EXHIBIT 2.7
[Form of]
SHARE PURCHASE AGREEMENT
Share Purchase Agreement (this "Agreement"), dated as of ,
1996, by and between Tele-Communications, Inc., a Delaware corporation ("TCI"),
and TCI Satellite Entertainment, Inc., a Delaware corporation ("TCISE").
RECITALS
A. TCI owns all the issued and outstanding capital stock of TCISE
("TCISE Stock"). TCI intends to distribute (the "Distribution") the TCISE Stock
to the holders of its Tele-Communications, Inc. Series A TCI Group Common Stock
and Tele-Communications Inc. Series B TCI Group Common Stock (together, the "TCI
Group Stock"). As a result of the Distribution, TCISE will cease to be a
subsidiary of TCI, and TCI and TCISE will be separate public companies.
B. In connection with the Distribution, TCI has granted to certain of
its employees and directors options ("TCI Options") to purchase shares of Series
A Common Stock, par value $1.00 per share, of TCISE ("TCISE Series A Stock") and
TCISE has granted to certain of its employees and directors options ("TCISE
Options") to purchase shares of Tele-Communications, Inc. Series A TCI Group
Common Stock, par value $1.00 per share, of TCI ("TCI Series A Stock"). The TCI
Options are sole and separate obligations of TCI and the TCISE Options are
sole and separate obligations of TCISE.
C. As a result of the Distribution, the conversion mechanism for the
TCI Series D Convertible Preferred Stock ("TCI Preferred Stock") will be
adjusted so that, on conversion, holders of TCI Preferred Stock will receive, in
addition to shares of TCI Series A Group Stock, the same number of shares of
TCISE Series A Stock that they would have received had they converted their TCI
Preferred Stock to TCI Group Stock (and Tele-Communications, Inc. Series A
Liberty Media Group Common Stock) prior to the Distribution.
D. As a result of the Distribution, the conversion mechanism for the
Convertible Notes due December 12, 2021 of TCI UA, Inc. ("Convertible Notes")
will be adjusted so that, on conversion, holders of Convertible Notes may be
entitled to receive shares of TCISE Series A Stock in addition to shares of TCI
Series A Stock.
E. This Agreement sets forth the terms and conditions on which,
from time to time, (i) TCI shall have the right to purchase from TCISE and
TCISE shall have the obligation to sell to TCI shares of TCISE Series A Stock in
such amounts as may be required from time to time to satisfy TCI's obligations
following the Distribution under the TCI Options, the TCI Preferred Stock, the
Convertible Notes and any other securities issued by
TCI prior to the Distribution that following the Distribution may be
exchangeable or convertible in whole or in part for TCISE Stock; and (ii) TCISE
shall have the right to purchase from TCI and TCI shall have the obligation to
sell to TCISE shares of TCI Series A Stock in such amounts as required to
satisfy TCISE's obligations under the TCISE Options.
NOW, THEREFORE, in consideration of the mutual covenants contained in
the Agreement and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
Section 1 Call Rights.
Immediately upon notice to TCI or TCISE (a "Purchaser"), as
applicable, by a securityholder of such Purchaser that such securityholder is
exercising (i) a TCI Option or TCISE Option, as applicable, (ii) a conversion
privilege of the TCI Preferred Stock or the Convertible Notes, or (iii) an
exchange or conversion privilege of any other security issued by TCI (an
"Exercise Notice"), the Purchaser shall have the right, exercisable upon written
notice (a "Call Notice") thereof, given at any time within ten business days
after receipt of such Exercise Notice, to require the other party hereto (the
"Issuer") to sell to the Purchaser, at the Purchase Price (as defined below) per
share as of the date of such Call Notice, the number of shares of TCISE Series A
Stock or TCI Series A Stock, as applicable, that are issuable upon such
exercise, as indicated in such Exercise Notice.
Section 2 Call Notices.
(a) Notice. A Call Notice shall state the number of shares to be
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purchased pursuant to Section 1 above, the date upon which the sale of shares of
TCI Series A Stock or TCISE Series A Stock subject thereto shall take place
(which shall be at least three and not more than five business days after the
date of such Call Notice), the name or names of the persons to whom such shares
are to be issued and the Purchase Price per share of such shares. The Purchaser
shall attach to each Call Notice a copy of the Exercise Notice to which such
Call Notice relates.
(b) Purchase Price. The "Purchase Price" of a share of TCI Series A
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Stock or TCISE Series A Stock, as applicable, as of any date, shall be the
average of the daily closing prices for such stock for the most recent period of
ten trading days on which such stock trades immediately preceding such date,
appropriately adjusted to take into account the actual occurrence, during the
period following the first of such ten trading days and ending on such date, of
any stock dividends, splits, reverse splits, combinations and the like. The
closing price for each day shall be the last reported sale price regular way (or
if no such reported sale takes place on such day, the average of the reported
closing bid and asked prices, regular way) on the composite tape, or if the
applicable securities are not quoted on the composite tape, on the principal
United States securities exchange registered under the Securities Exchange Act
of 1934 on which such securities are listed or admitted to trading or, if the
applicable securities are not listed or admitted to trading on any
such exchange, then the closing sale price (or the average of the quoted closing
bid and asked prices if no sale is reported) as reported by NASDAQ or any
comparable system, or if the applicable securities are not quoted on NASDAQ or
any comparable system, the average of the closing bid and asked prices as
furnished by any member of the National Association of Securities Dealers, Inc.
selected by the Purchaser. The Issuer shall have one business day to confirm
the Purchase Price as set forth in the Call Notice. If the Issuer in good faith
disputes the Purchase Price set forth in the Call Notice, such dispute must be
given by written notice to the Purchaser on the first business day following the
date of the Call Notice which notice shall state the amount which the Issuer
believes to be the correct Purchase Price. If the Purchaser and the Issuer have
not agreed on the amount of the Purchase Price by 5:00 p.m. Mountain Time of
the day immediately prior to the date of the sale, the Purchase Price shall be
the average of the amounts noticed by the Purchaser and the Issuer.
(c) Designees. The Purchaser may require the shares to be issued
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pursuant to Section 1 above in either the Purchaser's name or in the name of its
designee. If the Purchaser requests the issuance of the shares to be made in the
name of the Purchaser's designee , such designee shall be the securityholder
named in the Exercise Notice(s) to which the Call Notice relates.
Section 3 Representations and Warranties.
(a) Purchasers. Each Purchaser represents and warrants that it
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shall give a Call Notice and purchase shares under this Agreement only in such
amounts and at such times (w) as required by the exercise of TCI Options or
TCISE Options, as applicable; (x) as required by the conversion of the TCI
Preferred Stock or the Convertible Notes; (y) as required by the exchange or
conversion, in whole or in part, of any other securities issued by TCI; or (z)
as otherwise mutually agreed upon by TCI and TCISE.
(b) Issuers. Each Issuer represents and warrants that:
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(i) all the shares of TCI Series A Stock or TCISE Series A
Stock, as applicable, sold pursuant to this Agreement shall be duly and validly
authorized by the Issuer and, upon the issuance and delivery of such shares
against payment therefor by the Purchaser, such shares will be duly and validly
issued and fully paid and non-assessable; and
(ii) all the shares of TCI Series A Stock or TCISE Series A
Stock, as applicable, sold pursuant to this Agreement are, or at the time of
issuance will be, registered under the Securities Act of 1933, as amended (the
"Securities Act"), or are, or at the time of issuance will be, exempt from such
registration pursuant to Rule 144 of the General Rules and Regulations of the
Securities and Exchange Commission under the Securities Act.
Section 4 Miscellaneous.
(a) Successors and Assigns. This Agreement and the rights,
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interests or obligations hereunder shall not be assigned by any of the parties
hereto (whether by operation of law or otherwise) without the prior written
consent of the other party. Any assignment or delegation in contravention of
this Agreement shall be void and shall not relieve the assigning or delegating
party of any obligation hereunder. Subject to the foregoing provisions of this
Section 4(a), this Agreement shall inure to the benefit of and be binding upon
the parties hereto and their respective successors and permitted assigns.
(b) Counterparts. This Agreement may be executed in counterparts,
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each of which shall be deemed an original and all of which together shall
constitute one and the same instrument.
(c) Notices. All notices and other communications required or
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permitted to be given by any provision of this Agreement shall be in writing and
sent, for same day delivery, by hand or by facsimile transmission (with
acknowledgment received), charges prepaid and addressed to the intended
recipient as follows, or to such other address or number as may be specified
from time to time by like notice to the parties:
(i) If to TCI:
Tele-Communications, Inc.
0000 XXX Xxxxxxx
Xxxxxxxxx, XX 00000-0000
Facsimile: (000) 000-0000
Attention: General Counsel
(ii) If to TCISE:
TCI Satellite Entertainment, Inc.
0000 Xxxxx Xxxxxxx #000
Xxxxxxxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Corporate Counsel
(d) Headings. The section headings used in this Agreement are for
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reference purposes only and shall not affect the meaning or interpretation of
any term or provision of this Agreement.
(e) Entire Agreement; No Third-Party Beneficiaries. This Agreement
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(i) constitutes the entire agreement, and supersedes all prior agreements and
understandings, both written and oral, between TCI and TCISE with respect to the
subject matter of this Agreement, and (ii) is not intended to confer any rights
or remedies upon any person other than the parties hereto and their successors
and permitted assigns.
Dated: , 1996
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TELE-COMMUNICATIONS, INC.
By:
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Name:
Title:
TCI SATELLITE ENTERTAINMENT, INC.
By:
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Name:
Title:
