
By: /s/ Philippe P. Dauman
---------------------------------
Name: Philippe P. Dauman
Title: Executive Vice President
TELE-COMMUNICATIONS, INC.
By: /s/ Stephen M. Brett
---------------------------------
Name: Stephen M. Brett
Title: Executive Vice President
TCI COMMUNICATIONS, INC.
By: /s/ Gary S. Howard
--------------------------------
Name: Gary S. Howard
Title: Senior Vice President