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EXHIBIT 10.1
AMENDMENT
THIS AMENDMENT to that certain Master Venture Agreement, including Exhibits A
and B thereto (the "Agreement"), by and among Quokka Sports, Inc., a Delaware
corporation ("QSI"), NBC Olympics, Inc., a Delaware corporation ("NBC"), and
NBC/Quokka Ventures, LLC, a Delaware limited liability company ("NQV"), dated as
of February 9, 1999, is hereby entered into as of March 14, 2001, by and among
QSI, NBC and NQV.
RECITALS
WHEREAS, pursuant to a letter (the "Letter") dated March 9, 2001 from NBC to G.
Xxxxxxx Xxxxxxx, the Chief Financial Officer of NQV, NBC gave QSI notice of
termination of the Agreement (the "Termination Notice");
WHEREAS, QSI has disputed the right of NBC to terminate the Agreement;
WHEREAS, the parties have agreed to resolve the dispute as to termination
provided the Agreement is amended as set forth herein;
NOW THEREFORE, in consideration of the foregoing recitals and the mutual
promises hereinafter set forth, the parties hereto agree as follows:
1. Section 11.1 of the Agreement is hereby amended and restated in its entirety
to read as follows:
"11.1. This Agreement, including without limitation Exhibits A and B, shall
continue in effect from the Effective Date until May 1, 2001 unless
terminated earlier (i) in accordance with Sections 11.2 or 11.3 (except for
a termination pursuant to Section 11.3 with respect to the 2001-2002
Long-term Strategic Plan, Content Plan and Operating Budget, dated February
20, 2001, which was approved by the board of directors of NQV on Xxxxx 0,
0000 (xxx "Xxxx")), xx (xx) by NBC by written notice to QSI and NQV, in the
event either (a) The Salt Lake Olympic Organizing Committee For The Olympic
Winter Games of 2002 ("SLOC") terminates the agreement between NQV and SLOC
dated May 4, 2000, as amended, including the amendment dated March 12, 2001
(a "SLOC Termination"), or (b) there occurs any Event of Default by QSI (a
"QSI Note Default"), under the terms of the Amended 7% Convertible
Promissory Notes dated February 22, 2001 issued by QSI (the "Notes") and
such QSI Note Default has not been cured by QSI pursuant to the terms of the
Notes, the Transaction Documents (as defined in the Notes) or the
Restructuring Documents (as defined in the Notes) (such period of
effectiveness of the Agreement referred to herein as the "Term"). QSI agrees
to inform NBC immediately in the
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event of either a SLOC Termination or a QSI Note Default. Notwithstanding
anything in this Amendment or in the Agreement to the contrary (including,
without limitation, language regarding obligations to be performed after May
1, 2001 or any portion of the Plan allocable to the Subsequent Agreement or
the QSI Subsequent Agreement, if any), each party hereby agrees and
acknowledges that the Agreement ends on such date.
2. QSI and NQV hereby authorize and give consent to NBC to engage in
discussions with third parties (including but not limited to SLOC), prior to
the expiration of the Term, concerning the terms of an agreement to produce,
market, sell and distribute the Channel subsequent to the expiration of the
Term. NBC, however, hereby agrees not to engage in discussions with the
companies listed in that certain letter agreement (the "Letter Agreement")
signed by SLOC, QSI, NQV and NBC of even date herewith as potential buyers
(the "Potential Buyers"), provided QSI and NQV deliver to NBC weekly written
updates on the status of the discussions with the Potential Buyers, and
provided further that NBC shall be permitted to engage in such discussions
with a Potential Buyer once the discussions with such Potential Buyer have
concluded.
3. NBC agrees not to solicit or hire any employees of QSI prior to the
expiration of the Term and further agrees not to solicit any employees of
QSI for a period of six (6) months following the expiration of the Term.
4. (A) Provided the Agreement has not been terminated under any applicable
provision thereof prior to May 1, 2001, NBC agrees to enter into an
agreement (the "Subsequent Agreement") with a Qualified Buyer (as defined
below) as of May 1, 2001 (the "New Agreement Date"), on terms identical
(except as provided below) to those contained in the Agreement, if, on or
prior to the New Agreement Date, (w) a Qualified Buyer buys all of QSI's
interests in NQV in accordance with the terms of the Operating Agreement
between NBC and QSI dated February 9, 1999 (the "Operating Agreement") and
agrees to assume the obligations and rights of QSI as set forth in the
Operating Agreement (a "(w) Acquisition"), (x) an acquisition of all of the
capital stock of QSI, or of all or substantially all of the assets of QSI by
a Qualified Buyer is consummated (an "(x) Acquisition"), or (y) if a
Qualified Buyer has entered into a letter of intent with respect to an (x)
Acquisition and executes and agrees to be bound by said Subsequent Agreement
and assumes (or to the extent QSI survives as a separate entity, guarantees)
the obligations of QSI under the Operating Agreement in a written agreement
between NBC and the Qualified Buyer, regardless of whether or not the
Acquisition by such Qualified Buyer is consummated (a "(y) Acquisition"; a
(w) Acquisition, an (x) Acquisition and a (y) Acquisition are hereinafter
collectively referred to as an "Acquisition"). In the event of a (y)
Acquisition the Qualified Buyer shall have the option to enter into the
Subsequent Agreement and assume the obligations of QSI under the Operating
Agreement through the 2002 Olympic Winter Games only, in which case the
Subsequent Agreement and the Operating Agreement shall terminate at or
around the conclusion of the 2002 Olympic Winter Games as if it were the
conclusion of the 2004 Olympic Games under the Subsequent Agreement and the
Operating Agreement. The
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Subsequent Agreement and QSI Subsequent Agreement (as defined below) shall
contain provisions which (i) require the compliance by the Qualified Buyer
or QSI, as the case may be, with the Financial Covenants (as defined below)
throughout the term of the Subsequent Agreement and QSI Subsequent
Agreement, as the case may be, and (ii) provide that a default by the
Qualified Buyer, or QSI, in the case of a QSI Subsequent Agreement, under
any of its material contracts, including, without limitation, any credit
agreement, constitutes a default under the Subsequent Agreement, or the QSI
Subsequent Agreement, as the case may be, if such default has a material
adverse effect on the operations or financial condition of the Qualified
Buyer, or QSI in the case of a QSI Subsequent Agreement. In addition,
provided the Agreement has not been terminated under any applicable
provision thereof prior to May 1, 2001, NBC will enter into a Subsequent
Agreement with QSI (the "QSI Subsequent Agreement") if, on or before the New
Agreement Date, QSI secures financial resources sufficient to meet the
Funding Requirements and satisfies the Financial Covenants (except that the
market capitalization requirement in the Financial Covenants shall be waived
for this purpose only), both as determined by NBC in its discretion.
(B) To be deemed a Qualified Buyer an entity must satisfy in its entirety
each of the following conditions:
(i) It cannot be an NBC Competitor, unless the entity has been approved
as a Non-NBC Competitor in the Letter Agreement. An "NBC
Competitor" is a company that is significantly engaged in any of
the primary businesses of National Broadcasting Company, Inc. NBC
will use all reasonable efforts to promptly inform QSI of whether
it considers a potential buyer an NBC Competitor.
(ii) It cannot be significantly engaged in the same line of business as
the business category for which an Olympic Sponsor has obtained
such sponsorship (an "Olympic Sponsor Competitor"), unless the
entity has been approved as a Non-Olympic Sponsor Competitor in the
Letter Agreement. An "Olympic Sponsor" is a company that has
either signed (a) an agreement with the International Olympic
Committee to be a worldwide sponsor of the Olympic Games in 2002
(in the event the Qualified Buyer in a (y) Acquisition assumes
obligations only with respect to the 2002 Games) or 2002 and/or
2004 (in the event the Qualified Buyer assumes obligations with
respect to both the 2002 and 2004 Games in a (y) Acquisition), or
(b) an agreement with the United States Olympic Committee to be a
sponsor or supplier of the 2002 (in the event the Qualified Buyer
assumes obligations only with respect to the 2002 Games in a (y)
Acquisition) or 2002 and/or 2004 (in the event the Qualified Buyer
assumes obligations with respect to both the 2002 and 2004 Games in
a (y) Acquisition) United States Olympic Team, or (c) an agreement
with Olympic Properties Of The United States -- Salt Lake 2002 LLC
to be a sponsor or supplier of the 2002 Olympic Winter Games.
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(iii) For purposes of clarity, the parties agree that the only entities
which meet the requirements of subsections (i) and (ii) above or
which are otherwise acceptable to the parties are those entities
which are set forth in the Letter Agreement.
(iv) It assumes (or to the extent QSI survives as a separate entity,
guarantees) the performance of all of the obligations of QSI to be
contained in the Subsequent Agreement and the Operating Agreement.
(v) It must agree in a written contract between NBC and the Qualified
Buyer to (a) fund, on the date the Qualified Buyer enters into the
Subsequent Agreement, NQV with an amount sufficient for the
production of the Combined Site through the completion of the 2002
Olympic Winter Games in accordance with the Plan (the "Funding
Requirements"), and (b) make representations and warranties that it
meets certain financial covenants with respect to the ratio of debt
to cash flows, debt to equity and cash on hand customary for
comparable entities in the Qualified Buyer's industry, to be
mutually agreed between NBC and the Qualified Buyer (in good faith
and in a timely fashion) based on the financial statements of the
Qualified Buyer, and has a market capitalization of at least $500
million, if the entity is a publicly traded company (the "Financial
Covenants").
(vi) It is a company that can demonstrate to the reasonable satisfaction
of NBC that it has the personnel, technology, technical support,
software, advertising sales expertise and experience to produce and
deliver the content set forth in the Content Plan through, among
other ways, the retention of a sufficient number of QSI employees
of appropriate skill and caliber.
5. In the event NBC does not enter into a Subsequent Agreement as set forth in
Paragraph 4 above, NBC and QSI agree to cause the dissolution of NQV as of
May 1, 2001.
6. QSI and NQV hereby irrevocably and unconditionally waive, forever release
and discharge NBC (and any of its affiliates, officers, directors, employees
and partners) in any and all capacities from and against any and all claims,
covenants, promises, agreements, obligations, controversies, losses,
damages, costs, expenses, demands, causes of action, judgments or
liabilities of any kind or character whatsoever, whether matured or
contingent, or known or unknown, including for indemnity or contribution,
that QSI or NQV has or may have to the extent it or they arise out of, or in
connection with, (a) the Termination Notice, (b) the negotiation and
execution of this Amendment, (c) all known or alleged NBC breaches of the
Agreement or Operating Agreement, or (d) any claim that the Agreement
extends beyond May 1, 2001; provided that subsection (d) will not limit
either parties' obligation to enter into the Subsequent Agreement as
provided for in Paragraph 4 of this Amendment provided the conditions
therein are met.
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7. NBC agrees to use all reasonable good faith efforts at no material cost to
NBC to assist QSI in its efforts to consummate an Acquisition prior to the
expiration of the Term.
8. NBC hereby waives under the Agreement and the Operating Agreement (a) all
known or alleged prior breaches of QSI and NQV and (b) all defaults by QSI
and NQV for which QSI and/or NQV, as the case may be, has received notice.
Upon execution of this Amendment by the parties hereto the Termination
Notice shall be hereby revoked and of no further force and effect. The
Agreement, the Letter Agreement and the Operating Agreement, except as
otherwise amended herein, shall constitute the full and entire understanding
and agreement between the parties with regard to the subjects hereof and no
party shall be liable or bound to any other in any manner by any
representations, warranties, covenants and agreements except as specifically
set forth herein, the Agreement, the Letter Agreement and the Operating
Agreement. Except as expressly provided herein, the provisions of the
Agreement shall remain in full force and effect to the extent not
inconsistent with the terms of this Amendment. Capitalized terms used herein
and not defined herein shall have the meaning ascribed to those terms in the
Agreement or the Operating Agreement.
IN Witness Whereof, the parties hereto have executed the Amendment as of the
date set forth in the first paragraph hereof.
QUOKKA SPORTS, INC.
/s/ XXXXXX X. XXXXXX
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NAME: XXXXXX X. XXXXXX
TITLE: CHIEF OPERATING OFFICER
NBC QUOKKA VENTURES LLC
/s/ XXXX XXXXXX
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NAME: XXXX XXXXXX
TITLE: SECRETARY
NBC OLYMPICS, INC.
/s/ XXXX XXXXXX
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NAME: XXXX XXXXXX
TITLE: SENIOR VICE PRESIDENT
