EXHIBIT B TO
SECOND AMENDED AND RESTATED
LMC AGREEMENT
STOCKHOLDERS' AGREEMENT
Stockholders' Agreement, dated ___________, 199_,
by and among TCI Turner 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. Turner, III ("Turner") and Turner Outdoor,
Inc. ("TOI" and, together with Turner, 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 Turner 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 Turner 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
Turner Foundation, Inc. (the "Turner Foundation"), the R.E.
Turner Charitable Remainder Unitrust No. 2 (the "Turner
Unitrust") and any other Charitable Transferee or Qualified Trust
shall be deemed not to be Affiliates of any Turner Stockholder
and (ii) (A) no TCITP Affiliate shall be deemed to be an
Affiliate of any Turner Affiliate, or vice versa, and (B) no
TCITP Affiliate or Turner 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 Turner Stockholder to the Turner Foundation, any
other Charitable Transferee, the Turner 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 Turner 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 Turner 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 Turner
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 Turner 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 __, 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 Turner 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 Turner
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 Turner
Stockholder, the "Other Stockholder" shall be TCITP, and with
respect to a TCITP Stockholder, the "Other Stockholder" shall be
Turner.
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, Turner, in the case of any
purchase of Turner 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 Turner
Stockholder.
Subject Shares: As defined in Section 3.1 hereof.
TBS: Turner Broadcasting System, Inc.
TBS Shareholders' Agreement: The Shareholders'
Agreement dated as of June 3, 1987, among TBS, Turner 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.
Turner: As defined in the opening paragraphs of this
Agreement.
Turner Affiliates: The Turner Stockholders and the
Affiliates of the Turner Stockholders.
Turner Stockholders: Turner and all Affiliates of
Turner, in each case so long as such Person is the beneficial
owner of any Covered Securities, the Turner Foundation, the
Turner 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 Turner
Stockholder only with respect to Turner Holdco Shares acquired by
such entity in a Charitable Transfer) and any Turner Related
Party who is required to become a party to this Agreement
pursuant to the terms hereof.
Turner Holdco Shares: Any and all Covered
Securities of which any Turner Stockholder becomes the direct or
indirect beneficial owner at the Effective Time or thereafter;
provided, however, that Covered Securities beneficially owned by
the Turner Foundation or the Turner Unitrust immediately after
the Effective Time shall not be Turner 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 Turner Stockholder shall Dispose of any Turner
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 Turner Stockholders
shall, and shall cause each Related Party of Turner to, comply
with the provisions of this Agreement intended to be applicable
to the Turner Stockholders or any Turner 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 Turner
Stockholder, for so long as such Turner 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 Turner's 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 Turner's name herein and shall be entitled
to exercise Turner's 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 Turner 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________ ___, 1996, AMONG R.E. TURNER, III, TCI TURNER
PREFERRED, INC., 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 Turner 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
Turner Stockholders. Each of the Turner Stockholders represents
and warrants to the TCITP Stockholders and Holdco as follows:
(a) Neither such Turner 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 Turner 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 Turner 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 Turner Stockholder or any of
his or its Controlled Affiliates to grant, offer or enter
into any of the foregoing. Each of the Turner 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 Turner 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 Hart-
Scott-Rodino 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 Turner Stockholder, such Turner 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 Turner 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 Turner 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 Turner. 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
Turner 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 Turner, Holdco
and the other parties thereto under the Investors Agreement
(No. 1) dated as of the same date as this Agreement among Holdco,
Turner and TOI).
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
Agreement in two or more counterparts as of the day and year
first above written.
TCI TURNER PREFERRED, INC.
By: ----------------------------
Name:
Title:
LIBERTY BROADCASTING, INC.
By: ----------------------------
Name:
Title:
COMMUNICATION CAPITAL CORP.
By: ----------------------------
Name:
Title:
---------------------------------
R. E. TURNER, III
TURNER OUTDOOR, INC.
By: ----------------------------
Name:
Title:
TW INC. (which promptly following the
date hereof is changing its name to
Time Warner Inc.)
By: ----------------------------
Name:
Title: