EXHIBIT 10.1
FUNDING AGREEMENT ("Agreement") dated as of March 31, 1999, by and among TIME
WARNER ENTERTAINMENT COMPANY, L.P., ADVANCE/XXXXXXXX PARTNERSHIP, COMCAST
CORPORATION, XXX COMMUNICATIONS, INC., MEDIAONE OF DELAWARE, INC., GE AMERICAN
COMMUNICATIONS, INC., UNITED ARTISTS INVESTMENTS HOLDINGS, LLC, PARAGON
COMMUNICATIONS (collectively, the "Funding Parties") and PRIMESTAR, INC. (the
"Company").
RECITALS
(A) The Funding Parties, other than United Artists Investments
Holdings, LLC ("TCI"), or affiliates of such Funding Parties, are stockholders
of the Company
(B) The Funding Parties, other than GE American Communications, Inc.
("GEAC") are account parties under Existing Letters of Credit (as hereinafter
defined).
(C) GEAC is a provider of satellite services to customers including
the Company and the other Funding Parties or their affiliates and states that it
is entering into this Agreement in recognition of its relationship as a vendor
of such services to such customers.
(D) The Company is party to the Asset Purchase Agreement, dated as of
January 22, 1999 (the "Medium Power Agreement"), among Xxxxxx Electronics
Corporation (the "Buyer"), the Company, PRIMESTAR Partners L.P., a wholly owned
subsidiary of the Company ("PLP"), PRIMESTAR MDU, Inc., a wholly owned
subsidiary of the Company ("MDU"), and the Funding Parties other than TCI. By a
separate agreement (the "TCI Reimbursement Letter"), TCI has agreed to reimburse
the other Funding Parties for a portion of certain obligations specified
therein, including, without limitation, certain obligations assumed by such
other Funding Parties under the Medium Power Agreement.
(E) Section 9.10(a) of the Medium Power Agreement provides that the
Company, PLP and MDU agree to use all commercially reasonable efforts to satisfy
the condition that holders (the "Bondholders") of the Current Pay Notes and the
Discount Notes (as hereinafter defined) and the lenders (the "Lenders") under
the Company's Bridge Loans (as hereinafter defined) consent to modifications to
the terms of such debt in accordance with the provisions of the Medium Power
Agreement.
(F) Concurrently with the execution and delivery of this Agreement,
the Company is entering into one or more agreements (collectively, the "Lock-up
Agreement"), among the Company and certain holders of the Current Pay Notes,
Discount Notes and Bridge Loans, in
order to induce such creditors (the "Senior Subordinated Creditors") to
participate in the Exchange Offer and/or Private Transactions (as hereinafter
defined).
(G) In order to induce the Senior Subordinated Creditors to enter into
the Lock-up Agreement, the Funding Parties and the Company are entering into
this Agreement with the express intent that the Senior Subordinated Creditors be
intended third party beneficiaries of this Agreement.
(H) Each of the Funding Parties which is or has an affiliate that is a
stockholder of the Company has determined that the transactions contemplated by
the Medium Power Agreement and the Lock-up Agreement are in the best interests
of the Company and its subsidiaries, and in the best interests of such Funding
Party, and TCI has determined that the transactions contemplated by the Medium
Power Agreement and the Lock-up Agreement are in the best interests of TCI.
(I) Notwithstanding the specific obligations of the account parties to
the Existing Letters of Credit in respect thereof, none of the Funding Parties
(nor any affiliate of a Funding Party that is a stockholder of the Company) has
any pre-existing legal or contractual obligation to enter into this Funding
Agreement or to provide the financial support to the Company provided for
herein.
(J) This Agreement is, and is intended to be, a financial
accommodation by the Funding Parties within the meaning of Title 11 of the
United States Code.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, and intending to be
bound hereby, the parties hereto hereby agree as follows:
Section 1. Definitions.
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(a) As used in this Agreement, the following terms shall have the
corresponding meanings:
"Bridge Loans" means all loans made pursuant to the Interim Loan Facility,
whether or not converted into `Term Loans' or exchanged for `Exchange Notes' as
provided for therein.
"Cash Interest Election" has the meaning ascribed thereto in the indenture
governing the Discount Notes.
"Closing Date" means the date that the Medium Power Asset Sale is
consummated pursuant to the Medium Power Agreement.
"Closing Date Required Amount" means the sum of: (i) the Senior Bank
Payoff Amount, (ii) the Sub Debt Maximum Agreed Amount, and (iii) $25,000,000.
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"Company" means PRIMESTAR, Inc.
"Contingent Note Consideration" means any share appreciation right,
contingent value right, security, contract or other obligation of the Company
issued to holders of Current Pay Notes, Discount Notes and Bridge Loans pursuant
to any Exchange Offer or Private Transaction.
"Current Pay Notes" means the Company's 10-7/8% Senior Subordinated Notes
due 2007, Series A and B.
"Discount Notes" means the Company's 12-1/4% Senior Subordinated Discount
Notes due 2007, Series A and B.
"Exchange Offer" means an offer by the Company to the holders of the
Current Pay Notes and the Discount Notes to tender such notes for exchange, in
each case substantially on the terms provided for in the Lock-up Agreement.
"Existing Letters of Credit" means any standby letters of credit issued
for the account of any of the Funding Parties (or any affiliate of a Funding
Party other than the Company) other than GEAC to secure the payment of any
obligations of the Company or any of its subsidiaries.
"Expected Closing Date Proceeds" means an amount of money equal to the net
cash proceeds payable to the Company on the Closing Date under the Medium Power
Agreement, as set forth in the Initial Funding Certificate.
"GMH Stock" means Class H Common Stock of General Motors Corporation, a
Delaware corporation.
"High Power Agreement" means the Asset Purchase Agreement, dated as of
January 22, 1998, among Xxxxxx, the Company, PLP, Tempo and the stockholders of
the Company listed therein
"Xxxxxx" means Xxxxxx Electronics Corporation.
"Initial Funding Amount" means an amount of money equal to the lesser of
(i) the Closing Date Required Amount minus the Expected Closing Date Proceeds,
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and (ii) the Medium Power Commitment.
"Initial Funding Certificate" is defined in Section 2.
"Interim Loan Facility" means the Company's Senior Subordinated Credit
Agreement, dated as of April 1, 1998.
"Lock-up Agreement" is defined in the recitals.
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"Medium Power Agreement" is defined in the recitals.
"Medium Power Asset Sale" means the sale of the medium-power business to
Xxxxxx pursuant to the terms of the Medium Power Agreement.
"Medium Power Commitment" means $540 million.
"Minimum Tender Condition" shall have the meaning assigned to such term in
the Lock-up Agreement.
"Non-Debt Payment" means a payment made by any Funding Party to or for the
benefit of the Company, with no expectation of, or right to, repayment.
"Notes" means and includes each of the Bridge Loans, the Current Pay Notes,
and the Discount Notes.
"Partnership Credit Facility" means PLP's Credit Agreement, dated as of
March 9, 1994, as amended.
"PLP" is defined in the recitals.
"Post-Closing Working Capital Requirements" means, for any period following
the Closing Date, (i) the aggregate amount of all Scheduled Post-Closing
Obligations that are due and payable, or by their terms will become due and
payable, during the period in question, less (ii) the aggregate amount of all
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cash and cash equivalents of the Company on hand or in banks at the beginning of
such period and available to be used to satisfy Scheduled Post-Closing
Obligations.
"Private Transaction" means any transaction or series of transactions by
which the Company acquires (i) Current Pay Notes and Discount Notes or (ii)
Bridge Loans, in either case in an aggregate principal amount that would meet
the Minimum Tender Condition with respect to such securities or loans, on
substantially the terms provided for in the Lock-up Agreement.
"Pro Rata Share" means, for each Funding Party, the percentage set forth
opposite the name of such Funding Party on Schedule I attached hereto.
"Reimbursement Agreements" means those reimbursement agreements, each dated
as of April 1, 1998, between the Company and each of the Funding Parties other
than GEAC, or affiliates thereof, which provide for, among other things, the
assumption by the Company of all the obligations of such Funding Party (or
affiliate) under its respective Existing Letter of Credit and the existing
reimbursement agreements and/or other existing documentation between such party
and the issuing bank relating to such letter of credit, including all existing
and future payment obligations of such party thereunder, and the indemnification
by the Company of such party for any and all
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losses, claims, damages, liabilities, deficiencies, obligations, costs and
expenses of such party relating thereto.
"Required Funding Parties" means Funding Parties with an aggregate Pro Rata
Share in excess of 55%.
"Scheduled Post-Closing Obligations" means and includes each of the
obligations of the Company and its subsidiaries set forth on Schedule IV
attached hereto (including, without limitation, estimates of the Company's
ordinary costs and expenses to be incurred after the Closing Date during the
Shutdown Period), as such schedule may be modified by the Company, with the
consent of the Required Funding Parties, from time to time.
"Senior Bank Payoff Amount" means the amount required by the Company in
accordance with the Senior Credit Facility to pay and discharge in full on the
Closing Date all monetary obligations of the Company under the Senior Credit
Facility, including without limitation the aggregate principal amount of, and
accrued unpaid interest on, all loans then outstanding thereunder, and all
accrued unpaid commitment fees and other expenses thereunder, as set forth in
the aggregate on the Initial Funding Certificate.
"Senior Credit Facility" means the Company's $700,000,000 Credit Agreement,
dated as of March 31, 1998.
"Shutdown Costs" means all obligations and liabilities of the Company and
its subsidiaries on the Closing Date, other than (i) the Senior Bank Payoff
Amount, (ii) all obligations and liabilities of the Company under the Discount
Notes, the Current Pay Notes and the Bridge Loans, (iii) any such obligations or
liabilities assumed by Xxxxxx on the Closing Date pursuant to the Medium Power
Agreement or assumed by Xxxxxx pursuant to the High Power Agreement, and (iv)
any such obligations or liabilities to the extent backed by Existing Letters of
Credit.
"Shutdown Period" means the period beginning on the Closing Date and ending
on the earlier to occur of (i) the fourth anniversary of the Closing Date and
(ii) the last day of the fourth calendar month following the payment or
satisfaction and discharge in full of all Shutdown Costs.
"Sub Debt Maximum Agreed Amount" means the sum of: (i) 88.2% of the
aggregate principal amount of the Current Pay Notes, the Discount Notes and the
Bridge Loans outstanding on the Closing Date, determined in the case of the
Discount Notes as if the Company had made a Cash Interest Election as of
February 15, 1999, and (ii) 100% of all accrued unpaid interest through the
Closing Date under the Current Pay Notes, the Discount Notes and the Bridge
Loans, determined in the case of the Discount Notes as if the Company had made a
Cash Interest Election as of February 15, 1999, as set forth in the aggregate on
the Initial Funding Certificate.
"TCI Reimbursement Letter" is defined in Recital (D).
"Tempo" means Tempo Satellite, Inc.
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"TSAT Consideration Shares" means the number of shares of GMH Stock equal
to the product of (65,000,000/225,000,000) multiplied by 4,871,448 (i.e.,
1,407,307.2 shares of GMH Stock).
"Working Capital Facility" has the meaning provided in Section 6(a) hereof.
"Working Capital Sub-Commitment" means the Medium Power Commitment less (x)
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the Initial Funding Amount, (y) the sum of all amounts paid by the Funding
Parties as additional funding pursuant to Section 5(b) hereof, and (z) the sum
of all amounts paid by the Funding Parties to the Company or TSAT (as defined
herein) pursuant to Section 5(c) hereof; provided, however, that if any
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Scheduled Post-Closing Obligation is satisfied or discharged for an amount less
than that shown on Schedule IV, the Working Capital Sub-Commitment shall be
reduced by the amount of such difference; and provided further that if the
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Company sells (including pursuant to any forward sale contract or similar
arrangement) or otherwise disposes of any GMH Stock that it obtains from the
closing of the Medium Power Asset Sale, and the proceeds of such transaction are
available to the Company to pay Scheduled Post-Closing Obligations (without
violating the contractual obligations of the Company to any third party,
including, without limitation, the obligations of the Company under the Pledge
and Security Agreement to be entered into pursuant to the Lock-up Agreement),
the Working Capital Sub-Commitment shall be reduced by the net proceeds received
from such sale, taking into consideration any amounts required to be paid to the
Senior Subordinated Creditors pursuant to any share appreciation rights granted
to such creditors under the Lock-up Agreement.
(b) Capitalized terms used herein and not otherwise defined have the
meanings ascribed thereto in the Medium Power Agreement.
Section 2. Funding Amounts; Schedule.
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As soon as practicable after delivery by the Company of the
Preliminary Working Capital Certificate pursuant to Section 4.2 of the Medium
Power Agreement, but in any event not less than 10 days prior to the Closing
Date, the Company shall deliver to each of the Funding Parties a certificate
(the "Initial Funding Certificate"), signed by the Chief Financial Officer and
Chief Executive Officer of the Company and approved by the Board of Directors of
the Company, showing in reasonable detail the amount and calculation of: (i) the
Expected Closing Date Proceeds, determined in accordance with the Preliminary
Working Capital Certificate, (ii) the Senior Bank Payoff Amount, (iii) the Sub
Debt Maximum Agreed Amount (including the components of such amount as described
in clauses (i) and (ii) of the definition thereof) and (iv) the Initial Funding
Amount. The Initial Funding Certificate shall also include a detailed
projection of the Company's Post-Closing Working Capital Requirements for each
calendar month for the 12-month period following the Closing Date. An unsigned
draft of the Initial Funding Certificate, prepared for informational purposes
based on the current best estimates of the Company as to the items to be stated
therein, is attached to this Agreement as Schedule III.
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Section 3. Agreement to Provide Initial Non-Debt Funding.
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Subject to the conditions set forth in Section 4, on or before the Closing
Date, each of the Funding Parties shall pay and deliver to the Company, as an
equity investment, contribution to capital or Non-Debt Payment (as such Funding
Party shall determine), such Funding Party's Pro Rata Share of the Initial
Funding Amount, by wire transfer of immediately available funds.
Section 4. Conditions to Initial Funding; Conditions to Medium Power Sale.
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(a) The obligation of each of the Funding Parties pursuant to
Section 3 hereof to pay its Pro Rata Share of the Initial Funding Amount shall
be subject to the satisfaction or waiver (to the extent waivable) on or before
the Closing Date of each of the following conditions :
(i) the Minimum Tender Condition;
(ii) all other conditions to the closing of the Exchange Offer
(provided, however, that this condition shall be satisfied to the extent
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that the Minimum Tender Condition is met through one or more Private
Transactions);
(iii) the absence of the filing of any petition with respect to the
Company or PLP as debtor under the United States Bankruptcy Code; and
(iv) the closing of the Medium Power Asset Sale.
(b) The Company acknowledges that satisfaction of the Minimum Tender
Condition will constitute satisfaction of the Debt Tender Condition for all
purposes of the Medium Power Agreement, and that any failure of the Minimum
Tender Condition to be satisfied on or before the Closing Date will constitute a
failure of the Debt Tender Condition for such purposes. The Company does not
intend to consummate the Medium Power Asset Sale if the Minimum Tender Condition
is not satisfied on or before the Closing Date.
Section 5. Additional Non-Debt Funding.
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(a) The Company shall provide each of the Funding Parties as
promptly as practicable with copies of (i) the Estimated Working Capital
Certificate, (ii) the Final Working Capital Certificate (as defined in the
Medium Power Agreement), (iii) any written notice of disagreement delivered to
Xxxxxx pursuant to Section 4.2(a)(iii) of the Medium Power Agreement, and (iv)
in the event of any arbitration pursuant to such Section 4.2(a)(iii), the
written report of the Arbiter in connection therewith.
(b) In the event that the Company is required to make a working
capital adjustment in favor of Xxxxxx pursuant to Section 4.2 of the Medium
Power Agreement, whether
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as an adjustment to the purchase price or a payment pursuant to Section
4.2(a)(iii), then, within five business days after any such adjustment or
payment, upon written demand by the Company, each of the Funding Parties shall
pay and deliver to the Company, as an equity investment, contribution to capital
or Non-Debt Payment (as such Funding Party shall determine), such Funding
Party's Pro Rata Share of such adjustment or payment, by wire transfer of
immediately available funds; provided, however, that the aggregate obligations
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of any Funding Party pursuant to this Section 5, plus the portion of the Initial
Funding Amount paid by such Funding Party, shall not exceed such Funding Party's
Pro Rata Share of the Medium Power Commitment.
(c) (i) Reference is made to the Agreement dated as of January 22,
1999 (the "TSAT Agreement"), between TCI Satellite Entertainment, Inc. ("TSAT")
and the Company, pursuant to which the Company has agreed, on the terms and
subject to the conditions set forth therein, to make a payment to TSAT in the
amount of $65,000,000 (the "TSAT Consideration"), in consideration of the
undertakings by TSAT made therein, and not as a dividend on TSAT's common stock
of the Company, and in consideration of the obligations of the Funding Parties
hereunder. Subject to the satisfaction or waiver, on or before the Closing Date,
of each of the conditions set forth in clauses (i), (ii), (iii) and (iv) of
Section 4(a), as and when the TSAT Consideration is due and payable to TSAT
pursuant to the TSAT Agreement, the Company shall pay the TSAT Consideration by
delivering the TSAT Consideration Shares as provided in the TSAT Agreement. In
the event that the Company does not provide TSAT with good and valid title to
the TSAT Consideration Shares free and clear of all liens and encumbrances,
other than those contemplated by the TSAT Agreement, each of the Funding Parties
shall pay and deliver (or cause to be paid and delivered) to TSAT, in the form
of cash or shares of GMH Stock (as such Funding Party shall determine), with
shares of GMH Stock being valued on the same basis used to establish the value
of the TSAT Consideration Shares, such Funding Party's Pro Rata Share of the
TSAT Consideration. The Company and each of the Funding Parties acknowledge that
TSAT shall be entitled to rely on and enforce the obligations of the Funding
Parties hereunder as an express third-party beneficiary. In that connection,
TSAT acknowledges that no Funding Party shall have any liability for the payment
duties of any other Funding Party with respect to payments required by this
Section 5(c) as guarantor, co-obligor or otherwise.
(ii) The Company hereby represents and warrants to each Funding
Party that the transfer of the TSAT Consideration Shares to TSAT pursuant to
this Section 5(c) will not violate any provisions of the Medium Power Agreement
or the Lock-up Agreement.
Section 6. Working Capital Facility.
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(a) Subject to the satisfaction or waiver, on the Closing Date, of the
conditions set forth in Section 4 of this Agreement, each of the Funding Parties
hereby agrees to make available to the Company, under a revolving credit
facility or similar arrangement (the "Working Capital Facility") mutually
acceptable to the Company and the Required Funding Parties (and consistent with
the terms of this Agreement), subordinated loans and/or other extensions of
credit necessary
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to fund the Post-Closing Working Capital Requirements of the Company during the
Shutdown Period, up to such Funding Party's Pro Rata Share of the Working
Capital Sub-Commitment
(b) All loans and/or other extensions of credit made by the Funding
Parties to the Company pursuant to the Working Capital Facility shall be junior
and subordinated in right of payment to the prior indefeasible payment in full
of all obligations of the Company outstanding on the Closing Date under the
Senior Credit Facility, the Current Pay Notes, the Discount Notes, the Bridge
Loans, the Shutdown Costs and the Contingent Note Consideration. All cash
interest accruing under the Working Capital Facility shall be due and payable
only at maturity; however interest accruing during any period prior to maturity
may be payable in kind.
(c) The Working Capital Facility shall remain outstanding at all times
during the Shutdown Period.
(d) Drawings under the Working Capital Facility shall be used by the
Company only to pay (i) Scheduled Post-Closing Obligations, (ii) costs and
expenses incurred by the Company after the Closing Date in the ordinary course,
and (iii) any additional amounts approved by the Required Funding Parties. The
Working Capital Facility may provide as a drawing condition that the Company
certify to the Funding Parties the specific Scheduled Post-Closing Obligations
to be satisfied with the proceeds of any drawing and any mitigation efforts
undertaken by the Company with respect to such Shutdown Costs.
(e) At the end of the Shutdown Period, if the aggregate obligations of
the Company to the Funding Parties under the Working Capital Facility, including
the principal amount of all loans and other extensions of credit thereunder and
all unpaid interest accrued thereon, shall exceed the assets of the Company
available to repay such obligations, including without limitation any GMH Stock
then held by the Company, or any proceeds thereof, then each of the Funding
Parties shall convert its Pro Rata Share of such excess into an equity
investment, contribution to capital or Non-Debt Payment (as such Funding Party
shall determine) to the Company.
Section 7. Existing Letters of Credit.
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(a) The parties acknowledge that: (i) an aggregate of $575 million
principal amount of loans are currently outstanding under the Partnership Credit
Facility; (ii) such loans are due and payable in full on June 30, 1999, together
with accrued unpaid interest of not more than $15 million; (iii) the full and
timely payment of such principal and interest are secured by (A) Existing
Letters of Credit issued for the account of Funding Parties (or affiliates
thereof), other than GEAC, in the aggregate drawable amount of $580 million and
(B) a standby letter of credit issued for the account of the Company pursuant to
the Senior Credit Facility in the maximum drawable amount of $5 million; (iv)
the initial closing under the High Power Agreement occurred on March 10, 1999;
(v) the second closing under the High Power Agreement is expected to occur prior
to June 30, 1999; and (vi) assuming consummation of both closings under the High
Power Agreement, the Partnership expects to receive an aggregate of $465 million
in satisfaction of the Reimbursement Obligation (as
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defined in the High Power Agreement), which amount will be available to apply
against amounts due under the Partnership Credit Facility.
(b) On or before June 30, 1999, each of the Funding Parties, other
than GEAC, will pay or contribute to the Company sufficient funds to enable the
Company to pay (or to enable the Company to cause the Partnership to pay)
against amounts due under the Partnership Credit Facility (including interest
and principal) an amount equal to the product of (x) $125 million, times (y) the
percentage set forth opposite the name of such Funding Party on Schedule II
attached hereto. Amounts paid by any Funding Party pursuant to this Section
7(b) shall constitute an equity investment in, capital contribution to, or Non-
Debt Payment (as such Funding Party shall determine) to the Company, and shall
be in addition to the obligations of such Funding Party pursuant to Section 3
and Section 5 hereunder.
(c) If prior to June 30, 1999, the Subsequent Closing under the High
Power Agreement shall not have occurred, then, on or before June 30, 1999, each
of the Funding Parties, other than GEAC, will advance to the Company sufficient
funds to enable the Company to pay (or to enable the Company to cause the
Partnership to pay) against amounts due under the Partnership Credit Facility an
amount equal to the product of (x) $348.25 million, times (y) the percentage set
forth opposite the name of such Funding Party on Schedule II attached hereto.
Amounts advanced by any Funding Party pursuant to this Section 7(c) shall be
ratably secured by a security interest in the In-Orbit Satellite Assets, to the
full extent of the Company's rights and interests therein.
(d) On or before June 30, 1999, taking into account all payments
theretofore made pursuant Section 7(b) hereof (and, if the Subsequent Closing
shall not have occurred under the High Power Agreement, pursuant to Section 7(c)
hereof) , the Company will pay or cause the Partnership to pay in full all
obligations of the Partnership under the Partnership Credit Facility, including
without limitation the principal amount of all outstanding loans thereunder, all
accrued unpaid interest thereon, and any and all fees and expenses due in
respect thereof, against the termination and release in full of the Existing
Letters of Credit. The parties acknowledge that the Company shall utilize for
such payments $139.5 million of cash proceeds from the Initial Closing under the
High Power Agreement (which amount shall be so applied as soon as practicable
after the date hereof, subject to any applicable agreements with third parties,
and in any event on the Closing Date, subject to the closing of the Medium Power
Asset Sale) and, if the Subsequent Closing occurs prior to June 30, 1999, $325.5
million of cash proceeds therefrom, and the Company agrees that it shall not use
such proceeds for any other purpose, assuming the full and timely performance by
each of the Funding Parties, other than GEAC, of their respective obligations
hereunder.
(e) Notwithstanding anything in the Reimbursement Agreements to the
contrary, if a drawing is made under an Existing Letter of Credit issued for the
account of any Funding Party (or for the account of an affiliate of such Funding
Party), such Funding Party shall immediately and automatically cause the
reimbursement obligation of the Company with respect to such drawing to be
converted into an equity investment in, capital contribution to, or Non-Debt
Payment (as such Funding Party shall determine) to the Company by such Funding
Party (or affiliate). Any such equity
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investment, capital contribution or Non-Debt Payment shall reduce the
obligations of such Funding Party pursuant to Sections 7(b) and 7(c) hereunder,
but shall be in addition to the obligations of such Funding Party pursuant to
Section 3 and Section 5 hereunder.
Section 8. Entire Agreement; Amendment.
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(a) This Agreement embodies the entire agreement of the parties
hereto with respect to the subject matter hereof and supersedes any and all
prior or contemporaneous agreements with respect to such subject matter, whether
written or oral or claimed to arise from any course of conduct.
(b) Subject to any restrictions on amendment provided for in the
Lock-up Agreements, this Agreement may be amended by written agreement of the
Company and the Required Funding Parties; provided, however, that no such
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amendment shall increase the Medium Power Commitment, the obligations of each
Funding Party pursuant to Section 7 hereof, or the Pro Rata Share of any Funding
Party without the prior written consent of each Funding Party so affected, and
provided further that no amendment or waiver to the provisions of Section 4
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hereof or Sections 2, 5(c) and 6, which are subject to the conditions of Section
4 hereof, shall be effective without the prior written consent thereto of each
Funding Party nor shall any amendment of Section 5(c) hereof be effective
without the prior written consent of TSAT, and provided further that no
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amendment or waiver to this Agreement shall result in the disparate treatment of
any Funding Party without the consent of such Funding Party. Except as
expressly provided in this Section 8, this Agreement may not be modified or
amended, nor may any term or provision of this Agreement be waived.
Section 9. Representation Regarding Scheduled Post-Closing Obligations. The
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Company hereby represents and warrants to each of the Funding Parties that, to
the best knowledge of the Company after due inquiry, the Scheduled Post-Closing
Obligations include all monetary obligations of the Company and its subsidiaries
on a consolidated basis anticipated to exist on the Closing Date, other than (A)
any such obligations required to be assumed by Xxxxxx on the Closing Date
pursuant to the Medium Power Agreement, (B) any such obligations under the
Senior Credit Facility, the Current Pay Notes, the Discount Notes, the Bridge
Loans and the Partnership Credit Facility, (C) the contingent and/or disputed
obligations set forth on Schedule V attached hereto, and (D) such other
obligations of the Company and its subsidiaries as shall not individually or in
the aggregate exceed $3,000,000. The Company shall use its best efforts from
time to time prior to the Closing Date, as required, to prepare draft updates
to Schedule IV for approval by the Required Funding Parties.
Section 10. Assignment; Parties Bound and Benefited.
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(a) This Agreement may not be assigned or delegated without the prior
written consent of the Company and the Required Funding Parties, except by
operation of law.
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(b) This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and permitted assigns, and
the provisions of Section 5(c) of this Agreement shall inure to the benefit of
TSAT and its successors and permitted assigns.
(c) Each of the parties to the Lock-up Agreement (other than the
Company) (the "Signing Creditors") is intended to be a third-party beneficiary
of this Agreement, and shall have the right to rely on and enforce this
agreement in such capacity, subject (after the termination of the Lock-up
Agreement) to the right of the parties hereto to modify, amend or waive any
provision of this Agreement as provided herein, to the extent such modification,
amendment or waiver shall not materially adversely affect any such third-party
beneficiary. TSAT is intended to be a third-party beneficiary of Section 5(c)
this Agreement, and shall have the right to rely on and enforce this Agreement
in such capacity. Prior to the payment to the Signing Creditors of the Agreed
Consideration (as defined in the Lock-up Agreement), the obligations of the
Funding Parties to the Company or to TSAT hereunder shall be subordinated to the
rights of the Signing Creditors under the Lock-up Agreement, and any
distributions made by the Funding Parties to the Company or TSAT shall be held
in trust for the benefit of the Signing Creditors and paid over to the Signing
Creditors until they have been paid the Agreed Consideration in accordance
therewith.
(d) Other than as specifically set forth in this Section 10, no other
party is intended to be a third-party beneficiary of this Agreement.
Section 11. Notices.
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All notices, requests, consents, demands, elections and other
communications required or permitted hereunder shall be in writing and shall be
given to the intended recipients at their addresses or facsimile numbers as last
provided to the parties hereto.
Section 12. Paragraph Headings.
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The paragraph headings used herein are for convenience of reference only,
are not part of this Agreement and are not to affect the construction of or be
taken into consideration in interpreting this Agreement.
Section 13. Governing Law and Jurisdiction.
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This Agreement shall be construed in accordance with and governed by the
internal laws of the State of New York without giving effect to any conflicts of
laws principles. Each party hereto hereby irrevocably submits to the
jurisdiction of any New York State court sitting in the Borough of Manhattan or
any federal court sitting in the Borough of Manhattan in respect of any suit,
action or proceeding arising out of or relating to this Agreement and the
transactions pursuant hereto and in connection herewith, and irrevocably agrees
that all claims in respect of any such suit, action or proceeding shall be heard
and determined in any such court. Each party irrevocably waives any objection
which it may now or hereafter have to the laying of the venue of any such suit,
action or proceeding brought in any such court and any claim that any such suit,
action or proceeding brought in any such court has been brought in an
inconvenient forum.
Section 14. Specific Performance.
--------------------
Without intending to limit the remedies available to the Company, each of
the Funding Parties acknowledges and agrees that a violation by such Funding
Party of any terms of this Agreement will cause irreparable injury for which an
adequate remedy at law is not available. Therefore, the parties agree that the
Company shall be entitled to an injunction, restraining order or other form of
equitable relief from any court of competent jurisdiction compelling a Funning
Party, and their respective successors, to specifically perform, and restraining
such party from committing any breach of, or threatened breach of, any provision
of this Agreement.
Section 15. Severability.
------------
In case any provision in this Agreement shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby, it being
intended that all of the provisions hereof shall be enforceable to the full
extent permitted by law.
Section 16. Maximum Liability of TCI; Several Liability of each Funding Party.
-----------------------------------------------------------------
(a) Notwithstanding anything to the contrary contained herein, (i) the
total equity contributions, Non-Debt Payments and outstanding loans made by TCI
hereunder shall not at any time exceed (and shall be counted toward) the maximum
liability of TCI under the TCI Reimbursement Letter, as then in effect, and (ii)
nothing herein shall alter or otherwise affect or limit the respective rights
and obligations under the TCI Reimbursement Letter of the parties thereto.
(b) No Funding Party shall have any liability for the payment duties or
other obligations of any other Funding Party hereunder, as guarantor, co-obligor
or otherwise.
13
Section 17. Indemnification.
---------------
Notwithstanding anything to the contrary contained herein, the Company
shall continue to maintain insurance for its directors and officers adequate to
enable the Company to indemnify all of its current, former and future officers
and directors to the full extent permitted by law. The Working Capital Facility
can be drawn to pay premiums necessary to maintain indemnification insurance.
Section 18. Representations and Warranties.
------------------------------
Each of the Company and each Funding Party hereby acknowledges, warrants
and represents as to itself that the following statements are true, correct and
complete as of the date hereof:
(a) It has all requisite power and authority to enter into this Agreement
and to carry out the transactions contemplated by, and perform its respective
obligations under, this Agreement;
(b) The execution and delivery of this Agreement and the performance of its
obligations hereunder have been duly authorized by all necessary action on its
part, it has been duly authorized to make the representations and commitments
included herein, and the person executing and delivering this Agreement on
behalf of it has been duly authorized to do so;
(c) The execution, delivery and performance by it of this Agreement do not
and shall not violate any provision of law, rule or regulation applicable to it
or any of its subsidiaries or its organizational documents or those of any of
its subsidiaries; and
(d) This Agreement is its legal, valid and binding obligation, enforceable
against it by each other party hereto (and each intended third party beneficiary
hereof) in accordance with its terms.
Section 19. Termination.
-----------
This Agreement shall terminate upon the commencement of a case by or
against the Company or any Funding Party under Xxxxx 00, Xxxxxx Xxxxxx Code.
Section 20. Counterparts.
------------
This Agreement may be executed in counterparts, each of which shall for all
purposes be deemed to be an original, and all such counterparts shall together
constitute but one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered on and as of the date first written above.
PRIMESTAR, INC.
_______________________________
Name:
Title:
TIME WARNER ENTERTAINMENT
COMPANY, L.P.,
by AMERICAN TELEVISION AND
COMMUNICATIONS CORPORATION,
a general partner
_______________________________
Name:
Title:
ADVANCE/XXXXXXXX PARTNERSHIP,
by ADVANCE COMMUNICATION CORP.,
as general partner
_______________________________
Name:
Title:
COMCAST CORPORATION
_______________________________
Name:
Title:
XXX COMMUNICATIONS, INC.
_______________________________
Name:
Title:
MEDIAONE OF DELAWARE, INC.
_______________________________
Name:
Title:
GE AMERICAN COMMUNICATIONS, INC.
_______________________________
Name:
Title:
UNITED ARTISTS INVESTMENTS
HOLDINGS, LLC
_______________________________
Name:
Title:
PARAGON COMMUNICATIONS,
by AMERICAN TELEVISION AND
COMMUNICATIONS CORPORATION,
a general partner
_______________________________
Name:
Title:
