RIGHTS AGREEMENT
AGREEMENT, dated as of ______________________, 1997,
among TELE-COMMUNICATIONS, INC., a Delaware corporation ("TCI" or
the "Company"), TCI Music, Inc., a Delaware corporation
("MusicCo"), and ______________________________________, as
Rights Agent for the Company's rights issued pursuant hereto (the
"Rights").
Background
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Pursuant to the Agreement and Plan of Merger dated as
of February 6, 1997 (the "Merger Agreement"), the outstanding
shares of Common Stock of DMX Inc., were converted on the date of
this Agreement into shares of Series A Common Stock of MusicCo
upon effectiveness of the merger contemplated by the Merger
Agreement (the "Merger").
In connection with the Merger, TCI has agreed that if,
during the one-year period beginning on the date of the Merger,
the price of MusicCo's Series A Common Stock does not equal or
exceed $4.00 per share for a period of at least 20 consecutive
trading days, holders of MusicCo Series A Common Stock will have
the right, exercisable during the 30-day period beginning on the
first anniversary of the Merger, to require TCI to purchase such
Common Stock at a price of $4.00 per share, payable at TCI's
election in cash or shares of Tele-Communications, Inc. Series A
TCI Group Common Stock (or a combination thereof). Each Right
will entitle the registered holder thereof (the "Holders") to
sell one share of MusicCo Series A Common Stock (subject to
adjustment) to the Company for the consideration described herein
upon exercise thereof in accordance with the terms and conditions
of this Agreement.
The Company wishes the Rights Agent to act on behalf of
the Company, and the Rights Agent is willing so to act, in con
nection with the issuance, division, transfer, exchange and exer
cise of the Rights.
Agreement
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In consideration of the foregoing and for the purpose
of defining the terms and provisions of the Rights, the res
pective rights and obligations thereunder of the Company and the
holders and certain obligations of MusicCo, the parties agree as
follows:
ARTICLE I
DEFINITIONS
1.01 Certain Definitions. As used herein, the
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following terms have the meanings assigned to them in this
Section 1.01 (or in the applicable Section to which reference is
made) and include the singular as well as the plural:
"Aggregate Consideration Amount Per Distributed Entity
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Share": As of any date of determination, the sum of the
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Consideration Amount Per Distributed Entity Share for each
Distributed Entity then existing.
"Applicable Entity": As the context may require,
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MusicCo and each Distributed Entity, as applicable.
"Bankruptcy Event": Pursuant to or within the meaning
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of any Bankruptcy Law, the Company:
(a) commences a voluntary case;
(b) consents to the entry of an order for relief
against it in an involuntary case;
(c) consents to the appointment of a Custodian of
it or for all or substantially all of its property (other than
for its subsidiaries or property of its subsidiaries);
(d) makes a general assignment for the benefit of
its creditors;
(e) admits in writing its inability to pay its
debts generally as they become due;
(f) a court of competent jurisdiction enters an
order or decree under any Bankruptcy Law that:
(i) is for relief against the
Company in an involuntary case;
(ii) appoints a Custodian of the Company
or for all or substantially all of its property (other
than its subsidiaries or property of its subsidiaries);
(iii) orders the liquidation of the
Company, and any such order or decree remains unstayed
and in effect for 90 days; or
(g) the Company takes any corporate action to
authorize any of the foregoing.
The term "Bankruptcy Law" means Title 11, U.S. Code or
any similar federal or state law for the relief of debtors. The
term "Custodian" means any receiver, trustee, assignee,
liquidator or similar official under any Bankruptcy Law.
"beneficial owner": A Person shall be deemed the
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"beneficial owner" of, and shall be deemed to "beneficially own,"
any securities of which such person has "beneficial ownership"
within the meaning of Rule 13d-3 under the Securities Exchange
Act of 1934 (or any
successor statute or rule). Any Person's percentage beneficial
ownership of any class of securities shall be determined in
accordance with such rule.
"Business Day": Any day other than a Saturday, Sunday
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or other day on which commercial banks in New York, New York or
Los Angeles, California are authorized or required to close.
"Capital Stock": With respect to each Applicable
----------------
Entity, any and all shares (however designated) of capital stock
or other equity interests of such Applicable Entity, now or
hereafter authorized, that, upon the liquidation of such
Applicable Entity, entitle the holder thereof to share, without
limitation as to amount, in the liquidating distribution of the
assets of such Applicable Entity to its stockholders. In
determining the number and kind of shares of Capital Stock of
each Applicable Entity outstanding for purposes of the
definitions of "Per Share Value" and "Fair Market Value", any
shares of capital stock or of other equity interests of such
Applicable Entity that, without payment of additional
consideration, are convertible into or exchangeable ("Convertible
Shares") for shares of any other class or series of corporate
stock or of other equity interests of such Applicable Entity
("Conversion Shares") shall be deemed to have been so converted
or exchanged if the aggregate amount that would be payable, if
such Applicable Entity were then being liquidated, to the holders
of such Conversion Shares exceeds the aggregate amount that would
be payable (determined on a class by class basis), if such
Applicable Entity were then being liquidated, to the holders of
the Convertible Shares. The calculation of the aggregate amount
payable upon liquidation of such Applicable Entity to holders of
Conversion Shares or Convertible Shares, as the case may be,
shall take into account any fixed amounts payable in liquidation
with respect to such shares and shall otherwise assume that
liquidating distributions will be made on the basis of the Fair
Market Value of such Applicable Entity (calculated, in the case
of the Conversion Shares, on a pro forma basis assuming the
issuance of such Conversion Shares).
"Certificates": As defined in Section 2.02.
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"Change in Control Transaction": As defined in
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Section 4.17.
"Component": Each of the MusicCo Component and each
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Distributed Entity Component, if any, of each Right.
"Consideration Amount Per Distributed Entity Share":
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The amount determined in accordance with Section 4.16.
"Consideration Amount Per MusicCo Share": The amount
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determined in accordance with Section 4.16.
"Current Market Price": As defined in Section 4.05.
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"Deposit Date": As defined in Section 4.14.
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"disposition": Any sale, conveyance, transfer or other
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disposition by the Company of beneficial ownership of any
shares of Capital Stock of MusicCo during the term of
this Agreement, but excluding (i) a pledge of Capital Stock
of MusicCo as collateral security for bona fide indebtedness,
(ii) a disposition of Capital Stock of MusicCo after giving
effect to which the Company continues to be the beneficial owner
of the Capital Stock so disposed of and (iii) a disposition of
Capital Stock of MusicCo in connection with a merger,
consolidation or combination of the Company with or into another
corporation. The term "dispose" means to make a disposition.
"Distributed Entity": Any entity the shares of Capital
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Stock of which are distributed or sold in a Subject Distribution.
The term "Distributed Entity Stock" means the class or series of
Capital Stock of each Distributed Entity that is distributed or
sold in a Subject Distribution.
"Distributed Entity Component": As defined in
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Section 6.04.
"Distribution Value": With respect to each
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distribution by an Applicable Entity to all holders of shares of
MusicCo Series A Common Stock or Distributed Entity Stock, as
the case may be, of shares of the Capital Stock of any entity or
of rights or warrants entitling such holders (for a period
expiring within 45 days after the effective date of such
distribution) to purchase shares of the Capital Stock of any
entity, the positive difference, if any, between (a) the Fair
Market Value of such entity or, if the shares of Capital Stock so
distributed or sold pursuant to the distributed rights or
warrants represent less than 100% of the outstanding shares of
Capital Stock of such entity, then the portion of the Fair Market
Value of such entity represented by the shares so distributed or
sold, and (b) the aggregate consideration paid for the shares
sold pursuant to the distributed rights or warrants, if any.
"Early Expiration Event": With respect to MusicCo
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Series A Common Stock and the Capital Stock of each other
Applicable Entity, when the sum of the Fair Market Values of one
share of MusicCo Series A Common Stock and one share of the
Capital Stock of each other Applicable Entity shall have equaled
or exceeded $4.00 for at least 20 consecutive trading days.
"Excluded Stock": With respect to each Applicable
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Entity, any and all shares (however designated) of capital stock
or of other equity interests of such Applicable Entity now or
hereafter authorized that, upon the liquidation of such
Applicable Entity, do not entitle the holder thereof to share,
without limitation as to amount, in the liquidating distribution
of the assets of such Applicable Entity to its equity holders,
except that any of such shares that, without payment of
additional consideration, are convertible into or exchangeable
for shares of any other class or series of capital stock or of
other equity interests that are not so limited with respect to
participation in liquidating distributions shall not constitute
Excluded Stock if such shares would be deemed to have been so
converted in accordance with the definition of "Capital Stock".
"Exercise Period": As defined in Section 4.01, subject
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to Section 4.17.
"Fair Market Value": With respect to each Applicable
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Entity as of any date of determination, the fair market value of
such Applicable Entity on a going concern basis (as if such
Applicable Entity were being sold by a sale of stock or, if
applicable, of other equity
interests) or on a liquidation basis (whichever method
would yield the highest valuation), (i) reduced by the aggregate
amount that would be payable, if such Applicable Entity were
then being liquidated, (x) on any Excluded Stock of the
Applicable Entity and (y) on any shares of its Capital Stock then
outstanding (or deemed to be outstanding in accordance with the
definition of "Capital Stock") that entitle their holders to
payment of a fixed amount upon liquidation in addition to their
participation in liquidating distributions payable with respect
to other shares of Capital Stock (but the reduction pursuant to
this clause (y) shall be limited to such fixed amount) and (ii)
increased by the aggregate exercise or conversion price payable
to such Applicable Entity upon the exercise or conversion of all
warrants, rights and options to purchase or acquire Capital Stock
of such Applicable Entity and convertible securities the exercise
or conversion of which is taken into account in determining the
Per Share Value of such Applicable Entity. The fair market value
of an Applicable Entity on a going concern basis shall take into
account such considerations (including but not limited to tax
considerations which are specific to a sale of stock or, if
applicable, of other equity interests) as would customarily
affect the price at which a willing seller would sell and a
willing buyer would buy a comparable business as a going concern
in an arm's length transaction. The fair market value of an
Applicable Entity on a liquidation basis shall take into account
tax liabilities that would be incurred in a liquidation assuming
the most tax efficient and practical plan of liquidation and all
other liabilities that would be required to be paid or reserved
against before the making of liquidating distributions to equity
holders.
"Holders": As defined in the preamble.
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"MusicCo Series A Common Stock": Series A Common
---------------------------------
Stock, par value $.01 per share of MusicCo, and Capital Stock of
any other class into which such Series A Common Stock may
thereafter have been changed. "MusicCo Series A Shares" means
shares of MusicCo Series A Common Stock.
"MusicCo Common Stock": Capital Stock of MusicCo
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including MusicCo Series A Common Stock.
"MusicCo Component": As defined in Section 6.04.
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"MusicCo Dividend": Any distribution of cash or
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property (other than securities specified in Section 6.03) on
MusicCo Series A Common Stock.
"Notice": As defined in Section 4.07.
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"Per Share Value": With respect to each Applicable
-------------------
Entity, the quotient of (x) the Fair Market Value of such
Applicable Entity as of the applicable date, divided by (y) the
total number of shares of Capital Stock of such Applicable Entity
outstanding (or deemed to be outstanding in accordance with the
definition of "Capital Stock") as of such date (or shares
equivalent to (i) in the case of MusicCo, MusicCo Common Stock,
or (ii) in the case of any Distributed Entity, Distributed Entity
Stock, if any shares of Capital Stock of such Applicable Entity
then outstanding or deemed to be outstanding entitle their
holders to participate in
liquidating distributions on a basis different from that which
is applicable to shares of MusicCo Common Stock or Distributed
Entity Stock, as the case may be) plus the number of such
shares or share equivalents (to the extent not already treated
as outstanding pursuant to the definition of "Capital Stock")
issuable upon the exercise of outstanding warrants, rights and
options to purchase or acquire Capital Stock of such Applicable
Entity and the conversion of outstanding convertible securities
to the extent that any such exercise or conversion would result
in a profit to the holder of the related warrant, right, option
or convertible security given the Per Share Value so determined.
"Person": Any human being, corporation, partnership,
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limited liability company, trust, association or other entity.
"Rights": As defined in the preamble.
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"Significant Corporate Transaction": The occurrence of
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a Terminating Event with respect to an Applicable Entity the Fair
Market Value of which represents a greater percentage of the
Undistributed Value of MusicCo than the percentage thereof
represented by the Fair Market Value of any other Applicable
Entity, as determined by the Board of Directors of MusicCo (whose
good faith determination will be conclusive) as of the date the
agreement of merger or consolidation is executed or the vote of
the Board of Directors of such Applicable Entity to dissolve or
liquidate such Applicable Entity is taken.
"Subject Distribution": As defined in Section 6.03.
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"TCI Series A Common Stock": As defined in
--------------------------------
Section 4.04.
"TCI Series A Shares": As defined in Section 4.04.
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"Terminating Event": Each of the following events:
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(a) an Applicable Entity is a constituent party in any merger or
consolidation (other than a merger or consolidation in which such
Applicable Entity is the surviving corporation and that does not
result in any reclassification or change in the outstanding
Capital Stock of such Applicable Entity, other than a change in
par value or a reclassification or other change to which
Article VI is applicable and other than a merger the sole purpose
of which is to change such Applicable Entity's domicile within
the United States) or (b) such Applicable Entity is dissolved or
liquidated.
"Triggering Event": As defined in Section 4.18.
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"Underlying Number": As defined in Section 6.04.
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"Undistributed Value of MusicCo": As of any date as of
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which the determination thereof is to be made pursuant to
Section 6.03, the sum of the respective Fair Market Values of
MusicCo and of each Distributed Entity as of such date.
"Valuation Date": The last day of the most recent
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quarter ended prior to the Exercise Period or, with respect to
any accelerated Exercise Period, the applicable date determined
in accordance with Section 4.17.
ARTICLE II
RIGHTS AGENT
2.01 Appointment of Rights Agent. The Company appoints
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the Rights Agent to act as agent for the Company in accordance
with the terms set forth in this Agreement and the Rights Agent
accepts such appointment.
2.02 No Rights Certificates. The rights will be
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evidenced only by certificates for MusicCo Series A Shares
registered in the names of holders of MusicCo Series A Shares
("Certificates"), which Certificates will be deemed also to be
certificates for the Rights. As soon as practicable following
the Closing Date (as defined in the Merger Agreement), the Rights
Agent will send a summary of the terms of the Rights (the "Rights
Summary") by first-class, postage paid mail to each record Holder
of MusicCo Series A Shares as of the close of business on the
Closing Date (as defined in the Merger Agreement), at the address
of the Holder as shown on the records of MusicCo. The Rights
will be evidenced by certificates for MusicCo Series A Shares
together with the Rights Summary and the registered Holders of
MusicCo Series A Shares will also be registered Holders of the
associated Rights.
2.03 Registration. The Company and the Rights Agent
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shall be entitled to treat the registered Holders(s) of the
certificates representing MusicCo Series A Shares as the
absolute owner(s) of the Rights represented thereby
(notwithstanding any notation of ownership or other writing on
the Certificates made by anyone or any other notice to the
contrary) for all purposes and shall not be bound to recognize
any equitable or other claim to or interest in such Rights on the
part of any other Person.
ARTICLE III
TRANSFERS, EXCHANGES AND SUBSTITUTIONS
3.01 Transfers. The Rights will be transferable only
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in connection with the transfer of the associated MusicCo Series
A Shares. The surrender for transfer of any certificates
evidencing MusicCo Series A Shares, even without a copy of the
Rights Summary attached thereto, will also constitute a transfer
of the Rights associated with the MusicCo Series A Common Stock
represented by such certificate. Under no circumstances may any
Right be separated from, or transferred or assigned apart from,
the associated MusicCo Series A Share.
3.02 Legend. Certificates issued for MusicCo Series A
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Shares on or after the date of this Agreement and before
expiration of the Rights, which MusicCo Series A Shares
initially were issued pursuant to the Merger Agreement, will be
deemed also to be certificates for the Rights, and will have
impressed, printed or stamped on them the following legend:
This certificate also evidences and entitles the holder
to certain Rights as set forth in a Rights Agreement
between TCI Music, Inc. (the "Corporation"),
Tele-Communications, Inc., and ______________
_______________________ (the "Rights Agent") dated as
of __________________, 1997 (the "Rights Agreement"),
the terms of which are hereby incorporated by reference
and a copy of which is on file at the principal offices
of the Corporation. The Corporation will mail to the
holder of this certificate without charge a copy of the
Rights Agreement upon written request therefor.
ARTICLE IV
EXERCISE OF RIGHTS
4.01 Exercise Period. During the period commencing at
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the opening of business on [date of first anniversary of closing]
and ending at the close of business, ___________ time, on the
30th day after such date or the succeeding Business Day if such
date is not a Business Day (the "Exercise Period"), and during
any accelerated Exercise Period required by Section 4.17, each
Holder of Rights may irrevocably exercise all or any number of
his Rights in accordance with Section 4.08. If the Rights have
one or more Distributed Entity Components at the time such Rights
are exercisable, the Holder may, in accordance with Section 4.08,
irrevocably exercise such Right as to its MusicCo Component, any
or all of its Distributed Entity Components, or any combination
thereof. Notwithstanding anything to the contrary herein, the
Exercise Period shall be conducted in compliance with all
applicable laws, including all federal and state securities laws.
The foregoing notwithstanding, if an Early Expiration Event shall
have occurred prior to the commencement of the Exercise Period,
the Rights shall expire as of the date of the Early Expiration
Event without ever becoming exercisable by the Holder.
4.02 Expiration. In the Exercise Period and, subject
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to Section 4.20, any accelerated Exercise Period, the Company
shall be obligated to honor in accordance with Section 4.08 any
and all exercises of the Rights then issued and outstanding. All
Rights (and fractions thereof) not theretofore exercised shall
expire and cease to be exercisable upon the expiration of the
Exercise Period (subject to earlier expiration pursuant to the
last sentence of the preceding Section and pursuant to
Section 4.17). Upon the exercise of any Right (or fraction
thereof), in whole or in part, such Right (including any
Component thereof not exercised or not exercised in full) shall
thereupon expire and cease to be exercisable. Upon the
consummation of a Terminating Event with respect to any
Applicable Entity, that Component of each Right (and fractional
Right) that relates to the Capital Stock of such Applicable
Entity shall expire and cease to be exercisable.
4.03 Extension.
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(a) If the Company for any reason fails to give
the Notice in accordance with Section 4.07, the Exercise Period
shall be extended for a period of time equal to the delay in
giving the Notice.
(b) If the record date for a Subject Distribution
occurs prior to the Exercise Period, or an accelerated Exercise
Period, and the Distributed Entity Stock with respect to such
Subject Distribution is not delivered to stockholders entitled
thereto prior to the beginning of the applicable Exercise Period,
such Exercise Period shall be extended for a period of time equal
to the number of days from the beginning of such Exercise Period
and the date such Distributed Entity Stock is mailed to such
stockholders.
4.04 Consideration To Be Received Upon Exercise of
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Rights. Subject to Section 4.20, upon the valid exercise of
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Rights, the Holder shall be entitled to receive from the Company,
at the Company's sole option (subject only to Section 4.05 and
Section 4.15), cash or shares of the Company's TCI Group Series A
Common Stock, $1.00 par value per share ("TCI Series A Common
Stock" or "TCI Series A Shares"), or any combination of cash and
TCI Series A Shares determined in such proportions or on such
other basis as the Company shall elect in the Notice given
pursuant to Section 4.07, in consideration of the sale to the
Company of:
(a) if the MusicCo Component of any or all of
such exercised Rights has been exercised, a number of whole
shares of MusicCo Series A Common Stock equal to the number of
whole Rights of which the MusicCo Component has been so exercised
and honored; and
(b) if any Distributed Entity Component of any or
all of such exercised Rights has been exercised, a number of
whole shares of the Distributed Entity Stock to which such
Distributed Entity Component relates not in excess of the product
of (i) the number of whole Rights of which such Distributed
Entity Component has been exercised and honored and (ii) the
Underlying Number for such Distributed Entity Component of a
whole Right.
4.05 Consideration Amount. The amount of cash or the
--------------------
number of TCI Series A Shares to be paid or delivered by the
Company shall be determined as follows (subject to adjustments
required by Section 4.11 in the determination of the number of
whole TCI Series A Shares to be delivered):
(a) for the number of such shares of MusicCo
Series A Common Stock that the Company has elected to purchase
for cash, an aggregate amount in cash equal to the product of (i)
the number of such shares and (ii) the Consideration Amount Per
MusicCo Series A Share for the applicable Exercise Period;
(b) for the number of such shares of MusicCo
Series A Common Stock that the Company has elected to purchase
for TCI Series A Shares an aggregate number of TCI Series A
Shares equal to the product of (i) the number of such shares of
MusicCo Series A Common Stock and (ii) the quotient of (A) the
Consideration Amount Per MusicCo Series A Share for the
applicable Exercise Period, divided by (B) the Current Market
Price of a TCI Series A Share;
(c) for the number of such shares of Distributed
Entity Stock that the Company has elected to purchase for cash,
an aggregate amount in cash equal to the product of (i) the
number of such shares and (ii) the Consideration Amount Per
Distributed Entity Share for the applicable Exercise Period; and
(d) for the number of such shares of Distributed
Entity Stock that the Company has elected to purchase for TCI
Series A Shares, an aggregate number of TCI Series A Shares equal
to the product of (i) the number of such shares of Distributed
Entity Stock and (ii) the quotient of (A) the Consideration
Amount Per Distributed Entity Share for the applicable Exercise
Period, divided by (B) the Current Market Price of a TCI Series A
Share.
As used herein, the "Current Market Price" of a TCI
Series A Share shall be the average of the daily closing prices
for a share of TCI Series A Common Stock for 30 consecutive
trading days commencing 45 trading days before the date of
determination. The closing price for a share of TCI Series A
Common Stock is the last reported sale price on the National
Association of Securities Dealers, Inc. Automated Quotation
System (or the average of the quoted closing bid and asked prices
if no sale is reported) or if the TCI Series A Common Stock is
listed on an exchange, the closing sale price on the principal
exchange on which the TCI Series A Common Stock is listed (or the
average of the reported closing bid and asked prices if no sale
is reported). In the absence of one or more of such quotations,
the Board of Directors of the Company shall in good faith
determine the Current Market Price on the basis of such quotation
as it considers appropriate.
4.06 Condition to Delivery of TCI Series A Shares. The
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Company shall deliver TCI Series A Shares in full or partial
payment for the sale of shares of MusicCo Series A Common Stock
(or Distributed Entity Stock) only if such TCI Series A Shares
are then quoted on the National Association of Securities
Dealers, Inc. National Market System or listed on a national
securities exchange and have been registered with the Securities
and Exchange Commission on an appropriate form under the
Securities Act of 1933 or an exemption from such registration is
available and such shares are freely tradable. The Company may
not elect to deliver any other security of the Company or any
security of any other issuer.
4.07 Notice to Rights Holders. The Company shall
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publish in The Wall Street Journal (national edition, or if The
Wall Street Journal shall cease publication, in another national
financial publication), not less than 20 nor more than 30 days
prior to the commencement of an Exercise Period, a notice (the
"Notice") as to: the number of Rights outstanding on the date of
such Notice; the Consideration Amount Per MusicCo Share for such
Exercise Period, if applicable, as to each Distributed Entity
Component of the Rights; the number of shares of Distributed
Entity Stock to which such Distributed Entity Component relates
and the applicable Consideration Amount Per Distributed Entity
Share for such Exercise Period; and the form of consideration
pursuant to Section 4.04 the Company has elected to deliver (and
if the Company has elected to deliver both such forms of
consideration, the relative proportions thereof or any other
basis on which the relative amounts of cash to be paid and
numbers of TCI Series A Shares to be issued shall be determined).
The Notice shall contain such other information as may be
required by applicable federal or state securities laws or
regulations. At,
or immediately prior to the time of the publication of the
Notice, the Company will deliver to the Rights Agent such number
of copies as the Rights Agent may request of the Notice, of a
Letter of Transmittal to be used by Holders in tendering stock
certificates and of such other documents as the Company may
then be required to deliver to the Holders in accordance
with applicable federal and state securities laws and
regulations. The Rights Agent shall promptly mail by first class
mail, postage prepaid to the registered Holders of the
Certificates, at their respective addresses as they appear on the
register of Holders, a copy of the Notice, such Letter of
Transmittal and such other documents, if any. The Company will
also provide additional copies of the Letter of Transmittal to
any registered Holder requesting the same.
4.08 Exercise of Rights. Rights may be exercised (in
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whole or as to any Component) upon surrender to the Rights Agent
at its office of the following, together with a duly completed
and signed Letter of Transmittal: (i) if the MusicCo Component
of any of such Rights is being exercised, a stock certificate or
certificates representing a number of shares of MusicCo Series A
Common Stock equal to or greater than the number of Rights of
which the MusicCo Component is being exercised, duly endorsed and
in proper form for transfer, guaranteed by a bank or trust
company or a broker who is a member of a national securities
exchange with such endorsements; (ii) if a Distributed Entity
Component of any of such Rights is being exercised, a stock
certificate or certificates representing a number of shares of
the Distributed Entity Stock to which the Distributed Entity
Component relates equal to or greater than the product of the
number of whole Rights of which such Distributed Entity Component
is being exercised, multiplied by the Underlying Number for such
Distributed Entity Component of a whole Right; and (iii) payment
in United States currency of an amount equal to any stamp or
other tax or governmental charge required to be paid in
connection with the transfer of such shares of MusicCo Series A
Common Stock or Distributed Entity Stock in connection with the
exercise of the Rights. The Rights Agent will hold such stock
certificates in trust for the Holder until payment shall have
been made in accordance with Section 4.12 hereof and, upon such
payment, shall, subject to Section 4.09 and 4.10, deliver such
stock certificates to the Company.
4.09 MusicCo Certificates. Rights may be exercised
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only in integral amounts. If the MusicCo Component of a Right is
being exercised and if the Holder shall tender certificates for
shares of MusicCo Series Common A Stock that are, in the
aggregate, greater than the number of Rights of which the MusicCo
Component is being exercised, the Holder shall also designate in
the Letter of Transmittal the stock certificates for the MusicCo
Series A Common Stock enclosed therewith and the number of
whole shares being surrendered from each such stock certificate.
In such event, the Rights Agent shall, as agent for such Holder,
deliver the stock certificates to the transfer agent for the
MusicCo Series A Common Stock (the "Transfer Agent", which term
shall include any subsequent transfer agent for any shares of
MusicCo's capital stock issued upon reclassification of the
MusicCo Series A Common Stock), with instructions to issue a new
stock certificate to the Company for the number of shares of
MusicCo Series A Common Stock surrendered to and accepted by the
Company and to issue a new stock certificate or certificates to
or in accordance with the instructions of such Holder for the
balance of such shares of MusicCo Series A Common Stock.
MusicCo hereby irrevocably authorizes and directs its present and
any future Transfer Agent to issue such new certificates in
accordance herewith. MusicCo will keep a copy of this Agreement
on file with the Transfer Agent.
4.10 Distributed Entity Certificates. If a Distributed
--------------------------------
Entity Component of a Right is being exercised, then for each
Distributed Entity Component so exercised the Holder shall
designate in the Letter of Transmittal tendered upon exercise
thereof, the aggregate number of whole Shares of Distributed
Entity Stock to which such Distributed Entity Component relates
that are being surrendered upon the exercise of such Component of
the Rights (not in excess of the product of the number of whole
Rights of which such Distributed Entity Component is being
exercised, multiplied by the Underlying Number for such
Distributed Entity Component of a whole Right). If a Holder
shall tender certificates for shares of Distributed Entity stock
that are, in the aggregate, greater than the number of shares of
Distributed Entity Stock being so surrendered, the Holder shall
also designate in the Letter of Transmittal the stock
certificates for the Distributed Entity Stock enclosed therewith
and the number of whole shares of Distributed Entity Stock
surrendered from each such stock certificate. In such event, the
Rights Agent shall, as agent for the Holder, deliver the stock
certificates to the transfer agent for the Distributed Entity
Stock, with instructions to issue a new stock certificate to the
Company for the number of shares of Distributed Entity Stock
surrendered to and accepted by the Company and to issue a new
stock certificate or certificates to or in accordance with the
instructions of such Holder for the balance of such shares of
Distributed Entity Stock. Each Distributed Entity, by its
execution of a supplement to this Agreement as contemplated by
Section 6.07, irrevocably authorizes and directs the transfer
agent for the Distributed Entity Stock to issue such new
certificates in accordance herewith, and covenants and agrees to
keep a copy of this Agreement (as so supplemented) on file with
such transfer agent.
4.11 Notices. No later than the fifth Business Day
-------
after the end of the Exercise Period, the Rights Agent will
notify the Company and MusicCo of the following (as to each
Holder individually and as to all Holders in the aggregate): (i)
the number of Rights validly exercised in the Exercise Period;
(ii) the number of shares of MusicCo Series A Common Stock
surrendered upon such exercise; and (iii) as to each Distributed
Entity Component of the Rights that has been validly exercised,
the number of shares of the applicable Distributed Entity Stock
surrendered upon such exercise. Subject to Sections 4.13 and
4.14, on the later of (x) the tenth Business Day after the end of
the Exercise Period and (y) the fifth Business Day after receipt
of such notice from the Rights Agent, the Company shall deposit
with the Rights Agent the amount of cash or number of TCI Series
A Shares required to make full payment of the purchase price for
the shares of MusicCo Series A Common Stock and Distributed
Entity Stock being purchased by it pursuant to such exercised
Rights. In the case of payments in TCI Series A Shares, the
certificates evidencing the same shall be registered in the names
and denominations specified by the Rights Agent in its notice to
the Company. The Company shall not be required to issue
fractional TCI Series A Shares to any Holder after taking into
account all Rights exercised by such Holder. In lieu of
fractional TCI Series A Shares, the Company shall make payments
in cash for the value, based upon the Current Market Price, of
such fractional shares. The Rights Agent will promptly mail to
each Holder the purchase price for the shares of MusicCo Series
A Common Stock and Distributed Entity Stock sold by him. Payment
of any cash purchase price and any cash in lieu of fractional
interests shall be made by check.
4.12 Payment. If the Company has elected in accordance
-------
with Section 4.04 to offer a combination of cash and TCI Series A
Shares in consideration for the sale of MusicCo Series A Common
Stock upon the valid exercise of the MusicCo Component of the
Rights during the Exercise Period, the Rights Agent shall pay or
deliver such consideration to all Holders who have validly
exercised the MusicCo Component of the Rights during the Exercise
Period pro rata with respect to the respective aggregate numbers
of Rights the MusicCo Component of which has been so exercised by
them (subject to rounding or other adjustments made by the Rights
Agent and the payment of cash as provided in Section 4.11 in lieu
of the issuance of fractional TCI Series A Shares). Similarly,
if the Company has elected in accordance with Section 4.04 to
offer a combination of cash and TCI Series A Shares in
consideration for the sale of shares of Distributed Entity Stock
upon the valid exercise of a Distributed Entity Component of the
Rights during the Exercise Period, the Rights Agent shall pay or
deliver such consideration to all Holders who have validly
exercised such Distributed Entity Component during such Exercise
Period pro rata with respect to the respective aggregate numbers
of shares of such Distributed Entity Stock surrendered by them
upon such exercise (subject to rounding or other adjustments made
by the Rights Agent and the payment of cash as provided in
Section 4.11 in lieu of the issuance of fractional TCI Series A
Shares).
4.13 Payment Deferral. Notwithstanding Section 4.17,
----------------
if the Exercise Period for each Right is accelerated due to a
proposed Significant Corporate Transaction or Change in Control
Transaction and such transaction has not been consummated prior
to the expiration of such accelerated Exercise Period, the
Company may defer depositing the cash or TCI Series A Shares
required to effect the purchase of the MusicCo Series A Common
Stock and Distributed Entity Stock surrendered upon exercise of
the Rights, pending receipt of an officers' certificate in
accordance with this Section 4.13. Notwithstanding anything to
the contrary contained herein, any such deferral of the purchase
of the surrendered shares of MusicCo Series A Common Stock and
Distributed Entity Stock shall be conducted in compliance with
all applicable laws, including federal and state securities laws.
Not less than 10 Business Days prior to the effective date of the
proposed Significant Corporate Transaction, unless a shorter
period is acceptable to the Company, the Applicable Entity shall
deliver an officers' certificate (an "Applicable Entity Officers'
Certificate") signed by its Chairman of the Board and its
President to the Company and the Rights Agent, certifying that
all conditions precedent to the consummation of the Significant
Corporate Transaction have been satisfied or waived and setting
forth the effective date of the proposed Significant Corporate
Transaction. Not less than 10 Business Days prior to the
effective date of the proposed Change in Control Transaction, the
Company shall deliver to the Rights Agent an officer's
certificate (a "Company Officer's Certificate") signed by its
Chairman of the Board, President or a Vice President, certifying
that all conditions precedent to the consummation of the Change
in Control Transaction have been satisfied or waived and setting
forth the effective date of the proposed Change in Control
Transaction. Promptly following receipt by the Company of an
Applicable Entity Officers' Certificate or the delivery by the
Company of a Company Officer's Certificate, as the case may be,
but in no event later than the effective date specified therein,
the Company shall make the deposit of cash or TCI Series A Shares
with the Rights Agent required by Section 4.11. Promptly
following such deposit, the Rights Agent shall distribute the
cash or TCI Series A Shares so deposited to the Persons entitled
to the same as provided in Section 4.11, and deliver the
certificates for the MusicCo Common
Stock and Distributed Entity Stock to the Company as provided
in Section 4.08. If the Board of Directors of the Applicable
Entity determines to terminate or abandon the proposed
Significant Corporate Transaction or that such transaction
will otherwise not be consummated, the Applicable Entity
shall promptly following such determination deliver to the
Company and the Rights Agent an Applicable Entity Officers'
Certificate to such effect. If the proposed Change in
Control Transaction is terminated or abandoned or the Company
otherwise determines that such proposed transaction will not be
consummated, then the Company shall promptly so notify the Rights
Agent by delivering to the Rights Agent a Company Officer's
Certificate to such effect. Promptly following receipt by the
Rights Agent of such Applicable Entity Officers' Certificate or
Company Officer's Certificate, as the case may be, the Rights
Agent shall mail to each Holder by first class mail the
certificates evidencing the shares of MusicCo Series A Common
Stock, the shares of Distributed Entity Stock and the Rights
surrendered by such Holder to the Rights Agent in connection with
such accelerated Exercise Period and, if the Company has made a
deposit of cash or TCI Series A Shares with the Rights Agent in
connection with such accelerated Exercise Period, the Rights
Agent shall deliver the cash or TCI Series A Shares so deposited
to the Company.
4.14 Abandonment or Termination. Notwithstanding
----------------------------
Section 4.11, if the Exercise Period for each Right is
accelerated and the proposed transaction which resulted in the
acceleration is abandoned or terminated on or before the last day
(the "Deposit Date") on which the Company is required to make the
deposit pursuant to Section 4.11 of cash or TCI Series A Shares
to effect the purchase of shares of MusicCo Series A Common
Stock and Distributed Entity Stock surrendered in connection with
such accelerated Exercise Period, or the Company otherwise
determines in good faith on or before the Deposit Date that such
proposed transaction will not be consummated, then the Company
shall so notify the Rights Agent by delivering to the Rights
Agent an officer's certificate to such effect signed by its
Chairman of the Board, President or a Vice President promptly
following the termination or abandonment of such proposed
transaction or such determination by the Company, but in no event
later than the fifth Business Day following the Deposit Date.
Upon delivery of such officer's certificate, the Company shall be
relieved of its obligation to make the deposit otherwise required
by Section 4.11 or, if such deposit has theretofore been made,
shall be entitled to the return thereof. Promptly following
receipt of such officer's certificate, the Rights Agent shall
mail to each Holder the certificates evidencing the shares of
MusicCo Series A Common Stock, the shares of Distributed Entity
Stock and the Rights surrendered by such Holder to the Rights
Agent in connection with such accelerated Exercise Period and, if
the Company has made a deposit of cash or TCI Series A Shares
with the Rights Agent in connection with such accelerated
Exercise Period, the Rights Agent shall deliver the cash or TCI
Series A Shares so deposited to the Company.
4.15 Certain Covenants of the Company and Each
-----------------------------------------------
Applicable Entity. If the Company chooses to issue TCI Series A
-----------------
Shares upon the exercise of any Component of the Rights, the
Company will pay all documentary stamp and other taxes, if any,
attributable to the exercise of the Rights, other than any such
taxes payable by the Holder as provided in Section 4.08. Each of
MusicCo and each Distributed Entity shall cooperate with and
assist the Company in the preparation and filing of all
applications, reports, statements, notices and other documents or
forms with, and use its reasonable best efforts to obtain and to
assist the Company
in obtaining all consents and approvals of or waivers from,
all governmental and regulatory agencies and authorities
having jurisdiction (including, without limitation,
the Securities and Exchange Commission, Department of Justice and
Federal Trade Commission) and shall take such other actions,
including supplying all information necessary for any required
filing, as the Company may reasonably request, all as and to the
extent necessary or advisable in order for the Company to comply
with applicable laws, rules, regulations, orders and decrees in
connection with the performance of its obligations under this
Agreement and the Rights.
4.16 Consideration Amount. The Consideration Amount
--------------------
Per MusicCo Share shall be equal to the difference between
(i) $4.00 and (ii) the sum of the aggregate per share amount of
any MusicCo Dividends and the Aggregate Consideration Amount Per
Distributed Entity Share. The Consideration Amount Per
Distributed Entity Share shall be equal to the Per Share Value of
the applicable Distributed Entity as of the Valuation Date. The
Fair Market Value of each Distributed Entity as of such date
shall be determined in good faith by the Board of Directors of
MusicCo. Promptly following the determination of the Fair Market
Value of each Applicable Entity, MusicCo shall deliver to the
Company, with a copy to the Rights Agent, an officers'
certificate signed by the Chairman of the Board and the President
of MusicCo, certifying the Per Share Value of each Applicable
Entity and setting forth, in reasonable detail, the computation
thereof. Each Distributed Entity, by its execution of a
supplement to this Agreement as contemplated by Section 6.07,
covenants and agrees to provide MusicCo with such information
with respect to the Capital Stock of such Distributed Entity as
may be necessary to the computation of the Per Share Value of
such Distributed Entity. Anything in this Agreement to the
contrary notwithstanding, in no event will the sum of the
Consideration Amount Per MusicCo Share, the aggregate amount of
any MusicCo Dividends, and the Aggregate Consideration Amount Per
Distributed Entity Share for each Distributed Entity, exceed
$4.00.
4.17 Acceleration of Exercise Period. Subject to the
-------------------------------
last sentence of Section 4.01, if prior to the [anniversary date
of closing] (i) a Significant Corporate Transaction is proposed,
(ii) the Company proposes to make a disposition of all or any
number of the shares of Capital Stock of MusicCo beneficially
owned by it and as a result of such disposition the Company will
cease to be the beneficial owner of at least 30% (in voting
power) of the shares of Capital Stock of MusicCo then outstanding
(a "Change in Control Transaction"), (iii) a Bankruptcy Event
occurs or (iv) the Company is dissolved or liquidated, then the
Exercise Period for each Right shall be accelerated as provided
herein and the Company shall be obligated to honor all Rights
validly exercised in accordance with Section 4.08 prior to the
expiration of such accelerated Exercise Period.
4.18 Consideration on Acceleration. For purposes of
-----------------------------
determining the Consideration Amount Per MusicCo Share and the
Consideration Amount Per Distributed Entity Share payable in
connection with the accelerated Exercise Period, the applicable
Valuation Date shall be the last day of the fiscal quarter of
MusicCo immediately preceding the fiscal quarter in which (i) in
the case of a Significant Corporate Transaction, the agreement of
merger or consolidation is executed, or the vote of the Board of
Directors of the Applicable Entity to dissolve or liquidate the
Applicable Entity is taken or (ii) in the case of a Change in
Control Transaction, a binding agreement to make the related
disposition is entered into by the Company
or, if such disposition is to be effected pursuant to a
dividend or distribution to the stockholders of the Company or
otherwise than pursuant to a binding agreement, the vote of
the Board of Directors of the Company approving the making of
such dividend, distribution or other disposition is taken, or
(iii) in the case of a Bankruptcy Event, the Bankruptcy Event
occurs, or (iv) in the case of the dissolution or liquidation
of the Company, the vote of the Board of Directors of the Company
to dissolve or liquidate the Company is taken. (The execution
of such agreement by the Applicable Entity or the taking of such
vote by the Board of Directors of the Applicable Entity in
connection with a Significant Corporate Transaction, the giving
to the Acceptance Notice by MusicCo in the case of a MusicCo
Purchase Transaction, the execution of such binding agreement
Company or the taking of such vote by the Board of the Company
in connection with a Change in Control Transaction, the
occurrence of a Bankruptcy Event or the taking of such vote by
the Board of Directors of the Company to dissolve or liquidate
the Company, are each referred to as a "Triggering Event").
Promptly following the occurrence of a Triggering Event, the
applicable of MusicCo or the Company shall give written notice
thereof to the other (or in the case of a Triggering Event
for a Significant Corporate Transaction with respect to
which a Distributed Entity is the Applicable Entity,
such Applicable Entity shall give such notice to the Company and
MusicCo), with a copy to the Rights Agent. Publication of the
Notice contemplated by Section 4.07 shall be made as promptly as
practicable (in light of applicable requirements of federal and
state securities laws and regulations) following the final
determination of the Consideration Amount Per MusicCo Share and
the Consideration Amount Per Distributed Entity Share. In the
case of a Significant Corporate Transaction, the Applicable
Entity shall furnish the Rights Agent with such number of copies
as the Rights Agent may request of the proxy or information
statement and other material to be delivered to the Applicable
Entity's stockholders in connection with the stockholders'
meeting to approve the Significant Corporate Transaction. The
Rights Agent shall distribute such material to the registered
Holders of the Certificates by first class mail, postage prepaid,
at their respective addresses as they appear on the Register of
Holders prior to or contemporaneously with the publication of the
Notice, and such publication shall be delayed, if necessary,
until such material has been delivered to the Rights Agent.
4.19 Exercise Period on Acceleration. The accelerated
--------------------------------
Exercise Period shall commence at the opening of business on not
earlier than the 30th day, nor later than the 60th day, following
the publication of the Notice, and shall expire at the close of
business, ___________ time, on the 20th Business Day after the
commencement thereof (or such later date as may be required by
applicable Federal or state securities laws and regulations).
Subject to Section 4.20 below, all Rights (and fractions thereof)
(including all Components of such Rights (and of all fractional
Rights)) not validly exercised prior to the expiration of such
accelerated Exercise Period shall thereupon expire and cease to
be exercisable thereafter.
4.20 Rescission. If a proposed Significant Corporate
----------
Transaction or Change in Control Transaction that causes an
accelerated Exercise Period is terminated or abandoned before
consummation or the Company otherwise determines in good faith on
or before the Deposit Date that such proposed transaction will
not be consummated, then in any such event such acceleration of
the Exercise Period and all exercises of Rights during such
accelerated Exercise Period shall, without any requirement of
action by any party, be deemed rescinded and annulled,
and any Rights that have expired by virtue of the failure of the
Holder to validly exercise the same prior to the expiration of such
accelerated Exercise Period (or by virtue of the partial exercise
thereof during such accelerated Exercise Period) shall thereupon
be reinstated. The Rights Agent, upon receipt of the officers'
certificate contemplated by the applicable of Section 4.13 or
4.14, shall make the distributions to the Holders and the Company
required by the last sentence of the applicable of such Sections.
ARTICLE V
PURCHASE AND CANCELLATION OF RIGHTS
5.01 Purchase of Rights by the Company. The Company
---------------------------------
shall have the right to purchase or otherwise acquire Rights by
purchasing the associated MusicCo Series A Common Stock or
Distributed Entity Stock at such times, in such manner and for
such consideration as it may determine.
ARTICLE VI
ADJUSTMENT OF RIGHTS
6.01 Adjustment of Rights. The number of Rights
----------------------
represented by each Certificate shall be subject to adjustment
from time to time upon the happening of certain events as
hereinafter provided.
6.02 Mechanical Adjustment. If MusicCo shall: (a) pay
---------------------
a dividend or make a distribution on the outstanding shares of
MusicCo Series A Common Stock in shares of MusicCo Common Stock,
(b) subdivide the outstanding shares of MusicCo Series A Common
Stock into a larger number of shares, (c) combine the outstanding
shares of MusicCo Series A Common Stock into a smaller number of
shares or (d) issue any shares of its Capital Stock by
reclassification of the outstanding shares of MusicCo Common
Stock (including any such reclassification in connection with a
consolidation or merger in which MusicCo is the surviving
corporation), the number of Rights outstanding immediately prior
to the date such dividend or distribution is paid or made or the
effective date of such subdivision, combination or
reclassification shall be adjusted to the aggregate number of
shares of MusicCo Series A Common Stock (or shares of MusicCo's
Capital Stock issued in such reclassification) outstanding
immediately after the taking of such action. Such adjustment
shall be made successively whenever any event listed above shall
occur. If a reclassification described in clause (d) above
occurs, each reference in this Agreement and the Certificates to
a share of MusicCo Series A Common Stock shall be deemed to
refer to the number and kind of shares of MusicCo's Capital Stock
that a Holder of one share of MusicCo Series A Common Stock
would hold immediately following such reclassification. If
MusicCo takes any action requiring an adjustment to the number of
Rights prior to payment in full of the Consideration Amount Per
MusicCo Share upon exercise thereof, such Consideration Amount
Per MusicCo Share shall be adjusted by multiplying such amount by
a fraction the numerator of which is the number of
Rights outstanding immediately prior to such action and the
denominator of which is the number of Rights outstanding as a
result of the taking of such action.
6.03 Adjustment for Distributions of MusicCo
----------------------------------------------
Securities. If (i) MusicCo makes a distribution to all Holders
----------
of shares of MusicCo Series A Common Stock of shares of the
Capital Stock of any entity or of rights or warrants entitling
them (for a period expiring within 45 days after the effective
date of such distribution) to purchase shares of the Capital
Stock of any entity and (ii) the Distribution Value of such
distribution represents 10% or more of the Undistributed Value of
MusicCo immediately prior to such distribution, then the
provisions of this Section 6.03 shall apply to such distribution
(a "Subject Distribution"). The determination of whether a
distribution meets each of the criteria referred to in the
immediately preceding sentence and is therefore a Subject
Distribution shall be made by the Board of Directors of MusicCo
(whose good faith determination will be conclusive). In making
any determination of Fair Market Value for purposes of
determining the Distribution Value of such distribution and the
Undistributed Value of MusicCo, the Board of Directors of MusicCo
shall apply the same criteria as are applicable to a
determination of the Fair Market Value of MusicCo and each
Distributed Entity in accordance with Section 4.16.
6.04 Subject Distribution Adjustment. If MusicCo makes
-------------------------------
a Subject Distribution, then following the effective date
referred to below, each whole Right shall represent, in addition
to the right to sell to the Company one share of MusicCo Series
A Common Stock (the "MusicCo Component"), the right (the
"Distributed Entity Component") to sell to the Company at the
time, for the consideration and subject to the terms and
conditions set forth in this Agreement, that number of shares of
Distributed Entity Stock obtained by multiplying one by a
fraction, the numerator of which is the aggregate number of
shares of Distributed Entity Stock distributed in the Subject
Distribution or sold pursuant to the rights or warrants
distributed in the Subject Distribution, and the denominator of
which is the aggregate number of shares of MusicCo Series A
Common Stock outstanding on the record date for such
distribution. The number of shares of Distributed Entity Stock
(or fraction thereof) to which the Distributed Entity Component
of each whole Right applies (the "Underlying Number") shall be
determined as of and be effective (retroactively in the case of a
distribution that pursuant to Section 6.03 is subsequently deemed
to be a Subject Distribution) as of the effective date of the
distribution in the case of a distribution of shares of
Distributed Entity Stock, and shall be determined as of and be
effective (retroactively in the case of a distribution that
pursuant to Section 6.03 is subsequently deemed to be a Subject
Distribution) as of the day following the distribution of rights
or warrants in the case of a distribution of rights or warrants
to purchase Distributed Entity Stock (the applicable of such
dates herein referred to as the "effective date"). In the case
of fractional Rights, the Underlying Number for the Distributed
Entity Component of such fractional Right shall equal the same
fraction of the Underlying Number for the Distributed Entity
Component of a whole Right. The foregoing provisions shall apply
to each Subject Distribution and a new Distributed Component will
be created with respect to the Distributed Entity Stock
distributed in each such Subject Distribution. No Component of a
Right shall be separable from the Components of such Right.
6.05 Adjustment to Underlying Number. If MusicCo takes
-------------------------------
any action requiring an adjustment to the number of Rights
pursuant to Section 6.02 at a time when each Right has one or
more Distributed Entity Components, then the Underlying Number
for each Distributed Entity Component of each Right after giving
effect to such adjustment to the number of Rights shall equal the
number obtained by multiplying the Underlying Number for such
Distributed Entity Component immediately before giving effect to
such adjustment by a fraction the numerator of which is one and
the denominator of which is the number (or fraction) to which one
whole Right is adjusted as a result of the taking of such action
by MusicCo.
6.06 Distributed Entity Adjustment. If a Distributed
-----------------------------
Entity shall (i) pay a dividend or make a distribution on the
outstanding shares of Distributed Entity Stock in shares of
Distributed Entity Stock, (ii) subdivide the outstanding shares
of Distributed Entity Stock into a larger number of shares, (iii)
combine the outstanding shares of Distributed Entity Stock into a
smaller number of shares or (iv) issue any shares of its Capital
Stock by reclassification of the outstanding shares of
Distributed Entity Stock (including any such reclassification in
connection with a merger or consolidation in which the
Distributed Entity is the surviving corporation), then the
Underlying Number for the applicable Distributed Entity Component
of each Right immediately prior to the date such dividend or
distribution is paid or made or the effective date of such
subdivision, combination or reclassification shall be adjusted
(to the nearest one-hundredth of a share), effective immediately
after the applicable of such dates, by multiplying the Underlying
Number for such Distributed Entity Component immediately prior to
such adjustment by a fraction the numerator of which is the
aggregate number of shares of Distributed Entity Stock (or shares
of the Distributed Entity's Capital Stock issued in such
reclassification) outstanding immediately after the taking of
such action, and the denominator of which is the aggregate number
of shares of Distributed Entity Stock outstanding immediately
prior to the taking of such action. Such adjustment to the
Underlying Number shall be made successively whenever any event
listed above shall occur. If a reclassification described in
clause (iv) above occurs, each reference in this Agreement to a
share of Distributed Entity Stock shall be deemed to refer to the
number and kind of shares of the Capital Stock of the Distributed
Entity that a holder of one share of Distributed Entity Stock
would hold immediately following such reclassification. If a
Distributed Entity takes any action requiring an adjustment to
the Underlying Number for the applicable Distributed Entity
Component of each Right prior to payment in full of the
Consideration Amount Per Distributed Entity Share upon exercise
thereof, such Consideration Amount Per Distributed Entity Share
shall be adjusted by multiplying such amount by a fraction the
numerator of which is the Underlying Number for such Distributed
Entity Component immediately before giving effect to such
adjustment and the denominator of which is the Underlying Number
for such Distributed Entity Component immediately after giving
effect to such adjustment.
6.07 Distributions by Distributed Entity. If (i) a
-----------------------------------
Distributed Entity makes a distribution to all holders of shares
of Distributed Entity Stock of shares of the Capital Stock of any
entity or of rights or warrants entitling them (for a period
expiring within 45 days after the effective date of such
distribution) to purchase shares of the Capital Stock of any
entity and (ii) the Distribution Value of such distribution
represents 10% or more of the Undistributed Value of MusicCo
immediately prior to such distribution, then such distribution
shall be a Subject
Distribution, the entity the shares of Capital Stock of which
are distributed or sold in such Subject Distribution shall
be a Distributed Entity, and the class of Capital Stock of
the Distributed Entity that is distributed or sold in the
Subject Distribution shall be Distributed Entity Stock, with the
same effect for all purposes of this Agreement as if MusicCo had
made such distribution, except that the Underlying Number for the
Distributed Entity Component of each whole Right created pursuant
to Section 6.04 by virtue of such Subject Distribution shall
be the number obtained by multiplying one by a fraction the
numerator of which is the aggregate number of shares of Capital
Stock of such entity distributed or sold in the Subject
Distribution and the denominator of which is the aggregate
number of shares of Distributed Entity Stock of the Distributed
Entity making the Subject Distribution outstanding on the record
date for such distribution. The determination of whether a
distribution meets each of the criteria referred to in the
immediately preceding sentence and is therefore a Subject
Distribution shall be made by the Board of Directors of MusicCo
(whose good faith determination will be conclusive). The
Distribution Value of any such distribution shall be made in good
faith by the Board of Directors of MusicCo. If MusicCo or any
Distributed Entity makes a distribution which individually is not
a Subject Distribution solely by virtue of clause (ii) of the
first sentence of Section 6.03 or this Section 6.07, but would be
a Subject Distribution if aggregated with any other distribution
or distributions previously made by MusicCo or any Distributed
Entity that also were not Subject Distributions when made solely
by virtue of that clause (ii) (and were not thereafter deemed to
be Subject Distributions pursuant to this sentence), then upon
the making of the later of such distributions such distributions
shall be deemed to be a single Subject Distribution. The
determination of whether any combination of distributions would
constitute a Subject Distribution pursuant to the immediately
preceding sentence shall be made by the Board of Directors of
MusicCo (whose good faith determination will be conclusive) on
the basis of the Distribution Values of such distributions and
the Undistributed Value of MusicCo calculated in each case
immediately prior to the time the first of such distributions was
made.
6.08 MusicCo Covenants. MusicCo covenants and agrees
------------------
with the Company and the Rights Agent and, in the case of clause
(i) and clause (iv) solely with respect to the obligations
relating to clause (i), below, for the benefit of the Holders,
as follows:
(i) neither it nor any Distributed Entity will
distribute to all Holders of MusicCo Series A Common
Stock rights or warrants to purchase the Capital Stock
of any entity that would expire more than 45 days after
the effective date of such distribution;
(ii) neither it nor any Distributed Entity will
make a distribution to all Holders of any class of its
Capital Stock of any entity or of rights or warrants to
purchase the Capital Stock of any entity at any time
during the period (or the record date or effective date
of which is at any time during the period) commencing
with the Exercise Period and ending with the date on
which the Company (or its assignee) becomes the record
owner of the shares surrendered in such Exercise
Period, nor will it or any Distributed Entity, without
the prior written consent of the Company, make, pay or
declare to all Holders of any class of its Capital
Stock any other dividend or distribution or take any
other action at any time during the period (or the
record date or effective date of which is at any
time during the period) commencing with the Exercise
Period and ending with the date on which the Company (or
its assignee) becomes the record owner of the shares
surrendered in such Exercise Period, the reasonably
foreseeable effect of which would be to reduce or
otherwise adversely affect the Fair Market Value or the
Per Share Value of MusicCo or such Distributed Entity,
other than the actions specifically enumerated in
Sections 6.02 through Section 6.06 for which an express
adjustment to the Consideration Amount Per MusicCo
Share and Consideration Amount Per Distributed Entity
Share payable by the Company is provided;
(iii) without the prior written consent of the
Company, neither MusicCo nor any Distributed Entity
will, at any time during the term of this Agreement,
take or recommend to their respective shareholders any
action the reasonably foreseeable effect of which would
be to adversely affect the relative rights, powers or
preferences of the shares of MusicCo Common Stock or
Distributed Entity Stock to be acquired by the Company
upon the exercise of Rights or the exercise by the
Company of such rights, powers and preferences and of
full rights of ownership of such shares; and
(iv) prior to making any distribution of the
Capital Stock of any entity or of rights or warrants
to purchase the Capital Stock of any entity, the
Applicable Entity making such distribution will cause
such entity to execute and deliver a supplement to this
Agreement pursuant to which such entity shall accept
and agree to be bound by and comply with the provisions
of this Agreement that relate to such entity (or will
relate to such entity if it is thereafter deemed to be
a Distributed Entity pursuant to this Article VI) and
shall agree to cooperate with the Board of Directors of
MusicCo and provide such Board with such information as
it may from time to time reasonably request in
connection with its determination of the Distributed
Value of any distribution and the Undistributed Value
of MusicCo from time to time in accordance with this
Article VI and the definition of Significant Corporate
Transaction.
6.09 Notice of Adjustment. Whenever MusicCo takes any
--------------------
action that would require an adjustment to the number of Rights
represented by each Certificate (and the consequent adjustment of
the Underlying Number for each Distributed Entity Component, if
any) or the Consideration Amount Per MusicCo Share, or that would
require the creation of a Distributed Entity Component, and
whenever any Distributed Entity takes any action that would
require an adjustment to the Underlying Number of the applicable
Distributed Entity Component or the Consideration Amount Per
Distributed Entity Share, or that would require the creation of a
Distributed Entity Component, the Applicable Entity shall
promptly notify the Company and MusicCo in writing (with a copy
to the Rights Agent) of the action taken and of all information
relevant to the computation pursuant to this Article VI of the
required adjustments to the number of Rights, the Underlying
Number, the Consideration Amount Per MusicCo Share or the
Consideration Amount Per Distributed Entity Share, as the case
may be, and in the case of the creation of a Distributed Entity
Component, all information relevant to the computation of the
Underlying Number of such Distributed Entity Component. Promptly
thereafter, the Company shall deliver to the Rights Agent a
certificate of a firm of independent public accountants (who may
be the regular accountants employed by MusicCo or the Company)
setting forth, as applicable:
(i) If an action requiring an adjustment to the
number of Rights is taken, the number of Rights
represented by a Certificate before and after such
adjustment and, if applicable, the Consideration Amount
Per MusicCo Share and the Underlying Number for each
Distributed Entity Component of a Right, in each case
before and after such adjustment.
(ii) If an action requiring the creation of a
Distributed Entity Component is taken, the Underlying
Number for the Distributed Entity Component of each
Right so created.
(iii) If an action requiring an adjustment to
the Underlying Number of a Distributed Entity Component
is taken, the Underlying Number of such Distributed
Entity Component before and after such adjustment and,
if applicable, the Consideration Amount Per Distributed
Entity Share before and after such adjustment. Such
certificate shall also contain a brief statement of the
facts requiring such adjustment and the computation by
which such adjustment was made, or, if applicable, the
facts requiring the creation of such Distributed Entity
Component and the computation of such Underlying
Number. The Company shall also cause the Rights Agent
to send promptly by first class mail, postage prepaid,
to each Holder notice of such adjustment or adjustments
or of the creation of such Distributed Entity
Component. The certificate delivered to the Rights
Agent pursuant to this Section 6.09 shall be conclusive
evidence of the correctness of the matters set forth
therein in the absence of manifest error. The Rights
Agent shall be entitled to rely on such certificate and
shall be under no duty or responsibility with respect
to any such certificate, except to exhibit the same,
from time to time, to any Holder desiring an inspection
thereof during regular business hours. The Rights
Agent shall not at any time be under any duty or
responsibility to any Holder to determine whether any
facts exist that may require any adjustment or the
creation of any Distributed Entity Component hereunder,
or with respect to the nature or extent of any such
adjustment when made or of any such Distributed Entity
Component when created, or with respect to the method
employed in making such adjustment or calculating the
Underlying Number of such Distributed Entity Component.
6.10 Statement on Certificates. Irrespective of any
-------------------------
adjustments in the number of Rights represented by each Certifi
cate or the creation of any Distributed Entity Component or any
adjustments to the Underlying Number thereof, Certificates
theretofore or thereafter issued may continue to express solely
the number of Rights as are stated in the Certificates initially
issuable pursuant to this Agreement.
6.11 No Rights as Stockholders. Nothing contained in
-------------------------
this Agreement or in the Certificates shall be construed as
conferring upon the Holders or their transferees any rights
whatsoever as stockholders of MusicCo or the Company or any
Distributed Entity.
ARTICLE VII
RIGHTS AGENT
7.01 Inspection of Rights Agreement. The Rights Agent
------------------------------
shall keep copies of this Agreement and any notices given or
received hereunder available for inspection by the Holders during
normal business hours at its Office. The Company shall supply
the Rights Agent from time to time with such numbers of copies of
this Agreement as the Rights Agent may request.
7.02 Merger or Consolidation or Change of Name of
------------------------------------------------
Rights Agent. Any corporation into which the Rights Agent may be
------------
merged or with which it may be consolidated, or any corporation
resulting from any merger or consolidation to which the Rights
Agent shall be a party, or any corporation succeeding to the
corporate trust business of the Rights Agent, shall be the
successor to the Rights Agent hereunder without the execution,
filing or delivery of any paper or any further act on the part of
any of the parties hereto, provided that such corporation would
be eligible for appointment as a successor Rights Agent under the
provision of Section 7.16 hereof. If at the time such successor
to the Rights Agent shall succeed to the agency created by this
Agreement, any of the Certificates shall have been countersigned
but not delivered, any such successor to the Rights Agent may
adopt the countersignature of the original Rights Agent and
deliver such Certificates so countersigned, and if at any time
any of the Certificates shall not have been countersigned, any
successor to the Rights Agent may countersign such Certificates
either in the name of the predecessor Rights Agent or in the name
of the successor Rights Agent; and in all such cases such
Certificates shall have the full force provided in such
Certificates and in this Agreement. If at any time the name of
the Rights Agent shall be changed and at such time any of the
Certificates shall have been countersigned but not delivered, the
Rights Agent may adopt the countersignatures under its prior name
and deliver such Certificates so countersigned; and if at any
time any of the Certificates shall not have been countersigned,
the Rights Agent may countersign such Certificates either in its
prior name or in its changed name; and in all such cases such
Certificates shall have the full force provided in the
Certificates and in this Agreement.
7.03 Concerning the Rights Agent. The Rights Agent
---------------------------
undertakes the duties and obligations imposed by this Agreement
upon the following terms and conditions, by all of which the
Company and the Holders, by their acceptance of Certificates
shall be bound.
7.04 Correctness of Statements. The statements con
-------------------------
tained herein and in the Certificates shall be taken as state
ments, of the Company, and the Rights Agent assumes no
responsibility for the correctness of any of the same except such
as describe the Rights Agent or actions taken by it. The Rights
Agent assumes no responsibility with respect to the distribution
of the Certificates except as herein otherwise provided.
7.05 Breach of Covenants. The Rights Agent shall not
-------------------
be responsible for any failure of the Company, MusicCo or any
Distributed Entity to comply with any of the covenants or
conditions contained in this Agreement or in the Certificates to
be complied with or satisfied by the Company, MusicCo or any
Distributed Entity.
7.06 Performance of Duties. The Rights Agent may
----------------------
execute and exercise any of the rights or powers hereby vested in
it or perform any duty hereunder either itself or by or through
its attorneys, agents and employees.
7.07 Reliance on Counsel. The Rights Agent may consult
-------------------
at any time with legal counsel reasonably satisfactory to it (who
may be counsel for the Company) and the Rights Agent shall incur
no liability or responsibility to the Company or to any Holder in
respect of any action taken, suffered or omitted by it hereunder
in good faith and in accordance with the opinion or the advice of
such counsel.
7.08 Proof of Actions Taken. Whenever in the perfor
----------------------
xxxxx of its duties under this Agreement the Rights Agent shall
deem it necessary or desirable that any fact or matter be proved
or established by the Company prior to taking or suffering any
action hereunder, such fact or matter (unless other evidence in
respect thereof be herein specifically prescribed) may be deemed
conclusively to be proved and established by a certificate signed
by the Chairman of the Board, the President or a Vice President
of the Company and delivered to the Rights Agent; and such
certificate shall be full authorization to the Rights Agent for
any action taken, suffered or omitted in good faith by it under
the provisions of this Agreement in reliance upon such
certificate.
7.09 Compensation, Indemnity and Reimbursement. The
-----------------------------------------
Company agrees to pay the Rights Agent reasonable compensation
for all services rendered by the Rights Agent in the performance
of its duties under this Agreement, to reimburse the Rights Agent
for all expenses, taxes and governmental charges and other
charges of any kind and nature incurred by the Rights Agent in
the performance of its duties under this Agreement, and to indem
nify the Rights Agent and save it harmless against any and all
claims and liabilities, including judgments, costs and counsel
fees, for anything done or omitted by the Rights Agent in the
performance of its duties under this Agreement except as a result
of the Rights Agent's negligence or bad faith.
7.10 Legal Proceedings. The Rights Agent shall be
------------------
under no obligation to institute any action, suit or legal pro
ceeding or to take any other action likely to involve expense
unless the Company shall furnish the Rights Agent with reasonable
security and indemnity for any costs and expenses that may be
incurred in taking such action, but this provision shall not
affect the power of the Rights Agent to take such action as the
Rights Agent may consider proper, whether with or without any
such security or indemnity. All rights of action under this
Agreement or under any of the Rights may be enforced by the
Rights Agent without the possession of any of the Certificates or
the production thereof at any trial or other proceeding relative
thereto, and any such action, suit or proceeding instituted by
the Rights Agent shall be brought in its name as Rights Agent.
7.11 Other Transactions in Securities of Company. The
-------------------------------------------
Rights Agent in its individual and other capacities and any
stockholder, director, officer or employee of the Rights Agent
may buy, sell or deal in any of the Rights, or other securities
of the Company, MusicCo or any Distributed Entity or become
pecuniarily interested in any transaction in which the Company,
MusicCo or any Distributed Entity may be interested or contract
with or lend money to the Company, MusicCo or any Distributed
Entity or otherwise act as fully and freely as though it were not
Rights Agent under this Agreement. Nothing herein shall preclude
the Rights Agent from acting in any other capacity for the
Company, MusicCo or any Distributed Entity or for any other
Person, including without limitation, acting as transfer agent or
registrar for other securities issued by the Company, MusicCo or
any Distributed Entity.
7.12 Liability of Rights Agent. The Rights Agent shall
-------------------------
act hereunder solely as agent, and its duties shall be determined
solely by the provisions hereof. The Rights Agent shall not be
liable for anything that it may do or refrain from doing in
connection with this Agreement except for its own negligence or
bad faith.
7.13 Reliance on Documents. The Rights Agent will not
---------------------
incur any liability or responsibility to the Company or to any
Holder for any action taken in reliance on any notice, reso
lution, waiver, consent, order, certificate, or other paper,
document or instrument reasonably believed by it to be genuine
and to have been signed, sent or presented by the proper parties.
7.14 Validity of Agreement. The Rights Agent shall not
---------------------
be under any responsibility in respect of the validity of this
Agreement or the execution and delivery hereof (except the due
execution and delivery hereof by the Rights Agent) or in respect
of the validity or execution of any Certificate (except its
countersignature thereof).
7.15 Instructions from Company. The Rights Agent is
-------------------------
hereby authorized and directed to accept instructions with res
pect to the performance of its duties hereunder from any two of
the Chairman of the Board, the President or a Vice President of
the Company, and to apply to such officers for advice or
instructions in connection with its duties, and shall not be
liable for any action taken or suffered to be taken by it in good
faith in accordance with instructions of any such officer or
officers.
7.16 Change of Rights Agent. The Rights Agent may
-----------------------
resign and be discharged from its duties under this Agreement by
giving to the Company 30 days' prior notice in writing. The
Rights Agent may be removed by like notice to the Rights Agent
from the Company and by notice to the Holders. If the Rights
Agent shall resign or be removed or shall otherwise become incap
able of acting, the Company shall appoint a successor to the
Rights Agent. If the Company shall fail to make such appointment
within a period of 30 days after such removal or after it has
been notified in writing of such resignation or incapacity by the
resigning or incapacitated Rights Agent or by any Holder (who
shall with such notice submit his Certificate for inspection by
the Company), then any Holder may apply to any court of competent
jurisdiction for the appointment of a successor to the Rights
Agent. Pending appointment of a successor to the Rights Agent,
the duties of the Rights Agent shall be carried out by the
Company. Any successor Rights Agent, whether appointed by the
Company or such a court, shall be a bank
or trust company, in good standing, incorporated under the laws
of the United States of America or any state thereof and having
at the time of its appointment as Rights Agent a combined capital
and surplus of at least $50,000,000. After appointment, the
successor Rights Agent shall be vested with the same powers,
rights, duties and responsibilities as if it had been originally
named as Rights Agent without further act or deed; but the former
Rights Agent shall deliver and transfer to the successor Rights
Agent any property at the time held by it hereunder, and execute
and deliver any further assurance, conveyance, act or deed
necessary for the purpose. Failure to give any notice provided
for in this Section 7.16, however, or any defect therein, shall
not affect the legality or validity of the resignation or removal
of the Rights Agent or the appointment of the successor Rights
Agent, as the case may be. In the event of such resignation
or removal the successor Rights Agent shall mail, by first class
mail, postage prepaid, to each Holder, written notice of such
removal or resignation and the name and address of such successor
Rights Agent.
ARTICLE VIII
MISCELLANEOUS
8.01 Obtaining of Governmental Approvals. The Company
-----------------------------------
will from time to time take all action that may be necessary to
obtain and keep effective any and all permits, consents and
approvals of governmental agencies and authorities and securities
acts filings under federal and state securities laws and
regulations that may be or become required in connection with the
issuance, sale, transfer and delivery of the Certificates, the
exercise of the Rights and the purchase of MusicCo Common Stock
or Distributed Entity Stock upon exercise of the Rights.
8.02 Notices. Any notice or other communication
-------
required or permitted to be given pursuant to this Agreement to
the Company, MusicCo or the Rights Agent, shall be in writing and
shall be deemed given and received on the date delivered in
person or by telecopy (answer back received) or 24 hours after
delivery to a courier service which guarantees overnight delivery
or five days after the date mailed by registered or certified
mail, return receipt requested, postage prepaid, to the intended
recipient at the address specified below:
If to the Company:
Tele-Communications, Inc.
Terrace Tower II
0000 XXX Xxxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention:
With a copy similarly addressed to the
attention of the Legal Department
If to MusicCo:
Telecopier No.: ________________________
Attention: President
With a copy similarly addressed to the
attention of the Legal Department
If to the Rights Agent:
Telecopier No.: ________________________
Attention:
Any party may from time to time change the address to
which notices to it are to be given or mailed hereunder by notice
given to the other parties in the manner provided above.
Any notice or other communication pursuant to this
Agreement to the Holders shall be in writing and shall be mailed
first class mail, postage prepaid, or otherwise delivered, to
such Holders at their respective addresses on the Register of
Holders of the Rights Agent.
8.03 Amendments Without Consent of Holders. The
-----------------------------------------
Company and the Rights Agent may from time to time supplement or
amend this Agreement without the approval of any Holder, in order
to cure any ambiguity or to correct or supplement any provision
contained herein that may be defective or inconsistent with any
other provision herein, or to make any other provisions in regard
to matters or questions arising hereunder that the Company and
the Rights Agent may deem necessary or desirable and that shall
not be inconsistent with the provisions of the Rights and that
shall not adversely affect the interests of the Holders.
8.04 Amendments With Consent of Holders. The Company
----------------------------------
and the Rights Agent may from time to time amend or supplement
this Agreement without notice to any Holder but with the written
consent of the Holders (other than the Company or its
subsidiaries, or the officers, directors or affiliates of the
Company or any a its subsidiaries (other than MusicCo)) of a
majority in number of the outstanding Rights. The Holders of a
majority of the outstanding
Rights may waive compliance by the Company with any provision
of this Agreement without notice to any Holder. Without the
consent of each Holder affected, however, an amendment,
supplement or waiver may not:
(a) alter or modify the terms of the definition
of Early Expiration Event in Section1.01, Sections 2.03, 4.01,
4.16, 4.17, 4.18, 4.19, 4.20, or Article VI hereof in any way
that adversely affects the rights of any Holder in any material
respect; or
(b) waive a default in payment of the purchase
price for the MusicCo Common Stock and Distributed Entity Stock
to be purchased upon exercise of any Rights.
It shall not be necessary for the consent of the Hol
ders under this Section to approve the particular form of any
proposed supplement, but it shall be sufficient if such consent
approves the substance thereof.
8.05 Successors. All covenants and provisions of this
----------
Agreement by or for the benefit of the Company or the Rights
Agent shall bind and inure to the benefit of their respective
successors and assigns hereunder.
8.06 Applicable Law. This Agreement shall be governed
--------------
by and construed in accordance with the internal laws of the
State of Delaware, without giving effect to principles of
conflict of laws.
8.07 Benefits of this Agreement; Limitation of
-----------------------------------------------
Liability. Nothing in this Agreement shall be construed to give
----------
to any Person other than the Company, the Rights Agent and the
Holders any legal or equitable right, remedy or claim under this
Agreement; but this Agreement shall be for the sole and exclusive
benefit of the Company, the Rights Agent and the Holders.
Neither MusicCo nor any Distributed Entity, nor any director,
officer, employee or stockholder, as such, of the Company,
MusicCo or any Distributed Entity shall have any liability
hereunder to the Holders for any obligations of the Company under
this Agreement and the Rights or for any claim based on, in
respect of or by reason of such obligations or their creation.
Each Holder by accepting a Certificate waives and releases such
liability, such waiver and release being part of the
consideration for the issue of the Rights.
8.08 Counterparts. This Agreement may be executed in
------------
any number of counterparts and each of such counterpart shall for
all purposes be deemed to be an original, and all such
counterparts shall together constitute but one and the same
instrument.
8.09 Captions. The captions of the Sections and
--------
subsections of this Agreement have been inserted for convenience
only and shall have no substantive effect.
8.10 Termination. This Agreement shall terminate at
-----------
such time as the outstanding Rights are no longer exercisable
under the terms of this Agreement and the parties to this
Agreement shall have discharged all of their duties hereunder
8.11 Severability. In case any one or more of the
------------
provisions contained in this Agreement or in the Rights shall for
any reason be held to be invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall
not affect any other provisions of this Agreement or of such
Rights, but this Agreement and such Rights shall be construed as
if such invalid or illegal or unenforceable provision had never
been contained herein or therein.
8.12 Calculation of Time Periods. All periods of time
---------------------------
referred to in this Agreement (other than references to Business
Days) shall include all calendar days; 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 day that is not a Business Day,
such act or notice may be timely performed or given if performed
or given on the next succeeding Business Day.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed, all as of the day and year first
above written.
TELE-COMMUNICATIONS, INC.
By:
Name:
Title:
TCI MUSIC, INC.
By:
Name:
Title:
THE BANK OF NEW YORK, as Rights Agent
By:
Name:
Title:
