Exhibit 10.4
IRREVOCABLE PROXY
AND
VOTING AGREEMENT
THIS IRREVOCABLE PROXY AND VOTING AGREEMENT (this "Agreement"), dated as of
November 23, 1998, is entered into between SPRINT CORPORATION, a Kansas
corporation ("Sprint"), and XXX COMMUNICATIONS, INC., a Delaware corporation
(the "Holder").
WHEREAS, Sprint, Tele-Communications, Inc., a Delaware corporation ("TCI"),
Comcast Corporation, a Pennsylvania corporation ("Comcast"), and the Holder
(together with TCI and Comcast, the "Cable Holders") and certain of their
respective Subsidiaries (as defined herein) have entered into the Restructuring
and Merger Agreement, dated May 26, 1998 (the "Restructuring Agreement"),
pursuant to which such Cable Holders (directly or indirectly through
Subsidiaries) will acquire shares of Series 2 PCS Stock (as defined herein) on
the terms set forth in the Restructuring Agreement;
WHEREAS, contemporaneously with the execution of this Agreement, Sprint and
the Holder have entered into a Standstill Agreement, dated May 26, 1998 (the
"Standstill Agreement") imposing certain restrictions on the ability of the
Holder and its Affiliates to acquire shares of Series 1 PCS Stock (as defined
herein) and other shares of the capital stock of Sprint;
WHEREAS, Section 6.8 of the Restructuring Agreement permits the Holder and
its Affiliates to acquire shares of Series 1 PCS Stock under certain
circumstances, which acquisitions are permitted under the Standstill Agreement;
WHEREAS, each share of Series 2 PCS Stock has one-tenth of the vote of each
share of Series 1 PCS Stock in all matters presented for a vote of the holders
of the common stock of Sprint;
NOW, THEREFORE, in consideration of the premises and the representations,
warranties, covenants and agreements contained herein, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Holder and Sprint (each a "Party"), intending to be legally
bound, hereby agree as follows:
Section 1. Irrevocable Proxy.
(a) Subject to paragraphs (c), (d) and (e) below, the Holder hereby grants
to Xxxxxxx X. Xxxxx (the "Grantee") an irrevocable proxy, with full power of
substitution, to exercise voting authority and authority to act by written
consent over all shares of Series 1 PCS Stock Beneficially Owned by the Holder
and its Affiliates, at the time of execution of this Agreement or at any time in
the future (the "Proxy Shares"), on all matters submitted to a vote of all or
any class or classes of the holders of the Sprint Voting Securities, which proxy
is irrevocable and coupled with an interest for purposes of Section 17-6502 of
the Kansas General Corporation Code.
(b) Prior to the acquisition by any Affiliate of Holder that has not
previously executed and delivered to Sprint an Irrevocable Proxy under this
paragraph of any shares of Series 1 PCS Stock, the Holder will cause such
Affiliate to execute and deliver to Sprint the form of Irrevocable Proxy
attached hereto as Exhibit A, which proxies shall (together with the proxy
contained in Section 1(a)) be deemed to constitute the "Proxy" for the
purposes of this Agreement.
(c) Pursuant to the Proxy, the Grantee is authorized and directed to
vote the Proxy Shares for or against any matter presented for a vote of the
Sprint Voting Securities in the same manner as the majority of votes that
are cast with respect to such matter by the holders of Sprint Voting
Securities (other than the Proxy Shares).
(d) Notwithstanding the foregoing, the Proxy shall not be applicable
with respect to any of the Proxy Shares in connection with any matter on
which the holders of Series 1 PCS Stock vote pursuant to Article Six,
Sections 3.2(d) and 3.2(f) of the Initial Charter Amendment (as defined in
the Restructuring Agreement) or any successor provisions with the same
effect, and the Holder shall have the power to vote the Proxy Shares in its
discretion with respect to any such matter.
(e) The Grantee's appointment hereunder shall terminate at such time
as the Grantee ceases to be the Chief Executive Officer of Sprint, at which
time the Proxy shall automatically be granted, without any further act by
the Holder or its Affiliates, to the Grantee's successor as Chief Executive
Officer of Sprint and thereafter to each subsequent successor as the Chief
Executive Officer of Sprint (each of which persons shall be deemed the
Grantee hereunder). At the request of Sprint from time-to-time, the Holder
shall, and shall cause each of its Affiliates holding any Proxy Shares to,
execute an irrevocable proxy in the form of this Agreement or Exhibit A
hereto confirming the appointment of each successor Chief Executive Officer
of Sprint as the Grantee for all purposes under this Agreement.
(f) Within 10 days following the record date for each meeting of the
shareholders of Sprint, the Holder shall give notice to Sprint of (i) the
names of the Affiliates of the Holder that Beneficially Owned shares of
Series 1 PCS Stock as of the record date and (ii) the number of shares of
Series 1 PCS Stock Beneficially Owned by the Holder and each of its
Affiliates as of the record date.
Section 2. Voting Agreement. If the Proxy is determined to be invalid or
unenforceable in any respect, or the holder of the Proxy is unable or unwilling
for any reason to vote the Proxy Shares at any meeting of the stockholders of
Sprint as contemplated by Section 1(c), then, except in the case of a matter
described in Section 1(d), the Holder shall, and shall cause each of its
Affiliates to, attend each meeting of the stockholders of Sprint for the
purposes of satisfying quorum requirements and shall vote the Proxy Shares for
or against any matter presented for a vote of the Sprint Voting Securities in
the same manner as the majority of votes that are cast with respect to such
matter by the holders of Sprint Voting Securities (other than the Proxy Shares).
Section 3. Termination. The Proxy and this Agreement shall terminate on the
earlier to occur of (a) the consent in writing of Sprint and the Holder, (b) the
termination of the Standstill Agreement and (c) the tenth anniversary of this
Agreement.
Section 4 Certain Definitions. As used in this Agreement, the following
terms shall have the meanings specified below. Any capitalized terms not
otherwise defined herein shall have the meaning attributed thereto in the
Restructuring Agreement.
"Affiliate" means, with respect to any Person, any other Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by, or is under common Control with, such Person.
"Agreement" has the meaning set forth in the Preamble.
"Beneficial Owner" (including, with its correlative meanings "Beneficially
Own" and "Beneficial Ownership"), with respect to any securities, means any
Person which:
(a) has, or any of whose Affiliates has, directly or indirectly, the
sole or shares right to acquire (whether such rights is exercisable
immediately or only after the passage of time) such securities pursuant to
any agreement, arrangement or understanding (whether or not in writing),
including pursuant to the Restructuring Agreement, or upon the exercise of
conversion rights, exchange rights, warrants or options, or otherwise;
(b) has, or nay of whose Affiliates has, directly or indirectly, the
sole or shares right to vote or dispose of (whether such right is
exercisable immediately or only after the passage of time) or "beneficial
ownership" of (as determined pursuant to Rule 13d-3 under the Exchange Act
as in effect on the date hereof but including all such securities which a
Person has the right to acquire beneficial ownership of, whether or not
such right is exercisable within the 60-day period specified therein) such
securities, including pursuant to any agreement, arrangement or
understanding (whether or not in writing); or
(c) has, or any of whose Affiliates has, any agreement, arrangement or
understanding (whether or not in writing) for the purpose of acquiring,
holding, voting or disposing of any securities which are Beneficially
Owned, directly or indirectly, by any other Person (or any Affiliate
thereof) provided, that the Restructuring Agreement shall not be deemed an
agreement, arrangement or understanding contemplated by this paragraph (c).
"Cable Holders" has the meaning set forth in the Recitals.
"Class A Stock" means the Class A Common Stock, par value $2.50 per share,
of Sprint.
"Common Stock" means the Common Stock, par value $2.50 per share, of
Sprint.
"Control" (including, with its correlative meanings, "Controlled by" and
"under common Control with") means, with respect to a Person or Group:
(a) ownership by such Person or Group of Votes entitling it to
exercise in the aggregate more than 50 percent of the Voting Power of the
entity in question; or
(b) possession by such Person or Group of the power, directly or
indirectly, (i) to elect a majority of the board of directors (or
equivalent governing body) of the entity in question; (ii) to direct or
cause the direction of the management and policies of or with respect to
the entity in question, whether through ownership of securities, by
contract or otherwise; or (iii) with respect to a particular action or
agreement, to direct or cause the direction of decisions, or veto or
otherwise prevent decision, of or with respect to the entity in question
relating to such action or agreement.
"PCS Preferred Stock" means the Preferred Stock -- Seventh Series,
Convertible, no par value, of Sprint.
"PCS Stock" means the Series 1 PCS Stock, the Series 2 PCS Stock and the
Series 3 PCS Stock.
"Person" means an individual, a partnership, an association, a joint
venture, a corporation, a business, a trust, an unincorporated organization, a
governmental authority or any other entity organized under applicable law.
"Restructuring Agreement") has the meaning set forth in the Recitals.
"Series 1 PCS Stock" means the PCS Common Stock -- Series 1, par value
$2.00 per share, of Sprint, which will be created on the Closing Date by the
filing of the Initial Charter amendment, as defined in the Restructuring
Agreement.
"Series 2 PCS Stock" means the PCs Common Stock -- Series 2, par value
41.00 per share, of Sprint, which will be created on the Closing Date by the
filing of the Initial Charter amendment.
"Series 3 PCS Stock" means the PCS Common Stock -- Series 3, par value
$1.00 per share, of Sprint, which will be created on the Closing Date by the
filing of the Initial Charter amendment.
"FON Stock" means the Sprint FON Group Common Stock that will be created
upon completion of the Recapitalization, as defined in the Restructuring
Agreement.
"Sprint Voting Securities" means the Common Stock, the Class A Stock, the
FON Stock, the PCS Stock, the PCS Preferred Stock and any other securities of
Sprint having the right of Vote.
"Subsidiary" means, with respect to any Person (the "Parent"), any other
Person in which the Parent, one or more Subsidiaries of the Parent, or the
Parent and one or more of its subsidiaries (a) have the Ability, through
ownership of securities individually or as a group, ordinarily, in the absence
of contingencies, to elect a majority of the directors (or individuals
performing similar functions) of such other Person, and (b) own more than 50% of
the equity interests.
"Transfer" means any act pursuant to which, directly or indirectly, the
ownership of assets or securities in question is sold, transferred, conveyed,
delivered or otherwise disposed of.
"Vote" means, as to any entity, the ability to case a vote at a
stockholders' or comparable meeting of such entity with respect to the election
or directors or other members of such entity's governing body; provided that
with respect to Sprint only, "Vote" means the ability to exercise general voting
power (as opposed to the exercise of special voting or disapproval rights) with
respect to matters other than the lection of directors at a meeting of the
stockholders of Sprint.
"Voting Power" means, as to any entity as of any date, the aggregate number
of Votes outstanding as of such date in respect of such entity; provided that,
with respect to PCS Stock, the Vote per share used to calculate such aggregate
number of Votes shall be the Vote per share most recently established by the
Board of Directors of Sprint, whether for the most recent vote of stockholders
or for a vote of stockholders to be conducted in the future.
Section 5 Interpretation and Construction of this Agreement. The
definitions in Section 4 shall apply equally to both the singular and plural
forms of the terms defined. Whenever the context may require, any pronoun shall
include the corresponding masculine, feminine and neuter forms. The words
"include," "includes" and "including" shall be deemed to be followed by the
phrase "without limitation". All references herein to Articles, Sections and
Exhibits shall be deemed to be references to Articles and Sections of, and
Exhibits to, this Agreement unless the context shall otherwise require. The
headings of the Articles and Sections are inserted for convenience of reference
only and are not intended to be a part of or to affect the meaning or
interpretation of this Agreement. Unless the context shall otherwise require or
provide, any reference to any agreement or other instrument or statute or
regulation is to such agreement, instrument, statute or regulation as amended
and supplemented from time to time (and, in the case of a statute or regulation,
to any successor provision).
Section 6. Notices. Except as expressly provided herein, all notices,
consents, waivers and other communications required or permitted to be given by
any provision of this Agreement shall be in writing and mailed (certified or
registered mail, postage prepaid, return receipt requested) or sent by hand or
overnight courier, or by facsimile transmission (with acknowledgment received
and confirmation sent as provided below), charges prepaid and addressed to the
intended recipient as follows, or to such other address or number as such Person
may from time to time specify by like notice to the parties:
Holder: Xxx Communications, Inc.
0000 Xxxx Xxxxx Xxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Telecopy: (000) 000-0000
Attention: Xxxxxx Xxxxxxx
with a copy to:
Dow, Xxxxxx & Xxxxxxxxx
0000 Xxx Xxxxxxxxx Xxxxxx, X.X.
Xxxxx 000
Xxxxxxxxxx, X.X. 00000-0000
Telecopy: (000) 000-0000
Attention: Xxxxx X. Wild
Sprint: Sprint Corporation
2330 Shawnee Mission Parkway
East Wing
Westwood, Kansas 66205
Attention: General Counsel
Tel: (000) 000-0000
Fax (000) 000-0000
with a copy to:
King & Spalding
000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxxx, Esq.
Tel: (000) 000-0000
Fax (000) 000-0000
Any party may from time to time specify a different address for notices by like
notice to the other parties. All notices and other communications given in
accordance with the provisions of this Agreement shall be deemed to have been
given and received (i) four (4) Business Days after the same are sent by
certified or registered mail, postage prepaid, return receipt requested, (ii)
when delivered by hand or transmitted by facsimile (with acknowledgment received
and, in the case of a facsimile only, a copy of such notice is sent no later
than the next Business Day by a reliable overnight courier service, with
acknowledgment of receipt) or (iii) one (1) Business Day after the same are sent
by a reliable overnight courier service, with acknowledgment of receipt.ay after
the same are sent by a reliable overnight courier service, with acknowledgment
of receipt.
Section 7. Assignment. No Party will assign this Agreement or any rights,
interests or obligations hereunder, or delegate performance of any of its
obligations hereunder, without the prior written consent of each other Party.
Section 8. Entire Agreement. This Agreement (together with the Standstill
Agreement and the Restructuring Agreement) embodies the entire agreement and
understanding of the Parties with respect to the subject matter contained
herein, provided that this provision shall not abrogate any other written
agreement between the Parties executed simultaneously with this Agreement.
Section 9. Waiver, Amendment, etc. This Agreement may not be amended or
supplemented, and no waivers of or consents to departures from the provisions
hereof shall be effective, unless set forth in a writing signed by, and
delivered to, all the Parties. No failure or delay of any Party in exercising
any power or right under this Agreement will operate as a waiver thereof, nor
will any single or partial exercise of any right or power, or any abandonment or
discontinuance of steps to enforce such right or power, preclude any other or
further exercise thereof or the exercise of any other right or power.
Section 10. Binding Agreement; No Third Party Beneficiaries. This Agreement
will be binding upon and inure to the benefit of the Parties and their
successors and permitted assigns. Nothing expressed or implied herein is
intended or will be construed to confer upon or to give to any third party any
rights or remedies by virtue hereof.
Section 11. Governing Law; Equitable Relief.
(a) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF KANSAS (REGARDLESS OF THE
LAWS THAT MIGHT OTHERWISE GOVERN UNDER APPLICABLE PRINCIPLES OF
CONFLICTS OF LAW).
(B) EACH PARTY AGREES THAT MONEY DAMAGES WOULD NOT BE A
SUFFICIENT REMEDY FOR THE OTHER PARTIES FOR ANY BREACH OF THIS
AGREEMENT BY IT, AND THAT IN ADDITION TO ALL OTHER REMEDIES THE OTHER
PARTIES MAY HAVE, THEY SHALL BE ENTITLED TO SPECIFIC PERFORMANCE AND
TO INJUNCTIVE OR OTHER EQUITABLE RELIEF AS A REMEDY FOR ANY SUCH
BREACH. EACH PARTY AGREES NOT TO OPPOSE THE GRANTING OF SUCH RELIEF IN
THE EVENT A COURT DETERMINES THAT SUCH BREACH HAS OCCURRED, AND AGREES
TO WAIVE ANY REQUIREMENT FOR THE SECURING OR POSTING OF ANY BOND IN
CONNECTION WITH SUCH REMEDY.
Section 12. Severability. The invalidity or unenforceability of any
provision hereof in any jurisdiction will not affect the validity or
enforceability of the remainder hereof in that jurisdiction or the validity or
enforceability of this Agreement, including that provision, in any other
jurisdiction. To the extent permitted by applicable law, each party waives any
provision of applicable law that renders any provision hereof prohibited or
unenforceable in any respect. If any provision of this Agreement is held to be
unenforceable for any reason, it shall be adjusted rather than voided, if
possible, in order to achieve the intent of the Parties to the extent possible.
Section 13. Counterparts. This Agreement may be executed in one or more
counterparts each of which when so executed and delivered will be deemed an
original but all of which will constitute one and the same Agreement.
Section 14. Remedies. In addition to any other remedies which may be
available to Sprint (including any remedies which Sprint may have at law or in
equity), if the Holder or any of its Affiliates breaches any material provision
of this Agreement or the Proxy, neither the Holder nor such Affiliates shall be
entitled to vote any of its shares of capital stock of Sprint (or any shares
into which such shares of capital stock are converted) with respect to any
matter of proposal arising from, relating to or involving such breach, and no
such purported vote by the Holder or any of its Affiliates on such matter shall
be effective or shall be counted.
IN WITNESS WHEREOF, Sprint and the holder have caused their respective duly
authorized officers to execute this Irrevocable Proxy and Voting Agreement as of
the day and year first above written.
XXX COMMUNICATIONS, INC.
By: /s/ Xxxxx X. Xxxxxxx
----------------------
Name: Xxxxx X. Xxxxxxx
Title: Sr. Vice President,
New Business Development
SPRINT CORPORATION
By: /s/ Xxx X. Xxxxxx
----------------------
Name: Xxx X. Xxxxxx
Title: Vice President & Secretary
EXHIBIT A
IRREVOCABLE PROXY
______________, a______________ [corporation/partnership/limited liability
company] hereby grants to ___________________ [insert name of chief executive
officer of sprint] an irrevocable proxy, with full power of substitution, to
exercise voting authority and authority to act by written consent over all
shares of the Series 1 PCS Group Common Stock, par value $1.00, of Sprint
Corporation ("Sprint") Beneficially Owner by the Holder, at the time of
execution and delivery of this proxy or at any time in the future (the "Proxy
Shares"), on all matters submitted to a vote of all or any class or classes of
the holders of Sprint Voting Securities. This proxy is granted pursuant to the
terms of the Irrevocable Proxy and Voting Agreement (the "Voting Agreement"),
dated as of __________________, 1998, between Sprint and ______________, a
____________ corporation, and this proxy is irrevocable and coupled with an
interest for purposes of Section 17-6502 of the Kansas General Corporation Code.
This proxy is given under and subject to the terms and limitations of the
Voting Agreement (including, without limitation, Sections 1(c), 1(d) and 1(e)
thereof) and shall terminate simultaneously with the termination of the Voting
Agreement pursuant to Section 3 thereof. Capitalized terms utilized but not
defined in this proxy shall have the meaning ascribed thereto in the Voting
Agreement.
IN WITNESS WHEREOF, the undersigned has caused this duly authorized officer
to execute and deliver this Irrevocable Proxy as of the ____ day of ___________,
____.
[HOLDER]
By: ____________________________
Name: ______________________
Title: ______________________
