Exhibit 2(d)
PURCHASE AGREEMENT dated as of February 6, 1995,
as Amended and Restated as of December 8, 1995, among
XXXX XXXXX, an individual residing at Xxxxxx Road,
Liberty, New York (the "Principal Stockholder"), the
corporations and partnerships listed on the signature
pages hereof as Purchase Xxxxx Companies (the "Purchase
Xxxxx Companies"), the corporations listed on the
signature pages hereof as Direct Holders (the "Direct
Holders") and TIME WARNER INC., a Delaware corporation
("Parent").
WHEREAS the Principal Stockholder is the sole beneficial
owner of the Xxxxx Companies;
WHEREAS Parent desires to acquire the business and
operations of the Xxxxx Companies, either (i) by purchasing from
certain Xxxxx Companies specified in Section 2.01 (each an "Asset
Xxxxx Company") all of the assets, and assuming the liabilities
(except as provided herein), of such Asset Xxxxx Company or (ii) in
the case of certain other Xxxxx Companies specified in Section 2.01
(each an "Equity Xxxxx Company"), by purchasing all the partnership
interests thereof (the "Equity Interests") of the Equity Xxxxx
Companies from the Principal Stockholder or, in the case of the Equity
Interests that are not owned directly by the Principal Stockholder, by
the direct holder of such Equity Interests (all such acquisitions
being referred to collectively as the "Purchase"), and the Principal
Stockholder is willing to cause each Asset Xxxxx Company to sell all
the assets, subject to the liabilities (except provided herein), of
such Asset Xxxxx Company or to sell, and to cause the Direct Holders
to sell, the Equity Interests of the Equity Xxxxx Companies;
WHEREAS concurrently with the original execution and
delivery hereof, Cablevision Industries Corporation (the "Company"),
the Principal Stockholder, Parent and Sub entered into the Company
Merger Agreement, pursuant to which upon the terms and subject to the
conditions set forth therein, Sub will be merged with and into the
Company and the Principal Stockholder and the other Stockholders will
receive for each share of Company Common Stock the Merger
Consideration (as defined in the Company Merger Agreement);
WHEREAS concurrently with the original execution and
delivery hereof, each of Cablevision Properties, Inc., a Delaware
corporation ("CPI") and Cablevision Management Corporation of
Philadelphia, a Delaware corporation ("CMP") entered into a Merger
Agreement with the Principal Stockholder and Parent (the "CPI Merger
Agreement" and the "CMP Merger Agreement", respectively), pursuant to
which upon the terms and subject to the conditions set forth therein,
CPI Acquisition Sub was to be merged into CPI and CMP Acquisition Sub
was to be merged into CMP, as applicable, and the Principal
Stockholder was to receive for each share of common stock of CPI or
CMP, as applicable, the Merger Consideration (as defined in the
relevant Merger Agreement); and
WHEREAS concurrently with the original execution and
delivery hereof, the Company, the Xxxxx Companies, the Direct Holders,
the Principal Stockholder, Parent and Sub entered into the
Supplemental Agreement pursuant to which the Company, the Xxxxx
Companies, the Principal Stockholder, the Direct Holders, Parent and
Sub made certain representations, warranties, covenants and agreements
in connection with the Merger, the Purchase and the other Transactions
and also are prescribed various conditions to the Merger, the Purchase
and the other Transactions;
WHEREAS subsequent to the original execution and delivery
hereof, the parties hereto and CPI have determined that they wish to
revise the structure of the Transactions, without changing the
aggregate amount or types of consideration to be paid, so that (i)
Parent and/or one or more Designated Entities will acquire all of the
assets (consisting only of a partnership interest in CILP) and assume
all of the related liabilities of CPI pursuant to this Agreement and
CPI will become a Direct Holder hereunder, (ii) the CPI Merger
Agreement will be terminated, (iii) the consideration to be paid by
Parent and/or one or more Designated Entities for the assets of CFA
will be changed to substitute the assumption of liabilities (or
payment of cash) for the portion thereof that was to have consisted of
Parent Common Stock and (iv) CIMF will no longer be a Purchase Xxxxx
Company and a party to this Agreement and instead will be acquired by
the Company (immediately following its acquisition by Parent) for
Parent Common Stock pursuant to a Merger Agreement among Parent, CIMF,
the Principal Stockholder and the Company.
NOW, THEREFORE, in consideration of the representations,
warranties, covenants and agreements of the parties hereto contained
in the Acquisition Documents, the parties agree as follows:
ARTICLE I
Definitions and Interpretation
Capitalized terms used herein and not defined herein have
the meanings given such terms in Annex A to the Supplemental
Agreement, as amended from time to time, and the rules of
interpretation set forth in such Annex A are applicable hereto.
ARTICLE II
The Purchase
Section 2.01. Purchase Transactions. On the terms and
subject to the conditions specified in this Agreement and the
Supplemental Agreement, (x) Parent and (y) the relevant Purchase Xxxxx
Company, Xxxx Xxxxx or the Direct Holder will effect the following
transactions on the Closing Date.
(a) Parent and/or one or more Designated Entities will
purchase from Cablevision Industries of Delaware, Inc., a
Delaware corporation ("CID"), its partnership interest in
Cablevision Industries Limited Partnership, a Delaware limited
partnership ("CILP"), in exchange for the assumption of the
obligations of CID with respect thereto;
(b) Parent and/or one or more Designated Entities (which
entity shall not be the same entity purchasing from CID its
partnership interest in CILP) will purchase from CPI its
partnership interest in CILP in exchange for the assumption of
the obligations of CPI with respect thereto;
(c) Parent and/or one or more Designated Entities will
purchase from Cablevision Industries of Tennessee L.P., a
Delaware limited partnership ("CITLP"), all of its assets, in
exchange for the assumption of all its Assumed Liabilities;
(d) Parent and/or one or more Designated Entities will
purchase from Cablevision of Fairhaven/Acushnet, a New York
general partnership ("CFA"), all of its assets, in exchange for
the assumption of all its Assumed Liabilities;
(e) Parent and one or more Designated Entities will purchase
from the Principal Stockholder and ARA Cablevision, Inc., a
Delaware corporation, all of the partnership interests owned by
them in Cablevision Industries of Saratoga Associates, a New York
partnership ("CISA"), in exchange for the assumption of all its
Assumed Liabilities;
(f) Parent and/or one or more Designated Entities will
purchase from Cablevision Industries of Florida, Inc., a Florida
corporation ("CIF"), all of its assets, in exchange for the
assumption of all its Assumed Liabilities.
Notwithstanding the foregoing, a cash payment will be made pursuant to
Section 4.01 (and, after the Closing, Section 4.04) to the extent the
Adjustment Amount for any Purchase Xxxxx Company differs from the
Threshold of such Purchase Xxxxx Company. The consideration payable
pursuant to this Section 2.01, as so adjusted pursuant to Sections
4.01 and 4.04 is called the "Purchase Consideration". Each of CITLP,
CFA and CIF shall be an "Asset Xxxxx Company", and each of CISA and
CILP shall be an "Equity Xxxxx Company". Each Person from which the
Parent or one or more Designated Entities shall purchase assets or
Equity Interests shall be a "Seller".
Section 2.02. Purchase of Equity Interests. In the case
where the transactions described in Section 2.01 consist of the
purchase of Equity Interests, the Principal Stockholder shall or shall
cause the Direct Holder to sell, transfer and deliver or cause to be
sold, transferred and delivered to Parent and/or one or more
Designated Entities (as specified above), free and clear of any and
all Liens (other than Liens permitted under the Supplemental
Agreement), and Parent and one or more Designated Entities shall
purchase the Equity Interests to be sold and shall assume the
liabilities associated with such Equity Interests, including arising
out of the ownership as a general and/or limited partner of the Equity
Xxxxx Companies (such liabilities, together with the liabilities
assumed pursuant to Section 2.04, the "Assumed Liabilities").
SECTION 2.03. Purchase of Assets. In the case where the
transactions described in Section 2.01 consist of the purchase of
assets (other than Equity Interests) and assumption of liabilities,
each Asset Xxxxx Company shall, and the Principal Stockholder shall
cause each Asset Xxxxx Company to, sell, assign, transfer, convey and
deliver or cause to be sold, transferred, conveyed and delivered to
Parent, and Parent and/or one or more Designated Entities shall
purchase from the Principal Stockholder, all the assets, rights,
properties, goodwill and business of every kind and description,
wherever located, of each Asset Xxxxx Company, in each case as the
same shall exist at the Closing Date (the "Assets" of such Asset Xxxxx
Company), including all properties, tangible or intangible, real, or
personal, and all additions thereto on and after the date hereof and
through and including the Closing Date, other than such of those
assets and properties as may have been disposed of as permitted by
Section 4.01 of the Supplemental Agreement, but including the
following in respect of each Asset Xxxxx Company:
(i) such Asset Xxxxx Company's right, title and interest in
and to all parcels of real property owned in fee by such Asset
Xxxxx Company or in which such Asset Xxxxx Company has a
leasehold interest, and all buildings, structures and other
improvements located thereon and all rights of way and similar
authorizations;
(ii) such Asset Xxxxx Company's right, title and interest in
and to all of the tangible personal property owned or leased by
such Asset Xxxxx Company, including all towers, tower equipment,
antennas, above ground and underground cable, distribution
systems, headend amplifiers, line amplifiers, testing equipment,
motor vehicles, office equipment, furniture and fixtures,
supplies and other physical assets;
(iii) such Asset Xxxxx Company's right, title and interest
in and to all contracts, options, leases (whether of realty or
personalty), purchase orders, commitments or other agreements of
such Asset Xxxxx Company (other than the Franchises of such Asset
Xxxxx Company), whether oral or written, including agreements of
such Asset Xxxxx Company listed in Sections 3.01(m)(i),
3.01(m)(ii) and 3.01(m)(iii) of the Disclosure Schedule, all
subscription agreements with individuals for cable television,
security or
satellite service entered into in the ordinary course of business
and other contracts entered into in the ordinary course of
business prior to the date hereof or after the date hereof;
(iv) such Asset Xxxxx Company's right, title and interest in
and to all subscriber, customer and advertiser lists;
(v) such Asset Xxxxx Company's right, title and interest in
and to all municipal, county, state and federal franchises,
domestic satellite, business radio and other licenses and all
other permits, licenses and authorizations issued by local, state
and federal Governmental Entities, and applications therefor,
including the Franchises of such Asset Xxxxx Company;
(vi) such Asset Xxxxx Company's right, title and interest in
and to copyrights, patents, or any applications for any of the
foregoing, and any goodwill associated therewith, and other
similar intangible rights and interests;
(vii) all subscriber, customer and trade accounts receivable
due to such Asset Xxxxx Company as a result of such Asset Xxxxx
Company's (or the Company's) operation of the Systems prior to
the Closing Date;
(viii) all deposits under subscriber, utility, pole rental
and similar agreements of such Asset Xxxxx Company;
(ix) such Asset Xxxxx Company's records, files and data,
including maps, plans, diagrams, blueprints and schematics, if
any; and
(x) the Working Capital Assets of such Asset Xxxxx Company.
(b) Notwithstanding anything in Section 2.01 to the
contrary, no Asset Xxxxx Company shall have any obligation to sell,
nor shall Parent have any obligation to purchase, the Excluded Assets
or Excluded Systems Assets held by any Asset Xxxxx Company.
Section 2.04. Assumption of Certain Liabilities of the Asset
Xxxxx Companies by Purchaser. In the case where the transactions
described in Section 2.01 consist of
the purchase of assets (other than Equity Interests) and the
assumption of liabilities, Parent and/or one or more Designated
Entities shall assume and agree to pay, perform and discharge, and
indemnify each Asset Xxxxx Company against and hold it harmless from
(the following, together with the liabilities assumed pursuant to
Section 2.02, being called the "Assumed Liabilities"):
(a) all the obligations and liabilities of such Asset Xxxxx
Company under the Franchises (without limiting the provisions of
Section 5.02 of the Supplemental Agreement);
(b) all of the obligations of such Asset Xxxxx Company for
the provision of cable television or other services after the Closing
Date to subscribers to the Systems of such Asset Xxxxx Company;
(c) the obligations and liabilities of such Asset Xxxxx
Company under the express terms of all leases, subleases, contracts,
agreements and other instruments or binding arrangements to which such
Asset Xxxxx Company is a party or by which it is bound on the Closing
Date;
(d) the Working Capital Liabilities, and the Closing
Indebtedness and Other Liabilities, in each case of such Asset Xxxxx
Company;
(e) all obligations and liabilities in respect of Debt
Documents of such Asset Xxxxx Company;
(f) all Tax Liabilities of such Asset Xxxxx Company;
(g) all liabilities in respect of such Asset Xxxxx Company
disclosed in the Balance Sheets or in Section 3.01(e)(ii) of the
Disclosure Schedule; and
(h) all other obligations and liabilities of such Asset
Xxxxx Company;
provided, however, that Parent shall not assume or become liable to
pay, perform or discharge or to indemnify any Asset Xxxxx Company
against or hold it harmless from (and the Assumed Liabilities shall
not include) any of the following (the "Excluded Liabilities"):
(i) any obligations or liabilities of any Asset Xxxxx
Company under this Agreement or with respect to or arising
out of the Transactions which, pursuant to the terms of the
Acquisition Documents, are to be borne by the Principal
Stockholder or a Cablevision Company (except as may
otherwise be provided in Section 5.02 of the Supplemental
Agreement);
(ii) any obligations or liabilities of such Asset Xxxxx
Company arising or incurred after the Closing Date to the
extent not reflected in the Adjustment Amount;
(iii) any obligation or liability of such Asset Xxxxx
Company related to any Excluded Asset or Excluded Systems
Asset of such Asset Xxxxx Company;
(iv) any Severance and Incentive Liabilities of such
Asset Xxxxx Company, to the extent not reflected in the
Adjustment Amount;
(v) any obligation or liability of such Asset Xxxxx
Company in respect of taxes for pre-Closing Tax Periods for
which no accrual has been made in the determination of
Working Capital Liabilities; and
(vi) any obligations or liabilities that are not
related to such Asset Xxxxx Company's cable television
operations and that are incurred in violation of Section
4.01 of the Supplemental Agreement.
SECTION 2.05. Allocation. The parties agree that the
purchase price for the Equity Interests and Assets of the Purchase
Xxxxx Companies, as applicable, is allocated as provided in Section
2.01 (as adjusted pursuant to Section 4.01) of this Agreement, and
none of Parent, the Purchase Xxxxx Companies, the Direct Holders or
the Principal Stockholder (nor any of their respective affiliates)
shall take any position on any tax return or with any taxing authority
that is inconsistent with the allocation of the Purchase Consideration
set forth in Section 2.01 of this Agreement.
Article III
The Closing
SECTION 3.01. Closing; Delivery of Cash. (a) In
consideration of the Purchase and the Principal Stockholder's and each
Purchase Xxxxx Company's performance of the Acquisition Documents to
which it is a party, on the terms and subject to the conditions set
forth herein and in the Supplemental Agreement, at the Closing, Parent
shall deliver to the Principal Stockholder, on behalf of the Sellers,
(A) executed assumption agreements in form and substance reasonably
satisfactory to the Principal Stockholder that shall provide for the
assumption by Parent and/or one or more Designated Entities of the
Assumed Liabilities and (B) by wire transfer to a bank account
designated in writing by the Principal Stockholder at least three
business days prior to the Closing Date, in immediately available
funds, an amount equal to the aggregate amount of any cash payable
pursuant to Section 4.01.
(b) At the Closing, (i) the Principal Stockholder shall
cause each Asset Xxxxx Company to deliver to Parent (A) special
warranty deeds to any parcels of real property owned by such Asset
Xxxxx Company in fee, in accordance with local practice, and (B) bills
of sale, assignments and other instruments of transfer and conveyance,
transferring and assigning to Parent and/or one or more Designated
Entities the Assets of such Asset Xxxxx Company; and (ii) the
Principal Stockholder shall, and shall cause each Direct Holder of an
Equity Xxxxx Company to, deliver to Parent an executed assignment
agreement in form and substance reasonably satisfactory to Parent that
shall provide for the assignment of the Equity Interests of such
Equity Xxxxx Company to Parent and/or one or more Designated Entities,
as specified by Parent not later than three business days prior to the
Closing Date.
ARTICLE IV
Purchase Consideration Adjustments
SECTION 4.01. Adjustments to Purchase Consideration. (a) The
Purchase Consideration shall be adjusted in accordance with this
Section 4.01(a) if the Adjustment Amount of such Purchase Xxxxx
Company is higher
or lower than the Threshold of such Purchase Xxxxx Company. The
Threshold of each Purchase Xxxxx Company is set forth below:
Purchase Xxxxx Company Threshold
(1) CILP $245,742,000
(2) CITLP $67,032,000
(3) CFA $22,923,000
(4) CISA $60,410,000
(5) CIF $21,140,000
For purposes of this Agreement, the portion of the Threshold of CILP
that shall be allocable to CID's Equity Interest in CILP shall be
$101,982,930 and the portion of such Threshold that shall be allocable
to CPI's Equity Interest in CILP shall be $143,759,070. In the event
that the Threshold of CILP is adjusted pursuant to Section 4.05, the
portion thereof that is allocable to CID's and CPI's respective Equity
Interests in CILP shall be appropriately adjusted (without
duplication).
In the event that the Threshold of any Purchase Xxxxx Company (other
than CILP, CISA and CFA) exceeds the Adjustment Amount of such
Purchase Xxxxx Company a cash payment shall be made to the Principal
Stockholder (on behalf of the Sellers) in the amount of such excess.
In the case of CID and CPI, in the event that the portion of the
Threshold of CILP allocable to CID's and CPI's respective Equity
Interests in CILP shall exceed the portion of the Adjustment Amount
allocable to CID's and CPI's respective Equity Interests in CILP, a
cash payment shall be made to the Principal Stockholder (on behalf of
the relevant Seller) in the amount of such excess. In the case of
CISA, in the event that the Threshold exceeds the Adjustment Amount, a
cash payment shall be made to the Principal Stockholder (on his own
behalf and on behalf of ARA Cablevision, Inc.) in an amount equal to
95.2% of such excess, and a cash payment shall be made to CFA (or its
successors-in-interest) in an amount equal to 4.8% of such excess. In
the case of CFA, in the event that the Threshold exceeds the
Adjustment Amount, a cash payment shall be made to the Principal
Stockholder (on behalf of CFA) in an amount equal to 98% of such
excess,
and a cash payment shall be made to CIMF (or its successor-
in-interest) in an amount equal to 2% of such excess. In the event
that the Adjustment Amount of any Purchase Xxxxx Company (other than
CILP, CISA and CFA) exceeds the Threshold of such Purchase Xxxxx
Company, a cash payment shall be made by the Sellers in the amount of
such excess. In the case of CID and CPI, in the event that the portion
of the Adjustment Amount of CILP allocable to CID's and CPI's
respective Equity Interests in CILP exceeds the portion of CILP's
Threshold allocable to CID's and CPI's respective Equity Interests in
CILP, a cash payment shall be made by the Principal Shareholder (on
behalf of the relevant Sellers) to Parent. In the case of CISA, in the
event that the Adjustment Amount exceeds the Threshold, a cash payment
shall be made by the Principal Stockholder in an amount equal to 95.2%
of such excess and a cash payment shall be made by CFA (or its
successors-in-interest) in an amount equal to 4.8% of such excess. In
the case of CFA, in the event that the Adjustment Amount exceeds the
Threshold, a cash payment shall be made by the Principal Stockholder
in an amount equal to 98% of such excess, and a cash payment shall be
made by CIMF (or its successor-in-interest) in an amount equal to 2%
of such excess. The amount of cash, if any, payable pursuant to this
Section 4.01(a) in respect of a Purchase Xxxxx Company shall be called
the "Cash Amount".
(b) The "Adjustment Amount" of any Purchase Xxxxx Company
shall be an amount equal to, without duplication, (A) the aggregate
amount of Closing Indebtedness and Other Liabilities of such Purchase
Xxxxx Company, plus (B) the amount of the Working Capital Deficit of
such Purchase Xxxxx Company, if any, or minus (C) the amount of the
Working Capital Balance of such Purchase Xxxxx Company, if any, plus
(D) the amount of the Capital Expenditure Deficiency of such Purchase
Xxxxx Company, if any, or minus (E) the amount of the Capital
Expenditure Excess of such Purchase Xxxxx Company, if any, plus (F)
the aggregate amount of Severance and Incentive Liabilities of such
Purchase Xxxxx Company; provided that in determining the Adjustment
Amount of CFA effect shall be given to CFA's sale of a 4.8%
partnership interest in CISA pursuant to this Purchase Agreement and
to the results of any post-closing adjustments relating to CISA
pursuant to this Purchase Agreement.
(c) The Adjustment Amount of CILP allocable to CID's Equity
Interest in CILP (the "CID Adjustment Amount") shall be 41.5% of the
Adjustment Amount of CILP:
(d) The Adjustment Amount of CILP allocable to CPI's Equity
Interest in CILP (the "CPI Adjustment Amount") shall be 58.5% of the
Adjustment Amount of CILP:
SECTION 4.02. Estimated Adjustment Amount; Initial
Calculation of Purchase Consideration. Not later than five business
days prior to the Closing, each Purchase Xxxxx Company shall deliver
to Parent an estimate of the Adjustment Amount (the "Estimated
Adjustment Amount") of such Purchase Xxxxx Company, including
therewith estimated Closing Indebtedness and Other Liabilities
("Estimated Closing Indebtedness and Other Liabilities") of such
Purchase Xxxxx Company, estimated Working Capital Deficit or estimated
Working Capital Balance ("Estimated Working Capital Deficit or
Balance") of such Purchase Xxxxx Company, estimated Capital
Expenditure Deficiency or estimated Capital Expenditure Excess
("Estimated Capital Expenditure Deficiency or Excess") of such
Purchase Xxxxx Company, and estimated Severance and Incentive
Liabilities ("Estimated Severance and Incentive Liabilities") of such
Purchase Xxxxx Company, and the Cash Amount of such Purchase Xxxxx
Company shall be determined pursuant to Section 4.01 as if the
Estimated Adjustment Amount of such Purchase Xxxxx Company were the
Adjustment Amount of such Purchase Xxxxx Company (the "Estimated Cash
Amount" of such Purchase Xxxxx Company). As of the Closing, the Cash
Amount of each Purchase Xxxxx Company shall be deemed to comprise the
Estimated Cash Amount of such Purchase Xxxxx Company. After the
Closing, the Purchase Consideration shall be subject to adjustment in
accordance with Section 4.04.
SECTION 4.03. Escrow Arrangements. At the Closing, the
Principal Stockholder shall, on behalf of the Sellers, deposit into
escrow, in accordance with the terms of the Escrow Agreement, an
amount in cash (the "Escrowed Cash") in respect of each Purchase Xxxxx
Company, as set
forth below (and the Principal Stockholder hereby directs the Parent
to deposit such amounts out of the Purchase Consideration):
Purchase Xxxxx Company Escrowed Cash
CILP $479,528
CITLP $162,887
CFA $30,287
CISA $146,795
CIF $51,369
For purposes of this Agreement, the portion of the Escrowed Cash of
CILP that shall be allocable to CID's Equity Interest in CILP shall be
$199,004 and the portion thereof allocable CPI's Equity Interest in
CILP shall be $280,524. The Principal Stockholder shall be entitled to
determine the allocation, as among the Sellers, of the Escrowed Cash
to be deposited into escrow pursuant to the Escrow Agreement, and
unless otherwise specified shall be deemed to have determined that all
such Escrowed Cash required to be so deposited shall be the Cash
Amount payable to the Principal Stockholder.
SECTION 4.04. Reconciliation of Adjustment Amount;
Adjustment of Purchase Consideration. (a) Within 90 days after the
Closing Date, Parent shall prepare and deliver to the Principal
Stockholder, a statement (the "Statement") setting forth Parent's
determination of the Adjustment Amount of each Purchase Xxxxx Company,
including Closing Indebtedness and Other Liabilities, the Working
Capital Deficit or Working Capital Balance, the Capital Expenditure
Deficiency or the Capital Expenditure Excess and the Severance and
Incentive Liabilities, in each case of such Purchase Xxxxx Company,
and the calculation of the Cash Amount in accordance with Section
4.01. During the 30-day period following delivery of the Statement to
the Principal Stockholder, Parent shall provide the Principal
Stockholder with access during normal business hours to any books,
records, working papers or other information reasonably necessary or
useful in the preparation of the Statement and the calculation of the
Adjustment Amount to enable the Principal Stockholder to verify the
accuracy of the
Statement. The Statement shall become final and binding upon all
parties hereto on the thirtieth day following delivery thereof to the
Principal Stockholder unless the Principal Stockholder gives written
notice of disagreement with the Statement (a "Notice of Disagreement")
to Parent prior to such date. Any Notice of Disagreement shall specify
in reasonable detail the nature of any disagreement so asserted and
relate solely to the preparation of the Statement and the calculation
of the Adjustment Amount of any Xxxxx Company, the Cash Amount for any
Purchase Xxxxx Company in accordance with Section 4.01.
(b) If a Notice of Disagreement is received by Parent in a
timely manner, then the Statement (as revised in accordance with
clause (c) or (d) below) shall become final and binding upon the
parties hereto on the earlier of (i) the date the Principal
Stockholder and Parent resolve in writing any differences they may
have with respect to any matter specified in the Notice of
Disagreement or (ii) the date any disputed matters are finally
resolved in writing by the Arbitrator (as defined below). During the
30-day period following the delivery of a Notice of Disagreement,
Parent and the Principal Stockholder shall seek in good faith to
resolve in writing any differences which they may have with respect to
any matter specified in the Notice of Disagreement and each shall
provide the other with reasonable access to any books, records,
working papers or other information reasonably necessary or useful in
the preparation or calculation of (u) the Estimated Adjustment Amount
of each Purchase Xxxxx Company, including Estimated Closing
Indebtedness and Other Liabilities, the Estimated Working Capital
Deficit or Balance, the Estimated Capital Expenditure Deficiency or
Excess and the Estimated Severance and Incentive Liabilities, in each
case of each Purchase Xxxxx Company, (v) the Adjustment Amount of each
Purchase Xxxxx Company, including Closing Indebtedness and Other
Liabilities, the Working Capital Deficit or Working Capital Balance,
the Capital Expenditure Deficiency or the Capital Expenditure Excess
and the Severance and Incentive Liabilities, in each case of each
Purchase Xxxxx Company, (w) the Cash Amount of such Purchase Xxxxx
Company, (x) the Statement, (y) any Notice of Disagreement or (z)
otherwise with respect to any thereof. At the end of such 30-day
period if there has been no resolution of the matters specified in the
Notice of Disagreement, Parent and the Principal Stockholder shall
submit to an arbitrator (the "Arbitrator") for review and resolution
any and all matters arising under this Section which remain in
dispute. The
Arbitrator shall be Price Waterhouse, or if such firm is unable or
unwilling to act, such other nationally recognized independent public
accounting firm as shall be agreed upon by Parent and the Principal
Stockholder in writing. The Arbitrator shall render a decision
resolving the matters submitted to the Arbitrator within 30 days
following submission thereto. The cost of any arbitration (including
the fees of the Arbitrator) pursuant to this Section shall be borne
50% by Parent and 50% by the Principal Stockholder.
(c) If the Adjustment Amount of any Purchase Xxxxx Company
is higher or lower than the Estimated Adjustment Amount of such
Purchase Xxxxx Company, the Cash Amount of such Purchase Xxxxx Company
shall be finally adjusted pursuant to Section 4.01. If the Cash Amount
of such Purchase Xxxxx Company other than CISA or CFA as so finally
adjusted, is greater than the Estimated Cash Amount of such Purchase
Xxxxx Company, Parent shall, within 15 days after the Statement
becomes final and binding upon the parties, pay to the Principal
Stockholder on behalf of himself and the other Sellers an aggregate
amount equal to the excess of the Cash Amount of such Purchase Xxxxx
Company, as so finally determined, over the Estimated Cash Amount of
such Purchase Xxxxx Company; provided, however, that if there shall be
an excess or deficiency in the Cash Amount in respect of more than one
such Purchase Xxxxx Company, only one net amount shall in each case be
payable hereunder. If the Cash Amount of CISA, as so finally adjusted,
is greater than the Estimated Cash Amount of CISA, Parent shall,
within 15 days after the Statement becomes final and binding upon the
parties, pay to the Principal Stockholder on his own behalf and on
behalf of ARA Cablevision, Inc. an aggregate amount equal to 95.2% of
the excess of the Cash Amount of CISA, as so finally determined, over
the Estimated Cash Amount of CISA, and shall pay to CFA (or its
successors-in-interest) an aggregate amount equal to 4.8% of the
excess of the Cash Amount of CISA, as so finally determined, over the
Estimated Cash Amount of CISA. If the Cash Amount of CFA, as so
finally adjusted, is greater than the Estimated Cash Amount of CFA,
Parent shall, within 15 days after the Statement becomes final and
binding upon the parties, pay to the Principal Stockholder on behalf
of CFA an aggregate amount equal to 98% of the excess of the Cash
Amount of CFA, as so finally determined, over the Estimated Cash
Amount of CFA, and shall pay to CIMF (or its successor-in-interest) an
aggregate amount equal to 2% of the excess of the Cash
Amount of CFA, as so finally determined, over the Estimated Cash
Amount of CFA.
(d) If the Cash Amount of any Purchase Xxxxx Company other
than CISA or CFA, as so finally adjusted, is less than the Estimated
Cash Amount of such Purchase Xxxxx Company, Parent shall be entitled
to receive, within 15 days after the Statement becomes final and
binding upon the parties, an aggregate amount (the "Returned Amount")
equal to the excess of the Estimated Cash Amount of such Purchase
Xxxxx Company over the Cash Amount of such Purchase Xxxxx Company as
so finally determined. If the Cash Amount of CISA, as so finally
adjusted, is less than the Estimated Cash Amount of CISA, Parent shall
be entitled to receive from the Principal Stockholder, within 15 days
after the Statement becomes final and binding upon the parties, an
aggregate amount (the "CISA Returned Amount") equal to 95.2% of the
excess of the Estimated Cash Amount of CISA over the Cash Amount of
CISA, as so finally determined, and shall be entitled to received from
CFA (or its successors-in-interest), within 15 days after the
Statement becomes final and binding upon the parties, an aggregate
amount equal to 4.8% of the excess of the Estimated Cash Amount of
CISA over the Cash Amount of CISA, as so finally determined. If the
Cash Amount of CFA, as so finally adjusted, is less than the Estimated
Cash Amount of CFA, Parent shall be entitled to receive from the
Principal Stockholder, within 15 days after the Statement becomes
final and binding upon the parties, an aggregate amount (the "CFA
Returned Amount") equal to 98% of the excess of the Estimated Cash
Amount of CFA over the Cash Amount of CFA, as so finally determined,
and shall be entitled to receive from CIMF (or its successor-in-
interest), within 15 days after the Statement becomes final and
binding upon the parties, an aggregate amount equal to 2% of the
excess of the Estimated Cash Amount of CFA over the Cash Amount of
CFA, as so finally determined. The Principal Stockholder's obligation
to deliver the Returned Amount, the CISA Returned Amount and the CFA
Returned Amount shall be satisfied, first, out of the Escrowed Amount,
and second, out of other cash held by the Stockholders.
SECTION 4.05. Adjustments to Threshold. The Threshold of
each Purchase Xxxxx Company shall be reduced in the event the
Principal Stockholder designates as Excluded Assets any System or
Systems (or portions thereof) owned by such Purchase Xxxxx Company as
of the date of this Agreement pursuant to Section 5.25 of the
Supplemental Agreement by an amount equal to the Excluded Systems
Amount of such Purchase
Xxxxx Company. The "Excluded Systems Amount" shall equal 13.5
multiplied by the aggregate amount of operating cash flow of such
Purchase Xxxxx Company for the fiscal year immediately preceding the
Closing that is attributable to each System (or portion thereof) so
designated (it being understood that such cash flow shall be as so
determined in preparing such Purchase Xxxxx Company's audited
financial statements for such fiscal year).
SECTION 4.06. Stockholders' Representative. The Principal
Stockholder, each Direct Holder and each Asset Xxxxx Company hereby
designates Xxxxxx Xxxxxxx or such other Person as designated by the
Principal Stockholder to be the representative of each such person or
entity (the "Stockholders' Representative") for purposes of this
Agreement.
ARTICLE V
Conditions Precedent
The respective obligation of each party to effect the
Purchase and the other transactions contemplated hereby is subject to
the satisfaction or waiver (by the parties for whose benefit the
condition is imposed) on or prior to the Closing Date of the
conditions set forth in Article VI of the Supplemental Agreement.
ARTICLE VI
Termination, Amendment and Waiver
This Purchase Agreement may be terminated or amended or the
parties may extend the time for the performance of any of the
obligations or other acts of the other parties, waive any inaccuracies
in the representations and warranties contained in or in any document
delivered pursuant to this Agreement or waive compliance with any of
the agreements or conditions contained in this Agreement, in each case
as provided in Article VIII of the Supplemental Agreement.
ARTICLE VII
Termination of CPI Merger Agreement; Elimination
of CIMF as a Party
Parent, the Principal Stockholder and CPI hereby agree that
the transaction intended to be accomplished by way of the CPI Merger
Agreement shall instead be accomplished by way of this Agreement, so
that the CPI Merger Agreement is hereby terminated and shall no longer
be of any force or effect. The Purchase Agreement, dated as of
February 6, 1995, is hereby amended and restated in its entirety
pursuant to the terms hereof. The parties hereto hereby agree that
CIMF shall cease to be a party hereto and shall instead be acquired by
Parent pursuant to the CIMF Merger Agreement.
ARTICLE VIII
Governing Law
This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York, regardless of the
laws that might otherwise govern under applicable principles of
conflict of laws thereof.
IN WITNESS WHEREOF, the Principal Stockholder, the Purchase
Xxxxx Companies, the Direct Holders and Parent have caused this
Agreement to be signed by their respective duly authorized officers
(or, in the case of the Principal Stockholder, has signed this
Agreement), all as of the date first written above.
Xxxx Xxxxx, as the
Principal Stockholder
CABLEVISION INDUSTRIES LIMITED
PARTNERSHIP (a Purchase Xxxxx
Company),
by CABLEVISION INDUSTRIES OF
DELAWARE, INC., as General
Partner,
by
Name: Xxxxx Xxxxxxxxx
Title: Vice President
and by CABLEVISION PROPERTIES,
INC., as General Partner,
by
Name: Xxxxx Xxxxxxxxx
Title: Vice President
CABLEVISION INDUSTRIES OF
TENNESSEE L.P. (a Purchase Xxxxx
Company),
by CABLEVISION INDUSTRIES OF
TENNESSEE, INC., as General
Partner,
by
Name: Xxxxx Xxxxxxxxx
Title: Vice President
and by
Xxxx Xxxxx, as
General Partner
CABLEVISION INDUSTRIES OF SARATOGA
ASSOCIATES (a Purchase Xxxxx
Company),
by ARA CABLEVISION, INC.,
as General Partner,
by
Name: Xxxxx Xxxxxxxxx
Title: Vice President
and by
Xxxx Xxxxx, as
General Partner
CABLEVISION OF FAIRHAVEN/ACUSHNET
(a Purchase Xxxxx Company),
by CABLEVISION INDUSTRIES OF
MIDDLE FLORIDA, INC., as General
Partner,
by
Name: Xxxxx Xxxxxxxxx
Title: Vice President
and by
Xxxx Xxxxx, as
General Partner
CABLEVISION INDUSTRIES OF FLORIDA,
INC. (a Purchase Xxxxx Company),
by
Name: Xxxxx Xxxxxxxxx
Title: Vice President
CABLEVISION INDUSTRIES OF DELAWARE,
INC. (a Direct Holder),
by
Name: Xxxxx Xxxxxxxxx
Title: Vice President
CABLEVISION PROPERTIES INC. (a
Direct Holder),
by
Name:
Title:
ARA CABLEVISION, INC. (a Direct
Holder),
by
Name: Xxxxx Xxxxxxxxx
Title: Vice President
TIME WARNER INC.,
by
Name: Xxxxxxx X. Xxxx
Title: Vice President
and Deputy
General Counsel
