PURCHASE AGREEMENT
dated as of October 23, 2000
among
SELLERS
listed on Exhibit A hereto,
LIBERTY LIVEWIRE CORPORATION
and
GWNS ACQUISITION SUB, INC.
for
GROUP W NETWORK SERVICES
PAGE
ARTICLE I DEFINITIONS........................................................ 1
1.01 Certain Defined Terms..................................... 1
1.02 Other Defined Terms....................................... 9
1.03 Terms Generally........................................... 11
ARTICLE II PURCHASE AND SALE.................................................. 11
2.01 Purchase and Sale of the Acquired Assets.................. 11
2.02 Purchase Price............................................ 12
2.03 Excluded Assets........................................... 12
2.04 Non-Transferable Contracts and Permits.................... 13
2.05 Assumption of Assumed Liabilities......................... 14
2.06 Non-Assumed Liabilities................................... 14
2.07 [Intentionally Omitted]................................... 15
2.08 Closing................................................... 15
2.09 Closing Deliveries by Sellers............................. 15
2.10 Closing Deliveries by Purchasers.......................... 16
2.11 Allocation of Consideration............................... 16
2.12 Transfer Taxes............................................ 17
2.13 Purchase Price Adjustment................................. 17
2.14 Other Payments............................................ 20
ARTICLE III REPRESENTATIONS AND WARRANTIES OF VIACOM........................... 21
3.01 Incorporation and Authority of Sellers.................... 21
3.02 No Conflict............................................... 21
3.03 Consents and Approvals.................................... 22
3.04 Financial Information..................................... 22
3.05 Absence of Undisclosed Liabilities........................ 23
3.06 Absence of Certain Changes or Events...................... 23
3.07 Absence of Litigation..................................... 25
3.08 Compliance with Laws...................................... 25
3.09 Licenses and Permits...................................... 25
3.10 Acquired Assets........................................... 26
3.11 Real Property............................................. 27
3.12 Employee Matters.......................................... 28
3.13 Taxes..................................................... 29
3.14 Contracts................................................. 30
3.15 Intellectual Property..................................... 32
3.16 Brokers................................................... 33
3.17 Environmental Compliance.................................. 33
3.18 CBS Transmission Services Agreement....................... 33
3.19 EXCLUSIVITY OF REPRESENTATIONS............................ 33
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PAGE
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF LIVEWIRE......................... 34
4.01 Incorporation and Authority of Purchasers................. 34
4.02 No Conflict............................................... 34
4.03 Consents and Approvals.................................... 34
4.04 Absence of Litigation..................................... 35
4.05 Brokers................................................... 35
4.06 Financing................................................. 35
4.07 EXCLUSIVITY OF REPRESENTATIONS............................ 35
ARTICLE V ADDITIONAL AGREEMENTS.............................................. 35
5.01 Conduct of Business Prior to the Closing.................. 35
5.02 Access to Information..................................... 39
5.03 Confidentiality........................................... 40
5.04 Regulatory and Other Authorizations; Consents............. 41
5.05 Microwave Licenses........................................ 41
5.06 Insurance................................................. 41
5.07 Guaranteed Obligations.................................... 42
5.08 Further Action............................................ 42
5.09 [Intentionally Omitted]................................... 42
5.10 Inter-Company Accounts.................................... 42
5.11 Non-Solicitation of Certain Employees..................... 42
5.12 Contribution of Seller Loans and Termination of
Seller Loan Agreements.................................... 42
5.13 Section 338 Election...................................... 43
ARTICLE VI EMPLOYEE AND EMPLOYEE BENEFIT MATTERS.............................. 43
6.01 Scope of Section.......................................... 43
6.02 US Employees.............................................. 43
6.03 CBS Combined Pension Plan................................. 44
6.04 CBS Employee Investment Fund.............................. 44
6.05 Retiree Health and Life Insurance Benefits................ 44
6.06 Employee Welfare Plans.................................... 45
6.07 Vacation.................................................. 45
6.08 WARN Act Liability........................................ 46
6.09 IRS Form W-2.............................................. 46
6.10 International Employment Matters.......................... 46
ARTICLE VII CONDITIONS TO CLOSING.............................................. 46
7.01 Conditions to Obligations of Sellers...................... 46
7.02 Conditions to Obligations of Purchasers................... 47
ARTICLE VIII TERMINATION, AMENDMENT AND WAIVER.................................. 49
8.01 Termination............................................... 49
8.02 Termination is Non-Exclusive Remedy....................... 50
8.03 Waiver.................................................... 50
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PAGE
ARTICLE IX INDEMNIFICATION.................................................... 50
9.01 Indemnification by Purchasers............................. 50
9.02 Indemnification by Viacom................................. 51
9.03 Notification of Claims.................................... 52
9.04 Certain Exclusive Remedies................................ 53
9.05 Limitation on Liabilities................................. 53
ARTICLE X GENERAL PROVISIONS................................................. 54
10.01 Survival.................................................. 54
10.02 Expenses.................................................. 54
10.03 Notices................................................... 54
10.04 Public Announcements...................................... 55
10.05 Bulk Sales Law............................................ 55
10.06 Headings.................................................. 55
10.07 Severability.............................................. 55
10.08 Entire Agreement.......................................... 55
10.09 Successors and Assigns.................................... 56
10.10 No Recourse............................................... 56
10.11 No Third-Party Beneficiaries.............................. 56
10.12 Amendment................................................. 56
10.13 Disclosure Schedule....................................... 56
10.14 Governing Law; Jurisdiction; Waivers...................... 56
10.15 Counterparts.............................................. 57
10.16 No Presumption............................................ 57
10.17 Use of Sellers' Names and Logos by Purchasers............. 58
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Schedule 1.01 - Disclosure Schedule
Exhibit A - List of Sellers
Exhibit B - (Forms of) Ancillary Leases
Exhibit C - (Form of) CBS Transmission Services Agreement
Exhibit D - (Forms of) Technical Services Agreements
Exhibit E - (Form of) TM:RT License Agreement
Exhibit F - (Form of) Trademark License
Exhibit G - (Form of) Transitional Services Agreement
Exhibit H - Target Working Capital Calculation
Exhibit I - Certain Employees
iv
PURCHASE AGREEMENT, dated as of October 23, 2000, among VIACOM INC., a
Delaware corporation ("VIACOM"), the other selling parties set forth on Exhibit
A hereto (together with Viacom, "SELLERS"), Liberty Livewire Corporation, a
Delaware corporation ("LIVEWIRE"), and GWNS Acquisition Sub, Inc., a Delaware
corporation ("LIVEWIRE SUB" and, together with Livewire, "PURCHASERS").
W I T N E S S E T H:
WHEREAS Sellers collectively own the business unit known as "Group W
Network Services";
WHEREAS WEAPH owns 100% of the outstanding ordinary shares of ABC and
GWYB, as well as certain Seller Loans (each as hereinafter defined);
WHEREAS Sellers desire to sell, convey, transfer and assign to the
applicable Purchaser all of their respective rights, title and interests in, to
and under the Acquired Assets and all of their respective liabilities and
obligations under the Assumed Liabilities (each as hereinafter defined), and
Purchasers desire to purchase the Acquired Assets and assume the Assumed
Liabilities upon the terms and subject to the conditions set forth herein; and
WHEREAS, in connection with the transactions contemplated by this
Agreement, the parties and certain of their Affiliates (as hereinafter defined)
desire to enter into the Ancillary Agreements (as hereinafter defined) which
govern the continuing relations between such entities.
NOW, THEREFORE, Purchasers and Sellers hereby agree as follows:
ARTICLE I
DEFINITIONS
1.01 CERTAIN DEFINED TERMS. As used in this Agreement, the
following terms shall have the following meanings:
"ABC" means Asia Broadcast Centre Pte. Ltd., a company incorporated
under the laws of the Republic of Singapore.
"ACCOUNTING FIRM" means (a) an independent certified public accounting
firm in the United States of national recognition (other than a firm which then
serves as the independent auditor for Sellers, Purchasers or any of their
respective Affiliates) mutually acceptable to Viacom and Livewire or (b) if
Viacom and Livewire are unable to agree upon such a firm, then the regular
independent auditors for Viacom and Livewire shall mutually agree upon a third
independent certified public accounting firm, in which event, "Accounting Firm"
shall mean such third firm.
"ACQUIRED ASSETS" means, except as specifically excluded under the
Excluded Assets:
2
(a) all of Sellers' rights, title and interests in, to and under
the assets, properties and rights of every type and description, real, personal
and mixed, tangible and intangible, that are owned, used or held for use
exclusively in the conduct of the Business as conducted on the date hereof,
including the following:
(i) the goodwill relating exclusively to the Business;
(ii) all rights, title and interests of Sellers in real
property listed in Section 3.11 of the Disclosure
Schedule other than the Harbor Leases, together with
all fixtures, fittings, buildings, structures and
other improvements erected thereon, and easements,
rights of way, water lines, rights of use, licenses,
hereditaments, tenements, privileges and other
appurtenances thereto (such as appurtenant rights in
and to public streets) ("REAL PROPERTY");
(iii) all tangible assets and properties of Sellers owned,
used or held for use exclusively in connection with
the Business, including cars and other vehicles,
machinery, equipment, furniture, fixtures,
furnishings, office equipment, tools and parts,
except as set forth on Section 1.01(a) to the
Disclosure Schedule;
(iv) all of Sellers' Copyrights, Trademarks, patents,
tradenames, mask works, service names, technology,
know-how, processes, designs, formulae, technical
data, trade secrets, inventions, proprietary data,
research and development data, computer software
programs and other intangible property and any
registrations or applications for the same, and all
rights in connection with the foregoing and all
goodwill, if any, associated therewith, in each case
owned, licensed, used or held for use exclusively in
connection with the Business;
(v) all sales and promotional literature and other
sales-related materials of Sellers exclusively
attributable to the Business;
(vi) all rights and interests of Sellers under all
contracts, agreements, leases, licenses, sublicenses,
commitments, sales and purchase orders and other
instruments, written and oral, attributable
exclusively to the Business or the Acquired Assets
("CONTRACTS");
(vii) the WEAPH Shares; and
(viii) all rights and interests of Sellers under all
municipal, state and federal franchises, approvals,
permits, licenses, agreements, waivers and
authorizations obtained from any Governmental
Authority and relating exclusively to the conduct of
the Business or the Acquired Assets (the "PERMITS");
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(b) except as set forth in Section 1.01(b) of the Disclosure
Schedule, all other tangible assets and properties of Sellers owned, used or
held for use in the Business at the Minneapolis Location, at either of the
Stamford Locations, or at the Glenbrook Location;
(c) all of Sellers' rights, title and interests in, to and under
the Harbor Leases;
(d) all accounts receivable and notes receivable of Sellers
attributable to the Business (the "ACCOUNTS RECEIVABLE");
(e) all prepaid expenses, deferred charges, advance payments,
security deposits owned, used or held for use by Sellers in connection with the
Business, to the extent that such items relate to the Business or the Acquired
Assets;
(f) all books of account, general, financial, tax (other than
Income Tax) and personnel records (to the extent permitted by law), invoices,
supplier lists, correspondence and other documents, records, ledgers and files
created or maintained by Sellers and any rights thereto, in each case for all
periods commencing on or after January 1, 1998, to the extent that such books,
records and other materials relate to the Business or the Acquired Assets,
including without limitation all such books, records and other materials to the
extent available in machine-readable form;
(g) all of Sellers' rights or choses in action, suits,
proceedings, arbitrations, inquiries or investigations by or before any
Governmental Authority, relating to the Business or the Acquired Assets, but
only to the extent that such actions relate to an Assumed Liability ("ACTIONS");
(h) all of Sellers' claims, demands, assessments and rights of
recovery and set-off (including rights to insurance and condemnation proceeds
and rights under and pursuant to all warranties, representations and guarantees
made by suppliers of products, materials or equipment), in each case, to the
extent that they relate to any Assumed Liability ("CLAIMS"); and
(i) all of Sellers' customer lists to the extent that they relate
to customers of the Business as customers of the Business.
For avoidance of doubt the enumeration of assets in the foregoing
clauses (b) - (i) of the definition of Acquired Assets is not intended to limit
the provisions of clause (a) of the definition of Acquired Assets.
"AFFILIATE" means, with respect to any specified Person, any other
Person who or which, directly or indirectly through one or more intermediaries,
Controls, is Controlled by or is under common Control with such specified
Person; PROVIDED, HOWEVER, that for purposes of this definition, Affiliates of
Viacom shall be limited to direct and indirect Subsidiaries of Viacom.
"AGREEMENT" means this Agreement, including the Disclosure Schedule,
all exhibits and schedules hereto, all documents, certificates and instruments
delivered pursuant hereto and all amendments hereto made in accordance with
Section 10.12.
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"ANCILLARY AGREEMENTS" means the TM:RT License Agreement, the
Transitional Services Agreement, the Trademark License, the Technical Services
Agreements, and the Ancillary Leases.
"ANCILLARY LEASES" means those leases and other agreements to be
entered into by Livewire and Viacom and certain of its Affiliates as of the
Closing Date, substantially in the forms attached hereto as Exhibit B.
"BUSINESS" means the Group W Network Services business unit of Viacom
as conducted on the date hereof, considered as a single enterprise. For purposes
of this Agreement, the term "Business" shall be comprised exclusively of the
operations of Group W Network Services by all U.S.-based Sellers.
"BUSINESS DAY" means any day that is not a Saturday, a Sunday or other
day on which banks are required or authorized by Law to be closed in the City of
New York.
"CBS TRANSMISSION SERVICES AGREEMENT" means the amended and restated
transmission services agreement to be entered into by CBS Broadcasting, Inc.,
Group W Network Services, a business unit of Viacom, Livewire and Livewire Sub
as of the Closing Date, in substantially the form attached hereto as Exhibit C.
"CODE" means the Internal Revenue Code of 1986, as amended.
"CONTROL" means, as to any Person, the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise. The term "Controlled"
shall have a correlative meaning.
"COPYRIGHTS" means all copyrights owned by any Seller, and used or held
for use, in each case, exclusively in connection with the Business, including
those items described on Section 3.15 of the Disclosure Schedule, and all
goodwill, if any, appurtenant thereto.
"DISCLOSURE SCHEDULE" means the Disclosure Schedule attached as
Schedule 1.01 hereto.
"ENVIRONMENTAL LAWS" means any applicable federal, state, local or
foreign law, rule or regulation, in effect on the date of this Agreement,
relating to the environment, natural resources, or public health and safety.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"GAAP" means United States generally accepted accounting principles,
consistently applied.
"GLENBROOK LEASE" means the lease dated April 23, 1982, entered into by
Westinghouse Broadcasting Company, Inc., as tenant, and Glenbrook Industrial
Park Associates,
5
as landlord, as amended, relating to certain property located at 000
Xxxxxxxxx Xxxx, Xxxxxxxx, XX, which property is occupied and used in the
conduct of the Business.
"GLENBROOK LOCATION" means the premises leased under the Glenbrook
Lease.
"GOVERNMENTAL AUTHORITY" means any United States federal, state or
local or any Singapore or other foreign government, governmental, regulatory or
administrative authority, agency or commission or any court, tribunal, or
judicial or arbitral body.
"GOVERNMENTAL ORDER" means any written order, writ, judgment,
injunction, decree, stipulation, determination or award entered by or with any
Governmental Authority.
"GWYB" means Group W Yarra Broadcast Pte. Ltd., a company incorporated
under the laws of the Republic of Singapore.
"HARBOR LEASES" means the Harbor Plaza Lease and the Harbor View Lease.
"HARBOR PLAZA LEASE" means (a) the lease, dated as of December 31,
1993, entered into by Westinghouse Electric Corporation, as tenant, and Harbor
Vista Associates Limited Partnership, as landlord, as amended and restated, and
(b) the sublease dated as of March 1, 1996, entered into by International
Business Machines Corporation and Westinghouse Electric Corporation, relating to
certain space located at 000 Xxxxxx Xxxxx, Xxxxxxxx, XX, a portion of which
premises are occupied and used in the conduct of the Business.
"HARBOR VIEW LEASE" means the lease, dated as of September 30, 1996,
entered into by Group W Broadcasting, Inc., as tenant, and Harbor View Limited
Partnership II, as landlord, as amended, relating to certain space located at 00
Xxxxxx Xxxx, Xxxxxxxx, XX, a portion of which premises are occupied and used in
the conduct of the Business.
"HSR ACT" means the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of
1976, as amended, and the rules and regulations thereunder.
"XXX CONSENT" means the consent of the Info-Communications Development
Authority of Singapore (formerly known as the Telecommunications Authority of
Singapore) to the sale of WEAPH Shares and the indirect transfer of control of
the JV Companies contemplated by this Agreement.
"INCOME TAX" means any federal, state, local or foreign tax based upon
or measured by income, net income, income as specially defined or gross
receipts, including any interest, penalty or addition thereto, whether disputed
or not.
"IRS" means the Internal Revenue Service.
"JV COMPANIES" means ABC and GWYB.
6
"JV COMPANIES PURCHASE AGREEMENT" means the purchase agreement, dated
as of September 11, 2000, among Yellow River Networks Pte. Ltd. ("YELLOW
RIVER"), Yarra Broadcast ("YARRA"), Viacom and WEAPH.
"JV SHARES" means 322,500 ordinary shares (100% of the issued and
outstanding shares) of ABC and 202,500 ordinary shares (100% of the issued and
outstanding shares) of GWYB.
"KNOWLEDGE OF VIACOM" or "VIACOM'S KNOWLEDGE" means the actual
knowledge of Xxxxx Xxxxxxx, Xxxxx Xxx, Xxxxx Xxxxx, Xxxx Xxxxxxxxxxx (with
respect to the portions of the Business conducted at the Minneapolis Location
only), Xxxxxxx XxXxxxx, Xxxx Xxxxxxxx and Xx Xxxxx, in each case after
reasonable inquiry.
"LAW" means any federal, state, local or foreign statute, law,
ordinance, regulation, rule, code, order, other requirement or rule of law.
"LIABILITIES" means all liabilities or obligations, whether direct or
indirect, matured or unmatured, absolute or contingent, or otherwise.
"LIEN" means any mortgage, deed or trust, pledge, hypothecation,
security interest or other similar encumbrance.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on (i) the
Business and the businesses of the Singapore Companies, taken as a whole, (ii)
the Acquired Assets and the Singapore Companies, taken as a whole, taken
together with the Assumed Liabilities, or (iii) the results of operations or
financial condition of the Business and the Singapore Companies, considered as a
single enterprise; PROVIDED, HOWEVER, that any material adverse effect relating
generally to the economy or the industry or markets in which the Business or the
Singapore Companies operate shall not constitute a Material Adverse Effect.
"MINNEAPOLIS LOCATION" means the premises at 00 Xxxxx 00xx Xxxxxx in
Minneapolis that are leased to Livewire pursuant to an Ancillary Lease.
"NON-ALLOCABLE LIABILITY" means any liability or obligation of Sellers,
or any of them, arising on or prior to the Effective Time from or in connection
with:
(a) any claim that Viacom, any of its predecessors, or any of
their respective Affiliates, violated --
(i) any United States federal, state or foreign antitrust
law or regulation;
(ii) any United States federal, state or foreign
securities law or regulation;
(iii) any Environmental Law, except to the extent that any
such claim relates to the condition of the
Minneapolis Location, either of the
7
Stamford Locations, the Glenbrook Location or
otherwise arises primarily in connection with the
Acquired Assets or the Business; or
(iv) ERISA. For the avoidance of doubt, all claims and
obligations under, pursuant to or in connection with
any Plan listed on Schedule 3.12(b) incurred on or
prior to the Closing Date will remain the
responsibility of Sellers and their Affiliates, OTHER
THAN claims and obligations (x) reflected on the
Financial Statements or similar types of claims and
obligations incurred in the ordinary course of
business after July 31, 2000 (but excluding deferred
compensation, if any, or any liabilities due to any
violation of ERISA); or (y) expressly assumed by
Purchasers pursuant to Article VI or Section 2.05(b)
hereof;
(b) any securityholder derivative action brought on
behalf of Viacom or any of its predecessors, whether
or not Viacom or any of its Affiliates is named as a
defendant in such action;
(c) any claim that Viacom, any of its predecessors, or
any of their respective Affiliates, discriminated in
hiring, advancement, or other terms or conditions of
employment, or relating to harassment, a hostile
workplace or similar allegations;
(d) any claim that Viacom, any of its predecessors, or
any of their respective Affiliates is liable for acts
or omissions of one or more employees, pursuant to
the doctrine of respondeat superior or a similar
legal or equitable principle, except to the extent
that such acts or omissions relate to the Business
and/or the business of the Singapore Companies; or
(e) any liability or obligation of Sellers or any of them
arising from or in connection with the matters
disclosed in Items 2, 3 and 4 of Section 3.07 of the
Disclosure Schedule.
Notwithstanding anything to the contrary contained herein,
"Non-Allocable Liability" shall not include the matters disclosed in Item 1 of
Section 3.07 of the Disclosure Schedule.
"PERMITTED LIENS" means the following Liens: (a) Liens for
Taxes, assessments or other governmental charges or levies, or the claims of
landlords, carriers, warehousemen, mechanics, materialmen and like persons and
other Liens imposed by Law for amounts not yet due or which are being contested
in good faith; (b) Liens (other than any Lien imposed by ERISA) incurred or
deposits made in connection with worker's compensation, unemployment insurance
or other types of social security; (c) Liens not created by Sellers or any of
their Affiliates which affect only the underlying fee interest of any Real
Property leased by any Seller or the real property underlying the Harbor Leases;
(d) Liens that are reflected in title reports
8
attached hereto as Section 1.01(c) of the Disclosure Schedule relating to any
Real Property owned by any Seller; and (e) other Liens that secure an
aggregate amount of up to $50,000.
"PERSON" means any natural person, general or limited
partnership, corporation, limited liability company, firm, association or other
legal entity.
"SELLER LOANS" means (i) those outstanding loans owed to WEAPH
by each of ABC and GWYB in the initial aggregate principal amount of S$7,839,000
(seven million eight hundred thirty-nine thousand Singapore Dollars) and (ii)
those outstanding loans owed to Yarra Broadcast by each of ABC and GWYB in the
initial aggregate principal amount of S$7,911,000 (seven million nine hundred
eleven thousand Singapore Dollars), in each case, together with all interest
accrued and payable thereon as of the Closing Date, each of which loans was made
pursuant to a Shareholder Loan Agreement (the loans referred to in clause (ii)
have been transferred by Yarra Broadcast to WEAPH).
"SHAREHOLDER LOAN AGREEMENTS" means (i) the loan agreements
between WEAPH and ABC or GWYB and (ii) the loan agreements between Yarra
Broadcast and ABC or GWYB, in each case, set forth in Section 1.01 (c) of the
Disclosure Schedule hereto (the loan agreements referred to in clause (ii) have
been transferred by Yarra Broadcast to WEAPH).
"SINGAPORE COMPANIES" means ABC, GWYB and WEAPH.
"STAMFORD LOCATIONS" means the premises leased under the
Harbor View Lease and the premises on the first, second, third and fourth floors
leased under the Harbor Plaza Lease.
"STAY BONUS" means any bonus or other compensation offered by
Viacom or any of its Affiliates and payable after the Closing to any Person that
was a Business Employee or International Business Employee prior to the Closing
to induce such Person to remain a Business Employee or International Business
Employee through, or for a period following, the Closing.
"SUBSIDIARY" of any Person means any corporation, partnership,
joint venture, limited liability company, trust or estate of which (or in which)
more than 50% of (a) the issued and outstanding capital stock having ordinary
voting power to elect a majority of the board of directors of such corporation
(irrespective of whether at the time capital stock of any other class or classes
of such corporation shall or might have voting power upon the occurrence of any
contingency), (b) the interest in the capital or profits of such partnership,
joint venture or limited liability company, or (c) the beneficial interest in
such trust or estate, is at the time directly or indirectly owned or Controlled
by such Person.
"S$" means Singapore dollars, the currency of the Republic of
Singapore.
"TAX" or "TAXES" means any and all federal, state, local and
foreign income, excise, gross receipts, ad valorem, sales, use, value added,
license, mercantile, employment, franchise, profits, gains, property, transfer,
use and occupancy, payroll, withholding, estimated, capital stock, registration,
severance, intangibles or other taxes, fees, stamp taxes, duties, charges,
levies or assessments of any kind whatsoever, together with any interest and any
9
penalties, additions to tax or additional amounts imposed by any Tax
authority with respect thereto.
"TAX RETURNS" means all returns and reports (including
elections, declarations, disclosures, schedules, estimates and information
returns) required to be filed with any Governmental Authority relating to Taxes.
"TECHNICAL SERVICES AGREEMENTS" means the technical services
agreements to be entered into by Livewire and certain Viacom Affiliates as of
the Closing Date, substantially in the forms attached hereto as Exhibit D.
"TM:RT LICENSE AGREEMENT" means the license agreement relating
to the Traffic Master : Real Time Controller software, to be entered into by
Livewire and CBS Broadcasting, Inc., as of the Closing Date, substantially in
the form attached hereto as Exhibit E.
"TRADEMARK LICENSE" means the trademark license to be entered
into by Livewire and Viacom as of the Closing Date, in substantially the form
attached hereto as Exhibit F.
"TRADEMARKS" means all of those trademarks and service marks,
registrations and applications owned by any Seller and used or held for use
exclusively in connection with the Business, including those items described in
Section 3.15 of the Disclosure Schedule, and all goodwill, if any, appurtenant
thereto.
"TRANSITIONAL SERVICES AGREEMENT" means the transitional
services agreement to be entered into by Livewire and certain Viacom Affiliates
as of the Closing Date, substantially in the form attached hereto as Exhibit G.
"US$" or "$" means United States dollars, the currency of the
United States of America.
"WEAPH" means Westinghouse Electric (Asia-Pacific) Holdings,
Ltd., a company incorporated under the laws of the Republic of Singapore and a
wholly-owned Subsidiary of WEG.
"WEAPH SHARES" means 529,225 ordinary shares, par value S$1.00
per share, of WEAPH (100% of the issued and outstanding capital stock of WEAPH).
"WEG" means Westinghouse Electric G.m.b.H., a company
incorporated under the laws of Switzerland.
"YARRA BROADCAST" means Yarra Broadcast (Singapore) Pte. Ltd.,
a company incorporated under the laws of the Republic of Singapore.
1.02 OTHER DEFINED TERMS. The following terms have the
meanings defined for such terms in the Sections set forth below:
10
TERM SECTION
---- -------
ABC/GWYB Financial Statements 3.04(b)
Accounts Receivable 1.01 (definition of
Acquired Assets)
Actions 1.01 (definition of
Acquired Assets)
Adjusted Purchase Price 2.13(e)
Allocation 2.11
Assumed Liabilities 2.05
Basket Amount 9.02(b)
Business Employees 6.01
CCPP 6.03
Claims 1.01 (definition of
Acquired Assets)
Closing 2.08
Closing Date 2.08
Closing Working Capital 2.13(a)
Confidentiality Agreement 5.03(a)
Consideration 2.11
Contracts 1.01 (definition of
Acquired Assets)
Discovery People Fee 2.14(b)
EIF 6.04
Effective Date 6.02(a)
Effective Time 2.08
Equipment 1.01 (definition of
Acquired Assets)
ERISA 3.12(b)
Excluded Assets 2.03
FCC 3.09
FICA 3.13(c)
Financial Statements 3.04(a)
Former Business Employees 6.01
FUTA 3.13(c)
Indemnification Claim 9.03(a)
Indemnified Party 9.03(a)
Indemnifying Party 9.03(b)
Initial Purchase Price 2.02
International Business Employees 6.10
Livewire Preamble
Livewire Sub Preamble
Losses 9.01(a)
Microwave Licenses 5.05
Non-Transferable Contracts and Permits 2.04
Non-Assumed Liabilities 2.06
11
TERM SECTION
---- -------
Notice of Disagreement 2.13(c)
PBGC 3.12(f)
Permits 1.01 (definition of
Acquired Assets)
Plans 3.12(b)
Purchasers Preamble
Purchaser Indemnified Parties 9.02(a)
Purchaser's Savings Plan 6.04
Rate 2.13(e)
Real Property 1.01 (definition of
Acquired Assets)
Reference Financial Statements 3.04(a)
Sellers Preamble
Sellers' Names 10.17
Sellers' Retiree Plan 6.05
Singapore Contracts 3.14
Statement of Working Capital 2.13(a)
Target Working Capital 2.13(f)
Total Current Assets 2.13(f)
Total Current Liabilities 2.13(f)
Transfer Taxes 2.12
Viacom Preamble
Viacom's Account 2.02
Viacom Indemnified Parties 9.01(a)
Working Capital 2.13(f)
Year-End Financial Statements 3.04(a)
1.03 TERMS GENERALLY. (a) Words in the singular shall be
held to include the plural and vice versa and words of one gender shall be held
to include the other gender as the context requires, (b) the terms "hereof,"
"herein," and "herewith" and words of similar import shall, unless otherwise
stated, be construed to refer to this Agreement as a whole (including all of the
Schedules and Exhibits hereto) and not to any particular provision of this
Agreement, and Article, Section, paragraph, Exhibit and Schedule references are
to the Articles, Sections, paragraphs, Exhibits and Schedules to this Agreement
unless otherwise specified, (c) the word "including" and words of similar import
when used in this Agreement means "including, without limitation," unless
otherwise specified, and (d) the word "or" shall not be exclusive.
ARTICLE II
PURCHASE AND SALE
2.01 PURCHASE AND SALE OF THE ACQUIRED ASSETS. On the
terms and subject to the conditions set forth in this Agreement, at the Closing,
each applicable Seller shall (i) sell, convey, assign, transfer and deliver to
Livewire Sub, and Livewire Sub shall purchase, acquire and accept from such
applicable Seller, all of such applicable Seller's rights, title and interests
in, to and under the Acquired Assets (other than WEG's rights, title and
interest in and to the WEAPH
12
Shares) and (ii) sell, convey, assign, transfer and deliver to Livewire, and
Livewire shall purchase, acquire and accept from WEG, all of WEG's rights,
title and interests in and to the WEAPH Shares.
2.02 PURCHASE PRICE. Subject to the terms and conditions
of this Agreement, the aggregate purchase price to be paid by Livewire for the
purchase by Livewire and Livewire Sub of the Acquired Assets shall be (a) the
Adjusted Purchase Price (as defined below), and (b) the assumption of the
Assumed Liabilities. Subject to the terms and conditions of this Agreement, at
the Closing, Livewire shall pay to Viacom an initial cash payment in the amount
of US$ Ninety Five Million Three Hundred Fifty Thousand (US$95,350,000) (the
"INITIAL PURCHASE PRICE") and Livewire shall cause Livewire Sub to and Livewire
Sub shall assume the Assumed Liabilities. The Initial Purchase Price shall be
paid by Livewire by wire transfer of immediately available funds, to the account
designated by Viacom in writing at least two Business Days prior to the Closing
("VIACOM'S ACCOUNT").
2.03 EXCLUDED ASSETS. The following assets ("EXCLUDED
ASSETS") are not included in the Acquired Assets, and Sellers shall not sell to
Purchasers, and Purchasers shall not acquire from Sellers:
(a) all cash, cash equivalents, marketable securities,
cash equivalents in transit, in hand or in bank accounts held or maintained by
or for Sellers (including, for the avoidance of doubt, any cash received by any
Seller prior to Closing that is paid pursuant to any settlement of the matter
referred to in Item 1 of Section 3.07 of the Disclosure Schedule);
(b) all rights and assets that are used or exercised by
Sellers or any other Viacom Affiliate in the provision of services to any
Purchaser pursuant to the Transitional Services Agreement;
(c) any and all rights in, to and under the TM:RT
software and derivative works thereof (and the know-how related thereto) and the
TM:RT License Agreement, except as set forth in the TM:RT License Agreement;
(d) except as may be provided for in Article VI, all
assets attributable or relating to the Plans of the Business, and all personnel
books and records relating to any employee benefits or Plans maintained by and
relating to Viacom or any of its Affiliates;
(e) duplicate copies of all books and records transferred
to any Purchaser;
(f) corporate minute books or stock records relating to
Viacom or any of its Affiliates;
(g) any communications or records that are protected from
disclosure under an attorney-client privilege of Viacom or any of its Affiliates
as listed on a schedule to be provided by Viacom to any Purchaser at the
Closing;
(h) all rights in, to and under the names and marks
incorporating "Group W", "Viacom", "Westinghouse" and "CBS", including but not
limited to the related word marks and
13
any logos (including but not limited to the Westinghouse "W" logo) used in
connection therewith, subject to Section 10.17;
(i) all documents and analyses prepared by Viacom or any
of its Affiliates for internal evaluation purposes in connection with the sale
of the Business;
(j) subject to the provisions of Section 2.04 below, all
rights under Non-Transferable Contracts and Permits (as defined below);
(k) all rights of Viacom and its Affiliates in or under
any action, arbitration, hearing, litigation or suit (whether civil, criminal,
administrative, investigative or informal) related to Excluded Assets or
Non-Assumed Liabilities;
(l) all Claims of Viacom or any of its Affiliates (other
than any of the Singapore Companies) in respect of Income Taxes, any net
operating loss carryforwards of Viacom or its Affiliates and all Tax Returns of
the Business for periods ending on or prior to the Closing Date;
(m) all accounts owing by, and all Contracts between and
among, Viacom and any of its Affiliates;
(n) all contracts of insurance entered into by Viacom or
any of its Affiliates with respect to the Business or the Acquired Assets, and
all claims for reimbursement, pre-paid premiums, payments and rights thereunder
and proceeds therefrom, relating to any occurrence (in the case of an
occurrence-based policy) or claim (in the case of any claims made-based policy)
arising after the Closing Date (or arising on or before the Closing Date, to the
extent that Viacom shall effectively indemnify Livewire from and against any
losses, costs, damages, claims, liabilities and expenses arising or resulting
from or in connection with any such claim or occurrence);
(o) all Acquired Assets disposed of by Sellers after the
date of this Agreement to the extent such dispositions are not prohibited by the
terms of this Agreement;
(p) the rights of Sellers under this Agreement and the
Ancillary Agreements and the transactions contemplated hereby and thereby; and
(q) all other assets owned, leased, licensed, used or
held for use by Sellers or any of their Affiliates (other than the Singapore
Companies) to the extent that such assets relate to the businesses and
operations of Sellers and their Affiliates other than the Business and the
Acquired Assets.
2.04 NON-TRANSFERABLE CONTRACTS AND PERMITS. No statement
in this Agreement, nor the consummation of the transactions contemplated hereby
shall constitute an agreement to assign or an assignment of any Contract or
Permit or any claim or right or any benefit arising thereunder or resulting
therefrom if an attempted assignment thereof, without the consent of a third
party thereto or any Governmental Authority, is not allowed, would constitute a
breach thereof or would adversely affect any of the respective rights or
obligations of any Seller
14
("NON-TRANSFERABLE CONTRACTS AND PERMITS"). If any consent is not obtained,
or if an attempted assignment thereof would be ineffective or would adversely
affect any of the respective rights or obligations of any Seller, Sellers and
Purchasers shall use their respective commercially reasonable efforts to
achieve a mutually agreeable arrangement under which Livewire Sub shall
obtain the benefits and assume the obligations thereunder as of the Closing
Date, including subcontracting, sublicensing or subleasing to Livewire Sub,
and/or, as applicable, under which Sellers shall enforce for the benefit of
Livewire Sub all of their respective rights against any third parties or
Governmental Authorities with respect thereto, with Livewire Sub assuming
Sellers' respective obligations and liabilities thereunder, with
substantially the same effect (including substantially the same economic
effect) as if such Contract or Permit had been assigned to Livewire Sub under
this Agreement at the Closing. In consultation with Purchasers, Sellers shall
use their commercially reasonable efforts to obtain as soon as practicable
the consent or approval of any such third party or Governmental Authority to
the assignment of such Contract or Permit and to transfer such Contract or
Permit to Livewire Sub; and any transfer or assignment to Livewire Sub of any
Contract or Permit that shall require the consent or approval of any third
party or Governmental Authority shall be made subject to such consent or
approval being obtained and any terms or conditions contained in such consent
or approval. Nothing herein shall be understood (i) to state or imply that
any Purchaser or any Seller shall be obligated to make any payment in order
to obtain the consent of any such third party or Governmental Authority or
(ii) to limit the Closing conditions set forth in Sections 7.01(f) and
7.02(f).
2.05 ASSUMPTION OF ASSUMED LIABILITIES. Subject to the
terms and conditions of this Agreement, at the Closing, Livewire Sub shall
assume, and agree to pay, perform and discharge when due the following
obligations and liabilities of Sellers ("ASSUMED LIABILITIES"):
(a) all obligations and liabilities of Sellers under the
Contracts and Permits in accordance with the terms thereof, except those
Contracts and Permits included in the Excluded Assets;
(b) (i) in regard to Business Employees and Former
Business Employees who are not International
Business Employees, all liabilities and
obligations assumed by any Purchaser
pursuant to Article VI hereof, and
(ii) all liabilities and obligations of Sellers
that relate to International Business
Employees; and
(c) except as otherwise provided in the second sentence
of Section 2.06, all other liabilities and obligations to the extent relating to
the Business, whether incurred prior to or after the Closing Date, including (x)
any accrued but unpaid Taxes other than Income Taxes and (y) all liabilities and
obligations relating to the matters disclosed in Section 3.07 of the Disclosure
Schedule (other than Items 2, 3 and 4 of Section 3.07 of the Disclosure
Schedule).
2.06 NON-ASSUMED LIABILITIES. Anything in this Agreement
to the contrary notwithstanding, neither Purchaser shall assume or be bound by
or be obligated or responsible for any obligations or liabilities of any kind or
nature relating to the Business, other than the
15
Assumed Liabilities (the "NON-ASSUMED LIABILITIES"). Without limiting the
foregoing, and notwithstanding anything to the contrary contained herein, all
of the following shall be considered Non-Assumed Liabilities for the purposes
of this Agreement: (a) any liability or obligation with respect to Income
Taxes with respect to the Business or otherwise incurred or owed by Sellers;
(b) any liability of the Sellers for the unpaid Taxes of any other Person
(other than any Taxes of the Sellers required to be assumed by Purchasers
pursuant to Section 2.05 of this Agreement) under Treasury Regulation Section
1.1502-6 (or any similar provision of state, local, or foreign law), as a
transferee or successor, by contract, or otherwise; (c) any liability of the
Sellers for Income Taxes arising in connection with the consummation of the
transactions contemplated hereby; (d) any liability or obligation relating
to, arising from or in connection with, any matter disclosed in Items 2, 3 or
4 of Section 3.07 of the Disclosure Schedule; (e) any Non-Allocable
Liability; (f) any liability or obligation relating to, or arising from or in
connection with, any Stay Bonus; and (g) any liability or obligation in
respect of the Excluded Assets.
2.07 [Intentionally Omitted]
2.08 CLOSING. Subject to the terms and conditions of this
Agreement, the sale and purchase of the Acquired Assets, and the assumption of
the Assumed Liabilities, contemplated hereby shall take place at a closing (the
"CLOSING") to be held at 10:00 a.m. (New York City time) on the second Business
Day following the later to occur of (i) the expiration or termination of the
applicable waiting periods relating to the transactions contemplated hereby
under the HSR Act, (ii) the receipt of the XXX Consent, and (iii) the
satisfaction or waiver of the other conditions to the obligations of the parties
set forth in Article VII (other than those conditions which require the delivery
of documents or taking of other actions, at the Closing) at the offices of
Viacom, 1515 Broadway, New York, New York, or at such other time or on such
other date or at such other place as Viacom and Livewire may mutually agree upon
in writing (the day on which the Closing takes place being the "CLOSING DATE").
The sale of the Acquired Assets and the assumption of the Assumed Liabilities
pursuant to the terms and conditions of this Agreement shall be deemed to become
effective as of 12:01 a.m., Eastern Standard Time, on the Closing Date (the
"EFFECTIVE TIME").
2.09 CLOSING DELIVERIES BY SELLERS. At the Closing,
Sellers shall deliver to Livewire:
(a) the certificates and other documents required to be
delivered pursuant to Section 7.02(a);
(b) bills of sale, special warranty deeds, consents and
instruments of assignment, in form reasonably satisfactory to Viacom and
Livewire, to evidence the transfer to Livewire Sub of the Acquired Assets in
accordance herewith;
(c) except for all Business Employees and International
Business Employees who will be continuing their employment with the Business
after the Closing, or as Livewire shall otherwise agree, the written
resignations of all directors of WEAPH, ABC and GWYB;
16
(d) the Ancillary Agreements, duly executed by
applicable Sellers;
(e) a receipt for payment by Purchasers of the Initial
Purchase Price;
(f) certificates representing the WEAPH Shares;
(g) certificates representing the JV Shares;
(h) any payments due to Livewire pursuant to Section
2.14(b); and
(i) the CBS Transmission Services Agreement duly
executed by CBS Broadcasting, Inc.
2.10 CLOSING DELIVERIES BY PURCHASERS. At the Closing,
Purchasers shall deliver to Viacom:
(a) a wire transfer of immediately available funds to
Viacom's Account in an amount equal to the Initial Purchase Price;
(b) the certificates and other documents required to
be delivered pursuant to Section 7.01(a);
(c) assumption agreements, each in form reasonably
satisfactory to Viacom and Livewire, to evidence, among other things, the
assumption by Livewire Sub of the Assumed Liabilities;
(d) the Ancillary Agreements, duly executed by the
applicable Purchaser;
(e) any payments due to Viacom pursuant to Section
2.14(a); and
(f) the CBS Transmission Services Agreement duly
executed by Livewire, Livewire Sub and Group W Network Services.
All deliveries under Sections 2.09 and 2.10 shall occur simultaneously.
2.11 ALLOCATION OF CONSIDERATION. Viacom and Livewire
shall endeavor to agree as soon as practicable but in any event no later than
30 days after the Statement of Working Capital has been agreed by the
parties, on an allocation of the Adjusted Purchase Price and the Assumed
Liabilities (together, the "CONSIDERATION") among the Acquired Assets and the
Ancillary Agreements, in the manner required by Section 1060 of the Code and
the Treasury regulations thereunder (the "ALLOCATION"). Viacom and each
Purchaser agree that the Consideration allocated to the WEAPH Shares shall
not exceed the aggregate of US$25 million plus the amount of indebtedness of
the Singapore Companies assumed or retired by any Purchaser at Closing but
shall not be less than US$20 million and that the Consideration shall be
allocated among the Acquired Assets, the Assumed Liabilities and the
Ancillary Agreements consistent with the agreed-upon Allocation and Viacom
and each other applicable Seller and each Purchaser further agree to file all
Tax Returns and related forms (including without
17
limitation Form 8594) in accordance with the Allocation and shall not make
any inconsistent written statement or take any inconsistent position on any
Tax Return, in any refund claim, or during the course of any Internal Revenue
Service or other Tax audit. Each party shall notify the other party if it
receives notice that the Internal Revenue Service proposes any adjustment to
the Allocation. Notwithstanding the foregoing provisions of this Section
2.11, if Viacom and Livewire are unable to agree on an allocation of the
Consideration within 30 days after the Statement of Working Capital has been
agreed by the parties, each shall be permitted to allocate the Consideration
among the Acquired Assets, the Assumed Liabilities and the Ancillary
Agreements, and to take any related actions and positions, as it deems
appropriate; PROVIDED, HOWEVER, that (i) such purchase price allocations
shall be in accordance with Section 1060 of the Code and the applicable
Treasury regulations (and any comparable provisions of foreign Tax law) and
(ii) Viacom and its Affiliates or Livewire and its Affiliates (as the case
may be) shall be bound by, and shall not take any Tax reporting positions
inconsistent with, their respective allocations.
2.12 TRANSFER TAXES. Each of Viacom and Livewire shall be
responsible for and shall pay one-half of all sales, use, transfer, recording,
stamp, and other similar taxes and fees ("TRANSFER TAXES"), arising out of or in
connection with the transactions effected pursuant to this Agreement.
Notwithstanding the foregoing, Livewire shall have no liability for Income Taxes
of Sellers arising out of or in connection with the transactions effected
pursuant to this Agreement. The party which has primary responsibility under
applicable law for the payment of any particular Transfer Tax shall prepare and
file the relevant Tax Return and notify the other party in writing of the
Transfer Taxes shown on such Tax Return. Such other party shall pay to the party
with such primary responsibility an amount equal to one-half of such Transfer
Taxes in immediately available funds within five days of receipt of such notice
and the party with such primary responsibility shall promptly remit the Transfer
Taxes to the proper Tax authority.
2.13 PURCHASE PRICE ADJUSTMENT.
(a) As promptly as practicable, but in no event later
than 90 days after the Closing Date, Viacom shall at its expense prepare and
deliver to Livewire a statement (the "STATEMENT OF WORKING CAPITAL") setting
forth Working Capital (as defined below) as of the Effective Time ("CLOSING
WORKING CAPITAL") prepared in compliance with the requirements of this Section
2.13.
(b) Livewire shall cause the Business to provide
reasonable assistance to Viacom in the preparation of the Statement of Working
Capital and shall provide Viacom reasonable access during normal business hours
to the personnel, properties, books and records of the Business for such
purpose. Livewire acknowledges that Viacom shall have the primary responsibility
and authority for preparing the Statement of Working Capital.
(c) During the 30-day period following Livewire's receipt
of the Statement of Working Capital, Livewire and its representatives shall be
permitted to review and make copies reasonably required of (i) the working
papers of Viacom relating to the Statement of Working Capital and (ii) any
supporting schedules relating to the Statement of Working Capital. The Statement
of Working Capital shall become final and binding upon the parties on the
thirtieth
18
(30th) day following delivery thereof, unless Livewire gives written
notice of its disagreement with the Statement of Working Capital (a "NOTICE OF
DISAGREEMENT") to Viacom prior to such date. Any Notice of Disagreement shall
(A) specify in reasonable detail the nature of any disagreement so asserted, (B)
only include disagreements based on mathematical errors or based on Closing
Working Capital not being calculated in accordance with this Section 2.13, and
(C) be accompanied by a signed certificate by Livewire that it has complied with
the covenants set forth in Section 2.13(g). If a Notice of Disagreement
complying with the preceding sentence is received by Viacom in a timely manner,
then the Statement of Working Capital (as revised in accordance with clause (I)
or (II) below) shall become final and binding upon the parties on the earlier of
(I) the date Viacom and Livewire resolve in writing any differences they have
with respect to the matters specified in the Notice of Disagreement or (II) the
date any disputed matters are finally resolved in writing by an Accounting Firm.
(d) During the 30-day period following the delivery of
any Notice of Disagreement that complies with the preceding paragraph, Viacom
and Livewire shall seek in good faith to resolve in writing any differences that
they may have with respect to the matters specified in the Notice of
Disagreement. During such period, Livewire shall cause the Business to afford
Viacom reasonable access during normal business hours to the personnel,
properties, books, records, schedules and working papers of the Business and
Viacom shall be permitted to review and make copies reasonably required of the
working papers and business records of Livewire relating to the preparation of
the Notice of Disagreement. If, at the end of such 30-day period, Viacom and
Livewire have not resolved such differences, Viacom and Livewire shall submit to
an Accounting Firm for review and resolution any and all matters which remain in
dispute and which were properly included in the Notice of Disagreement. Viacom
and Livewire shall use reasonable efforts to cause the Accounting Firm to render
a decision resolving the matters in dispute within 30 days following the
submission of such matters to the Accounting Firm. Viacom and Livewire agree
that judgment may be entered upon the determination of the Accounting Firm in a
New York court sitting in the City of New York. The cost of any arbitration
(including the fees and expenses of the Accounting Firm but excluding the fees
and expenses of any attorneys) pursuant to this Section 2.13 shall be borne by
Viacom and Livewire in inverse proportion as they may prevail on matters
resolved by the Accounting Firm, which proportionate allocations shall also be
determined by the Accounting Firm at the time the determination of the
Accounting Firm is rendered on the merits of the matters submitted.
(e) The Initial Purchase Price shall be increased by the
amount by which Closing Working Capital exceeds the Target Working Capital (as
defined below), and the Initial Purchase Price shall be decreased by the amount
by which the Target Working Capital exceeds the Closing Working Capital (the
Initial Purchase Price, after giving effect to such increase or decrease shall
be referred to as the "ADJUSTED PURCHASE PRICE"). If the Adjusted Purchase Price
exceeds the Initial Purchase Price, Livewire shall, and if the Initial Purchase
Price exceeds the Adjusted Purchase Price, Viacom shall, within 10 business days
after the Statement of Working Capital becomes final and binding upon the
parties, make payment to the other party by wire transfer in immediately
available funds of the amount of such excess, together with interest thereon at
the three-month treasury xxxx rate (as reported by the Wall Street Journal or,
if not reported thereby, by another authoritative source) in effect on the
Closing Date plus .25% (the "RATE"), calculated on the basis of the actual
number of days elapsed over 365, from the Closing
19
Date to the date of actual payment, compounded quarterly. Any payments due by
Livewire under this Section 2.13 shall be paid into Viacom's Account.
Notwithstanding the foregoing, in the event that Livewire delivers a Notice
of Disagreement to Viacom in accordance with this Section 2.13 such that only
a certain portion of the Closing Working Capital set forth in Viacom's
Statement of Working Capital is being disputed, and accordingly either Viacom
or Livewire is required to make a payment to the other with respect to the
non-disputed portion of the Closing Working Capital regardless of the
resolution of the disputed items contained in the Notice of Disagreement,
then Viacom or Livewire, as applicable, shall, within 10 business days of the
receipt of the Notice of Disagreement, make payment to the other by wire
transfer in immediately available funds in respect of the non-disputed
portion of the Closing Working Capital pending resolution of the items
contained in the Notice of Disagreement, together with interest thereon at
the Rate on the date of the Notice of Disagreement, calculated as described
above, and such payment (excluding interest) shall be credited against the
payment (excluding interest) required pursuant to the second sentence of this
paragraph.
(f) The term "WORKING CAPITAL" means Total Current Assets
minus Total Current Liabilities (in each case as defined below as measured as of
any date of determination). The "TARGET WORKING CAPITAL" shall equal US$589,000.
The calculation of the Target Working Capital is set forth in Exhibit H. The
terms "TOTAL CURRENT ASSETS" and "TOTAL CURRENT LIABILITIES" mean, respectively,
the combined total current assets included in the Acquired Assets (other than
the WEAPH Shares) and the combined total current liabilities included in the
Assumed Liabilities, in each case determined using the same methodologies,
practices, accounting applications and assumptions as used in determining the
Target Working Capital. The parties agree that the adjustment contemplated by
this Section 2.13 is intended to show the change in Working Capital from July
31, 2000 to the Closing Date, and that such change may only be measured if the
calculation is done in accordance with the preceding sentence. The scope of any
disputes to be resolved by the Accounting Firm shall be limited to whether such
calculations were done in accordance with the foregoing provisions of this
Section 2.13 and whether there were mathematical errors in the Statement of
Working Capital. For the avoidance of doubt, and notwithstanding anything to
contrary set forth herein, the following additional rules shall apply to the
calculation of Target Working Capital and Closing Working Capital:
(i) neither Target Working Capital nor Closing
Working Capital shall include the Discovery
People Fee or any right to receive such a
fee;
(ii) neither Target Working Capital nor Closing
Working Capital shall include any capital
lease obligations;
(iii) neither Target Working Capital nor Closing
Working Capital shall include any Income Tax
obligations;
(iv) if, after the date hereof and at least 5
days prior to Closing, Sellers incur a
current liability to acquire a capital asset
described in Section 2.14(a) of the
Disclosure Schedule or approved in writing
by Livewire as provided in Section 2.14(a),
such current liability shall not be included
in Closing Working Capital; and
20
(v) Total Current Assets shall include the
current portion of any obligations owed to
any Seller (and effectively assigned at
Closing to Livewire Sub) pursuant to any
settlement of the matter referred to in Item
1 of Section 3.07 of the Disclosure
Schedule; PROVIDED, that the current portion
of any such obligations included in Total
Current Assets shall in no event exceed
$60,000.
(g) Livewire agrees that following the Closing it shall
not take any actions which would affect the Statement of Working Capital with
respect to the accounting books, records, policies or procedures of the Business
on which the Statement of Working Capital is to be based that (i) are
inconsistent with the Business' practices prior to the Closing Date or (ii)
would make it impossible or impracticable to calculate the Closing Working
Capital in the manner and utilizing the methods required hereby. Without
limiting the generality of the foregoing, no changes shall be made in any
reserve (including any reserves in Total Current Liabilities) or other account
existing as of July 31, 2000 except as a result of events occurring after such
date and, in such event, only in a manner consistent with practices of the
Business prior to the Closing Date.
2.14 OTHER PAYMENTS.
(a) To the extent that, between the date hereof and 5
days prior to Closing, Sellers actually make (and pay for in cash, excluding
cash of the Singapore Companies) any capital expenditure with respect to the
Business or the business of any Singapore Company described in Section 2.14(a)
of the Disclosure Schedule or approved in writing by Livewire, then, at Closing,
against evidence of payment therefore, Livewire will make a cash payment to
Viacom equal to (i) the amount of all such additional capital expenditures MINUS
(ii)(x) the amount of such capital expenditures multiplied by (y) the number of
days between January 1, 2001 and the Closing Date, inclusive of both such dates,
divided by (z) the shorter of the number of days (A) of the estimated useful
life of the applicable asset as determined in accordance with the past practices
of the Business or the business of any Singapore Company, as the case may be, or
(B) of the term of the service contract relating to the applicable asset;
PROVIDED, HOWEVER, that in the event that the Closing takes place on or prior to
January 1, 2001, this clause (ii) shall be equal to zero. Anything contained
herein to the contrary notwithstanding, any written approval relied on by
Sellers pursuant to this Section 2.14(a) shall be effective only if signed by
Xxxxx Xxxxxx, Xxxxx Xxxxxx, Xxxxxxx Xxxxx or any other officer of Livewire
specifically authorized in a written notice to Viacom.
(b) In the event that, prior to Closing, any Seller
receives any termination fee from Discovery Ventures, LLC, pursuant to the
Technical Services Agreement dated December 29, 1998, between Group W Network
Services and Discovery Ventures, LLC, as amended and as terminated pursuant to a
letter dated August 10, 2000 (any such termination fee, the "DISCOVERY PEOPLE
FEE"), then, at Closing, Viacom will make a cash payment to Livewire in an
amount equal to (i) the amount of the Discovery People Fee, MINUS (ii)(x) the
amount of such termination fee multiplied by (y) the number of days between
January 1, 2001 and the Closing Date, inclusive of both such dates, divided by
(z) 424 days. By way of illustration of the foregoing, if Sellers receive
termination fees in the amount of $1,920,000 prior to Closing on January 31,
2001, then
21
Viacom will pay to Livewire (A) $1,920,000 minus (B) $1,920,000 multiplied by
31 days divided by 424 days, which amount equals $1,779,623.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF VIACOM
Viacom represents and warrants to Purchasers as follows:
3.01 INCORPORATION AND AUTHORITY OF SELLERS. Each of the
Sellers and the Singapore Companies is a corporation duly incorporated, validly
existing and, in cases of corporations incorporated in the United States, in
good standing, under the Laws of the jurisdiction of its incorporation or
organization. Each Seller has all necessary corporate power and authority to
enter into this Agreement and the Ancillary Agreements to which it is a party,
to carry out its obligations hereunder and thereunder and to consummate the
transactions contemplated hereby and thereby. The execution and delivery by each
Seller of this Agreement and the Ancillary Agreements to which it is a party,
the performance by each of them (as applicable) of their respective obligations
hereunder and thereunder and the consummation by each of them (as applicable) of
the transactions contemplated hereby and thereby have been duly authorized by
all requisite corporate action on the part of each Seller. This Agreement has
been and, when executed and delivered at the Closing, the Ancillary Agreements
to which each applicable Seller is a party will be, duly executed and delivered
by the applicable Seller and, assuming due authorization, execution and delivery
by Purchasers, this Agreement constitutes, and at the Closing the Ancillary
Agreements will constitute, the legal, valid and binding obligation of each
applicable Seller, enforceable against each applicable Seller in accordance with
their respective terms, subject, as to enforceability, to the effect of any
applicable bankruptcy, reorganization, insolvency, moratorium, fraudulent
conveyance or similar Laws affecting creditors' rights generally and to the
effect of general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law). Prior to the
date of this Agreement, Viacom has delivered to Livewire true and correct copies
of the Certificate of Incorporation and the Bylaws (or similar instruments with
different names) of each of the Singapore Companies as in effect as of the date
of this Agreement.
3.02 NO CONFLICT. Assuming all consents, approvals,
authorizations and other actions described in Section 3.03 have been obtained
and all filings and notifications listed in Section 3.03 of the Disclosure
Schedule have been made, and except as described in Section 3.02 of the
Disclosure Schedule, the execution, delivery and performance by each Seller of
this Agreement and the Ancillary Agreements to which it is a party, do not and
will not (a) violate or conflict with the Certificate of Incorporation or
By-laws (or similar constituent instruments with different names) of any Seller
or any of the Singapore Companies, (b) conflict with or violate any Law or
Governmental Order applicable to Sellers or any of the Singapore Companies,
except as (i) would not, individually or in the aggregate, have a Material
Adverse Effect, (ii) would not prohibit Sellers from consummating the sale of
the Acquired Assets and the other transactions contemplated hereby or (iii) may
result from any facts or circumstances relating solely to Livewire or its
Affiliates or (c) result in any breach of, or constitute a default (or event
which with the giving of notice or lapse of time, or both, would become a
default) under, or give to any Person any rights of termination, amendment,
acceleration or cancellation of, or result in the
22
creation of any Lien (other than any Permitted Lien) on any of the Acquired
Assets, the JV Shares or any asset or property of any Singapore Company
pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease,
license, permit, franchise or other instrument to which any Seller or any
Singapore Company is a party or by which the Acquired Assets, the JV Shares
or, to the knowledge of Viacom, any asset or property of any Singapore
Company are bound or affected, except as would not, individually or in the
aggregate, have a Material Adverse Effect or prohibit Sellers from
consummating the sale of the Acquired Assets and the other transactions
contemplated hereby.
3.03 CONSENTS AND APPROVALS. The execution and delivery by
each Seller of this Agreement and the Ancillary Agreements to which it is a
party, do not, and the performance by each Seller of this Agreement and the
Ancillary Agreements to which it is a party, will not, require any consent,
approval, authorization or other action by, or filing with or notification to,
any Governmental Authority or other Person except (a) as described in Section
3.03 of the Disclosure Schedule, (b) the notification requirements of the HSR
Act, (c) any consents, approvals, authorizations, filings or notifications
required under Singapore law, including without limitation the XXX Consent, (d)
where failure to obtain such consent, approval, authorization or action, or to
make such filing or notification, would not have a Material Adverse Effect or
prohibit Sellers from consummating the sale of the Acquired Assets and the other
transactions contemplated hereby, and (e) as may be necessary as a result of any
facts or circumstances relating solely to Livewire or its Affiliates.
3.04 FINANCIAL INFORMATION. (a) "FINANCIAL STATEMENTS"
shall mean the Year-End Financial Statements, the Reference Financial Statements
and the ABC/GWYB Financial Statements, in each case as defined below. The
audited combined financial statements of Group W Network Services as at and for
the year ended December 31, 1999, including the audited combined balance sheet,
statement of operations and statement of cash flows (together with all notes and
attachments thereto, the "YEAR-END FINANCIAL STATEMENTS") and the unaudited
combined balance sheet and statement of operations of Group W Network Services
as at and for the seven-month period ended July 31, 2000 (the "REFERENCE
FINANCIAL STATEMENTS"), all of which are included in Section 3.04(a) of the
Disclosure Schedule, fairly present, in all material respects, the combined
financial condition and results of operations of the Business and, to the extent
directly or indirectly owned at such time by Seller, the Singapore Companies at
such dates, or for the periods covered thereby, and, except as disclosed in
Section 3.04(a) of the Disclosure Schedule, were prepared on a basis consistent
with the past practices of the Business and the Singapore Companies and, in the
case of the Year-End Financial Statements, in accordance with GAAP. The income
statement included in the Reference Financials was prepared on a basis
consistent with the income statement included in the Year-End Financial
Statements except for normal recurring year-end adjustments. The balance sheet
included in the Reference Financials was prepared on a basis consistent with the
internal financial reporting policies of Sellers.
(b) The audited financial statements of ABC and GWYB, as
at and for the year ended November 30, 1999, including the audited balance
sheets, profit and loss accounts and statements of cash flows (together with all
notes and attachments thereto, the "ABC/GWYB FINANCIAL STATEMENTS"), all of
which are included in Section 3.04(b) of the Disclosure Schedule, fairly
present, in all material respects, the financial condition and results of
operations of ABC
23
and GWYB, respectively, and, except as disclosed in Section 3.04(b) of the
Disclosure Schedule, each was prepared on a basis consistent with the past
practices of ABC or GWYB, as the case may be, and in accordance with
Singapore generally accepted accounting principles.
3.05 ABSENCE OF UNDISCLOSED LIABILITIES.
(a) As of the Closing Date, there shall be no liability
or obligation of the Business which is included in the Assumed Liabilities
except liabilities or obligations (i) disclosed in Section 3.05(a) of the
Disclosure Schedule or otherwise included in the other Disclosure Schedules to
this Agreement if the relevance of such matter to Section 3.05(a) of the
Disclosure Schedule is reasonably apparent from the face of the disclosure
actually made, (ii) as, and to the extent, reflected or reserved against in the
Financial Statements, (iii) with respect to the matters addressed in Sections
3.12 and 3.13 and Article VI (which shall be governed solely by the terms of
such Sections and Article), (iv) under executory contracts included in the
Acquired Assets, (v) incurred in the ordinary course of the Business after July
31, 2000 and prior to the Closing, or (vi) which would not individually or in
the aggregate have a Material Adverse Effect.
(b) As of the Closing Date, the Singapore Companies shall
have no liabilities or obligations of any nature except liabilities or
obligations (i) disclosed in Section 3.05(b) of the Disclosure Schedule or
otherwise included in the other Disclosure Schedules to this Agreement if the
relevance of such matter to Section 3.05(b) of the Disclosure Schedule is
reasonably apparent from the face of the disclosure actually made, (ii) as, and
to the extent, reflected or reserved against in the Financial Statements, (iii)
with respect to the matters addressed in Sections 3.12 and 3.13 and Article VI
(which shall be governed solely by the terms of such Sections and Article), (iv)
incurred in the ordinary course of business after June 30, 2000 and prior to the
Closing, (v) under executory contracts to which any Singapore Company is or
becomes a party, or (vi) which would not individually or in the aggregate have a
Material Adverse Effect.
3.06 ABSENCE OF CERTAIN CHANGES OR EVENTS. Since December
31, 1999, except as disclosed in Section 3.06 of the Disclosure Schedule, the
Business has been conducted and the Singapore Companies have conducted their
respective businesses in the ordinary course and consistent with past practice.
Since December 31, 1999, or such other date specified below,
except as set forth in Section 3.06 of the Disclosure Schedule or as
contemplated by this Agreement, there has not been:
(i) a Material Adverse Effect;
(ii) since July 31, 2000 to the date of this
Agreement, the creation of any Lien on the
Acquired Assets or any asset of the
Singapore Companies, other than Permitted
Liens;
(iii) since July 31, 2000 to the date of this
Agreement, any establishment or material
increase in any bonus, insurance,
24
severance, deferred compensation,
pension, retirement, profit sharing,
stock option (including any grant of any
stock options, stock appreciation rights,
performance awards or restricted stock
awards), stock purchase or other employee
benefit plans, or other material increase
in the compensation payable or to become
payable to any officer or key employee of
the Business or any of the Singapore
Companies by any Seller or any of their
Affiliates, except, in any case described
above, as may be required by Law or
existing contracts or in the ordinary
course of business;
(iv) to the date of this Agreement, any sale,
assignment, transfer, lease or other
disposition or agreement to sell, assign,
transfer, lease or otherwise dispose of any
of the Acquired Assets or any of the assets
of the Singapore Companies having an
aggregate replacement value exceeding
$50,000;
(v) to the date of this Agreement, with respect
to the Business or any of the Singapore
Companies, (A) any acquisition (by merger,
consolidation, acquisition of stock or
assets or otherwise) of any corporation,
partnership or other business organization
or division thereof or interest therein or
(B) any incurrence of any indebtedness for
borrowed money (other than to any Seller),
the entry into any capitalized lease
obligations in excess of $50,000 per lease
or the entry into any deferred purchase
price obligations in excess of $50,000 per
obligation or issuance of any debt
securities or assumption, grant, guarantee
or endorsement, or other accommodation or
arrangement making the Business or any
Singapore Company responsible for, the
obligations of any Person other than in the
ordinary course of business consistent with
past practice or any loans or advances other
than loans or advances to employees of the
Business or any Singapore Company in the
ordinary course;
(vi) to the date of this Agreement, any change in
any method of accounting or accounting
practice used by any Seller or any Singapore
Company in connection with the Business or
the businesses of the Singapore Companies;
(vii) any loss or destruction of any Acquired
Asset or any asset of any Singapore Company,
other than any such loss or destruction
which would not individually or in the
aggregate result in a Material Adverse
Effect;
(viii) since December 31, 1999 to the date of this
Agreement, any settlement of any pending or
material threatened Action or Claim relating
to the Business, the Acquired Assets or any
Singapore
25
Company, other than any settlement of
pending litigation against any Seller or
Singapore Company solely for a cash
payment not in excess of $100,000;
(ix) any declaration or payment of any dividend
on or distribution in respect of the capital
stock of any Singapore Company (other than
dividends payable by a JV Company to WEAPH),
(b) split, combination or reclassification
of any capital stock of any Singapore
Company or (c) redemption, repurchase or
other acquisition by a Singapore Company or
any Seller of any shares of capital stock of
any Singapore Company (except as expressly
contemplated by this Agreement or the JV
Companies Purchase Agreement);
(x) to the date of this Agreement, any
revaluation by a Seller of any Acquired
Assets (or any revaluation of any assets of
any Singapore Company), including any
writing up or writing down of the value of
inventory or any writing-off notes or
accounts receivable, other than in the
ordinary course of business consistent with
past practice;
(xi) to the date of this Agreement, any capital
expenditure in excess of $50,000 not
contemplated by the most recent capital
expenditure budget of the Business and the
Singapore Companies (copies of which have
been provided to Livewire); and
(xii) any agreement by any Seller or Singapore
Company to do any of the foregoing.
3.07 ABSENCE OF LITIGATION. Except as set forth in Section
3.07 of the Disclosure Schedule, there are no Actions pending, or to Viacom's
Knowledge, threatened in writing against any Seller related to the Business or
any Singapore Company, or to which any of the Acquired Assets or any asset of
any Singapore Company are subject, before any Governmental Authority that are
reasonably likely to have a Material Adverse Effect or to prevent or prohibit
the consummation of the transactions contemplated by this Agreement and the
Ancillary Agreements (or any material part thereof).
3.08 COMPLIANCE WITH LAWS. Except as set forth in Section
3.08 of the Disclosure Schedule, no Seller or Singapore Company is in violation
of any Law or Governmental Order that is binding upon such entity insofar as it
relates to the Business, any material Acquired Asset or any material asset of
any Singapore Company, except for any such violations that, individually or in
the aggregate, would not have a Material Adverse Effect.
3.09 LICENSES AND PERMITS. No governmental qualifications,
registrations, filings, privileges, franchises, licenses, permits, approvals or
authorizations are required to operate the Business or the businesses of the
Singapore Companies in substantially the same
26
manner as the Business and the businesses of the Singapore Companies are
being operated as of the date hereof, other than (i) the Microwave Licenses;
(ii) the other authorizations. licenses, permits and approvals of the Federal
Communications Commission ("FCC") described in Section 3.09 of the Disclosure
Schedule; and (iii) such authorizations, licenses, permits and approvals of
Governmental Authorities other than the FCC (A) as are described in Section
3.09 of the Disclosure Schedule or (B) of which the failure to hold or obtain
would not, individually or in the aggregate, have a Material Adverse Effect.
Each of the Permits set forth in Section 3.09 of the Disclosure Schedule is
valid and binding and in full force and effect, except as would not,
individually or in the aggregate, have a Material Adverse Effect.
3.10 ACQUIRED ASSETS. (a) Except for the rights and
assets contemplated by the Ancillary Agreements or otherwise set forth in
Section 3.10(a) of the Disclosure Schedule, the Acquired Assets (together
with the services and rights included under the Ancillary Agreements) include
all of the material assets, properties and rights of every type and
description, real, personal and mixed, tangible and intangible, that are
owned, used or held for use primarily in the operation of the Business as of
the date hereof other than assets disposed of, utilized or consumed in the
ordinary course of business since the date of this Agreement. All of the
tangible Acquired Assets material to the operation of the Business and all of
the tangible assets of the Singapore Companies material to the operation of
the businesses of the Singapore Companies are in good operating condition and
repair, subject to normal wear and maintenance, except to the extent the
failure to be in such condition or repair would not result in a Material
Adverse Effect.
(b) Each applicable Seller holds, and at the Closing will
hold, good title to or have valid leasehold interests in all of the Acquired
Assets (other than the WEAPH Shares (as to which the provisions of Section
3.10(c) apply) and the Real Property and the Harbor Leases (as to which the
provisions of Section 3.11 apply)) being transferred and sold by it hereunder,
free and clear of any and all Liens, except (i) as disclosed in Section
3.10(b)(i) of the Disclosure Schedule, (ii) for Permitted Liens or (iii) for
Liens created by or through Livewire or any of its Affiliates or as a result of
the transactions contemplated by this Agreement. Each applicable Singapore
Company holds, and at the Closing will hold, good title to or have valid
leasehold interests in all of its assets, free and clear of any and all Liens,
except (i) as disclosed in Section 3.10(b)(ii) of the Disclosure Schedule, (ii)
for Permitted Liens or (iii) for Liens created by or through Livewire or any of
its Affiliates or as a result of the transactions contemplated by this
Agreement.
(c) The WEAPH Shares consist of 529,225 ordinary shares
of WEAPH. The WEAPH Shares constitute all of the issued and outstanding capital
stock of WEAPH. The WEAPH Shares were duly authorized and validly issued and are
fully paid and nonassessable and were not issued in violation of any pre-emptive
rights. Except as described in Section 3.10(c) of the Disclosure Schedule, there
are no outstanding options, warrants or rights of conversion or other rights,
agreements, arrangements or commitments relating to the WEAPH Shares obligating
WEG to sell or transfer any portion of the WEAPH Shares, or restricting in any
way WEG's rights and powers with respect to the WEAPH Shares, including without
limitation any restriction on transfer, voting or consensual rights. WEG owns
the WEAPH Shares free and clear of all Liens except for Liens arising under any
securities law and any Liens arising out of, under or in connection with this
Agreement or through Livewire or any of its Affiliates. Except
27
as described in Section 3.10(c) of the Disclosure Schedule, there are no
voting trusts, stockholder agreements, proxies or other agreements in effect
with respect to the voting or transfer of the WEAPH Shares. As of the Closing
Date, WEAPH will hold no material assets other than the JV Shares and the
Seller Loans and Seller Loan Agreements (but only if such Seller Loans are
not contributed to capital and such Seller Loan Agreements are not
terminated, in each case as contemplated in Section 5.12 hereof) and certain
rights under the JV Companies Purchase Agreement and certain of the
agreements contemplated thereby and be subject to no liabilities other than
its ownership of the JV Shares and certain liabilities for Taxes, except as
set forth on Section 3.10(c) of the Disclosure Schedule.
(d) The JV Shares consist of 322,500 ordinary shares, par
value S$1.00 per share, of ABC and 202,500 ordinary shares, par value S$1.00 per
share, of GWYB. The JV Shares constitute all of the issued and outstanding
ordinary shares of ABC and GWYB. The JV Shares were duly authorized and validly
issued and are fully paid and nonassessable and were not issued in violation of
any pre-emptive rights. There are no outstanding options, warrants or rights of
conversion or other rights, agreements, arrangements or commitments relating to
the JV Shares obligating WEAPH to sell or transfer any portion of the JV Shares.
WEAPH owns the JV Shares free and clear of all Liens except for Liens arising
under any securities law and any Liens arising out of, under or in connection
with this Agreement or through Livewire or any of its Affiliates. There are no
voting trusts, stockholder agreements, proxies or other agreements in effect
with respect to the voting or transfer of the JV Shares.
(e) As of September 30, 2000, there is S$6,843,002.51
(six million eight hundred forty-three thousand two 51/100 Singapore Dollars),
including accrued and unpaid interest, outstanding under the Seller Loans made
to GWYB, and S$10,898,113.56 (ten million eight hundred ninety-eight thousand
one hundred thirteen 56/100 Singapore Dollars), including accrued and unpaid
interest, outstanding under the Seller Loans made to ABC. WEAPH is the sole
obligee, beneficially and of record, under each of the Seller Loans and WEAPH
owns the Seller Loans free and clear of all Liens except for Permitted Liens and
any Liens arising out of, under or in connection with this Agreement or through
Livewire or any of its Affiliates.
(f) The JV Companies do not own, directly or indirectly,
any ownership, equity, profit or voting interest in any corporation,
partnership, joint venture or other Person, and have no agreement or commitment
to purchase any such interest.
(g) No assets of the JV Companies were used by WEAPH or
Viacom to acquire JV Shares pursuant to the JV Companies Purchase Agreement.
(h) The JV Companies have no liabilities to Yellow River
or Yarra or any directors or officers thereof.
3.11 REAL PROPERTY.
(a) The applicable Seller has good title to, or valid
leasehold interest in, each parcel of Real Property and the Harbor Leases, as
set forth next to such Seller's name in Section 3.11 of the Disclosure Schedule,
in each case free and clear of all Liens, except (a) as disclosed
28
in Section 3.11 of the Disclosure Schedule, (b) for Permitted Liens or (c)
for Liens created by or through Livewire or any of its Affiliates.
(b) The Singapore Companies do not own any real property.
3.12 EMPLOYEE MATTERS.
(a) Except as set forth on Section 3.12(a) of the
Disclosure Schedule, (i) there have been no union organizing efforts with
respect to the Business or the Singapore Companies conducted within the last
three years and, to Viacom's knowledge, there are none now being conducted; (ii)
during the three years prior to the date of this Agreement there has not been,
nor, to Viacom's knowledge, is there now threatened, a strike, work stoppage,
work slowdown or other material labor dispute with respect to, or affecting, the
Business or the Singapore Companies; and (iii) no Business Employee or
International Business Employee is represented by any union or other labor
organization.
(b) Section 3.12 (b) of the Disclosure Schedule sets
forth a true, correct and complete list of all of (i) the written employee
benefit plans, arrangements or policies (whether U.S. or international),
including plans subject to the Employee Retirement Income Security Act of 1974,
as amended ("ERISA"), and, without limitations, any retirement, pension,
deferred compensation, profit sharing, savings, health, dental, hearing, vision,
drug, life insurance, cafeteria, flexible spending, dependent care plan, policy
or arrangement, (ii) any stock-option, or equity based compensation plan and
(iii) any employment or severance agreement, in each case, maintained or
contributed to by Viacom or any of its Affiliates for any current or former
Business Employee or International Business Employee (collectively, the
"PLANS").
(c) Viacom has made available to Livewire a complete and
current copy of each Plan document and the most recent summary plan description
for any Plan, and any employee handbook applicable to Business Employees or
International Business Employees.
(d) Except as set forth on Section 3.12(d) to the
Disclosure Schedule and with such exceptions as would not have a Material
Adverse Effect:
(i) Each Plan has been established and
administered in accordance with the terms of
such Plan and all applicable Laws.
(ii) Each Plan intended to be tax-qualified under
Section 401(a) of the Code has received a
favorable determination letter from the IRS
as to its tax-qualified status under the
Code and, to Viacom's knowledge, nothing has
occurred since the date of such favorable
determination letter which would adversely
affect the validity of such letter.
(iii) With respect to any Plan, no actions, suits,
claims or proceedings (other than routine
claims for benefits) involving Business
Employees or International Business
Employees are pending or, to Viacom's
knowledge, threatened, and no facts or
circumstances
29
exist which could be reasonably expected to
give rise to any such actions, suits, claims
or proceedings.
(iv) No Plan is currently under governmental
investigation or audit and to Viacom's
knowledge, no such investigation or audit is
contemplated or under consideration.
(e) No event has occurred and no condition exists with
respect to any Plan that could be reasonably expected to subject any Purchaser
to any material tax, fine, penalty or other liability for a "prohibited
transaction" under Section 4975 of the Code and Section 406 of ERISA.
(f) With respect to any Plan that is subject to Title IV
of ERISA: (i) no liability to the Pension Benefit Guaranty Corporation ("PBGC")
has been incurred (other than for premiums not yet due); (ii) no notice of
intent to terminate any such plan in a "distress termination" under Section 4041
of ERISA has been filed with the PBGC or distributed to participants; (iii) no
proceedings to terminate any such plan have been instituted by the PBGC; (iv) no
"accumulated funding deficiency", within the meaning of Section 412 of the Code
or Section 302 of ERISA, whether or not waived, exists; and (v) no lien has
arisen or is expected to arise under Section 412 of the Code or Section 302 of
ERISA on the Acquired Assets.
(g) No Plan is a "multiemployer plan" within the meaning
of Section 3(37)(A) of ERISA.
3.13 TAXES. Except as set forth in Section 3.13 of the
Disclosure Schedule:
(a) All material federal, state, local and foreign Tax
Returns required to be filed by or on behalf of, or in which is required to be
reported the income, gains, losses, deductions, or credits of, the Business, the
Acquired Assets, and the Singapore Companies, their Subsidiaries, and their
respective predecessors, if any, under the Code or any other applicable statute
or law have been or will be filed within the time prescribed by law (including
extensions of time approved by the appropriate Governmental Entity). Such Tax
Returns have been prepared, or will be prepared, in accordance with all
applicable government regulations and are, or will be, accurate and complete in
all respects, except where a failure to so prepare such Tax Returns could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
(b) Each of the Sellers and their respective predecessors
have timely paid or adequately provided for (or will timely pay or adequately
provide for) all Taxes due and payable from them on or prior to the Closing Date
with respect to the Business and the Acquired Assets, except for any such
failures as could not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect. Each of the Singapore Companies, their
Subsidiaries and their respective predecessors, if any, have timely paid or
adequately provided for (or will timely pay or adequately provide for) all Taxes
due and payable from them on or prior to the Closing Date (whether or not shown
on any Tax Returns), except for any such failures as could not, individually or
in the aggregate, reasonably be expected to have a Material Adverse Effect.
30
(c) As of the Closing Date, the Sellers (with respect to
the Business) and the Singapore Companies and their Subsidiaries will have paid
all Taxes they are required to pay with respect to workers and all other third
parties and will have withheld with respect to their respective employees and
contract workers all Income Taxes and other Taxes required to be withheld
(including, without limitation, any amounts under the Federal Insurance
Contribution Act ("FICA") and the Federal Unemployment Tax Act ("FUTA")).
(d) The Sellers have no knowledge of any claim or
assertion relating to Taxes which, if adversely determined, would result (x) in
any Material Adverse Effect or (y) in a material Lien on the Acquired Assets or
on any of the assets of the Singapore Companies or their Subsidiaries.
(e) None of the Singapore Companies and their
Subsidiaries has granted any waiver of any statute of limitations with respect
to, or any extension of a period for the assessment of, any Tax, which waiver or
extension currently remains in effect.
(f) None of the Assumed Liabilities is an obligation to
make a payment that will not be deductible under Section 162(m) or Section 280G
of the Code.
(g) None of the Acquired Assets sold, conveyed,
transferred and assigned to Purchaser by Westinghouse Electric G.M.B.H.
constitutes a "United States real property interest" as defined in Section
897(c) of the Code and the Treasury Regulations promulgated thereunder.
(h) None of the Singapore Companies is a "passive foreign
investment company" as defined in Section 1297 of the Code and the Treasury
Regulations promulgated thereunder.
(i) None of the Singapore Companies has filed a consent
under Section 341(f) of the Code concerning collapsible corporations.
(j) None of the Assumed Liabilities is an obligation
under any Tax allocation or Tax sharing agreement or a liability for Taxes of
any Person under Treasury Regulation Section 1.1502-6 (or any similar provision
of state, local or foreign law) as a transferee or successor, by contract or
otherwise. None of the Singapore Companies is a party to any Tax allocation or
Tax sharing agreement or has any liability for Taxes of any other Person (other
than the Singapore Companies) by contract or otherwise.
(k) GWYB has obtained Pioneer status for Singapore tax
purposes for the seven-year period commencing December 1, 1995. Such grant of
status, as it has been revised through the date of this Agreement, remains in
full force and effect and, to Viacom's knowledge, GWYB has not violated the
terms of such grant, as it has been revised through the date of this Agreement.
3.14 CONTRACTS. Section 3.14(a) of the Disclosure Schedule
lists, in each case, as of the date of this Agreement, (a) all Contracts of the
types described below relating to the Business to which any Seller is a party
and (b) all contracts, agreements, leases, licenses, sublicenses, commitments,
sales and purchase orders and other instruments, written and oral, of the types
described below to which any Singapore Company is a party ("SINGAPORE
CONTRACTS"):
31
(i) any such Contract or Singapore Contract
involving payments to or from any Seller of
$100,000 or more, except commitments which
may be terminated without liability or
penalty by a Seller or any Singapore Company
on not more than 30 days' notice;
(ii) any such Contract or Singapore Contract
relating to a material acquisition by the
Business or any Singapore Company of a
business under which there remain any
material unperformed obligations;
(iii) any such Contract or Singapore Contract
relating to indebtedness for borrowed money
(whether incurred, assumed, guaranteed or
secured by any asset), including without
limitation any and all agreements relating
to lockboxes and other security arrangements
relating thereto;
(iv) any such Contract or Singapore Contract
relating to capitalized lease obligations or
the deferred purchase price of property
(whether incurred, assumed, guaranteed or
secured by any asset), or operating leases
except any such Contract or Singapore
Contract with an aggregate outstanding
principal amount (or, in the case of any
operating lease, an annual lease payment)
not exceeding $50,000;
(v) any such Contract or Singapore Contract
containing any provision or covenant
prohibiting or limiting the ability of the
Business or any Singapore Company to engage
in any business activity (in any geographic
region or otherwise) or to compete with any
Person;
(vi) any such Contract or Singapore Contract that
creates or obligates the Business or any
Singapore Company to participate in any
joint venture, limited liability company,
partnership agreements, shareholders
arrangement or other similar arrangement;
(vii) any such Contract or Singapore Contract that
relates to the maintenance of transmitters
or editing machines involving payments of
more than $100,000 per year;
(viii) any tax sharing or similar agreement;
(ix) any such Contract or Singapore Contract that
provides for any party to have first
refusal, first offer, "tag-along" or
"drag-along" rights or obligations with
respect to any capital stock or other
security of any Singapore Company;
(x) all Singapore Contracts between the
Singapore Companies and any Seller; and
32
(xi) any other legally binding Contract or
Singapore Contract not of the type covered
by any of the other items of this Section
3.14(a) which is not in the ordinary course
of business and which is material to the
Business and the Singapore Companies, taken
as a whole.
(b) Except as set forth in Section 3.14(b) of the
Disclosure Schedule, all Contracts and each contract to which any Singapore
Company is a party are in full force and effect with such exceptions as do not,
individually or in the aggregate, have a Material Adverse Effect. Neither any
Seller nor any Singapore Company nor, to Viacom's knowledge, any other party
thereto is in breach or default in the performance of any obligation under any
Contract or any Singapore Contract and no event has occurred or has failed to
occur whereby, with or without the giving of notice or the lapse of time or
both, a default or breach will be deemed to have occurred thereunder, except for
such breaches, defaults and events which, either individually or in the
aggregate, would not reasonably be expected to have a Material Adverse Effect.
3.15 INTELLECTUAL PROPERTY. (a) Section 3.15 of the
Disclosure Schedule contains a list of all material Copyrights and Trademarks
and all material copyrights and trademarks owned by any Singapore Company,
specifying as to each, as applicable: (a) the nature of such copyright or
trademark; (b) the owner of such copyright or trademark; and (c) the applicable
registration or application numbers. Except as set forth in Section 3.15 of the
Disclosure Schedule, none of the copyrights or trademarks set forth thereon is
subject to any outstanding judgment, injunction, order, decree or agreement
restricting the use thereof by any Singapore Company or (with respect to the
Business) any Seller or restricting the licensing thereof by any Singapore
Company or Seller to any Person, except for any judgment, injunction, order,
decree or agreement which would not reasonably be expected to have a Material
Adverse Effect.
(b) To Viacom's knowledge, Sellers and Singapore
Companies own or have adequate rights to use all patents, trademarks, trade
names, service marks, brands, logos, copyrights, trade secrets, customer lists
and other proprietary intellectual property rights required for or used in the
Business (including, without limitation, Xxxxxxxxxxxxxx.xxx) and the businesses
of the Singapore Companies as now conducted, except as would not, individually
or in aggregate, be reasonably expected to have a Material Adverse Effect.
Except as otherwise disclosed in Section 3.15(b) of the Disclosure Schedule or
as would not, individually or in the aggregate, be reasonably likely to have a
Material Adverse Effect, the Sellers and Singapore Companies have not received
notice, and have no reason to know, of any claim or threatened infringement of
the rights of others with respect to any patents, trade secrets, trademarks,
service marks, trade names, brands, logos, copyrights or licenses used or owned
by Sellers and Singapore Companies in connection with the Business and the
businesses of the Singapore Companies. Except as otherwise disclosed in Section
3.15(b) of the Disclosure Schedule or as would not, individually or in the
aggregate, be reasonably likely to have a Material Adverse Effect, to Viacom's
knowledge, the use of the Traffic Master:
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Real Time Controller software in the manner currently used by Sellers in the
Business and by the Singapore Companies in their business does not infringe
the patents, trade secrets, trademarks, service marks, trade names, brands,
logos or copyrights of any third parties. Except for third party software
embodied in the Traffic Master: Real Time Controller software and except as
otherwise disclosed in Section 3.15(b) of the Disclosure Schedule or as would
not, individually or in the aggregate, be reasonably likely to have a
Material Adverse Effect, the Sellers and Singapore Companies have sufficient
rights in the Traffic Master: Real Time Controller software to grant the
license contained in the TM:RT License Agreement and to perform their
obligations thereunder.
3.16 BROKERS. No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated by this Agreement based upon arrangements
made by or on behalf of any Seller.
3.17 ENVIRONMENTAL COMPLIANCE. Except as set forth in
Section 3.17 of the Disclosure Schedule or as would not result in a Material
Adverse Effect, (a) to the knowledge of Viacom, each Seller is in compliance
with all Environmental Laws with respect to the Business, (b) to the knowledge
of Viacom, each Singapore Company is in compliance with all Environmental Laws,
(c) there are no judicial or administrative actions, proceedings or
investigations pending or, to the knowledge of Viacom, threatened against any
Seller with respect to the Business, any Real Property owned or leased by any
Seller or the Harbor Leases, alleging the violation of or seeking to impose
liability pursuant to any Environmental Law, (d) there are no judicial or
administrative actions, proceedings or investigations pending or, to the
knowledge of Viacom, threatened against any Singapore Company alleging the
violation of or seeking to impose liability pursuant to any Environmental Law
and (e) to the knowledge of Viacom, there are no conditions or circumstances
involving the Business, any Real Property or any of the other Acquired Assets
that creates liability in excess of $50,000 under applicable Environmental Laws.
3.18 CBS TRANSMISSION SERVICES AGREEMENT. If, after the
Closing Date, Livewire continues to perform and provide to CBS Broadcasting Inc.
the services that are to be provided pursuant to the CBS Transmission Services
Agreement in the same manner in which such services are currently performed and
provided to CBS Broadcasting Inc. by Group W Network Services, then, upon
Closing and the execution and delivery of the CBS Transmission Services
Agreement, Purchasers and Group W Network Services will not be in default under
any terms of the CBS Transmission Services Agreement as of the Closing Date.
3.19 EXCLUSIVITY OF REPRESENTATIONS. THE REPRESENTATIONS
AND WARRANTIES MADE BY VIACOM IN THIS AGREEMENT ARE IN LIEU OF AND ARE EXCLUSIVE
OF ALL OTHER REPRESENTATIONS AND WARRANTIES, INCLUDING ANY IMPLIED WARRANTIES.
VIACOM HEREBY DISCLAIMS ANY SUCH OTHER OR IMPLIED REPRESENTATIONS OR WARRANTIES,
NOTWITHSTANDING THE DELIVERY OR DISCLOSURE TO PURCHASERS OR THEIR OFFICERS,
DIRECTORS, EMPLOYEES, AGENTS OR REPRESENTATIVES OF ANY DOCUMENTATION OR OTHER
INFORMATION (INCLUDING, WITHOUT LIMITATION, ANY FINANCIAL PROJECTIONS OR OTHER
SUPPLEMENTAL DATA).
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF LIVEWIRE
Livewire represents and warrants to Sellers as follows:
4.01 INCORPORATION AND AUTHORITY OF PURCHASERS. Each
Purchaser is a corporation duly incorporated, validly existing and in good
standing under the Laws of its jurisdiction of incorporation or organization and
has all necessary corporate power and authority to enter into this Agreement and
the Ancillary Agreements, to carry out its obligations hereunder and thereunder
and to consummate the transactions contemplated hereby and thereby. The
execution and delivery of this Agreement and the Ancillary Agreements by each
Purchaser, the performance by each of them of their respective obligations
hereunder and thereunder and the consummation by each of them (as applicable) of
the transactions contemplated hereby and thereby have been duly authorized by
all requisite corporate action on the part of each Purchaser. This Agreement has
been, and when executed and delivered by the applicable Purchaser at the
Closing, the Ancillary Agreements will be, duly executed and delivered by the
applicable Purchaser and, assuming due authorization, execution and delivery by
each applicable Seller, this Agreement constitutes and at Closing the Ancillary
Agreements will constitute, the legal, valid and binding obligation of each
applicable Purchaser enforceable against each applicable Purchaser in accordance
with their respective terms, subject, as to enforceability, to the effect of any
applicable bankruptcy, reorganization, insolvency, moratorium, fraudulent
conveyance or similar Laws affecting creditors' rights generally and to the
effect of general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at Law).
4.02 NO CONFLICT. The execution, delivery and performance
by each Purchaser of this Agreement and the Ancillary Agreements to which it is
a party, do not and will not (a) violate or conflict with the Certificate of
Incorporation or By-laws (or other similar constituent documents with different
names) of any Purchaser, (b) except as may result from any facts or
circumstances relating solely to Sellers, conflict with or violate any Law or
Governmental Order applicable to Purchasers except as would not, individually or
in the aggregate, have a material adverse effect on Purchasers' ability to
perform their respective obligations hereunder or under the Ancillary
Agreements, or (c) except as may result from any facts or circumstances relating
solely to Sellers, result in any breach of, or constitute a default (or event
which, with the giving of notice or lapse of time, or both, would become a
default) under, or give to any Person any rights of termination, amendment,
acceleration or cancellation of, or result in the creation of any Lien on any of
the assets or properties of any Purchaser pursuant to, any note, bond, mortgage,
indenture, contract, agreement, lease, license, permit, franchise or other
instrument relating to such assets or properties to which any Purchaser is a
party or by which any of such assets or properties is bound or affected, except
as would not, individually or in the aggregate, have a material adverse effect
on Purchasers' ability to perform their respective obligations hereunder or
under the Ancillary Agreements.
4.03 CONSENTS AND APPROVALS. The execution and delivery by
each Purchaser of this Agreement and the Ancillary Agreements to which it is a
party, do not, and the performance by each Purchaser of this Agreement and the
Ancillary Agreements to which it is a party, will not, require any consent,
approval, authorization or other action by, or filing with or notification
35
to, any Governmental Authority or other Person, except (a) the notification
requirements of the HSR Act, (b) any consents, approvals, authorizations,
filings or notifications required under Singapore law, (c) where failure to
obtain such consent, approval, authorization or action, or to make such
filing or notification, would not, individually or in the aggregate, have a
material adverse effect on Purchasers' ability to perform its obligations
hereunder or under the Ancillary Agreements, or (d) as may be necessary as a
result of any facts or circumstances relating solely to Viacom or its
Affiliates.
4.04 ABSENCE OF LITIGATION. There is no action,
arbitration, litigation or suit pending, or to any Purchaser's knowledge
threatened in writing, against any Purchaser before any Governmental Authority
that, individually or in the aggregate, would have a material adverse effect on
Purchasers' ability to perform its obligations hereunder or under the Ancillary
Agreements.
4.05 BROKERS. No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated by this Agreement based upon arrangements
made by or on behalf of any Purchaser.
4.06 FINANCING. Livewire has, and at Closing will have,
sufficient funds to pay, and to cause Livewire Sub to pay the applicable portion
of, the Adjusted Purchase Price and to perform all of their obligations
hereunder and under the Ancillary Agreements.
4.07 EXCLUSIVITY OF REPRESENTATIONS. THE REPRESENTATIONS
AND WARRANTIES MADE BY PURCHASERS IN THIS AGREEMENT ARE IN LIEU OF AND ARE
EXCLUSIVE OF ALL OTHER REPRESENTATIONS AND WARRANTIES, INCLUDING ANY IMPLIED
WARRANTIES. EACH PURCHASER HEREBY DISCLAIMS ANY SUCH OTHER OR IMPLIED
REPRESENTATIONS OR WARRANTIES, NOTWITHSTANDING THE DELIVERY OR DISCLOSURE TO
SELLERS OR ANY OF THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, AGENTS OR
REPRESENTATIVES OF ANY DOCUMENTATION OR OTHER INFORMATION.
ARTICLE V
ADDITIONAL AGREEMENTS
5.01 CONDUCT OF BUSINESS PRIOR TO THE CLOSING.
(a) Unless Livewire otherwise agrees in writing (which
agreement shall not be unreasonably withheld or delayed) and except as otherwise
set forth herein or in Section 5.01(a)(i) of the Disclosure Schedule, between
the date of this Agreement and the Closing Date, each Seller shall (i) conduct
the Business in the ordinary course consistent with past practice, (ii) use
commercially reasonable efforts to preserve substantially intact the
organization of the Business (including without limitation the key employees of
the Business (PROVIDED that no Seller or Singapore Company shall be obligated to
pay any bonus, incentive or other compensation to any employee, other than base
salary in the ordinary course of business or any bonus, incentive or other
compensation which such Seller or Singapore Company has agreed prior to the date
hereof to pay)), and (iii) use commercially reasonable efforts to preserve the
36
current relationships of the Business with its customers, suppliers,
distributors and other Persons with which any Seller has a significant
business relationship. Unless Livewire otherwise agrees in writing (which
agreement shall not be unreasonably withheld or delayed) and except as
otherwise set forth herein or in Section 5.01(a)(i) of the Disclosure
Schedule, between the date of this Agreement and the Closing Date, Viacom
shall use reasonable best efforts to the extent it is within its power to
cause each Singapore Company to (i) conduct its business in the ordinary
course consistent with past practice, (ii) use commercially reasonable
efforts to preserve substantially intact the organization of its business
(including without limitation, the key employees of its business (PROVIDED
that no Seller or Singapore Company shall be obligated to pay any bonus,
incentive or other compensation to any employee, other than base salary in
the ordinary course of business or any bonus, incentive or other compensation
which such Seller or Singapore Company has agreed prior to the date hereof to
pay)), and (iii) use commercially reasonable efforts to preserve the current
relationships of its business with its customers, suppliers, distributors and
other Persons with which any Singapore Company has a significant business
relationship.
(b) Except as expressly provided in this Agreement,
between the date of this Agreement and the Closing Date, no Seller shall, and
Viacom shall use reasonable best efforts to the extent it is within its power to
cause each Singapore Company not to, do any of the following without the prior
written consent of Livewire (which consent shall not be unreasonably withheld or
delayed):
(i) grant any Lien on any Acquired Asset or
asset of a Singapore Company, in each case,
other than Permitted Liens;
(ii) incur, assume or guarantee any indebtedness
or other obligation for borrowed money,
enter into any capitalized lease obligations
or operating lease with an initial principal
amount (or, in the case of any operating
lease, an annual lease payment) exceeding
$50,000 or enter into any deferred purchase
price obligations with an initial principal
amount exceeding $100,000, in any such case
that would constitute Assumed Liabilities or
permit any Singapore Company to incur,
assume or guarantee any indebtedness or
other obligation for borrowed money except
under the Facility Agreements between The
Development Bank of Singapore and each of
ABC and GWYB, each dated May 26, 1995, as
amended, capitalized lease obligations with
an initial principal amount not exceeding
$50,000 or deferred purchase price
obligations with a principal amount not
exceeding $50,000;
(iii) incur, assume or guarantee any other
liabilities that would constitute Assumed
Liabilities or liabilities of any Singapore
Company, in each case, other than in the
ordinary course of business consistent with
past practice;
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(iv) establish or materially increase any bonus,
insurance, severance, deferred compensation,
pension, retirement, profit sharing, stock
option, stock purchase or other employee
benefit plan, or otherwise materially
increase the compensation payable to or to
become payable to any officers or key
employees of the Business or any Singapore
Company, except in any case described above,
(a) in the ordinary course of business and
consistent with past practice, (b) as may be
required by Law, existing contracts or
applicable collective bargaining agreements
or (c) for changes made by Sellers in Plans
that affect substantially all Plan
participants;
(v) hire any individual as an employee of, or
engage any individual as a consultant to,
the Business or any Singapore Company with
an annual base salary and required bonus in
excess of $100,000, except in the ordinary
course of business and consistent with past
practice;
(vi) sell, assign, transfer, lease or otherwise
dispose of any of the Acquired Assets or any
of the assets of any of the Singapore
Companies having an aggregate replacement
value exceeding $50,000 without replacement
of an asset of equivalent value, PROVIDED,
HOWEVER, that if the Closing has not
occurred prior to December 31, 2000, Viacom
may assign and/or transfer certain Real
Property and/or leases related to certain
Real Property to Westinghouse CBS Holding
Company, Inc., which entity is a Seller
under this Agreement;
(vii) except in accordance with Law or changes
required by GAAP, materially change any
method of accounting or accounting practice
used by any Seller in connection with the
Business or by any Singapore Company;
(viii) settle any pending or material threatened
Action or Claim relating to the Business,
the Acquired Assets or any Singapore Company
other than the matters referred to in Items
1, 2, 3 or 4 of Section 3.07 of the
Disclosure Schedule (PROVIDED that neither
the Purchasers nor the Acquired Assets are
bound by any obligation in connection with
any such settlement), PROVIDED that the
Sellers and the Singapore Companies may
settle any pending or material threatened
Action or Claim against any of them solely
for a cash payment not in excess of $100,000
(for avoidance of doubt, any cash received
by any Seller prior to Closing that is paid
pursuant to any settlement of the matter
referred to in Item 1 of Section 3.07 of the
Disclosure Schedule shall not be deemed an
Acquired Asset0;
38
(ix) (a) declare or pay any dividends on or make
any distributions in respect of the capital
stock of any Singapore Company (other than
dividends payable by a JV Company to WEAPH),
(b) split, combine or reclassify any capital
stock or the capital stock of any Singapore
Company or issue or authorize or propose the
issuance of any other securities in respect
of, or in substitution for, shares of
capital stock or the capital stock of any
Singapore Company or (c) redeem, repurchase
or otherwise acquire any shares of the
capital stock of any Singapore Company other
than as contemplated in the JV Companies
Purchase Agreement;
(x) enter into, modify or amend, any contract
which would constitute an Acquired Asset or
an Assumed Liability or enter into any
Singapore Contract which contract, amendment
or modification is reasonably likely to
result in liability to any Purchaser or any
Singapore Company in excess of $100,000 per
annum;
(xi) revalue any of the Acquired Assets or assets
of the Singapore Companies, including
writing up or writing down the value of
inventory or writing-off notes or accounts
receivable, other than in the ordinary
course of business consistent with past
practice or as otherwise required by GAAP;
(xii) acquire as part of the Business or any
Singapore Company any corporation,
partnership or other business organization
or division thereof or any equity interest
therein or make any capital expenditure in
excess of $100,000 not contemplated by the
capital expenditure plan provided to
Livewire prior to the date of this
Agreement;
(xiii) make or permit any material change in the
general nature of the businesses of the
Singapore Companies;
(xiv) except as described in Section 5.01(b)(x) of
the Disclosure Schedule, amend the
Certificate of Incorporation or Bylaws (or
similar instruments with different names of
any Singapore Company), or alter through any
merger, consolidation or other similar
transaction the corporate structure of any
Singapore Company;
(xv) issue, agree to issue, deliver, sell, award,
pledge, dispose of or otherwise encumber or
authorize or propose the issuance, delivery,
sale, award, pledge, disposal or other
encumbrance of, any shares of the capital
stock of any Singapore Company or any class
or any securities convertible into or
exchangeable for, or any rights,
39
warrants or options to acquire, any such
shares or convertible or exchangeable
securities;
(xvi) make or change any material election in
respect of Taxes with respect to any
Singapore Company, or cause any Singapore
Company to make or change any material
election in respect of Taxes;
(xvii) enter into any material closing agreement
with respect any Singapore Company, consent
to any extension or waiver of the limitation
period applicable to any claim or assessment
in respect of Taxes in connection with any
Singapore Company, or cause any Singapore
Company to enter into any material closing
agreement or consent to any extension or
waiver of the limitation period applicable
to any claim or assessment in respect of
Taxes; or
(xviii) agree to do any of the foregoing.
5.02 ACCESS TO INFORMATION.
(a) From the date hereof until the Closing, upon
reasonable notice, each Seller shall cause its respective officers, directors,
employees, auditors and agents to (i) afford the officers, employees and
authorized agents and representatives of Livewire reasonable access, during
normal business hours, to the offices, properties, books and records of the
Business, as applicable, and (ii) furnish to the officers, employees and agents
and representatives of Livewire such additional financial and operating data and
other information regarding the Business as Livewire may from time to time
reasonably request; PROVIDED, HOWEVER, that such investigation shall not
unreasonably interfere with the Business or any of the businesses or operations
of any Seller.
(b) From the date hereof until the Closing, upon
reasonable notice, Viacom shall use reasonable best efforts to the extent it is
within its power to cause each Singapore Company to cause its respective
officers, directors, employees, auditors and agents to (i) afford the officers,
employees and authorized agents and representatives of Livewire reasonable
access, during normal business hours, to the offices, properties, books and
records of such Singapore Company, as applicable, and (ii) furnish to the
officers, employees and agents and representatives of Livewire such additional
financial and operating data and other information regarding such Singapore
Company as Livewire may from time to time reasonably request; PROVIDED, HOWEVER,
that such investigation shall not unreasonably interfere with any of the
businesses or operations of any Seller or any Singapore Company.
(c) After the Closing, upon reasonable notice, Sellers
and Purchasers shall furnish or cause to be furnished to each other and their
respective accountants, counsel and other representatives access, during normal
business hours, to such information (including records pertinent to the Business
or the Singapore Companies), personnel and assistance relating to the Business
or the Singapore Companies as is reasonably necessary for financial reporting
and
40
accounting matters, the preparation of any returns, reports or forms, the
defense of, prosecution of, or response required under, or pursuant to, any
lawsuit, action or proceeding or in order to enable the parties to comply
with their respective obligations under this Agreement. Sellers and
Purchasers shall also furnish or cause to be furnished to each other and
their respective accountants, counsel and other representatives access,
during normal business hours, to such information for any other reasonable
business purpose. Sellers and Purchasers shall retain until the tenth
anniversary of the Closing Date all such records pertinent to the Business or
the Singapore Companies which are owned by such Person immediately after the
Closing (excluding any Excluded Assets); after which, before disposing of any
such records, the applicable party shall give notice to such effect to the
other, and shall give the other, at the other's cost and expense, a
reasonable opportunity to remove and retain all or any part of such records
as the other may select.
5.03 CONFIDENTIALITY.
(a) Except as provided in this Section 5.03, the terms of
the letter agreement dated as of June 2, 2000 (the "CONFIDENTIALITY AGREEMENT")
between Viacom and Livewire are hereby incorporated herein by reference and
shall continue in full force and effect until the Closing, at which time the
Confidentiality Agreement and the obligations of Livewire under this Section
5.03 shall terminate; PROVIDED, HOWEVER, that the Confidentiality Agreement
shall terminate only in respect of that portion of the Evaluation Material (as
defined in the Confidentiality Agreement) exclusively relating to the
transactions contemplated by this Agreement. If this Agreement is, for any
reason, terminated prior to the Closing, the Confidentiality Agreement shall
continue in full force and effect.
(b) Each Seller severally covenants to Purchasers that,
if the Closing occurs, then from and after the Closing it shall not, and it
shall cause its Subsidiaries and its and its Subsidiaries' respective directors,
officers, attorneys and representatives not to, publicly disclose any non-public
information relating to the Business or any of the businesses of the Singapore
Companies contained in the duplicate copies of the books and records transferred
to Purchasers pursuant to this Agreement to any Person, except that such
disclosure may be made (i) as may be required by Law or by order of any
Governmental Authority or pursuant to any listing agreement with, or any
applicable rule or regulation of, the Securities and Exchange Commission, any
United States national securities exchange, any foreign securities exchange or
the National Association of Securities Dealers, Inc. or (ii) as may be necessary
to establish or enforce the rights of any Seller under this Agreement or any
Ancillary Agreement, and except that any Seller, or any Affiliate of such
Seller, may make (or permit to be made) such disclosure of such information in
its (or others') financial statements (including, without limitation, in the
notes or schedules thereto) as such Seller or such Affiliate, as the case may
be, may determine in good faith to be necessary so that such financial
statements comply with generally accepted accounting principles or any other
applicable legal requirements and may make (or permit to be made) such
disclosure of such financial statements as it may determine in its discretion.
41
5.04 REGULATORY AND OTHER AUTHORIZATIONS; CONSENTS.
(a) Each party hereto shall use its reasonable best
efforts to obtain all authorizations, consents, orders and approvals of, and
make all filings, applications or registrations with, all Governmental
Authorities or other third parties that may be or become necessary for its
execution and delivery of, and the performance of its obligations pursuant to,
this Agreement and the Ancillary Agreements and will cooperate fully with the
other parties in promptly seeking to obtain all such authorizations, consents,
orders and approvals. The parties hereto will not take any intentional action a
primary purpose of which is to delay, impair or impede the receipt of any
required approval.
(b) Each party hereto agrees to make an appropriate
filing of a Notification and Report Form pursuant to the HSR Act with respect to
the transactions contemplated hereby as soon as practicable (but in no event
later than 15 Business Days) after the date hereof and to supply promptly any
additional information and documentary material that may be requested pursuant
to the HSR Act. Each party shall bear its own filing fees, if any, associated
with its respective HSR filings.
(c) Each party hereto agrees to cooperate with each other
and use their commercially reasonable efforts to obtain any other consents and
approvals which may be required in connection with the transactions contemplated
by this Agreement and the Ancillary Agreements. However, nothing in this
Agreement shall be understood to imply that any Purchaser or any Seller shall
have any obligation to make any payment to any third party to obtain any
consent, approval or waiver. Notwithstanding anything to the contrary contained
in this Agreement, none of Sellers nor any Singapore Company nor Livewire, nor
any of their respective Affiliates shall be required to divest themselves of any
of their respective assets or properties, change their ownership or structure or
agree to limit the ownership or operation by them of any assets.
5.05 MICROWAVE LICENSES. Sellers submitted five
applications to license the fifteen broadcast auxiliary service licenses (not to
be assigned to Purchasers) as five Local Transmission Service licenses (the
"MICROWAVE LICENSES"). Each Purchaser agrees to cooperate with Sellers in using
their respective commercial reasonable efforts to obtain the issuance of the
Microwave Licenses as expeditiously as possible; PROVIDED, HOWEVER, that Sellers
shall not be required to commence any Action or challenge any determination with
respect to the Microwave Licenses.
5.06 INSURANCE. Effective as of the Effective Time, the
Acquired Assets shall cease to be insured by the insurance policies currently
maintained by Sellers and certain of their Affiliates (other than any insurance
policies owned or obtained by any of the Singapore Companies and which do not
cover any entities other than the Singapore Companies). For avoidance of doubt,
with respect to insurance coverage written on an "occurrence basis," Sellers
will have no liability for insurance coverage for occurrences which take place
on and after the Effective Time, and with respect to insurance coverage written
on a "claims made basis", Sellers will have no liability for insurance coverage
for claims made after the Effective Time.
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5.07 GUARANTEED OBLIGATIONS. Purchasers shall cooperate
with Sellers and use their respective commercially reasonable efforts to obtain
the release of Sellers and any of their Affiliates from their respective
obligations under the guarantees set forth in Section 5.07 of the Disclosure
Schedule and, if such release is not obtained by the Closing, at the Closing
Purchasers will repay in full the debt and other obligations which are the
subject of such guarantees. Livewire will pay any breakage fees or costs
incurred as a result of such repayment. Provided that Sellers receive assurances
from Livewire that the Closing will occur, Sellers will deliver any notices
required under the loan agreements underlying the guarantees referred to in
Section 5.07 of the Disclosure Schedule to effectuate any repayment of such debt
and other obligations as provided in this Section 5.07.
5.08 FURTHER ACTION. Each of the parties hereto shall
execute and deliver such documents and other papers and take such further
actions as may be reasonably required to carry out the provisions of this
Agreement and give effect to the transactions contemplated hereby, whether
before, at or after the Closing.
5.09 [Intentionally Omitted.].
5.10 INTER-COMPANY ACCOUNTS. Except with respect to the
Seller Loans, which may be contributed, and the Seller Loan Agreements, which
may be terminated, in each case as contemplated in Section 5.12 hereof,
immediately prior to the Closing, all inter-company accounts and notes between
GWNS and Sellers or any of their respective Affiliates shall be canceled;
provided that inter-company notes and accounts, if any, between the Singapore
Companies shall not be canceled.
5.11 NON-SOLICITATION OF CERTAIN EMPLOYEES.
(a) Sellers agree that, if the Closing is consummated,
for a period of two years after the Closing Date, they will use commercially
reasonable efforts not to solicit for employment any person who as of the
Closing Date was a management level employee of any Seller engaged in the
Business or a management level employee of any Singapore Company and who became
an employee of Livewire or its Subsidiaries on the Closing Date; PROVIDED,
HOWEVER, that the foregoing shall not preclude any Seller from (i) soliciting
any such person whose employment has been terminated by Livewire or any of its
Subsidiaries or (ii) placing general advertisements.
(b) Purchasers agree that, if the Closing is consummated,
for a period of two years after the Closing Date, they will use commercially
reasonable commercial efforts not to solicit for employment any of the persons
listed on Exhibit I; PROVIDED, HOWEVER, that the foregoing shall not preclude
any Purchaser from (i) soliciting any such person whose employment has been
terminated by Viacom or any of its Subsidiaries or (ii) placing general
advertisements.
5.12 CONTRIBUTION OF SELLER LOANS AND TERMINATION OF
SELLER LOAN AGREEMENTS. All Seller Loans shall be contributed by WEAPH to ABC
and GWYB, as applicable, as a contribution to capital and all Seller Loan
Agreements shall be terminated on or prior to the
43
Closing; PROVIDED that such contribution and termination has no adverse tax,
legal or accounting consequences for any Seller, any Singapore Company or any
Purchaser.
5.13 SECTION 338 ELECTION. Viacom shall reasonably
cooperate with Purchasers to make an election under Section 338 of the Code with
respect to the purchase of the WEAPH Shares.
ARTICLE VI
EMPLOYEE AND EMPLOYEE BENEFIT MATTERS
6.01 SCOPE OF SECTION. This Article VI contains the
covenants and agreements of the parties with respect to (a) the status of
employment of the employees employed in the Business ("BUSINESS EMPLOYEES") upon
the sale of the Business to the Purchaser, and (b) the employee benefits and
employee benefit plans provided or covering such Business Employees and former
employees of the Business who terminated employment or who retired from the
Business ("FORMER BUSINESS EMPLOYEES"). Nothing herein expressed or implied
confers upon any Business Employee or Former Business Employee any rights or
remedies of any nature or kind whatsoever under or by reason of this Article VI.
6.02 US EMPLOYEES. This Section 6.02 applies only to
Business Employees and Former Business Employees employed or previously employed
by the Business located in the United States.
(a) Purchaser shall offer employment effective as of the
Closing Date to all Business Employees located in the US who are employed by
Sellers in the US immediately prior to the Closing Date, including those on
short-term disability. If any Business Employee is absent from active employment
on the Closing Date due to workers compensation, illness, military leave,
disability leave, or other authorized leave of absence, Purchaser shall offer
employment to such Business Employee on the date such absence from active
service ends (such commencement date hereinafter referred to as the "EFFECTIVE
DATE"). For a period not less than one year following the Closing Date,
Purchaser shall provide such Business Employees with a position with similar job
requirements and responsibilities, the same base salary or wages, and benefits
that in the aggregate are comparable to the benefits provided to Business
Employees by the US Business on the day before the Closing Date; provided,
however, that in providing a comparable level of salary, wages and benefits
following the Closing Date, Purchaser shall not be required to take into account
benefits provided under the CBS Combined Pension Plan nor any retiree health or
retiree life insurance benefits. The foregoing shall not be construed to limit,
in any way, Purchaser's ability to change the terms and conditions of employment
of any Business Employee after the Closing Date.
(b) If Purchaser terminates the employment of any
Business Employee within one year after the Closing Date, Purchaser shall pay
such Business Employee a severance benefit that shall in no event be less than,
nor paid later than, the total severance benefit (including basic and
supplemental payments), if any, to which such Business Employee would have been
entitled if Sellers' or their Affiliates' severance plans, as in effect as of
the Closing Date, applied to such
44
termination of employment. For purposes of this Section 6.02(b), service with
both Sellers and Purchaser shall be taken into account in computing the
amount of such benefit.
(c) Viacom agrees to use reasonable efforts to facilitate
the transition of Business Employees to employment with Purchaser as of the
Closing Date. Such reasonable efforts shall include affording Purchaser
reasonable opportunities to review, to the extent permitted by law, employment
and personnel records (other than medical records) of Employees, to discuss with
Employees terms and conditions of employment with Purchaser as of the Closing
Date and to distribute to Business Employees forms and documents relating to
employment with Purchaser.
(d) Except to the extent prohibited by law, Sellers shall
deliver to Purchaser originals or copies of all personnel files (including
medical records, if any, but excluding benefit plan records) and records
relating to Business Employees, and Sellers shall have reasonable continuing
access to such files and records thereafter.
(e) Purchaser shall be responsible for, and shall
indemnify and hold harmless, Sellers and their respective Affiliates against any
liability, claim or obligation (including reasonable attorney's fees) relating
to or arising out of the employment or termination of employment, including
claims for severance, on or after the Closing Date (or, if applicable, the
Effective Date) of Employees who accept employment with Purchaser.
6.03 CBS COMBINED PENSION PLAN. Sellers shall retain all
assets and liabilities under the CBS Combined Pension Plan (the "CCPP")
attributable to service prior to the Closing Date (or, if applicable, the
Effective Date) for each Business Employee and Former Business Employee who is a
participant in the CCPP immediately prior to the Closing.
6.04 CBS EMPLOYEE INVESTMENT FUND. Seller shall treat
Business Employees as having terminated employment with Seller for purposes the
CBS Employee Investment Fund and any other defined contribution plan in which
Business Employees participate prior to the Closing Date (the "EIF"). Seller
shall amend the EIF to provide that the account balances for all Business
Employees treated as having terminated employment with Seller or its Affiliates
shall be fully and immediately vested and non-forfeitable. Seller shall allocate
matching contributions to the accounts of Business Employees in the ordinary
course of business. Purchaser will cause one or more tax-qualified defined
contribution plans established or maintained by Purchaser ("PURCHASER'S SAVINGS
PLAN") to accept rollover contributions by Business Employees of any account
balances distributed to them by the EIF. Any such rollover contributions will be
accepted in cash only. Notwithstanding the foregoing, Purchaser shall allow any
such Business Employee's outstanding loan under the EIF to be rolled over into
the Purchaser's Savings Plan. The distribution and rollover described herein
shall comply with applicable law, and each party shall make all filings and take
any actions required of such party by applicable law in connection therewith. To
the extent relevant under the Purchaser's Savings Plan, Business Employees shall
be given service credit for service recognized for the equivalent purpose under
EIF.
6.05 RETIREE HEALTH AND LIFE INSURANCE BENEFITS. Business
Employees who have met the age and service requirements for retirement on or as
of the Closing Date (or, if
45
applicable, the Effective Date) whose names are set forth on Section 6.05 to
the Disclosure Schedule shall be eligible to receive retiree health benefits
from each of the Sellers' plan providing such benefits ("SELLERS' RETIREE
PLAN") for themselves and their eligible dependents, when they retire from
the Purchaser under the terms and conditions of the Plans in effect when they
retire; provided, however, that the right of such Business Employees to
receive such benefits from Sellers or their respective Affiliates are subject
to the availability of and terms and conditions of Sellers' Retiree Plan at
the time the Business Employee retires from Purchaser. Notwithstanding any
other term of this Agreement, in no event will Purchasers be liable for any
cost or expense of such coverage under Seller's Retiree Plan.
6.06 EMPLOYEE WELFARE PLANS. (a) The employee welfare
benefit plan or plans established or maintained by Purchaser for the benefit of
Business Employees and, if applicable, Former Business Employees shall (i)
credit all service with Sellers or their respective Affiliates for all purposes
under the new plans, including eligibility, participation and benefit
entitlement, (ii) waive any pre-existing condition limitation or exclusion, and
(iii) if the Closing Date occurs on or after January 1, 2001, credit all
payments made for health care expenses during the current plan year for purposes
of deductibles, co-payments and maximum out-of-pocket limits. Sellers or their
applicable Affiliate shall be responsible for any claims for medical or dental
benefits incurred by any Business Employee or his or her covered dependents
prior to such Employee's date of hire by Purchaser in accordance with the terms
of Sellers' or their applicable Affiliate's medical and dental plans, and
Purchaser shall be responsible for any medical or dental claims incurred by any
Business Employee or his or her covered dependents after the Business Employee's
date of hire by Purchaser in accordance with the terms of Purchasers' medical
and dental plans. For purposes of this Section 6.06, a medical or dental claim
shall be deemed to be incurred when the services giving rise to the claim are
performed and not when the Business Employee is billed for such services or
submits a claim for benefits.
(b) In the event that the Closing Date occurs prior to
January 1, 2001, for the period from the Closing Date through December 31, 2000
the Seller shall continue to cover the Business Employees in the group medical
and dental plans that covered the Business Employees prior to the Closing Date.
Purchaser shall promptly reimburse Seller for Seller's out-of pocket expenses
for maintaining such coverage upon transmission to Purchaser of a statement of
such expenses in relation thereto.
(c) Seller and their Affiliates will retain full
responsibility and liability for offering and providing "continuation coverage"
of any "qualified beneficiary" who is covered by a "group health plan" sponsored
or contributed to the Sellers or their Affiliates and who has experienced a
"qualifying event" or is receiving "continuation coverage" through and including
the Closing Date. As used in this Section 6.06, "continuation coverage",
"qualified beneficiary", "group health plan" and "qualifying event" all shall
have the meanings given such terms under Code Section 4980B.
6.07 VACATION. Purchaser shall assume all liabilities for
unpaid, accrued vacation of Business Employees as of the Closing Date and shall
permit Business Employees to use their vacation entitlement accrued as of the
Closing Date until 6 months following the Closing Date or such later date as
Purchaser may determine, in accordance with the terms of
46
Sellers' or their applicable Affiliate's vacation policy. Service with both
Sellers and their Affiliates and Purchaser shall be taken into account in
determining Business Employees' vacation entitlement under Purchaser's
vacation policy.
6.08 WARN ACT LIABILITY. Purchaser agrees to pay and be
responsible for all liability, cost, expense and sanctions resulting from any
failure to comply with the WARN Act, and the regulations thereunder, that is
related to or arises out of any actions taken by the Purchaser on or following
the Closing Date.
6.09 IRS FORM W-2. The parties agree that, in the event
the Closing Date occurs following December 31, 2000, they shall comply with the
alternative procedure of Section 5 of IRS Revenue Procedure 96-60, 1996-53 IRB
24, and that Purchaser shall prepare and file Forms W-2 for the Employees of all
Sellers for the year in which the Closing occurs and Sellers and their
Affiliates shall be relieved of preparing IRS Forms W-2 for the Employees for
the year in which the Closing occurs.
6.10 INTERNATIONAL EMPLOYMENT MATTERS. Except as otherwise
provided in the second sentence of Section 2.06, Purchaser shall assume or
retain and be responsible for Sellers' and their respective Affiliates'
obligations and liabilities relating to the employment (including any employment
contracts and employee benefit plans) of the Business Employees and Former
Business Employees who are or were employed outside the United States
(collectively, the "INTERNATIONAL BUSINESS EMPLOYEES") and Purchaser shall take
any and all actions necessary or appropriate (if any) to continue the employment
of such International Business Employees and to have Purchaser assume or retain
all obligations and liabilities relating to their employment (including, but not
limited to, any employee benefit plans listed in Section 3.12(b) of the
Disclosure Schedule and any employment contracts) under local laws and practices
without Sellers or any of their Affiliates having any liability to any such
employees for severance, redundancy, termination, payment in lieu of notice,
indemnity or other payments to any of such employees by reason of, or as a
result of, the actions contemplated by this Agreement, including but not limited
to this Article VI.
ARTICLE VII
CONDITIONS TO CLOSING
7.01 CONDITIONS TO OBLIGATIONS OF SELLERS. The obligations
of Sellers to consummate the transactions contemplated by this Agreement shall
be subject to the fulfillment or waiver, at or prior to the Closing, of each of
the following conditions:
(a) REPRESENTATIONS AND WARRANTIES; COVENANTS. (i) The
representations and warranties of Livewire contained in this Agreement (A) that
are qualified as to materiality, shall be true and correct and (B) that are not
qualified as to materiality, shall be true and correct in all material respects,
in each case as of the Closing Date, other than representations and warranties
made as of another date, which representations and warranties shall have been
true and correct, or true and correct in all material respects, as the case may
be, as of such date; (ii) the obligations, covenants and agreements of
Purchasers contained in this Agreement to be performed or complied with by any
of them on or prior to the Closing Date (A) that are qualified
47
as to materiality shall have been performed or complied with by them and (B)
that are not qualified as to materiality shall have been performed or
complied with by them in all material respects, in each case on or prior to
the Closing Date, except that Purchasers shall have complied in all respects
with its obligations under Sections 2.02 and 2.05 hereof; and (iii) Viacom
shall have received a certificate to such effect signed by a duly authorized
senior officer of each Purchaser;
(b) HSR ACT. Any waiting period (and any extension
thereof) under the HSR Act applicable to the purchase and sale of the Acquired
Assets and assumption of the Assumed Liabilities contemplated hereby shall have
expired or shall have been terminated;
(c) NO GOVERNMENTAL ORDER. There shall be no Governmental
Order in existence that restrains or that materially and adversely affects the
transactions contemplated by this Agreement or is likely to render it impossible
or unlawful to consummate such transactions or that imposes any conditions that
are, individually or in the aggregate, reasonably likely to have a material
adverse effect on the Business, the Acquired Assets (including the WEAPH Shares)
or the Singapore Companies taken as a whole or Viacom;
(d) RESOLUTIONS. Viacom shall have received a true and
complete copy, certified by the Secretary or an Assistant Secretary of each
Purchaser, of the resolutions duly and validly adopted by the Board of Directors
of Purchaser evidencing its authorization of the execution and delivery of this
Agreement and the Ancillary Agreements and the consummation of the transactions
contemplated hereby and thereby;
(e) ANCILLARY AND CBS TRANSMISSION SERVICES AGREEMENTS.
The Ancillary Agreements and the CBS Transmission Services Agreement shall be
executed and delivered by all parties thereto other than Viacom and its
Affiliates;
(f) CONSENTS. Each of the consents listed in Section
7.01(f) of the Disclosure Schedule shall have been obtained and shall be in full
force and effect; and
(g) RELEASE OF GUARANTEES. The release of Sellers and any
of their Affiliates from their respective obligations under the guarantees set
forth in Section 5.07 of the Disclosure Schedule shall have been obtained, or at
the Closing Purchasers shall provide to Sellers, in form and substance
reasonably satisfactory to Sellers, evidence of the payment in full of the debt
and other obligations which are the subject of such guarantees.
7.02 CONDITIONS TO OBLIGATIONS OF PURCHASERS. The
obligations of Purchasers to consummate the transactions contemplated by this
Agreement shall be subject to the fulfillment or waiver, at or prior to the
Closing, of each of the following conditions:
(a) REPRESENTATIONS AND WARRANTIES; COVENANTS. (i) The
representations and warranties of Viacom contained in this Agreement (A) that
are qualified as to materiality, shall be true and correct and (B) that are not
qualified as to materiality, shall be true and correct in all material respects,
in each case as of the Closing Date, other than representations and warranties
made as of another date, which representations and warranties shall have been
true and correct,
48
or true and correct in all material respects, as the case may be, as of such
date; (ii) the obligations, covenants and agreements of Sellers contained in
this Agreement to be performed or complied by any of them on or prior to the
Closing Date (A) that are qualified as to materiality, shall have been
performed or complied with them and (B) that are not qualified as to
materiality, shall have been performed or complied with by them in all
material respects, in each case on or prior to the Closing Date except that
Sellers shall have complied in all respects with their obligations under
Section 2.01 hereof; and (iii) Purchasers shall have received a certificate
to such effect signed by a duly authorized senior officer of Viacom;
(b) HSR ACT. Any waiting period (and any extension
thereof) under the HSR Act applicable to the purchase and sale of the Acquired
Assets (including the WEAPH Shares) and assumption of the Assumed Liabilities
contemplated hereby shall have expired or shall have been terminated;
(c) NO GOVERNMENTAL ORDER. There shall be no Governmental
Order issued after the date hereof and prior to the Closing Date in existence
that prohibits or renders it impossible or unlawful to consummate the
transactions contemplated hereby or that (as a condition to consummating all or
any part of such transactions):
(i) would prohibit or limit the ownership or
operation by Livewire or any of its
Affiliates of any portion of the business or
assets of Livewire or any of its Affiliates,
or compel Livewire or any of its Affiliates
to dispose of or hold separate any portion
of the business or assets of Livewire or any
of its Affiliates;
(ii) would impose limitations on the ability of
Livewire, Livewire Sub or WEAPH, as the case
may be, to acquire or hold, or exercise full
rights of ownership of, any Acquired Assets
or any shares of WEAPH or the Singapore
Companies, including the right to vote the
capital stock of WEAPH or each other
Singapore Company on all matters properly
presented to the stockholders of WEAPH or
such other Singapore Company;
(iii) would prohibit Livewire or any of its
Affiliates from effectively controlling in
any material respect the business and
operations of Livewire or any of its
Subsidiaries;
(iv) would require a change in the ownership,
capital structure, management or governance
provisions of Livewire or any of its
Affiliates; or
(v) imposes any other conditions that,
individually or in the aggregate, are
reasonably likely to have a Material Adverse
Effect.
(d) RESOLUTIONS. Purchasers shall have received a true
and complete copy, certified by the Secretary or an Assistant Secretary of each
Seller, of the resolutions duly and
49
validly adopted by the Board of Directors or Executive Committee of each
Seller evidencing its respective authorization of the execution and delivery
of this Agreement and the Ancillary Agreements to which such Seller is a
party and the consummation of the transactions contemplated hereby and
thereby;
(e) ANCILLARY AND CBS TRANSMISSION SERVICES AGREEMENTS.
The Ancillary Agreements and the CBS Transmission Services Agreements shall be
executed and delivered by all parties thereto other than Purchasers;
(f) CONSENTS. Each of the consents and approvals listed
in Section 7.02(f) of the Disclosure Schedule shall have been obtained and shall
be in full force and effect; and
(g) FCC APPROVAL. (i) Either the pending applications set
forth in Section 3.09 of the Disclosure Schedule shall have been granted
authorizing the operation of the microwave facilities sufficient for the
operation of the Business as it is presently conducted and has been operated
during the last six (6) months through use of the Broadcast Auxiliary Service
licenses that the pending applications are intended to replace; OR other
substitute facilities or transmission capacity sufficient for the operation of
the Business as it is presently conducted and has been conducted during the past
six (6) months through use of the Broadcast Auxiliary Service licenses
acceptable to Livewire, such acceptance not to be unreasonably withheld, is
provided by Sellers; and (ii) the FCC shall have granted its approval to the
transfer to Purchaser of the licenses set forth in Section 3.09 of the
Disclosure Schedule and, unless substitute facilities or capacity are provided
by Seller pursuant to clause (i) above, to the authorizations for which
applications are now pending before the FCC also listed in Section 3.09 of the
Disclosure Schedule, which approval shall not modify the operating authority set
forth in the existing licenses (or applied for in the pending applications) in a
way that would individually or in the aggregate have a Material Adverse Effect.
ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER
8.01 TERMINATION. This Agreement may be terminated at any
time prior to the Closing as follows:
(a) by the mutual written consent of Viacom and Livewire;
(b) by either Viacom or Livewire, if the Closing shall
not have occurred within 180 days from the date hereof; PROVIDED, HOWEVER, that
the right to terminate this Agreement under this Section 8.01(b) shall be
suspended as to any party whose failure to fulfill any material obligation under
this Agreement shall have been the cause of, or shall have resulted in, the
failure of the Closing to occur prior to such date, until the 10th day after
such failure has been cured;
(c) by either Viacom or Livewire in the event of the
issuance of a final, nonappealable Governmental Order restraining or prohibiting
the transactions contemplated herein; or
50
(d) by Livewire in the event of the delivery by Viacom of
a notice pursuant to clause (A) of the last sentence of Section 9.02(b);
PROVIDED, HOWEVER, that notice of such termination shall be delivered to Viacom
within three business days after receipt of Viacom's notice pursuant to such
clause (A).
8.02 TERMINATION IS NON-EXCLUSIVE REMEDY. In the event of
the termination of this Agreement as provided in Section 8.01, this Agreement
shall forthwith become void and there shall be no liability on the part of any
party hereto, except as set forth in Sections 5.03, 10.02 and 10.10 and nothing
herein shall relieve any party from liability for any willful failure to perform
its obligations under this Agreement prior to any termination thereof.
8.03 WAIVER. At any time prior to the Closing, any party
may (a) extend the time for the performance of any of the obligations or other
acts of any other parties hereto, (b) waive any inaccuracies in the
representations and warranties of the other parties hereto contained herein or
in any document delivered pursuant hereto, or (c) waive compliance by the other
parties hereto with any of the agreements or conditions contained herein. Any
such extension or waiver shall be valid only if set forth in an instrument in
writing signed by a duly authorized officer of the party to be bound thereby.
ARTICLE IX
INDEMNIFICATION
9.01 INDEMNIFICATION BY PURCHASERS.
(a) Subject to Section 10.01, Livewire and Livewire Sub
shall jointly and severally indemnify and hold Sellers and their Affiliates and
their respective employees, officers and directors (collectively, the "VIACOM
INDEMNIFIED PARTIES") harmless from and against, and agrees to promptly defend
any Viacom Indemnified Party from and reimburse any Viacom Indemnified Party
for, any and all losses, damages, costs, expenses, liabilities, obligations and
claims of any kind (including any Action brought by any Governmental Authority
or Person and including reasonable attorneys' fees and expenses reasonably
incurred) (collectively, "LOSSES"), which such Viacom Indemnified Party may at
any time suffer or incur, or become subject to, which are the direct and
proximate result of:
(i) the inaccuracy as of the Closing Date of any
representations and warranties made by
Livewire in Article IV of this Agreement;
(ii) any failure by any Purchaser to carry out,
perform, satisfy and discharge any of its
covenants or agreements contained in this
Agreement;
(iii) the failure to obtain the termination and
unconditional release as of the Closing Date
of all outstanding guarantees issued by
Viacom or any of its Affiliates relating to
the Business, the Acquired Assets, the
Assumed Liabilities or the Singapore
Companies (other than any guarantee to the
extent relating to any Non-Assumed
Liability);
51
(iv) the Assumed Liabilities;
(v) the operation or ownership of the Business,
the Acquired Assets, in each case, other
than any Non-Assumed Liability; or
(vi) the operation or ownership of the Singapore
Companies.
(b) Notwithstanding any other provision to the contrary,
(x) Purchasers shall not be required to indemnify and hold harmless any Viacom
Indemnified Party pursuant to Section 9.01(a) unless the applicable Viacom
Indemnified Party has asserted a claim with respect to such matters within the
applicable survival period set forth in Section 10.01, and (y) the cumulative
indemnification obligation of Purchasers under Section 9.01(a)(i) of this
Article IX shall in no event exceed the aggregate Adjusted Purchase Price.
9.02 INDEMNIFICATION BY VIACOM.
(a) Subject to Section 10.01, Viacom shall indemnify and
hold Livewire, its Affiliates and their respective employees, officers and
directors (collectively, the "PURCHASER INDEMNIFIED PARTIES") harmless from and
against, and agrees to promptly defend any Purchaser Indemnified Party from and
reimburse any Purchaser Indemnified Party for, any and all Losses which such
Purchaser Indemnified Party may at any time suffer or incur, or become subject
to which are the direct and proximate result of:
(i) the inaccuracy as of the Closing Date of any
representations and warranties made by
Viacom in Article III of this Agreement (in
each case without giving effect to any
materiality qualification (including
qualifications indicating accuracy in all
material respects) or "Material Adverse
Effect" qualification (including, without
limitation, qualifications indicating
accuracy with such exceptions as would not
result in a Material Adverse Effect);
(ii) any failure by Sellers to carry out,
perform, satisfy and discharge any of their
covenants or agreements contained in this
Agreement;
(iii) the Non-Assumed Liabilities; or
(iv) any liability of WEAPH or Viacom under the
JV Companies Purchase Agreement or arising
from or in connection with the purchase of
JV Shares under JV Companies Purchase
Agreement.
(b) Notwithstanding any other provision to the contrary,
Viacom shall not be required to indemnify and hold harmless any Purchaser
Indemnified Party pursuant to Section 9.02(a), (i) unless Livewire has asserted
a claim with respect to such matters within the applicable survival period set
forth in Section 10.01, (ii) except in the case of a purchase price adjustment
pursuant to Section 2.13 or a breach of Sellers' obligations contained in the
provisos to clauses (ii) of the first and second sentences of Section 5.01(a),
until the aggregate amount of Purchaser Indemnified Parties' Losses resulting
from the inaccuracy of a particular representation
52
or warranty or the failure to carry out, perform, satisfy or discharge any
particular covenant or agreement (calculated on a net after-tax basis, as
described below) exceeds $20,000, after which, subject to clause (iii) of
this Section 9.02(b), Viacom shall be obligated for all Losses of Purchaser
Indemnified Parties (calculated on a net after-tax basis, as described below)
in excess of such amount and (iii) until the aggregate amount of the excesses
determined pursuant to clause (ii) of this Section 9.02(b) (calculated on a
net after-tax basis, as described below) exceeds $750,000 (the "BASKET
AMOUNT"), after which Viacom shall be obligated for such excesses (calculated
on a net after-tax basis, as described below) in excess of the Basket Amount;
PROVIDED, HOWEVER, that the cumulative indemnification obligation of Viacom
under Section 9.02(a)(i) shall in no event exceed the aggregate Adjusted
Purchase Price. Further, Viacom shall not be required to indemnify and hold
harmless any Purchaser Indemnified Party for any Loss (A) resulting from the
inaccuracy, breach, non-fulfillment or non-performance of any representation,
warranty, covenant or agreement if such inaccuracy, breach, non-fulfillment
or non-performance arises from events occurring after the date of this
Agreement and such inaccuracy, breach, non-fulfillment or non-performance is
disclosed by Viacom to Livewire in a written notice referring to this Section
9.02(b) given not less than two days prior to the Closing or (B) to the
extent a reserve for such Loss is included in or taken into account in the
calculation or determination of Closing Working Capital.
(c) Any Losses for which indemnification would be
applicable under this Article IX shall be calculated net of (i) any insurance
proceeds payable to an indemnified party in connection with such Losses, (ii)
any tax benefit received or accruing to an indemnified party, or (iii) any other
amounts recoverable or receivable by the indemnified party from any other third
party, whether under a guarantee, settlement, contractual or legal
indemnification arrangement or otherwise. If any such proceeds, benefits or
other recovered amounts are received by the Indemnified Party (as defined below)
after its receipt of any indemnification payment from the Indemnifying Party (as
defined below) hereunder, the Indemnified Party shall promptly pay over to the
Indemnifying Party all such amounts received, up to the amount of the
indemnification payment made. The parties hereto hereby waive all rights to
punitive or consequential damages or lost profits upon resolution of any dispute
arising out of or relating to this Agreement, except that any Indemnifying Party
shall be responsible for indemnifying any Indemnified Party for punitive or
consequential damages awarded to any non-affiliated third party pursuant to any
Indemnification Claim (as defined below).
9.03 NOTIFICATION OF CLAIMS.
(a) A party entitled to be indemnified pursuant to
Section 9.01 or 9.02 (the "INDEMNIFIED PARTY") shall, within 15 days of
receiving notice or becoming aware of the existence or assertion of any claim or
demand, the commencement of any action, suit or proceeding, the occurrence of
any event or the existence of any fact or circumstance which the Indemnified
Party has determined has given or could give rise to a right of indemnification
under this Agreement (an "INDEMNIFICATION CLAIM"), notify the party liable for
such indemnification (the "INDEMNIFYING PARTY") in writing of such claim,
describing in reasonable detail the basis of its claim for indemnification and
providing copies of all written material relating thereto and an estimate of the
amount of Losses that have been or may be suffered by the Indemnified Party. In
the event that an Indemnified Party shall fail to give such notice of an
Indemnification Claim
53
within such 15-day period, the Indemnifying Party shall be relieved of
liability hereunder in respect of such Indemnification Claim (or the facts
and circumstances giving rise thereto) to the extent that the Indemnifying
Party is prejudiced or damaged as a result of such failure (and, to such
extent, all Losses resulting from such Indemnification Claim shall be
disregarded for purposes of determining whether the Basket Amount has been
exceeded).
(b) If the Indemnified Party shall notify the
Indemnifying Party of any Indemnification Claim pursuant to Section 9.03(a), and
if such Indemnification Claim relates to a claim or demand asserted by a third
party against the Indemnified Party, the Indemnifying Party shall have the right
to assume control over the defense and settlement thereof and employ counsel
reasonably acceptable to the Indemnified Party to defend any such claim asserted
against the Indemnified Party. The Indemnified Party shall have the right to
participate in the defense of any such claim or demand at its own expense. The
Indemnified Party shall make available to the Indemnifying Party or its agents
all records and other material in the Indemnified Party's possession reasonably
required for its use in contesting or settling any such claim. The Indemnifying
Party shall have the right at any time to settle or compromise any
Indemnification Claim without the consent of the Indemnified Party if, as a part
of such settlement or compromise, the Indemnified Party is given an
unconditional release of all liability with respect to such claim by all
relevant parties asserting same and such settlement or compromise relates solely
to monetary damages. In the event such settlement or compromise involves
non-monetary damages with respect to the Indemnified Party, the Indemnified
Party shall have the right to consent to such settlement or compromise, which
consent shall not be unreasonably withheld or delayed.
(c) Upon the payment of any amount pursuant to an
Indemnification Claim, the Indemnifying Party shall be subrogated, to the extent
of such payment, to all of the Indemnified Party's rights of recovery against
any third parties with respect to the matters to which such Indemnification
Claim relates.
9.04 CERTAIN EXCLUSIVE REMEDIES. Except (i) as provided in
Section 8.01 and (ii) for the indemnification obligations specified in Article
VI, Viacom and Livewire acknowledge and agree that the indemnification
provisions of Sections 9.01 and 9.02 shall be the sole and exclusive remedies of
Viacom and Livewire, respectively, for any breach of the representations or
warranties herein or nonperformance of any covenants and agreements herein of
the other party or its Affiliates.
9.05 LIMITATION ON LIABILITIES. Anything contained herein
to the contrary notwithstanding, neither Purchaser shall indemnify the Viacom
Indemnified Parties from, or otherwise be obligated or liable to any Viacom
Indemnified Party in respect of, any Losses to which any Viacom Indemnified
Party may at any time claim, suffer, incur, or become subject to, to the extent
that such Losses constitute, or are the direct and proximate result of, (i) a
breach of any representation or warranty of Viacom under this Agreement or (ii)
a breach by any Seller of any covenant of such Seller set forth in clause (i),
(ii), (iii), (vi), (vii), (viii), (ix), (x), (xi), (xv), (xvi), (xvii), or, with
respect to any of the foregoing clauses only, (xviii) of Section 5.01(b) of this
Agreement (or the facts constituting any such breach), notwithstanding (and
determined without giving effect to) any limitation upon any such representation
or warranty set forth
54
in Section 10.01 of this Agreement or any limitation on indemnification set
forth in Section 9.02(b) of this Agreement.
ARTICLE X
GENERAL PROVISIONS
10.01 SURVIVAL. All representations, warranties, covenants
and agreements of Sellers and Purchasers contained in or made pursuant to this
Agreement or in any Exhibit or Schedule hereto or in any certificate furnished
pursuant hereto or in any of the Ancillary Agreements, shall survive (and not be
affected in any respect by) the Closing, PROVIDED, HOWEVER, that: (a) the
representations and warranties contained in or made pursuant to the third to
last sentence of Section 3.10(c) and the second to last sentence of Section
3.10(d) of this Agreement shall survive indefinitely; (b) the representations
and warranties contained in or made pursuant to Section 3.17 of this Agreement
shall terminate on, and no Indemnification Claim or other claim or action may be
brought with respect thereto after, the third anniversary of the Closing Date;
(c) the representations and warranties contained in or made pursuant to Section
3.11 of this Agreement shall terminate on, and no Indemnification Claim or other
claim or action may be brought with respect thereto after, the third anniversary
of the Closing Date; provided, however that such representations and warranties
shall terminate on the Closing Date if (x) Purchasers do not use commercially
reasonable efforts to obtain title insurance with respect to the Real Property
to be effective as of the Closing Date or (y) if Livewire or any of its
Affiliates obtains title insurance with respect to the Real Property; (d) the
representations and warranties contained in or made pursuant to Section 3.13 of
this Agreement shall terminate on, and no Indemnification Claim or other claim
or action may be brought with respect thereto after the expiration of the
applicable statute of limitations; (e) the representations and warranties
contained in or made pursuant to this Agreement other than those referred to in
the foregoing clauses (a) - (d) shall terminate on, and no Indemnification Claim
or other claim or action may be brought with respect thereto after, the one year
anniversary of the Closing Date; (f) the covenants and agreements contained in
Section 5.01 shall terminate on, and no Indemnification Claim or other claim or
action may be brought with respect thereto after, the one year anniversary of
the Closing Date; and (g) the covenants and agreements contained in Sections
5.04 and 5.05 shall terminate on the Closing Date. Any representation, warranty,
covenant or agreement that is the subject of a claim which is asserted in
writing to an Indemnifying Party in accordance with the provisions of Article IX
hereof prior to the expiration of the applicable period set forth above shall
survive with respect to such claim until the final resolution thereof.
10.02 EXPENSES. Except as may be otherwise specified
herein, all costs and expenses, including fees and disbursements of counsel,
financial advisors and accountants, incurred in connection with this Agreement
and the transactions contemplated hereby shall be paid by the party incurring
such costs and expenses, whether or not the Closing shall have occurred.
10.03 NOTICES. All notices, requests, claims, demands and
other communications hereunder shall be in writing and shall be deemed to have
been duly given or made when delivered in person one Business Day after having
been dispatched via a nationally recognized overnight courier service, when
dispatched by facsimile, or three Business Days after being sent
55
by registered or certified mail (postage prepaid, return receipt requested)
to the respective parties at the following addresses (or at such other
address for a party as shall be specified in a notice given in accordance
with this Section 10.03):
(a) if to Sellers:
Viacom Inc.
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel and
Deputy General Counsel
Telecopier: (000) 000-0000 and (000) 000-0000
(b) if to Purchasers:
Liberty Livewire Corporation
000 Xxxxxxxx - 0xx Xxxxx
Xxxxx Xxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxx
Xxxxxx X. Xxxxx, General Counsel
Telecopier: (000) 000-0000
10.04 PUBLIC ANNOUNCEMENTS. Except as may be required by
Law or stock exchange rules, no party to this Agreement shall make any public
announcements in respect of this Agreement or the transactions contemplated
hereby or otherwise communicate with any news media without the prior consent of
the other party, which consent shall not be unreasonably withheld or delayed.
10.05 BULK SALES LAW. Sellers and Purchasers agree to waive
compliance with the provisions of the bulk sales laws of any jurisdiction in
connection with the consummation of the transactions contemplated hereby.
10.06 HEADINGS. The headings contained in this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
10.07 SEVERABILITY. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced because of any Law
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
adverse to any party hereto. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible in a mutually acceptable
manner in order that the transactions contemplated hereby be consummated as
originally contemplated to the greatest extent possible.
10.08 ENTIRE AGREEMENT. This Agreement, together with the
Confidentiality Agreement and the Ancillary Agreements, constitutes the entire
agreement of the parties hereto
56
with respect to the subject matter hereof and thereof and supersedes all
prior agreements and undertakings, both written and oral, between Viacom and
Livewire with respect to the subject matter hereof and thereof, except as
otherwise expressly provided herein or therein.
10.09 SUCCESSORS AND ASSIGNS. This Agreement will be
binding upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns but will not be assignable or delegable by any
party without the prior written consent of the other party hereto which shall
not be unreasonably withheld. Any attempted assignment or delegation hereof in
violation of this provision shall be null and void AB INITIO.
10.10 NO RECOURSE. Notwithstanding any of the terms or
provisions of this Agreement, each of Sellers on the one hand, and Purchasers,
on the other hand, agree that none of them nor any Person acting on their behalf
may assert any claims or cause of action against any employee, officer or
director of the other party or stockholder of such other party (other than a
stockholder that is a party to this Agreement) in connection with or arising out
of this Agreement or the transactions contemplated hereby.
10.11 NO THIRD-PARTY BENEFICIARIES. This Agreement is for
the sole benefit of the parties hereto and their permitted assigns and nothing
herein, express or implied, is intended to or shall confer upon any other Person
or entity any legal or equitable right, benefit or remedy of any nature
whatsoever under or by reason of this Agreement, except with respect to
indemnified persons pursuant to Sections 9.01 and 9.02.
10.12 AMENDMENT. This Agreement may not be amended or
modified except by an instrument in writing signed by Sellers and Purchasers.
10.13 DISCLOSURE SCHEDULE. The Disclosure Schedule is
qualified in its entirety by reference to specific provisions of this Agreement,
is not intended to constitute, and shall not be construed as constituting
representations or warranties of Viacom except as and to the extent provided in
this Agreement. Any matter disclosed in one provision, subprovision, section or
subsection of the Disclosure Schedule, the existence of which is reasonably
related to any other provision, subprovision, section or subsection of the
Disclosure Schedule is deemed to be disclosed with respect to that other
provision, subprovision, section or subsection of the Disclosure Schedule to the
extent that this Agreement requires such disclosure and the relevance of such
matter to such provision, subprovision, section or subsection is reasonably
apparent from the face of the disclosure actually made. The disclosure of any
item in the Disclosure Schedule shall not, by such disclosure, be deemed to
constitute a material item or a Material Adverse Effect. Capitalized terms used
in the Disclosure Schedule shall have the meanings assigned to them in this
Agreement unless otherwise defined therein or unless the context otherwise
requires. The inclusion of, or the reference to, any item within any particular
Section of the Disclosure Schedule does not constitute an admission that such
item meets any or all of the criteria set forth in the Agreement for inclusion
in such Section. The information contained in the Disclosure Schedule shall be
subject to the Confidentiality Agreement.
10.14 GOVERNING LAW; JURISDICTION; WAIVERS. This Agreement
shall be governed by, and construed in accordance with, the Laws of the State of
New York applicable to
57
agreements made and performed wholly therein (without application of the
conflicts of laws principles thereof). The parties hereto hereby irrevocably
and unconditionally agree that:
(a) Each party hereto hereby irrevocably and
unconditionally submits, for itself and its property, to the exclusive
jurisdiction of any New York State court sitting in the County of New York or
any federal court of the United States of America sitting in the Southern
District of New York, as the party instituting suit shall elect in its sole
discretion, and any appellate court from any such court, in any suit, action or
proceeding arising out of or relating to this Agreement or for recognition or
enforcement of any judgment relating hereto. Each party hereto hereby
irrevocably and unconditionally agrees that any suit, action or proceeding
against it by any other party hereto with respect to this Agreement may be
instituted, and that any suit, action or proceeding shall be instituted only in
any New York State court sitting in the County of New York or any federal court
sitting in the Southern District of New York, and any appellate court from any
such court, as the party hereto instituting such suit, action or proceeding may
elect in its sole discretion. Each party hereto also hereby irrevocably and
unconditionally agrees that a final judgment in any such suit, action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law.
(b) Each party hereto hereby irrevocably and
unconditionally waives, to the fullest extent it may legally and effectively do
so, any objection which it may now or hereafter have to the laying of venue of
any suit, action or proceeding arising out of or relating to this Agreement in
any New York State court sitting in the County of New York or any federal court
sitting in the Southern District of New York, and any appellate court for such
court. Each party hereto hereby irrevocably waives, to the fullest extent
permitted by law, the defense of an inconvenient forum to the maintenance of
such suit, action or proceeding in any such court and further waives the right
to object, with respect to such suit, action or proceeding, that such court does
not have jurisdiction over such party. Each party hereto hereby irrevocably
waives the right to a jury trial in any suit, action or proceeding arising out
of or relating to this Agreement.
(c) Each party hereto hereby irrevocably and
unconditionally consents to service of process in the manner provided for the
giving of notices pursuant to this Agreement. Nothing in this Agreement shall
affect the right of either party to serve process in any other manner permitted
by law.
10.15 COUNTERPARTS. This Agreement may be executed in one
or more counterparts, and by the different parties hereto in separate
counterparts, each of which when executed shall be deemed to be an original but
all of which taken together shall constitute one and the same agreement.
Delivery of an executed counterpart of a signature page to this Agreement by
telecopier shall be effective as manual delivery of an originally executed
counterpart of this Agreement.
10.16 NO PRESUMPTION. This Agreement shall be construed
without regard to any presumption or rule requiring construction or
interpretation against the party drafting or causing any instrument to be
drafted.
58
10.17 USE OF SELLERS' NAMES AND LOGOS BY PURCHASERS. It is
expressly agreed that, unless otherwise agreed to by the parties in writing,
Purchasers are not purchasing or acquiring any right, title or interest in, and
following the Closing the Singapore Companies will have no rights in or to, the
names of Sellers (including but not limited to, any trade names, trademarks,
logos or service marks employing the words "Group W", "Viacom", "CBS",
"Westinghouse" or the Westinghouse "W" logo, or any variation thereof or any
confusingly similar trade name, trademark, logo or service xxxx, collectively,
the "SELLERS' NAMES"). Each Purchaser agrees that neither it nor any of its
Affiliates, including the Singapore Companies, shall make any use of the
Sellers' Names from and after the Closing Date. To this end, each Purchaser
agrees that it shall, among other things, cause a resolution by the Board of
Directors and the sole shareholder of WEAPH to be passed effective upon the
consummation of the Closing that the corporate name of WEAPH be changed to
eliminate the name "Westinghouse" therefrom, and each Purchaser shall cooperate
with Sellers to take any action or cause its Affiliates, including the Singapore
Companies, to take any action prior to and after the Closing as may be required
to effect such name change, including, without limitation, any filings with any
Governmental Authority. In addition, each Purchaser shall, and shall cause its
Affiliates, including the Singapore Companies, to, as promptly as practicable
but in no event later than 180 days (or, in the case of any Sellers' Name
containing the word "Group W", 365 days) following the Closing Date, remove,
strike over or otherwise obliterate all Sellers' Names from all materials
constituting or evidencing the Acquired Assets, the Assumed Liabilities or any
of the assets of any Singapore Company, including without limitation, any
business cards, schedules, stationery, displays, signs, promotional materials,
manuals, forms and other materials. Each Purchaser shall, as promptly as
practicable, prepare, or cause the applicable Singapore Company to prepare, its
own stock of business cards, schedules, stationery, displays, signs, promotional
materials, manuals, forms and other materials to replace those included in the
Acquired Assets, Assumed Liabilities or the assets of any Singapore Company
bearing any of Sellers' Names.
IN WITNESS WHEREOF, Sellers and Purchasers have caused this
Agreement to be executed as of the date first written above by their respective
officers thereunto duly authorized.
VIACOM INC.
By
--------------------------------------
Name:
Title:
WESTINGHOUSE ELECTRIC G.M.B.H.
By
--------------------------------------
Name:
Title:
WESTINGHOUSE CBS HOLDING COMPANY, INC.
By
--------------------------------------
Name:
Title:
CBS BROADCASTING INC.
By
--------------------------------------
Name:
Title:
LIBERTY LIVEWIRE CORPORATION
By
--------------------------------------
Name:
Title:
GWNS ACQUISITION SUB, INC.
By
--------------------------------------
Name:
Title:
EXHIBIT A
SELLERS
Sellers consist of:
Viacom Inc.
Westinghouse Electric G.m.b.H.
Westinghouse CBS Holding Company, Inc.
CBS Broadcasting Inc.
EXHIBIT B
FORMS OF ANCILLARY LEASES
Please see attached.
EXHIBIT C
FORM OF CBS TRANSMISSION SERVICES AGREEMENT
Please see attached.
EXHIBIT D
FORMS OF TECHNICAL SERVICES AGREEMENTS
Please see attached.
EXHIBIT E
FORM OF TM:RT LICENSE AGREEMENT
Please see attached.
EXHIBIT F
FORM OF TRADEMARK LICENSE
Please see attached Trademark and Trade Name License Agreement.
EXHIBIT G
FORM OF TRANSITIONAL SERVICES AGREEMENT (SHARED SERVICES AGREEMENT)
Please see attached Shared Services Agreement.
EXHIBIT H
TARGET WORKING CAPITAL CALCULATION
Please see attached.
EXHIBIT I
CERTAIN EMPLOYEES
Xxxxxx Xxxx
Xxxx Xxxxxx
Xxxx Xxxxxx
Xxx Xxxxx
Xxx Xxxxxx
Xxxxx Xxxxxx
