EXHIBIT 2.4
AMENDMENT TO
ASSET EXCHANGE AGREEMENT
THIS AMENDMENT TO ASSET EXCHANGE AGREEMENT (this "Amendment") is made as of
January 5, 2001, by and between MediaOne of Illinois, Inc. and Insight
Communications Company, L.P. (together, the "Parties")
RECITALS
A. The Parties have entered into that Asset Exchange Agreement dated as
of August 15, 2000 (the "Original Agreement," and as amended by this Amendment,
the "Agreement"), pursuant to which Insight and AT&T Illinois have agreed to
convey, or cause to be conveyed, to the Partnership certain cable television
assets.
B. The Parties wish to amend the Original Agreement as set forth in this
Amendment.
AGREEMENTS
In consideration of the covenants and agreements set forth herein and for
other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the Parties hereby agree as follows:
1. Definitions. Capitalized terms used and not defined in this Amendment will
have the meaning given to them in the Original Agreement.
2. Amendments to Section 1.
(a) Section 1 of the Original Agreement is amended to add the following
definition:
"Adjustment Time" means 12:01 A.M. on January 1, 2001.
(b) Section 1.20 of the Original Agreement is hereby amended and restated
to read as follows:
1.20 Closing Time. 12:01 A.M., Mountain Time, on the Closing Date.
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3. Closing Date. The Parties agree that if all of the conditions to the
Closing contained in the Agreement (other than those based on acts to be
performed at the Closing) have been satisfied or waived on or prior to January
5, 2001, then the Closing will occur on January 5, 2001, which date will be the
"Closing Date" under the Agreement.
4. Closing Adjustments.
(a) Section 3.2 of the Original Agreement is amended and restated in its
entirety as follows:
3.2 Adjustments to Value of Assets. The value of the AT&T Assets and
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the Insight Assets shall be adjusted as follows:
(a) Appropriate adjustments on a pro rata basis as of the
Adjustment Time will be made with respect to each of the AT&T Systems and
Insight Systems for all prepaid expenses other than inventory (but only to
the extent the full benefit of such prepaid expenses will be realizable by
the other party within 12 months after the Adjustment Time), accrued
expenses (including real and personal property taxes), copyright fees and
franchise or license fees or charges, prepaid income, subscriber
prepayments and, subject to paragraph (f) below, accounts receivable
related to such party's Cable Business to the extent specified in Section
3.2(f), all as determined in accordance with GAAP consistently applied and
to reflect the principle that all expenses and income attributable to such
party's Cable Business for the period through and including the Adjustment
Time are for the account of such party, and all expenses and income
attributable to such party's Cable Business for the period after the
Adjustment Time are for the account of the other party.
(b) All advance payments to, or funds of third parties on
deposit with, AT&T Illinois or Insight as of the Adjustment Time and
relating to such party's Cable Business, including advance payments and
deposits (including any accrued interest on such deposits) by subscribers
served by such party's Cable Business for converters, encoders, decoders,
cable television service and related sales, shall be assumed by, and
credited to the account of, the other party.
(c) There shall be credited to each party the economic value of
all accrued vacation time that such party credits after the Closing Time to
the employees of the other party that are hired by such party pursuant to
Section 7.3(f), where economic value is the amount equal to the cash
compensation that would be payable to each such employee at his or her
level of compensation on the Closing Date for a period equal to such
employee's credited accrued vacation.
(d) There shall be credited to AT&T Illinois and Insight, as
applicable, the economic value of any salary paid by such party for periods
after the Adjustment Time to employees that are hired by the other party
pursuant to Section 7.3(f).
(e) All deposits relating to the business and operations of each
party's Systems that are held by Third Parties as of the Adjustment Time
for the account of such party or as security for such party's performance
of its obligations, including deposits on leases and deposits for
utilities, will be credited to the account of such party in their full
amounts and will become the property of the other party; provided that no
adjustment will be made for any deposits the full benefit of which for
contractual or other reasons cannot be
made available to the other party within 12 months following the Adjustment
Time.
(f) Neither AT&T Illinois nor Insight will receive credit for
any of its (i) accounts receivable resulting from cable television or internet
service sales any portion of which is 60 days or more past due as of the
Adjustment Time, or (ii) accounts receivable from customers whose accounts are
inactive or whose service is pending disconnection for any reason as of the
Adjustment Time. AT&T Illinois and Insight will receive credit for accounts
receivable resulting from cable television or internet service sales the entire
portion of which are 0-59 days past due as of the Adjustment Time in an amount
equal to 99% of the face amount of such accounts receivable. For purposes of
making "past due" calculations under the foregoing sentence, the billing
statements of a System will be deemed to be due and payable on the first day of
the period during which the service to which such billing statements relate is
provided. AT&T Illinois and Insight will receive credit for advertising accounts
receivable as follows: (i) 100% of the face amount of the advertising accounts
receivable which are outstanding 30 days or less from the invoice date, (ii) 95%
of the face amount of all advertising accounts receivable which are outstanding
more than 30 but fewer than 61 days from the invoice date, (iii) 80% of the face
amount of all advertising accounts receivable which are outstanding more than 60
but fewer than 91 days from the invoice date, and (iv) 50% of the face amount of
all advertising accounts receivable which are outstanding more than 90 but fewer
than 121 days from the invoice date. Neither AT&T Illinois nor Insight will
receive credit for advertising accounts receivable which are outstanding more
than 120 days from the invoice date. Notwithstanding the foregoing, each of AT&T
Illinois and Insight will receive credit for 100% of the face amount of their
advertising accounts receivable from national and regional representation
accounts, regardless of the age thereof.
(g) Any amounts paid, or accrued as a current liability, prior
to the Adjustment Time by AT&T Illinois or its Affiliates with respect to
retroactive franchise fees in respect of the AT&T Systems, or by Insight or its
Affiliates with respect to retroactive franchise fees in respect of Insight's
Systems will be credited to the account of AT&T Illinois or Insight, as
applicable, in their full amounts to the extent that (i) such amounts can
legally be passed through to and collected from subscribers of the AT&T Systems
or the Insight Systems after Closing, and (ii) no agreement has been entered
into prohibiting the collection of such amounts, with such amounts with respect
to the AT&T Systems being assets of Insight upon collection and such amounts
with respect to the Insight Systems being assets of AT&T Illinois upon
collection.
(h) AT&T Illinois shall receive a credit, not to exceed
$3,200,000, equal to the amount of capital expenditures by AT&T Illinois during
the period from September 30, 1999 through the Adjustment Time relating to (i)
the upgrade and rebuild of the AT&T Systems' plant capacity and associated items
(including headend sites and headend equipment to expand channel capacity), and
(ii) the launch of digital services for the AT&T Systems, including the purchase
of digital converters (but not including digital converters purchased in the
ordinary course of business to replace lost, stolen or defective digital
converters), the launch of telephony services, and the launch of high speed data
services, including the purchase of modems.
(i) The adjustments provided for in this Section 3.2 will be
made without duplication. In addition, none of the adjustments provided for
in this Section 3.2 will be made with respect to any Excluded Asset or with
respect to any item of income or expense related to an Excluded Asset.
(j) The net amount of the adjustments calculated under this
Section 3.2 (the "Adjustment Amount"), as preliminarily determined pursuant
to Section 3.3, shall be paid by AT&T Illinois or Insight, as applicable to
the other party at the Closing by wire transfer of immediately available
funds.
(b) Section 3.3 of the Original Agreement is amended and restated in its
entirety to read as follows:
3.3 Calculation of Adjustments.
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(a) Each of AT&T Illinois and Insight will estimate in good
faith with respect to its Systems, and set forth, together with a detailed
statement of the calculation thereof, the adjustments and prorations with
respect to its Cable Business prescribed by Section 3.2 (the "Pro Rata
Adjustments") in a certificate (the "Initial Adjustment Certificate")
executed by an authorized representative of such party and delivered to the
other party at least 10 Business Days prior to the Closing. Each Initial
Adjustment Certificate will be accompanied by appropriate supporting
documentation, including an accounts receivable detail with relevant aging
information as of the Adjustment Time, in summary form, supporting the
determination of the Pro Rata Adjustments proposed in such certificate.
Following receipt of such Initial Adjustment Certificate, the recipient
shall have five Business Days to review such schedule and supporting
information and to notify the preparer of such Initial Adjustment
Certificate of any disagreements with the preparer's estimates of its Pro
Rata Adjustments. If the recipient provides a notice of disagreement with
the preparer's estimates of such amounts within such five Business Day
period, AT&T Illinois and Insight shall negotiate in good faith to resolve
any such dispute and to reach an agreement prior to the Closing on such
estimated amounts as of the Adjustment Time. The estimates so agreed upon
by AT&T Illinois and Insight or (if the parties do not reach such an
agreement on such estimated amounts set forth in the Initial Adjustments
Certificate prior to the Closing Date or if the recipient fails to provide
a notice of disagreement with the preparer's estimates of such amounts
within the time provided) the estimates of such Pro Rata Adjustments set
forth in the Initial Adjustments Certificate shall be the basis for
determining the preliminary Adjustment Amount payable pursuant to Section
3.2. All disagreements that may exist with respect to the Initial
Adjustment Certificate shall be resolved in connection with the preparation
of the Final Adjustment Certificate pursuant to paragraph (b) below.
(b) Within 90 days after the Closing, each of AT&T Illinois and
Insight will deliver to the other a certificate (the "Final Adjustment
Certificate") showing in full detail its final determination of the Pro
Rata Adjustments with respect to its Systems, which certificate will be
accompanied by appropriate documentation supporting the amounts
proposed in such certificate, including an accounts receivable detail with
relevant aging information as of the Adjustment Time, and which will be
executed by an officer of such party. Each party will review the other's
Final Adjustment Certificate and will give written notice to the other
party of any objections it has to the calculations shown in such
certificate within 30 days after its receipt thereof. AT&T Illinois and
Insight will endeavor in good faith to resolve any such objections within
30 days after the receipt by the parties of each other's objections. If any
objections or disputes have not been resolved at the end of such 30-day
period, the disputed portions of the Pro Rata Adjustments will be
determined within the following 30 days by a partner in a major accounting
firm with substantial cable television audit experience which is not the
auditor of either Insight or AT&T Illinois (or any Affiliate of either of
them) and the determination of such auditor will be final and will be
binding upon all parties. If Insight and AT&T Illinois cannot agree with
respect to the selection of an auditor, Insight and AT&T Illinois will each
select an auditor and those two auditors will select a third auditor whose
determination will be final and will be binding upon all parties. Insight
and AT&T Illinois will bear equally the expenses arising in connection with
an auditor's determination of disputed amounts, and payment of the final
Adjustment Amount (after taking into account any estimated Adjustment
Amount paid at the Closing) will be made by the party responsible therefor
to the other party in immediately available funds within 15 Business Days
after the final determination is made.
(c) Each of AT&T Illinois and Insight will provide to the other
reasonable access to all records in its possession which were used in the
preparation of its Initial Adjustment Certificate and Final Adjustment
Certificate and as may be necessary in the preparation of the other party's
Initial Adjustment Certificate and Final Adjustment Certificate.
5. Assumed Obligations and Liabilities.
(a) Section 4.1 of the Original Agreement is amended and restated in its
entirety to read as follows:
4.1 AT&T Assumed Obligations and Liabilities. As of the Closing,
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AT&T Illinois will assume and after the Closing, AT&T Illinois will pay,
discharge and perform the following (the "AT&T Assumed Obligations and
Liabilities"): (a) those obligations and liabilities accruing and relating
to periods after the Closing Time under or with respect to the Insight
Assets assigned and transferred to AT&T Illinois at the Closing; (b) those
obligations and liabilities of Insight to customers of Insight's Cable
Business for (i) subscriber deposits related to the Insight Systems held by
Insight as of the Adjustment Time in the amount for which AT&T Illinois
received credit under to Section 3.2 and (ii) customer, advertising and
other advance payments held by Insight as of the Adjustment Time in the
amount for which AT&T Illinois received credit under Section 3.2; (c) all
obligations and liabilities accruing and relating to Insight's Cable
Business prior to the Adjustment Time in respect of which AT&T Illinois
received a credit pursuant to Section 3.2; and (d) all other remaining
obligations and liabilities accruing and relating to periods after the
Closing Time and arising out of the ownership of the Insight Assets or the
operation of the Insight Systems after the Closing
Time, except to the extent that such obligations or liabilities relate to
any Insight Excluded Asset. All obligations and liabilities, contingent,
fixed or otherwise, arising out of or relating to the Insight Assets or the
Insight Systems other than the AT&T Assumed Obligations and Liabilities
will remain and be the obligations and liabilities solely of Insight,
including any obligation, liability or claim relating to or arising
pursuant to (x) rate refunds to subscribers of the Insight Systems with
respect to rates charged to such subscribers during periods through and
including the Closing Time, (y) litigation commenced prior to, or related
to an event occurring at any time prior to the Closing Time or (z) any
Insight Excluded Asset.
(b) Section 4.3 of the Original Agreement is amended and restated in its
entirety to read as follows:
4.3 Insight Assumed Obligations and Liabilities. As of the Closing,
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Insight will assume and after the Closing, Insight will pay, discharge and
perform the following (the "Insight Assumed Obligations and Liabilities"):
(a) those obligations and liabilities accruing and relating to periods
after the Closing Time under or with respect to the AT&T Assets assigned
and transferred to Insight at the Closing; (b) those obligations and
liabilities of AT&T Illinois to customers of AT&T's Cable Business for (i)
subscriber deposits related to the AT&T Systems held by AT&T Illinois as of
the Adjustment Time in the amount for which Insight received credit under
Section 3.2 and (ii) customer, advertising and other advance payments held
by AT&T Illinois as of the Adjustment Time in the amount for which Insight
received credit under Section 3.2; (c) all obligations and liabilities
accruing and relating to AT&T's Cable Business prior to the Adjustment Time
in respect of which Insight received a credit pursuant to Section 3.2; and
(d) all other remaining obligations and liabilities accruing and relating
to periods after the Closing Time and arising out of the ownership of the
AT&T Assets or operation of the AT&T Systems after the Closing Time, except
to the extent that such obligations or liabilities relate to any AT&T
Excluded Asset. It is understood and agreed that at the closing of the
Contribution, the Partnership shall assume the Insight Assumed Obligations
and Liabilities to the extent related to the period from and after the
"Closing Time" or the "Adjustment Time," as applicable, under the
Contribution Agreement for the benefit of AT&T Illinois and its Affiliates
and upon such assumption, Insight shall have no further obligation or
liability in respect of the same to the extent assumed by the Partnership.
All obligations and liabilities, contingent, fixed or otherwise, arising
out of or relating to the AT&T Assets or the AT&T Systems other than the
Insight Assumed Obligations and Liabilities will remain and be the
obligations and liabilities solely of AT&T Illinois including any
obligation, liability or claim relating to or arising pursuant to (x) rate
refunds to subscribers of the AT&T Systems with respect to rates charged to
such subscribers during periods through and including the Closing Time, (y)
litigation commenced prior to, or related to an event occurring at any time
prior to the Closing Time, or (z) any AT&T Excluded Asset, including the
Media One Social Contract and, subject to Section 7.19, the pending
Settlement Agreement and Release that may relate to certain of the AT&T
Systems with respect to late fees charged by them, a copy of which,
in the form submitted to the courts, has been provided to Insight by AT&T
(the "AT&T Late Fee Settlement").
6. Amended Covenants.
(a) Section 7.3(b) of the Original Agreement is amended and restated in
its entirety to read as follows:
(b) Each party or its Affiliates will pay to all employees of
its Cable Business all compensation, including salaries, commissions,
bonuses, deferred compensation, severance (if applicable), insurance,
vacation (except for accrued vacation included in the adjustments
calculated pursuant to Section 3.2(c) to be carried over pursuant to
Section 7.3(f)), pension, profit sharing, disability payment, medical, sick
pay and other compensation or benefits to which they are entitled for
periods through and including the date of termination of the employee's
employment with such party, in accordance with the terms and conditions of
any arrangement providing for such compensation or benefits, including,
without limitation, all amounts, if any, payable on account of the
termination of their employment. Each party will reimburse the other for
any such compensation paid by the transferor party to the employees of
their respective Cable Businesses for periods after the Adjustment Time.
The transferor party shall promptly satisfy any legal obligation with
respect to continuation of group health coverage for its employees required
pursuant to Section 4980B of the Code or Section 601, et seq., of ERISA.
(b) Section 7.3(d) of the Original Agreement is amended and restated in
its entirety to read as follows:
(d) All claims and obligations under, pursuant to or in
connection with any welfare, medical, insurance, disability or other
employee benefit plans of either party or its Affiliates or arising under
any Legal Requirement affecting System employees of such party or its
Affiliates incurred through and including the Closing Time or resulting
from or arising from events, obligations or occurrences occurring or
commencing through and including the Closing Time will remain the
responsibility of such party, whether or not such employees are hired by
the other party after the Closing Time. The hiring party will be
responsible for any such claims and obligations from and after the Closing
Time. Neither party will have or assume any obligation or liability under
or in connection with any such plan maintained by the other party or its
Affiliates. For purposes of this Agreement, the following claims and
liabilities shall be deemed to be incurred as follows: (i) medical, dental
and/or prescription drug benefits when the treatment is provided, except
with respect to such benefits provided in connection with a continuous
period of hospitalization, which shall be deemed to be incurred at the time
of admission to the hospital; (ii) life, accidental death and dismemberment
and business travel accident insurance benefits and workers' compensation
benefits, upon the death, disability or accident giving rise to such
benefits; and (iii) salary continuation or other short-term disability
benefits, or long-term disability, upon commencement of the disability
giving rise to such benefit. In regard to any Employee on Leave Status,
such responsibility for benefit coverage of such employee, and liability
for payment of benefits, shall remain that
of the transferor party, until such employee becomes a Hired Employee of
the transferee party after the Closing Time pursuant to Section 7.3.(a) or
is terminated by the transferor party or its respective Affiliates.
(c) Section 7.26 of the Original Agreement is amended and restated in its
entirety to read as follows:
7.26 [Intentionally Deleted]
(d) Section 7 of the Original Agreement is amended to add the following
Section 7.28:
7.28 Advertising Sales. Section 7.29 of the Contribution Agreement,
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as amended, shall govern any advertising sales arrangements between the
AT&T Illinois and Insight.
(e) Section 7 of the Original Agreement is amended to add the following
Section 7.29:
7.29 Real Property Transfers.
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(a) Insight and AT&T Illinois will each deliver to the
other, within 30 days after Closing, any documents that Insight or AT&T
Illinois, as applicable, has not executed and delivered to the other at the
Closing and that are necessary to (i) record with the appropriate
Governmental Authority the deeds delivered in accordance with Section
9.2(c) of this Agreement, in the case of deed deliveries by AT&T Illinois
(if any), and Section 9.3(b) of this Agreement, in the case of deed
deliveries by Insight and (ii) pay any Taxes or fees associated with such
recording or the conveyance of the Owned Real Property to the other. The
transfer or similar Taxes, recording fees and other expenses associated
with recording the deeds for the Insight Owned Real Property shall be
advanced by AT&T Illinois at the time of recording and adjusted between
Insight and AT&T Illinois in accordance with the provisions of Section 7.8
of the Original Agreement on the Final Adjustment Certificates. The payment
of Taxes and fees in connection with the recording of the deeds evidencing
the transfer of the AT&T Owned Real Property, if any, shall be governed by
Section 7.30 of the Contribution Agreement, as amended.
(b) If Insight or AT&T Illinois makes a good faith error in
calculating any transfer or similar Taxes payable by such party in
connection with the transfer of its Owned Real Property to the other, or if
the amount of any such Tax, recording fee or similar charge paid or
tendered in connection with recording the deeds described in Section
7.29(a) is finally determined to be insufficient by any Governmental
Authority, Insight and/or AT&T Illinois, as applicable in accordance with
Section 7.8 of this Agreement, shall reimburse the other for all additional
amounts paid in connection with such transfer, which amounts will be deemed
to include any penalties and interest associated with such Taxes or
payments, (which reimbursement may be effected by appropriate adjustments
in the Final Adjustment Certificates of Insight and AT&T Illinois).
(c) The provisions in this Section 7.29 do not relieve
AT&T Illinois or
Insight from any other obligations under this Agreement unless such
obligations are directly in conflict with the provisions set forth in this
Section 7.29.
(f) Section 7 of the Original Agreement is amended to add the following
Section 7.30:
7.30 Lien Releases. To the extent Insight or AT&T Illinois has not
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delivered at Closing the Lien Releases required by Section 9.2(d) and
9.3(d) of the Agreement, Insight and AT&T Illinois will each deliver to the
other, within 20 days of Closing, (i) evidence, reasonably satisfactory to
the recipient of such evidence, that all Liens (other than Permitted Liens)
affecting or encumbering the Insight Assets or AT&T Assets, as applicable,
have been terminated, released or waived, as appropriate, and (ii)
original, executed instruments in form reasonable satisfactory to such
recipient party effecting such termination, releases or waivers; provided,
however, that in the case of the delinquent Taxes shown on the December 8,
2000 title commitment for 000 Xxxxx Xxxxxx Xxxx Xxxxxxxxx, Xxxxxxxxx,
Xxxxxxxxxx, Insight also shall provide, within 90 days after Closing,
whatever evidence, payment or release is reasonably acceptable to Chicago
Title, or will take such other actions reasonably acceptable to Chicago
Title, to permit it to delete the exceptions taken for such Taxes and UCC-1
financing statements on AT&T Illinois' title policy for such property.
Insight shall pay the cost of the endorsement issued by Chicago Title to
delete the exceptions described above. If Insight has not complied with
the obligations described above, AT&T Illinois will receive a credit for
any such outstanding Taxes (including interest and penalties, if any, and
the cost for the endorsement to delete the exceptions relating to Taxes),
which credit will be reflected in the Final Adjustment Certificates
delivered by AT&T Illinois and Insight pursuant to Section 3.3 of the
Agreement. Upon receipt of the credit by AT&T Illinois (i) Insight shall
be released from any and all obligations pertaining to the delinquent Taxes
shown on AT&T Illinois' title policy described above and (ii) AT&T Illinois
shall submit a payment equal to the credit received from Insight to the
appropriate Governmental Authorities in satisfaction of the delinquent
taxes on behalf of Insight.
(g) Section 7 of the Original Agreement is amended to add the following
Section 7.31:
7.31 Copyright Fees and Franchise Fees.
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(a) AT&T Illinois shall prepare and file in a timely manner all
filings for the AT&T Systems for all periods ending on or prior to the
Adjustment Time that are required to be filed after the Adjustment Time
pursuant to Section 111 of the Copyright Act and the related regulations of
the Copyright Office. AT&T Illinois shall be responsible for and shall pay
in a timely manner all amounts payable pursuant to Section 111 of the
Copyright Act and the related regulations of the Copyright Office for the
AT&T Systems for all periods ending on or prior to the Adjustment Time.
AT&T Illinois shall provide Insight with copies of all filings in the form
filed with the Copyright Office together with evidence of payment of all
copyright royalty fees and other amounts paid to the Copyright Office
pursuant to Section 111 of the Copyright Act and the related regulations of
the Copyright Office. AT&T Illinois shall be responsible for and shall
timely respond to all Copyright Office and third party inquiries relating
to AT&T Illinois' copyright filings and royalty fee payments for the AT&T
Systems
covering all periods ending on or prior to the Adjustment Time and shall
provide Insight with copies of all such inquiries and correspondence
between AT&T Illinois, the Copyright Office or third parties related to
AT&T Illinois' copyright filings and royalty fee payments for the AT&T
Systems.
(b) Insight shall prepare and file in a timely manner all filings for
the Insight Systems for all periods ending on or prior to the Adjustment
Time that are required to be filed after the Adjustment Time pursuant to
Section 111 of the Copyright Act and the related regulations of the
Copyright Office. Insight shall be responsible for and shall pay in a
timely manner all amounts payable pursuant to Section 111 of the Copyright
Act and the related regulations of the Copyright Office for the Insight
Systems for all periods ending on or prior to the Adjustment Time. Insight
shall provide AT&T Illinois with copies of all filings in the form filed
with the Copyright Office together with evidence of payment of all
copyright royalty fees and other amounts paid to the Copyright Office
pursuant to Section 111 of the Copyright Act and the related regulations of
the Copyright Office. Insight shall be responsible for and shall timely
respond to all Copyright Office and third party inquiries relating to
Insight's copyright filings and royalty fee payments for the Insight
Systems covering all periods ending on or prior to the Adjustment Time and
shall provide AT&T Illinois with copies of all such inquiries and
correspondence between Insight, the Copyright Office or third parties
related to Insight's copyright filings and royalty fee payments for the
Insight Systems.
(c) AT&T Illinois shall be responsible for and shall pay in a timely
manner all franchise fees and other amounts payable pursuant to the AT&T
System Franchises for all periods ending on or prior to the Adjustment
Time, shall prepare and timely submit to the applicable franchising
authorities all related reports, and shall timely respond to all inquiries
from the applicable franchising authority relating to such franchise fee
payments. AT&T Illinois shall provide Insight with evidence of payment of
all such amounts and copies of all reports and related correspondence in
the form submitted to or received from the franchising authorities.
(d) Insight shall be responsible for and shall pay in a timely manner
all franchise fees and other amounts payable pursuant to the Insight System
Franchises for all periods ending on or prior to the Adjustment Time, shall
prepare and timely submit to the applicable franchising authorities all
related reports, and shall timely respond to all inquiries from the
applicable franchising authority relating to such franchise fee payments.
Insight shall provide AT&T Illinois with evidence of payment of all such
amounts and copies of all reports and related correspondence in the form
submitted to or received from the franchising authorities.
7. Final Schedules. The Schedules delivered by AT&T Illinois on October 26,
2000 constitute the final AT&T Illinois Schedules to the Original Agreement (the
"Final AT&T Schedules"). The Schedules delivered by Insight on October 27, 2000
constitute the final Insight Schedules to the Original Agreement (the "Final
Insight Schedules"). The Final AT&T Schedules and Final Insight Schedules
(together, the "Final Schedules") were delivered in accordance with Section 7.27
of the Agreement and are deemed to have been attached to the Original Agreement
and to have been a part thereof for all purposes as of the execution date of the
Original Agreement. Attached as Exhibit 1
(with respect to the Insight Final Schedules) and Exhibit 2 (with respect to the
AT&T Final Schedules) are (a) copies of the Final Schedules incorporating
corrections (the "Corrected Schedules") necessary to reflect any agreements
between the parties, with respect to the assignment or transfer of
retransmission consent agreements, construction contracts, advertising sales
assets or call center services, or corrections as to factual matters set forth
in the Final Schedules that have discovered to be incorrect since the delivery
of the Final Schedules and (b) blacklined versions of the Corrected Schedules
compared to the Final Schedules. The corrections made to the Final Schedules as
described above are deemed to be incorporated into each party's Final Schedules
and are deemed to have been attached to the Original Agreement and to have been
a part thereof for all purposes as of the execution date of the Original
Agreement.
8. Transitional Services.
(a) Insight agrees that it will provide, or will cause its Affiliates to
provide, to AT&T Illinois, as necessary, the transitional services described on
Exhibit 3 to this Amendment (the "Transitional Services") for the periods
specified for each such service on Exhibit 3. The Transitional Services
provided by Insight pursuant to this Section 8(a) will be substantially similar
to the quality, nature and scope of comparable services provided to the Insight
Systems prior to the Closing and otherwise on terms and conditions mutually
satisfactory to the Parties. During the period when the Transitional Services
are provided, AT&T Illinois will use commercially reasonable efforts, or will
cause its Affiliates to use commercially reasonable efforts, to establish any
necessary arrangements to permit AT&T Illinois to provide the Transitional
Services directly to the Insight Systems without further assistance from
Insight. AT&T Illinois will reimburse Insight for any reasonable costs (which
in no event will be less than the actual out-of-pocket costs to Insight of
providing such services) associated with the provision of the Transitional
Services promptly upon the receipt of an invoice from Insight specifying such
costs. AT&T Illinois will cooperate in good faith to effect (i) the transition
of email and network services for the Insight Systems to its own, or its
Affiliates', email and network systems within 30 days after the Closing and (ii)
the transition of customer credit card payment processing for the Insight
Systems to the processing system of AT&T Illinois within 90 days after the
Closing.
(b) Notwithstanding Section 11.3 or Section 11.6 of the Original
Agreement, neither Insight nor any of its Affiliates will be liable to AT&T
Illinois or any of its Affiliates for any Losses arising out of, relating to or
in connection with this Section 8 or the performance or non-performance by
Insight of the Transitional Services hereunder, except to the extent such Losses
are attributable to Insight's or its Affiliates' bad faith, gross negligence or
willful misconduct or breach of this Section 8. AT&T Illinois shall indemnify
each of Insight and its Affiliates for, and hold each of them harmless from and
against, any and all Losses arising out of, relating to or in connection with
this Section 8 or the performance or non-performance by Insight of the
Transitional Services, except to the extent such Losses are attributed to
Insight's or its Affiliate's bad faith, gross negligence or willful misconduct
or breach of this Section 8. Such indemnification by AT&T Illinois will include
but not be limited to any Losses arising out of the AT&T Illinois', or its
Affiliates', use of or access to the Insight's email or network systems.
(c) This Section 8 supersedes Section 7.12 of the Original Agreement as it
relates to
Insight's obligation to provide Transitional Billing Services as described
therein. The notices provided by the Parties pursuant to Section 7.12 of the
Original Agreement shall not be affected by Section 8 of this Amendment.
(d) The provision of any Transitional Services related to the AT&T Systems
will be governed by the terms of Section 11 to the Amendment to the Contribution
Agreement dated January 5, 2001.
9. Counterparts. This Amendment may be executed in counterparts, each of
which will be deemed an original. This Amendment will be binding on the parties
only upon the delivery of original, true photocopy or facsimile of manually-
executed counterparts, and may not be executed or delivered electronically
(other than delivery by facsimile).
10. Governing Law. THIS AMENDMENT AND THE RIGHTS OF THE PARTIES UNDER IT WILL
BE GOVERNED BY AND CONSTRUED IN ALL RESPECTS IN ACCORDANCE WITH THE LAWS OF THE
STATE OF DELAWARE, WITHOUT REGARD TO THE CONFLICTS OF LAWS RULES OF DELAWARE.
11. Severability. Any term or provision of this Amendment that is invalid or
unenforceable will be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforceable the remaining rights
of the Person intended to be benefitted by such provision or any other
provisions of this Amendment. The provisions of this Amendment shall survive
the delivery of any deed evidencing the conveyance of Owned Real Property in
conformance with the Agreement.
12. Construction of Amendment. This Amendment has been negotiated by the
undersigned and their respective legal counsel, and legal or equitable
principles that might require the construction of this Amendment or any
provision of this Amendment against the party drafting this Amendment will not
apply in any construction or interpretation of this Amendment. The word
"include" and derivatives of that word are used in this Amendment in an
illustrative sense rather than limiting sense.
13. Effect of Amendment. Except as amended by this Amendment, all terms and
provisions of the Agreement will remain unchanged and in full force. From and
after the date of this Amendment, each reference in the Original Agreement to
"this Agreement," "hereof," hereunder" or words of like import, and all
references to the Original Agreement in any and all agreements, instruments,
documents, notes, certificates and other writings of every kind and nature
(other than in this Amendment or as otherwise expressly provided) shall be
deemed to mean the Original Agreement, as amended by this Amendment.
[Remainder of page intentionally left blank]
The parties have executed this Amendment to Asset Exchange Agreement as of
the day and year first above written.
MEDIAONE OF ILLINOIS, INC.
By:_______________________________________________
Name:_____________________________________________
Title:____________________________________________
INSIGHT COMMUNICATIONS COMPANY, L.P.
By: Insight Communications Company, Inc., its
general partner
By:_______________________________________________
Name:_____________________________________________
Title:____________________________________________
