EXHIBIT 55
EXECUTION COPY
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AMENDED AND RESTATED
STOCKHOLDERS AGREEMENT
BETWEEN
LIBERTY MEDIA CORPORATION
AND
XXXXX XXXXXX
DATED AS OF AUGUST 9, 2005
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IAC/INTERACTIVECORP
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS..................................................................................1
Section 1.1. Certain Defined Terms..................................................................1
Section 1.2. Other Defined Terms....................................................................6
Section 1.3. Other Definitional Provisions..........................................................7
ARTICLE II RESERVED.....................................................................................7
ARTICLE III CORPORATE GOVERNANCE.........................................................................7
Section 3.1. Voting on Certain Matters..............................................................7
Section 3.2. Restrictions on Other Agreements.......................................................8
Section 3.3. Irrevocable Proxy of Liberty...........................................................9
Section 3.4. Cooperation............................................................................9
ARTICLE IV TRANSFER OF COMMON SHARES...................................................................10
Section 4.1. Restrictions on Transfer by Liberty and Xxxxxx........................................10
Section 4.2. Tag-Along for Xxxxxx and Liberty for Transfers by the Other...........................11
Section 4.3. Right of First Refusal Between Liberty and Xxxxxx.....................................14
Section 4.4. Transfers of Class B Shares...........................................................16
Section 4.5. Transferees...........................................................................17
Section 4.6. Notice of Transfer....................................................................18
Section 4.7. Compliance with Transfer Provisions...................................................18
ARTICLE V BDTV ENTITY ARRANGEMENTS....................................................................18
Section 5.1. Management............................................................................18
Section 5.2. Changes to BDTV Structures............................................................19
Section 5.3. Transfers of BDTV Interests...........................................................19
ARTICLE VI MISCELLANEOUS...............................................................................20
Section 6.1. Conflicting Agreements................................................................20
Section 6.2. Duration of Agreement.................................................................20
Section 6.3. Further Assurances....................................................................20
Section 6.4. Amendment and Waiver..................................................................20
Section 6.5. Severability..........................................................................20
Section 6.6. Effective Time........................................................................21
Section 6.7. Entire Agreement......................................................................21
Section 6.8. Successors and Assigns................................................................21
Section 6.9. Counterparts..........................................................................21
Section 6.10. Liabilities Under Federal Securities Laws.............................................21
Section 6.11. Remedies..............................................................................21
Section 6.12. Notices...............................................................................22
Section 6.13. Adjustment of Shares Numbers..........................................................23
Section 6.14. Governing Law; Consent to Jurisdiction................................................23
Section 6.15. Interpretation........................................................................23
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AMENDED AND RESTATED STOCKHOLDERS AGREEMENT, dated as of August 9,
2005, between Liberty Media Corporation, a Delaware corporation ("LIBERTY"), for
itself and on behalf of the members of the Liberty Stockholder Group and Mr.
Xxxxx Xxxxxx ("XXXXXX"), for himself and on behalf of the members of the Xxxxxx
Stockholder Group.
WHEREAS, the parties hereto have agreed that Liberty and Xxxxxx shall
enter into this Agreement in order to amend and restate in its entirety the
respective rights and obligations of the parties set forth in the Amended and
Restated Stockholders Agreement, dated as of December 16, 2001 (the "2001
STOCKHOLDERS AGREEMENT"); and
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and obligations hereinafter set forth, the parties hereto hereby agree
as follows:
ARTICLE I
DEFINITIONS
Section 1.1. CERTAIN DEFINED TERMS. As used herein, the following terms
shall have the following meanings:
"1997 STOCKHOLDERS AGREEMENT" means the Stockholders Agreement, dated
as of October 19, 1997, among Universal Studios, Inc., Liberty, Xxxxxx and The
Seagram Company Ltd., as in effect as of such date and without giving effect to
any termination of such agreement (including in connection with the execution of
any agreement intended to supersede such agreement).
"AFFILIATE" means, with respect to any Person, any other Person that
directly, or indirectly through one or more intermediaries, controls, is
controlled by or is under common control with, such specified Person, for so
long as such Person remains so associated to the specified Person. For purposes
of this definition, natural persons shall not be deemed to be Affiliates of each
other, and none of Liberty, Xxxxxx or the Company shall be deemed to be
Affiliates of any of the others. In addition, for purposes of this definition,
Expedia, Inc. and the Company shall not be deemed Affiliates of one another as a
result of such entities being under the common control of the Stockholders.
"AGREEMENT" means this Amended and Restated Stockholders Agreement as
it may be amended, supplemented, restated or modified from time to time.
"BDTV I" means BDTV, Inc., a Delaware corporation.
"BDTV II" means BDTV II, Inc., a Delaware corporation.
"BDTV III" means BDTV III, Inc., a Delaware corporation.
"BDTV IV" means BDTV IV, Inc., a Delaware corporation.
"BDTV ENTITIES" means, collectively, the BDTV Limited Entities and the
BDTV Unrestricted Entities.
"BDTV LIMITED ENTITIES" means, collectively, BDTV I and BDTV II.
"BDTV UNRESTRICTED ENTITIES" means BDTV III, BDTV IV and each other
BDTV Entity that may be formed subsequent to the date hereof; PROVIDED that each
of Liberty and Xxxxxx acknowledges and agrees that any corporation, partnership,
limited liability company or other business association hereafter formed by
Xxxxxx and Liberty to hold Common Shares will be a BDTV Unrestricted Entity and
will be a corporation, partnership, limited liability company or other business
association having a capital structure and governance rights substantially
similar to that of BDTV III.
"BENEFICIAL OWNER" or "BENEFICIALLY OWN" has the meaning given such
term in Rule 13d-3 under the Exchange Act and a Person's beneficial ownership of
Common Shares or Voting Securities shall be calculated in accordance with the
provisions of such Rule; PROVIDED, HOWEVER, that for purposes of determining
beneficial ownership, (i) a Person shall be deemed to be the beneficial owner of
any Equity which may be acquired by such Person (disregarding any legal
impediments to such beneficial ownership), whether within 60 days or thereafter,
upon the conversion, exchange or exercise of any warrants, options (which
options held by Xxxxxx shall be deemed to be exercisable), rights or other
securities issued by the Company, (ii) no Person shall be deemed to beneficially
own any Equity solely as a result of such Person's execution of this Agreement
(including by virtue of holding a proxy with respect to any shares) or the
Governance Agreement, and (iii) Liberty shall be deemed to be the beneficial
owner of all of the Common Shares owned by each BDTV Entity, other than for
purposes of Articles III and V of this Agreement. Notwithstanding the foregoing,
for purposes of calculating the Minimum Stockholder Amount, a Person shall be
deemed to be the beneficial owner only of Common Shares which are issued and
outstanding.
"BOARD" means the Board of Directors of the Company.
"BUSINESS DAY" shall mean any day that is not a Saturday, a Sunday or
other day on which banks are required or authorized by law to be closed in the
City of New York.
"CAPITAL STOCK" means, with respect to any Person at any time, any and
all shares, interests, participations or other equivalents (however designated,
whether voting or non-voting) of capital stock, partnership interests (whether
general or limited) or equivalent ownership interests in or issued by such
Person.
"CAUSE" means (i) the conviction of, or pleading guilty to, any felony,
or (ii) the willful, continued and complete failure to attend to managing the
business affairs of the Company, after written notice of such failure from the
Board and reasonable opportunity to cure.
"CEO" means the Chief Executive Officer of the Company.
"CEO TERMINATION DATE" means the later of (i) such time as Xxxxxx no
longer serves as CEO and (ii) such time as Xxxxxx no longer holds the Liberty
Proxy (other than suspension of such proxy pursuant to Section 3.3(e)).
"CLASS B COMMON STOCK" means the Class B common stock, par value $0.001
per share, of the Company and any securities of the Company issued in respect
thereof, or in substitution
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therefor, in connection with any stock split, dividend or combination, or any
reclassification, recapitalization, merger, consolidation, exchange or other
similar reorganization (other than Common Stock issued upon conversion of Class
B Common Stock).
"COMMISSION" means the Securities and Exchange Commission, and any
successor commission or agency having similar powers.
"COMMON SHARES" means, collectively, the Common Stock and the Class B
Common Stock.
"COMMON STOCK" means the common stock, par value $0.001 per share, of
the Company and any securities of the Company issued in respect thereof, or in
substitution therefor, in connection with any stock split, dividend or
combination, or any reclassification, recapitalization, merger, consolidation,
exchange or other similar reorganization.
"COMPANY" means IAC/InterActiveCorp, a Delaware corporation, and any
successor by merger, consolidation, or other business combination.
"CONTINGENT MATTERS" shall have the meaning ascribed to such term in
the Governance Agreement.
"CONTROL" (including the terms "CONTROLLED BY" and "UNDER COMMON
CONTROL WITH"), with respect to the relationship between or among two or more
Persons, means the possession, directly or indirectly, of the power to direct or
cause the direction of the affairs or management of a Person, whether through
the ownership of voting securities, as trustee or executor, by contract or
otherwise.
"DAILY HEDGING LIMIT" means a number of shares of Common Stock not to
exceed on any single day 25% of the average daily trading volume of the Common
Stock during the three full calendar months preceding the date of determination
(disregarding any sales by Liberty).
"XXXXXX INTEREST PURCHASE PRICE" means the cash amount (or cash value
of Equity) contributed by Xxxxxx to a BDTV Entity plus interest on such amount,
from the date of such contribution to the date of purchase of Xxxxxx'x Interest
in such BDTV Entity by a member of the Liberty Stockholder Group, at the rate of
interest per annum in effect from time to time and publicly announced by The
Bank of New York as its prime rate of interest, compounded annually. For
purposes of BDTV I, BDTV II, BDTV III and BDTV IV, the cash amount (or cash
value of Equity) initially contributed by Xxxxxx was $100 in each such BDTV
Entity.
"XXXXXX STOCKHOLDER GROUP" means (i) Xxxxxx and (ii) any Affiliate of
Xxxxxx which (A) Xxxxxx controls and (B) in which Xxxxxx owns, directly or
indirectly, 90% or more of the outstanding Capital Stock or other ownership
interests, which such Affiliate holds Equity subject to this Agreement.
"DIRECTOR" means any member of the Board.
"DISABLED" means the disability of Xxxxxx after the expiration of more
than 180 consecutive days after its commencement which is determined to be total
and permanent by a
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physician selected by Liberty and reasonably acceptable to Xxxxxx, his spouse or
a personal representative designated by Xxxxxx; PROVIDED that Xxxxxx shall be
deemed to be disabled only following the expiration of 90 days following receipt
of a written notice from the Company and such physician specifying that a
disability has occurred if within such 90-day period he fails to return to
managing the business affairs of the Company. A total disability shall mean
mental or physical incapacity that prevents Xxxxxx from managing the business
affairs of the Company.
"ELIGIBLE STOCKHOLDER AMOUNT" means, in the case of Xxxxxx, the
equivalent of 2,200,000 Common Shares and, in the case of Liberty (including, in
the case of Liberty, all of the Common Shares owned by the BDTV Entities),
2,000,000 shares of Common Stock, in each case determined on a fully diluted
basis (taking into account, in the case of Xxxxxx, all unexercised Options,
whether or not then exercisable).
"EQUITY" means any and all shares of Capital Stock of the Company,
securities of the Company convertible into, or exchangeable for, such shares,
and options, warrants or other rights to acquire such shares.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"FAIR MARKET VALUE" means, as to any securities or other property, the
cash price at which a willing seller would sell and a willing buyer would buy
such securities or property in an arm's-length negotiated transaction without
time constraints.
"FCC" means the Federal Communications Commission or its successor.
"FCC Regulations" means, as of any date, all federal communications
statutes and all rules, regulations, orders, decrees and policies of the FCC as
then in effect, and any interpretations or waivers thereof or modifications
thereto.
"GOVERNANCE AGREEMENT" means the Amended and Restated Governance
Agreement, among the Company, Xxxxxx and Liberty, of even date herewith, as it
may be amended, supplemented, restated or modified from time to time hereafter.
"GROUP" shall have the meaning assigned to it in Section 13(d)(3) of
the Exchange Act.
"HEDGING TRANSACTION" means any (i) short sale, (ii) any purchase, sale
or grant of any right (including, without limitation, any put or call option),
or (iii) any forward sale (whether for a fixed or variable number of shares or
at a fixed or variable price) of or with respect to, or any non-recourse loan
secured by, Common Stock or any security (other than a broad-based market basket
or index) that includes, relates to or derives any significant part of its value
from Common Stock, and such term includes (a) the pledge of Common Stock in
connection with any of the foregoing to secure the obligations of the pledgor
under a Hedging Transaction and (b) the pledge of a Hedging Transaction itself
to secure any extension of credit to a party based, in whole or part, on the
value thereof.
"HSR ACT" means the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of
1976, as amended.
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"INDEPENDENT INVESTMENT BANKING FIRM" means an investment banking firm
of nationally recognized standing that is, in the reasonable judgment of the
Person engaging such firm, qualified to perform the task for which it has been
engaged.
"LIBERTY STOCKHOLDER GROUP" means Liberty and those Subsidiaries of
Liberty that, from time to time, hold Equity subject to this Agreement.
"MARKET SALE" means a "brokers' transaction" within the meaning of
Section 4(4) of the Securities Act.
"MINIMUM STOCKHOLDER AMOUNT" means Common Shares representing at least
50.1% of the outstanding voting power of the outstanding Common Shares.
"OPTIONS" means options to acquire Capital Stock of the Company granted
by the Company to Xxxxxx and outstanding from time to time.
"PERMITTED DESIGNEE" means any Person designated by a Stockholder, who
shall be reasonably acceptable to the other Stockholder, to exercise such
Stockholder's rights pursuant to Section 4.3.
"PERMITTED TRANSFEREE" means (i) with respect to Liberty, any member of
the Liberty Stockholder Group, and (ii) with respect to Xxxxxx, any member of
the Xxxxxx Stockholder Group. In addition, each of Liberty and Xxxxxx shall be a
Permitted Transferee of its respective Permitted Transferees.
"PERSON" means any individual, corporation, limited liability company,
limited or general partnership, joint venture, association, joint-stock company,
trust, unincorporated organization, government or any agency or political
subdivisions thereof or any Group comprised of two or more of the foregoing.
"PUBLIC STOCKHOLDER" means any Person that, together with its
Affiliates (a) has sole or shared voting power with respect to Voting Securities
representing no more than 10% of the voting power of the outstanding Voting
Securities or (b) has sole or shared power to dispose of Equity representing no
more than 10% of the Equity to be tendered or exchanged in any applicable tender
or exchange offer, as the case may be.
"REFERENCE RATE" means, for any day, a fixed rate per annum equal to
the yield, expressed as a percentage per annum, obtained at the official auction
of 90-day United States Treasury Bills most recently preceding the date thereof
plus 100 basis points.
"RELATED HEDGING TRANSACTIONS" means a series of Hedging Transactions
between members of the Liberty Stockholder Group on the one hand, and the same
counterparty or its Affiliates, on the other hand, which Hedging Transactions
each have specified maturity dates occurring within a period of thirty days.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"STOCKHOLDER" means each of Liberty and Xxxxxx.
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"STOCKHOLDER GROUP" means one or more of the Xxxxxx Stockholder Group
and the Liberty Stockholder Group. For purposes of this Agreement, (i) prior to
the time that Liberty acquires Xxxxxx'x interest in a BDTV Entity, each BDTV
Entity shall be deemed to be a member of the Liberty Stockholder Group except as
otherwise expressly set forth herein and (ii) a Stockholder's Permitted Designee
shall be deemed to be a member of the designating Stockholder's Stockholder
Group (other than for purposes of Section 4.1(a)(w)).
"SUBSIDIARY" means, with respect to any Person, any corporation or
other entity of which at least a majority of the voting power of the voting
equity securities or equity interest is owned, directly or indirectly, by such
Person.
"THIRD PARTY TRANSFEREE" means any Person to whom a Stockholder
(including a Third Party Transferee subject to this Agreement pursuant to
Sections 4.5(b) and 4.5(c)) or a Permitted Transferee Transfers Common Shares,
other than a Permitted Transferee of such Stockholder or a member of another
Stockholder Group.
"TRANSFER" means, directly or indirectly, to sell, transfer, assign,
pledge, encumber, hypothecate or similarly dispose of, either voluntarily or
involuntarily, or to enter into any contract, option or other arrangement or
understanding with respect to the sale, transfer, assignment, pledge,
encumbrance, hypothecation or similar disposition of, any Common Shares
beneficially owned by a Stockholder or any interest in any Common Shares
beneficially owned by a Stockholder, PROVIDED, HOWEVER, that a merger or
consolidation in which a Stockholder is a constituent corporation shall not be
deemed to be the Transfer of any Common Shares beneficially owned by such
Stockholder that a significant purpose of any such transaction is not
to avoid the provisions of this Agreement).
"VOTING SECURITIES" means at any time shares of any class of Capital
Stock of the Company which are then entitled to vote generally in the election
of Directors.
Section 1.2. OTHER DEFINED TERMS. The following terms shall have the meanings
defined for such terms in the Sections set forth below:
TERM SECTION
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Appraisal............................................... Section 4.3(c)
Xxxxxx.................................................. Preamble
Xxxxxx Termination Date................................. Section 6.2(b)
Exchange Notice......................................... Section 4.4(a)
Expedia Shares Section 5.2
Initiating Party........................................ Section 4.2(a)
L/D Offer Notice........................................ Section 4.3(b)
L/D Offer Price......................................... Section 4.3(c)
L/D Other Party......................................... Section 4.3(b)
L/D Transferring Party.................................. Section 4.3(a)
Liberty................................................. Preamble
Liberty Lending Limit................................... Section 4.3(f)
Liberty Proxy........................................... Section 3.3(a)
Liberty Proxy Shares.................................... Section 3.3(a)
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Liberty Termination Date................................ Section 6.2(a)
Litigation.............................................. Section 6.14
Non-Transferring Stockholder............................ Section 4.4(a)
Settlement Threshold.................................... Section 4.3(e)
Stock Lending Transaction............................... Section 4.2(f)
Tag-Along Notice........................................ Section 4.2(a)
Tag-Along Sale.......................................... Section 4.2(a)
Tag-Along Shares........................................ Section 4.2(a)
Tag Party............................................... Section 4.2(a)
Transferring Stockholders............................... Section 4.4(a)
Section 1.3. OTHER DEFINITIONAL PROVISIONS. (a) The words "hereof",
"herein" and "hereunder" and words of similar import when used in this Agreement
shall refer to this Agreement as a whole and not to any particular provision of
this Agreement, and Article and Section references are to this Agreement unless
otherwise specified.
(b) The meanings given to terms defined herein shall be equally applicable
to both the singular and plural forms of such terms.
(c) For purposes of calculating the amount of outstanding Common Shares or
Equity as of any date and the number of Common Shares or Equity beneficially
owned by any Person as of any date, any Common Shares held in the Company's
treasury or owned by any Subsidiaries of the Company shall be disregarded.
ARTICLE II
RESERVED
ARTICLE III
CORPORATE GOVERNANCE
Section 3.1. VOTING ON CERTAIN MATTERS. (a) In the event that Section
2.03 of the Governance Agreement is applicable, in connection with any vote or
action by written consent of the stockholders of the Company relating to any
matter that constitutes a Contingent Matter, Liberty and Xxxxxx agree (and each
agrees to cause each member of its Stockholder Group, if applicable), with
respect to any Common Shares with respect to which it or he has the power to
vote (whether by proxy, the ownership of voting securities of a BDTV Entity or
otherwise) (including all Common Shares held by any BDTV Entity), (x) to vote
against (and not act by written consent to approve) such Contingent Matter
(including causing each BDTV Entity to vote all Common Shares held by it against
approval of such Contingent Matter and not executing any written consents with
respect to such Common Shares held by any BDTV Entity) unless Liberty and Xxxxxx
(or, if either such Stockholder's consent is no longer required pursuant to the
Governance Agreement, the Stockholder whose consent is then required) have
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consented to such Contingent Matter in accordance with the provisions of the
Governance Agreement and (y) to take or cause to be taken all other reasonable
actions required, to the extent permitted by law, to prevent the taking of any
action by the Company with respect to a Contingent Matter without the consent of
Liberty and/or Xxxxxx (as applicable).
(b) Each Stockholder agrees to vote (and cause each member of its or his
Stockholder Group to vote, if applicable), or act by written consent with
respect to, any Common Shares with respect to which it or he has the power to
vote (whether by proxy, the ownership of voting securities of a BDTV Entity or
otherwise) (including all Common Shares held by any BDTV Entity) in favor of
each of the Director designees of Liberty which Liberty has a right to designate
pursuant to the Governance Agreement.
(c) Upon the written request of Liberty, Xxxxxx, in his capacity as a
stockholder only, agrees to vote (and cause each member of the Xxxxxx
Stockholder Group to vote, if applicable), or act by written consent, with
respect to any Common Shares with respect to which it or he has the power to
vote (whether by proxy, the ownership of voting securities of a BDTV Entity or
otherwise) (including all shares held by any BDTV Entity) and otherwise take or
cause to be taken all actions necessary to remove any Director designated by
Liberty and to elect any replacement Director designated by Liberty as provided
in the Governance Agreement. Unless Liberty and Xxxxxx otherwise agree, neither
Xxxxxx nor any member of the Xxxxxx Stockholder Group, shall take any action to
cause the removal of any Director designated by Liberty except upon the written
request of Liberty.
(d) Liberty will not be deemed to be in violation of paragraphs (a), (b)
or (c) of this Section 3.1 as a result of any action by Xxxxxx (including
actions taken by a BDTV Entity as a result of an action by Xxxxxx) that is not
within Liberty's control.
Section 3.2. RESTRICTIONS ON OTHER AGREEMENTS. No Stockholder or any of
its or his Permitted Transferees shall enter into or agree to be bound by any
stockholder agreements or arrangements of any kind with any Person with respect
to any Equity (including, without limitation, the deposit of any Common Shares
in a voting trust or forming, joining or in any way participating in or
assisting in the formation of a Group with respect to any Common Shares, other
than any such Group consisting exclusively of Liberty and Xxxxxx and any of
their respective Affiliates, Permitted Designees and Permitted Transferees and,
to the extent contemplated by Section 4.5, any Third Party Transferee) and no
Stockholder (other than Liberty or any of its Permitted Transferees) or any of
its or his Permitted Transferees shall enter into or agree to be bound by any
agreements or arrangements of any kind with any Person to incur indebtedness for
purposes of purchasing Equity (other than to exercise Options or to purchase
Common Shares pursuant to Section 4.3 of this Agreement), except (i) for such
agreements or arrangements as are now in effect, (ii) in connection with a
proposed sale of BDTV Entity securities or Common Shares otherwise permitted
hereunder, (iii) for such agreements or arrangements with a Permitted Designee
as are reasonably acceptable to the other Stockholder and not inconsistent with
or for the purpose of evading the terms of this Agreement, (iv) agreements
between a Stockholder and its Permitted Transferee that are reasonably
acceptable to the other Stockholder and not inconsistent with this Agreement or
(iv) for Hedging Transactions as contemplated by Section 4.2(e).
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Section 3.3. IRREVOCABLE PROXY OF LIBERTY. (a) Subject to paragraphs
(b) and (c) below, until the earlier of the date that (x) Xxxxxx is no longer
CEO or (y) Xxxxxx is Disabled, Xxxxxx shall be entitled to exercise voting
authority and authority to act by written consent over all Common Shares
beneficially owned by each member of the Liberty Stockholder Group (the "LIBERTY
PROXY SHARES"), on all matters submitted to a vote of the Company's stockholders
or by which the Company's stockholders may act by written consent, pursuant to a
conditional proxy (which proxy is irrevocable and coupled with an interest for
purposes of Section 212 of the Delaware General Corporation Law) (the "LIBERTY
PROXY"); PROVIDED, that in the event that Xxxxxx is removed by the Board as CEO
for any reason other than Cause, Xxxxxx shall be deemed to continue to be CEO
for purposes of this Agreement and shall be entitled to the Liberty Proxy set
forth herein until the earlier of (A) such time as he has abandoned efforts to
cause his reinstatement as CEO and (B) the next stockholders meeting of the
Company at which he had an adequate opportunity to nominate and elect his slate
of directors (unless at such stockholders meeting Xxxxxx'x slate of directors is
elected and Xxxxxx is promptly thereafter reinstated as CEO).
(b) Notwithstanding the foregoing, the Liberty Proxy shall not be valid
with respect to any of the Liberty Proxy Shares (and Xxxxxx will have no right
to vote the Liberty Proxy Shares) in connection with any vote on (or consent to
approve) any matter that is a Contingent Matter with respect to which Liberty's
consent is required pursuant to the terms of the Governance Agreement with
respect to which Liberty has not consented.
(c) The Liberty Proxy shall terminate as provided for in Section 3.3(a)
or, if earlier, (i) immediately upon a material breach by Xxxxxx of the terms of
Section 3.1(a), Section 3.1(b), Section 3.1(c) or Section 3.3(b) of this
Agreement, (ii) at such time as Xxxxxx has been convicted of, or has pleaded
guilty to, any felony involving moral turpitude or (iii) at such time as Xxxxxx
ceases to beneficially own 5,000,000 Common Shares with respect to which he has
a pecuniary interest; PROVIDED, in the case of clauses (ii) and (iii) above,
that Liberty sends notice of such termination to Xxxxxx within 30 days after
receiving notice of the event giving rise to such termination, in which case the
Liberty Proxy shall terminate immediately upon the receipt of such notice.
(d) Notwithstanding anything to the contrary set forth herein, the Liberty
Proxy is personal to Xxxxxx and may not be assigned by Xxxxxx by operation of
law or otherwise and shall not inure to Xxxxxx'x successors without the prior
written consent of Liberty.
(e) Notwithstanding the foregoing, and without affecting the termination
of the Liberty Proxy pursuant to Section 3.3 hereof, the Liberty Proxy will be
suspended during any period in which Xxxxxx has suffered a mental or physical
disability preventing Xxxxxx from voting or acting by written consent with
respect to the Liberty Proxy Shares, and during such period of disability,
Liberty will be entitled to vote or consent in writing with respect to all
Liberty Proxy Shares. The Liberty Proxy will be reinstated (unless sooner
terminated in accordance with Section 3.3) upon Xxxxxx ceasing to be so
disabled.
Section 3.4. COOPERATION. Each Stockholder shall vote (or act or not
act by written consent with respect to) all of its Common Shares (and any Common
Shares with respect to which it has the power to vote (whether by proxy or
otherwise) and shall, as necessary or desirable, attend all meetings in person
or by proxy for purposes of obtaining a quorum, and
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execute all written consents in lieu of meetings, as applicable, to effectuate
the provisions of this Article III.
ARTICLE IV
TRANSFER OF COMMON SHARES
Section 4.1. RESTRICTIONS ON TRANSFER BY LIBERTY AND XXXXXX. (a) Until
the CEO Termination Date or such time as Xxxxxx becomes Disabled, subject to the
other provisions of this Agreement, neither Liberty nor Xxxxxx shall Transfer or
otherwise dispose of (including pledges), directly or indirectly, any Common
Shares beneficially owned by its Stockholder Group other than (v) Transfers of
Common Shares by Xxxxxx in order to pay taxes arising from the granting, vesting
and/or exercise of the Options, (w) Transfers of Common Shares by Liberty to
members of the Liberty Stockholder Group or by Xxxxxx to members of the Xxxxxx
Stockholder Group, (x) a pledge or grant of a security interest in vested Common
Shares (other than the pledge of certain Common Shares pursuant to prior
arrangements between Xxxxxx and the Company) or pledges by a member of the
Liberty Stockholder Group of securities of a BDTV Entity that Liberty is
entitled to Transfer under (b)(ii) below in connection with bona fide
indebtedness in which the pledgee of the applicable Common Shares (or securities
of such BDTV Entity) agrees that, upon any default or exercise of its rights
under such pledge or security arrangement, it will offer to sell the pledged
Common Shares (or securities of such BDTV Entity) to the non-pledging
Stockholder (or its or his designee) for an amount equal to the lesser of the
applicable amount of such indebtedness and the fair market value of such pledged
Common Shares (or securities of such BDTV Entity), (y) Transfers of Options or
Common Shares to the Company by Xxxxxx or his Affiliates in connection with a
"cashless" exercise of the Options (including Options granted to Xxxxxx
heretofore or in the future), and (z) Transfers of Common Shares made pursuant
to Sections 4.2, 4.3 and 4.4. The restrictions on Transfer by Liberty provided
in this Section 4.1 shall be for the sole benefit of Xxxxxx and the restrictions
on Transfer by Xxxxxx provided in this Section 4.1 shall be for the sole benefit
of Liberty.
(b) Notwithstanding the restrictions contained in subsection (a) above
(and in addition to the foregoing exceptions, but subject to the right of first
refusal described in Section 4.3 on behalf of Xxxxxx (or his designee) with
respect to Transfers by members of the Liberty Stockholder Group and to a right
of first refusal on behalf of Liberty (or its designee) with respect to
Transfers by members of the Xxxxxx Stockholder Group (which rights shall be
assignable)): (i) either Liberty or Xxxxxx may Transfer all or any portion of
the Common Shares beneficially owned by its Stockholder Group (and, in the case
of Liberty only, its entire interest in the BDTV Entities) to an unaffiliated
third party, PROVIDED, HOWEVER, that a Transfer by either Liberty or Xxxxxx of
Common Shares to a third party shall be subject to the tag-along right pursuant
to Section 4.2, after, in the case of any Transfer of Class B Common Stock,
compliance with the right of first refusal described in Section 4.3 and the swap
provisions described in Section 4.4, and (ii) either Liberty or Xxxxxx may
Transfer any portion of the Common Shares (including, in the case of Liberty,
all or a portion of a BDTV Entity interest) held by its Stockholder Group to an
unaffiliated third party; PROVIDED that, (a) following such Transfer such
Stockholder Group retains its Eligible Stockholder Amount of Common Shares and
(b) in the case of the Transfer of an interest in or Common Shares held by a
BDTV Limited Entity as of the date hereof, following such Transfer, the Liberty
Stockholder Group and the Xxxxxx
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Stockholder Group collectively beneficially own the Minimum Stockholder Amount.
Notwithstanding the previous sentence and the restrictions contained in
paragraph (a) above and subject to the requirement, with respect to a Transfer
by Liberty of an interest in or Common Shares held by a BDTV Limited Entity as
of the date hereof, that the Stockholders and their respective Stockholder
Groups collectively beneficially own the Minimum Stockholder Amount, either
Liberty or Xxxxxx may transfer any of its Common Shares in one or more
transactions that comply with the requirements of Rule 144 or 145 (as
applicable) under the Securities Act.
Section 4.2. TAG-ALONG FOR XXXXXX AND LIBERTY FOR TRANSFERS BY THE
OTHER. (a) If either Xxxxxx or Liberty shall desire to Transfer to any
unaffiliated third party any of the Common Shares beneficially owned by him or
it or any member of his or its Stockholder Group (other than the Transfers
referred to in paragraphs (e) and (f) below), in one transaction or a series of
related transactions (the "TAG-ALONG SALE"), Xxxxxx or Liberty, as applicable
(the "Initiating Party), shall give prior written notice to the other (the "TAG
PARTY") of such intended Transfer. Such notice (the "TAG-ALONG NOTICE") shall
set forth the terms and conditions of such proposed Transfer, including the
number of Common Shares proposed to be Transferred (the "TAG-ALONG SHARES"), the
purchase price per Common Share proposed to be paid therefor and the payment
terms and type of Transfer to be effectuated.
(b) Within ten days after delivery of the Tag-Along Notice, the Tag Party
will have the opportunity and right (exercisable by such Tag Party by written
notice to the Initiating Party not later than the end of such ten day period) to
sell to the acquiring Person in such proposed Tag-Along Sale (upon the same
terms and conditions as the Initiating Party), subject to the following
sentence, up to that number of Common Shares beneficially owned by it
(including, in the case of Liberty, all of the Common Shares held by the BDTV
Entities) as shall equal the product of (x) a fraction, the numerator of which
is the number of Tag-Along Shares and the denominator of which is the aggregate
number of Common Shares beneficially owned as of the date of the Tag-Along
Notice by the Initiating Party (including all of the Common Shares held by the
BDTV Entities if Liberty is the Initiating Party), multiplied by (y) the number
of Common Shares beneficially owned by the Tag Party (including all of the
Common Shares held by the BDTV Entities if Liberty is the Tag Party) as of the
date of the Tag-Along Notice. The number of Common Shares that Xxxxxx or Liberty
may sell to an unaffiliated third party pursuant to Section 4.2(a) shall be
determined by multiplying the maximum number of Tag-Along Shares that such third
party is willing to purchase on the terms set forth in the Tag-Along Notice by a
fraction, the numerator of which is the number of Common Shares that such
Stockholder proposes to sell hereunder (subject to the maximum amount for Xxxxxx
or Liberty, as applicable, calculated pursuant to the preceding sentence) and
the denominator of which is the aggregate number of Common Shares that Xxxxxx
and Liberty propose to sell hereunder.
(c) At the closing of any proposed Transfer in respect of which a
Tag-Along Notice has been delivered, the Tag Party shall deliver, free and clear
of all liens (other than liens caused by the acquiring Person in the Tag-Along
Sale), to such third party certificates evidencing the Common Shares to be sold
thereto duly endorsed with Transfer powers and shall receive in exchange
therefore the consideration to be paid by such third party in respect of such
Common Shares as described in the Tag-Along Notice. No transferee shall be
required to purchase shares of a BDTV Entity in connection with the Tag-Along
Sale and each of Liberty and Xxxxxx shall
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cooperate so that any transferee will be able to purchase directly any Common
Shares held by a BDTV Entity and not the shares of any BDTV Entity.
(d) Neither Xxxxxx and the members of his Stockholder Group, on the one
hand, nor Liberty and the members of its Stockholder Group, on the other hand,
shall effect any Transfer or Transfers constituting a Tag-Along Sale absent
compliance with this Section 4.2.
(e) This Section 4.2 shall not be applicable to the Transfer by Xxxxxx or
any member of his Stockholder Group (i) of an aggregate of not more than
2,000,000 Common Shares within any rolling twelve-month period, (ii) pursuant to
Section 4.1(a)(v) or 4.1(a)(y), (iii) in a Market Sale, or (iv) following such
time as Xxxxxx is no longer CEO other than any Transfer made in connection with
Xxxxxx ceasing to be CEO. This Section 4.2 shall not be applicable to (i) the
Transfer of Common Stock by the Liberty Stockholder Group in a Market Sale,
provided that the total volume of sales effected on any single day shall not
exceed the Daily Hedging Limit, or (ii) the entry into, maintenance of,
performance of obligations under and unwinding of Hedging Transactions effected
by the Liberty Stockholder Group, including, without limitation, the Transfer of
Common Stock in connection therewith through the delivery of Common Stock to a
third party in connection with the settlement or satisfaction of a Hedging
Transaction or the foreclosure and sale by a secured party of any Common Stock
pledged to secure the obligations of a party under a Hedging Transaction or in
respect of any extension of credit to a party based, in whole or part, on the
value of such Hedging Transaction; provided, that: (A) no Hedging Transaction
shall, prior to the settlement of such Hedging Transaction, impair Xxxxxx'x
right to vote any shares of the Common Stock pursuant to Section 3.3 (it being
understood that a settlement of a Hedging Transaction may result in a
disposition of the shares subject to such Hedging Transaction and that, upon
such disposition, Xxxxxx will not have the right to vote such shares); PROVIDED,
that such right shall not be deemed to be impaired to the extent that a
counterparty to a Hedging Transaction to whom Common Stock has been pledged has
obtained the right to vote or take consensual action with respect to the Common
Stock so pledged as a result of an event of default or termination event with
respect to the Liberty Stockholder Group under the Hedging Transaction;
provided, further, that the terms of such pledging arrangement shall permit the
Liberty Stockholder Group to exercise voting rights and to take consensual
action with respect to the Common Stock so pledged in circumstances where no
event of default or termination event has occurred; (B) a significant purpose of
Liberty's engaging in the Hedging Transaction shall not be the circumvention of
Xxxxxx'x tag along rights under Section 4.2 of this Agreement (and there shall
be a rebuttable presumption that no such purpose exists if the Hedging
Transaction is effected with a financial institution and neither Liberty nor its
Affiliates have any oral or written understanding or agreement with the
financial institution relating to the subsequent Transfer to any Person or
group, if any, of the shares of Common Stock subject to the Hedging
Transaction); (C) if pursuant to a Hedging Transaction or Related Hedging
Transactions, a number of shares of Common Stock representing 5% or more of the
outstanding shares of such class (determined as of the date the Hedging
Transaction or the date of the initial Hedging Transaction in any series of
Related Hedging Transactions is effected) (such 5% amount, the "SETTLEMENT
THRESHOLD"), could be Transferred by the Liberty Stockholder Group to such
counterparty in
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connection with the settlement of such Hedging Transaction or Related Hedging
Transactions, then Liberty shall cause such members of the Liberty Stockholder
Group to settle or satisfy the obligations with respect to such Hedging
Transaction or Related Hedging Transactions in such a manner so that the number
of shares delivered to such counterparty in connection with the settlement of
such Hedging Transaction or Related Hedging Transactions does not exceed the
Settlement Threshold unless the counterparty has indicated to Liberty and Xxxxxx
(if requested by Xxxxxx) that it will utilize such shares of Common Stock to
fill a preexisting short position in the shares of Common Stock; (D) for each
twelve-month period beginning on the date hereof and each anniversary of the
date hereof, Liberty shall ensure that the Liberty Stockholder Group shall not
enter into Hedging Transactions with respect to more than one third (1/3) of the
shares of Common Stock that the Liberty Stockholder Group owns (including all
shares of Common Stock owned by the BDTV Entities) on the first day of such
twelve-month period; (E) Liberty will advise Xxxxxx (which may be oral) that it
is contemplating entering into a Hedging Transaction (including a brief
description of the general structure of the Hedging Transaction contemplated and
the potential timing of such Hedging Transaction) as far in advance as
reasonably practicable prior to effecting such Hedging Transaction, but in no
event more than ten Business Days prior to effecting such Hedging Transaction,
and, if Xxxxxx (i) has determined in good faith that such Hedging Transaction
would adversely affect a contemplated significant corporate transaction
(including financing) of the Company, and uses his reasonable best efforts to
make such a determination as soon as practicable (but in no event later than
10:00 a.m. New York City time on the second Business Day immediately following
the date of the giving of such notice by Liberty) and requests that the Liberty
Stockholder Group delay any such Hedging Transaction because of the matters
referred to in clause (i) above, then Liberty shall cause the Liberty
Stockholder Group to delay such Hedging Transaction for a period not to exceed
ten Business Days commencing on the Business Day after the date Xxxxxx has been
advised that Liberty is contemplating a Hedging Transaction, and after such ten
Business Day period, if any, Liberty shall be entitled to effect such Hedging
Transaction; and (F) Liberty shall ensure that all sales or short sales in
connection with establishing the initial hedge with respect to one or more
Hedging Transactions shall not, taking all such sales or short sales during a
particular day in the aggregate, exceed the Daily Hedging Limit.
(f) During the term of this Agreement, the Liberty Stockholder Group will
be entitled to engage in Stock Lending Transactions from time to time (which
Stock Lending Transactions will be deemed not to impair the proxy granted
pursuant to Section 3.3) with respect to the Common Stock subject to the
following limitations: (i) the maximum number of shares of Common Stock
Beneficially Owned by the Liberty Stockholder Group which may be lent at any one
time to others in Stock Lending Transactions during the period from the date
hereof to the first anniversary of this Agreement may not exceed an aggregate of
15,000,000 shares of Common Stock (subject to adjustment pursuant to Section
6.13 hereof) (the "LIBERTY LENDING LIMIT"); and (ii) following such first
anniversary the Liberty Lending Limit will be increased to an aggregate of
16,250,000 shares of Common Stock (subject to adjustment as aforesaid). For
purposes hereof, a "Stock Lending Transaction" shall mean a transaction effected
in connection with any Hedging Transaction whereby the Liberty Stockholder Group
lends shares of Common Stock to a third party or permits a third party to sell,
pledge, rehypothecate, assign, invest, use, commingle or otherwise dispose of,
or otherwise use in its business such shares of Common Stock.
(g) Upon written request made from time to time by Liberty, Xxxxxx will
use reasonable efforts to cause the Company to deliver to Liberty and Xxxxxx a
written statement specifying the number of shares of Company Common Stock,
Company Class B Common Stock and other Voting Securities issued and outstanding
as of the most recent practicable date.
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Liberty and Xxxxxx will, in connection with any applicable calculations
hereunder or under the Governance Agreement, be entitled to rely upon the
information set forth in such statement. In the event such statement is not
delivered to Liberty within five Business Days following Liberty's request
therefor, Liberty and Xxxxxx (and their respective successors and permitted
assigns) shall be entitled to rely for purposes of such calculations on the
number of shares of Company Common Stock, Company Class B Common Stock and other
Voting Securities listed as issued and outstanding in the Company's most recent
quarterly or annual report publicly filed with the Commission or the most recent
statement from the Company.
Section 4.3. Right of First Refusal Between Liberty and Xxxxxx. (a) Any
Transfer of shares of Class B Common Stock by a member of the Liberty
Stockholder Group or a member of the Xxxxxx Stockholder Group (the "L/D
TRANSFERRING PARTY") will be subject to the right of first refusal provisions of
this Section 4.3, other than a Transfer by a member of the Liberty Stockholder
Group or the Xxxxxx Stockholder Group permitted by Section 4.1(a) hereof or a
Transfer that is a sale described in clause (i) of the first or second sentence
of Section 4.2(e).
(b) Prior to effecting any Transfer referred to in Section 4.3(a), the L/D
Transferring Party shall deliver written notice (the "L/D OFFER NOTICE") to
Xxxxxx, if the L/D Transferring Party is a member of the Liberty Stockholder
Group, or to Liberty, if the L/D Transferring Party is a member of the Xxxxxx
Stockholder Group (the recipient of such notice, the "L/D OTHER PARTY"), which
L/D Offer Notice shall specify (i) the Person to whom the L/D Transferring Party
proposes to make such Transfer, (ii) the number or amount of the shares of Class
B Common Stock to be Transferred, (iii) the L/D Offer Price (as defined below),
and (iv) all other material terms and conditions of the proposed Transfer,
including a description of any non-cash consideration sufficiently detailed to
permit valuation thereof, and which L/D Offer Notice shall be accompanied by any
written offer from the prospective transferee to purchase such shares of Class B
Common Stock, if available and permitted pursuant to the terms thereof. The L/D
Offer Notice shall constitute an irrevocable offer to the L/D Other Party, for
the period of time described below, to purchase all (but not less than all) of
such shares of Class B Common Stock.
(c) For purposes of this Section 4.3, "L/D OFFER PRICE" shall mean the
purchase price per share of Class B Common Stock to be paid to the L/D
Transferring Party in the proposed transaction (as it may be adjusted in order
to determine the net economic value thereof). In the event that the
consideration payable to the L/D Transferring Party in a proposed transaction
consists of securities, the purchase price per share shall equal the fair market
value of such securities divided by the number of shares of Class B Common Stock
to be Transferred. Such fair market value shall be the market price of any
publicly traded security and, if such security is not publicly traded, the fair
market value shall be equal to the Fair Market Value of such security determined
as follows: Each of Liberty and Xxxxxx shall select an Independent Investment
Banking Firm each of which shall promptly make a determination (each such
determination, an "APPRAISAL") of the Fair Market Value of such security. If the
higher of such Appraisals is less than or equal to 110% of the lower of such
Appraisals, then the Fair Market Value shall be equal to the average of such
Appraisals. If the higher of such Appraisals is greater than 110% of the lower
of such Appraisals, then a third Independent Investment Banking Firm (which
shall be an Independent Investment Banking Firm that shall not have been engaged
by the Company, Expedia, Inc. (but only for so long as Xxxxxx is Chairman of the
Board of Directors of Expedia, Inc.) Liberty or Xxxxxx in any significant matter
for the three years prior to the date of such
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selection) shall be selected by the first two Independent Investment Banking
Firms, which third Independent Investment Banking Firm shall promptly make a
determination of the Fair Market Value. The Fair Market Value shall equal the
average of the two of such three Appraisals closest in value (or if there are no
such two, then of all three Appraisals).
(d) If the L/D Other Party elects to purchase the offered shares of Class
B Common Stock, it shall give notice to the L/D Transferring Party within ten
Business Days after receipt of the L/D Offer Notice of its election (or in the
case of a third party tender offer or exchange offer, at least five Business
Days prior to the expiration date of such offer, PROVIDED that all conditions to
such offer that need to be satisfied prior to acceptance for payment (other than
with respect to the number of shares of Class B Common Stock tendered) shall
have been satisfied or waived and the L/D Offer Notice shall have been provided
at least ten Business Days prior to the expiration date of such offer), which
shall constitute a binding obligation, subject to standard terms and conditions
for a stock purchase contract between two significant stockholders of an issuer
(provided that the L/D Transferring Party shall not be required to make any
representations or warranties regarding the business of the Company), to
purchase the offered shares of Class B Common Stock, which notice shall include
the date set for the closing of such purchase, which date shall be at least 20
Business Days following the delivery of such election notice, or, if later, five
Business Days after receipt of all required regulatory approvals; PROVIDED that
the closing shall only be delayed pending receipt of required regulatory
approvals if (i) the L/D Other Party is using reasonable efforts to obtain the
required regulatory approvals, (ii) there is a reasonable prospect of receiving
such regulatory approvals and (iii) if such closing is delayed more than 90 days
after the date of the L/D Other Party's notice of election to purchase, then the
L/D Other Party agrees to pay interest on the aggregate L/D Offer Price at the
Reference Rate to the L/D Transferring Party from such date to the closing date.
Notwithstanding the foregoing, such time periods shall not be deemed to commence
with respect to any purported notice that does not comply in all material
respects with the requirements of this Section 4.3(d). Liberty and Xxxxxx may
assign their respective rights to purchase under this Section 4.3 to any Person
who is a Permitted Designee.
(e) If the L/D Other Party does not respond to the L/D Offer Notice within
the required response time period or elects not to purchase the offered shares
of Class B Common Stock, the L/D Transferring Party shall be free to complete
the proposed Transfer (to the same proposed transferee, in the case of a
privately-negotiated transaction) on terms no less favorable to the L/D
Transferring Party or its Affiliate, as the case may be, than those set forth in
the L/D Offer Notice, provided that (x) such Transfer is closed within (I) 90
days after the latest of (A) the expiration of the applicable period for the L/D
Other Party to accept the offer from the L/D Transferring Party, or (B) the
receipt by the L/D Transferring Party of notice declining the offer to purchase
the shares of Class B Common Stock or, in the case of (A) or (B), if later, five
Business Days following receipt of all required regulatory approvals; PROVIDED
that the closing shall only be delayed pending receipt of required regulatory
approvals if (i) the L/D Transferring Party is using reasonable efforts to
obtain the required regulatory approvals and (ii) there is a reasonable prospect
of receiving such regulatory approvals, or (II) in the case of a public
offering, within 20 days of the declaration by the Commission of the
effectiveness of a registration statement filed with the Commission pursuant to
this Agreement, and (y) the price at which the shares of Class B Common Stock
are transferred must be equal to or higher than the L/D Offer Price (except in
the case of a public offering, in which case the price at which the
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shares of Class B Common Stock are sold (before deducting underwriting discounts
and commissions) shall be equal to at least 90% of the L/D Offer Price).
(f) If the L/D Other Party elects to exercise its right of first refusal
under this Section 4.3, the L/D Other Party shall pay the L/D Offer Price in
cash (by wire transfer of immediately available funds) or by the delivery of
marketable securities having an aggregate fair market value equal to the L/D
Offer Price, PROVIDED, that if the securities to be so delivered by the L/D
Other Party would not, in the L/D Transferring Party's possession, have at least
the same general degree of liquidity as the securities the L/D Transferring
Party was to receive in such proposed transaction (determined by reference to
the L/D Transferring Party's ability to dispose of such securities (including,
without limitation, the trading volume of such securities and the L/D Other
Party's percentage ownership of the issuer of such securities)), then the L/D
Other Party shall be required to deliver securities having an appraised value
(calculated in accordance with the method described in Section 4.3(c)) equal to
the L/D Offer Price. If the L/D Other Party delivers securities in payment of
the L/D Offer Price, it will cause the issuer of such securities to provide the
L/D Transferring Party with customary registration rights related thereto (if,
in the other transaction, the L/D Transferring Party would have received cash,
cash equivalents, registered securities or registration rights). Each of Xxxxxx
and Liberty agrees to use his or its commercially reasonable efforts (but not to
expend any money) to preserve for the other Stockholder, to the extent possible,
the tax benefits available to it in such proposed transaction, and to otherwise
seek to structure such transaction in the most tax efficient method available.
Notwithstanding the foregoing, if Xxxxxx pays the L/D Offer Price in securities,
such securities must be securities that Liberty is permitted to own under
applicable FCC Regulations.
(g) Notwithstanding anything to the contrary contained in this Section
4.3, the time periods applicable to an election by the L/D Other Party to
purchase the offered securities shall not be deemed to commence until the Fair
Market Value has been determined, provided that, in the case of a third party
tender offer or exchange offer, in no event shall any such election be permitted
within five Business Days prior to the latest time by which shares of Class B
Common Stock shall be tendered in such offer if all conditions to such offer
that need to be satisfied prior to acceptance for payment (other than the number
of shares tendered) have been satisfied or waived. Each of Xxxxxx and Liberty
agrees to use his and its best efforts to cause the Fair Market Value to be
determined as promptly as practicable, but in no event later than ten Business
Days after the receipt by the L/D Other Party of the L/D Offer Notice.
Section 4.4. TRANSFERS OF CLASS B SHARES. (a) Subject to the rights of
first refusal pursuant to Section 4.3 and subject to paragraph (c) below, in the
event that any Stockholder or any members of its Stockholder Group (the
"TRANSFERRING STOCKHOLDER") proposes to Transfer any shares of Class B Common
Stock, such Transferring Stockholder shall send a written notice (which
obligation may be satisfied by the delivery of the applicable L/D Offer Notice)
(the "EXCHANGE NOTICE," which term will include any corresponding L/D Offer
Notice) to Xxxxxx, if the Transferring Stockholder is Liberty or a member of the
Liberty Stockholder Group, or to Liberty, if the Transferring Stockholder is
Xxxxxx or a member of the Xxxxxx Stockholder Group (the recipient of such
notice, the "NON-TRANSFERRING STOCKHOLDER"), that such Transferring Stockholder
intends to Transfer shares of Class B Common Stock, including the number of such
shares proposed to be Transferred. The Non-Transferring Stockholder shall give
notice to the Transferring Stockholder within 10 Business Days of its receipt of
the Exchange Notice of its
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desire to exchange some or all of such shares of Class B Common Stock proposed
to be Transferred for an equivalent number of shares of Common Stock or its
election to purchase all such offered shares of Class B Common Stock pursuant to
Section 4.3. If the Non-Transferring Stockholder desires to exchange some or all
of such shares rather than exercise its right of first refusal pursuant to
Section 4.3, such shares of Class B Common Stock shall be exchanged. Except to
the extent necessary to avoid liability under Section 16(b) of the Exchange Act
and subject to applicable law, any such exchange shall be consummated
immediately prior to the consummation of any such Transfer.
(b) If any shares of Class B Common Stock proposed to be Transferred are
not exchanged pursuant to the provisions of paragraph (a) above, prior to any
such Transfer, the Transferring Stockholder shall convert, or cause to be
converted, such shares of Class B Common Stock into shares of Common Stock (or
such other securities of the Company into which such shares are then
convertible).
(c) The provisions of Section 4.4(a) and 4.4(b) shall not be applicable to
any Transfers (i) to a member of such Stockholder's Stockholder Group, (ii)
pursuant to a pledge or grant of a security interest in compliance with clause
(x) of Section 4.1(a), or (iii) from Liberty, Xxxxxx or their respective
Stockholder Group to the other Stockholder or its or his Stockholder Group
subject to the terms of this Agreement.
Section 4.5. TRANSFEREES. (a) Any Permitted Transferee or Permitted
Designee of a Stockholder shall be subject to the terms and conditions of this
Agreement as if such Permitted Transferee or Permitted Designee were Liberty (if
Liberty or a Permitted Transferee of Liberty is the transferor) or Xxxxxx (if
Xxxxxx or a Permitted Transferee of Xxxxxx is the transferor). Prior to the
initial acquisition of beneficial ownership of any Common Shares by any
Permitted Transferee (or a Permitted Designee), and as a condition thereto, each
Stockholder agrees (i) to cause its respective Permitted Transferees or
Permitted Designees to agree in writing with the other parties hereto to be
bound by the terms and conditions of this Agreement to the extent described in
the preceding sentence and (ii) that such Stockholder shall remain directly
liable for the performance by its respective Permitted Transferees or Permitted
Designees of all obligations of such Permitted Transferees or Permitted
Designees under this Agreement. Except as otherwise contemplated by this
Agreement (including the terms of Sections 4.2, 4.3 and 4.4), (i) each of Xxxxxx
and Liberty agrees not to cause or permit any of its respective Permitted
Transferees to cease to qualify as a member of such Stockholder's Stockholder
Group so long as such Permitted Transferee beneficially owns any Common Shares,
and if any such Permitted Transferee shall cease to be so qualified, such
Permitted Transferee shall automatically upon the occurrence of such event cease
to be a "Permitted Transferee" for any purpose under this Agreement and (ii)
each Stockholder agrees not to Transfer any Common Shares to any Affiliate other
than a Permitted Transferee of such Stockholder.
(b) No Third Party Transferee shall have any rights or obligations under
this Agreement, except:
(i) in the case of a Third Party Transferee of Liberty (or any member
of the Liberty Stockholder Group) who acquires shares of Common Stock and
who (together with its Affiliates) would not be a Public Stockholder, such
Third Party Transferee shall
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be subject to the obligations of Liberty (but subject to the other terms
and conditions of this Agreement) pursuant to Section 3.1(a) (but shall
not have the right to consent to any Contingent Matters), Section 3.1(b),
Section 3.1(c), Section 3.2, Section 3.4, this Section 4.5 and Article VI;
PROVIDED that such Third Party Transferee shall only be subject to such
obligations for so long as it would not be a Public Stockholder; and
(ii) in the case of a Third Party Transferee of Xxxxxx (or any member
of the Xxxxxx Stockholder Group) who (together with its Affiliates) upon
consummation of any Transfer would not be a Public Stockholder, such Third
Party Transferee shall be subject to the obligations of Xxxxxx (but
subject to the other terms and conditions of this Agreement) pursuant to
Section 3.1(a) (but shall not have the right to consent to any Contingent
Matters), 3.1(b), Section 3.1(c), Section 3.4, this Section 4.5 and
Article VI; PROVIDED that such Third Party Transferee shall only be
subject to such obligations for so long as it would not be a Public
Stockholder.
(c) Prior to the consummation of a Transfer described in Section 4.5(b) to
the extent rights and obligations are to be assigned, and as a condition
thereto, the applicable Third Party Transferee shall agree in writing with the
other parties hereto to be bound by the terms and conditions of this Agreement
to the extent described in Section 4.5(b). To the extent the Third Party
Transferee is not an "ULTIMATE PARENT ENTITY" (as defined in the HSR Act), the
ultimate parent entity of such Third Party Transferee shall agree in writing to
be directly liable for the performance of the Third Party Transferee to the same
extent Liberty would be liable for the performance of its Permitted Transferees.
Section 4.6. NOTICE OF TRANSFER. In addition to any other notices
required by this Agreement, to the extent any Stockholder and its Permitted
Transferees Transfer any Common Shares, such Stockholder shall, within three
Business Days following consummation of such Transfer, deliver notice thereof to
the Company and the other Stockholder, PROVIDED, HOWEVER, that no such notice
shall be required to be delivered unless the aggregate Common Shares transferred
by such Stockholder and its Permitted Transferees since the date of the last
notice delivered by such Stockholder pursuant to this Section 4.6 exceeds 1% of
the outstanding Common Shares.
Section 4.7. COMPLIANCE WITH TRANSFER PROVISIONS. Any Transfer or
attempted Transfer of Common Shares in violation of any provision of this
Agreement shall be void.
ARTICLE V
BDTV ENTITY ARRANGEMENTS
Section 5.1. MANAGEMENT. The business and affairs of each BDTV Entity
will be managed by a Board of Directors elected by the holders of a majority of
the voting equity interests in such BDTV Entity. Notwithstanding the foregoing,
the taking of any action by a BDTV Entity with respect to (i) to the extent
permitted by applicable law, any matter that would have constituted a
Fundamental Change under the 1997 Stockholders Agreement (as applied to such
BDTV Entity and to the Common Shares, MUTATIS MUTANDIS) or (ii) any acquisition
or disposition (including pledges) of any Common Shares held by such BDTV
Entity, in either
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case, will require the unanimous approval of the holders of
all voting and non-voting equity interests in such BDTV Entity.
Section 5.2. CHANGES TO BDTV STRUCTURES. Liberty and Xxxxxx agree,
subject to applicable law and FCC Regulations, to take such actions as may be
reasonably necessary, including but not limited to amending the certificate of
incorporation of each BDTV Entity, in order to provide Liberty with the ability
to transfer, directly or indirectly, such amounts of Common Shares as Liberty is
permitted to sell hereunder, and, if requested by Liberty, Xxxxxx agrees,
subject to applicable law and at Liberty's sole cost and expense to take actions
as are reasonably necessary to permit each BDTV Entity to hold separately shares
of capital stock of Expedia, Inc. ("EXPEDIA SHARES") to be held by it
immediately following the effective time of the Company's spin off of Expedia,
Inc., to sell such Expedia Shares, directly or indirectly, separately from a
sale of the Common Shares (but only as permitted by the agreements between
Liberty and Xxxxxx with respect to the Expedia Shares), to reorganize the assets
of any or all of the BDTV Entities to reflect ownership of the Expedia Shares,
including, without limitation, to transfer Common Shares and/or Expedia Shares
to a Subsidiary of a BDTV Entity (and any such Subsidiary of a BDTV Entity that
holds Common Shares or other entity holding Common Shares as a result of such
reorganization shall be deemed a BDTV Unrestricted Entity or BDTV Limited
Entity, as applicable) or otherwise to enable Liberty to exercise its rights
hereunder with respect to Common Shares and under the agreements between Liberty
and Xxxxxx with respect to the Expedia Shares.
Section 5.3. TRANSFERS OF BDTV INTERESTS. Except as otherwise
specifically provided in this Agreement (including Section 4.1(b)), no transfers
or other dispositions (including pledges), directly or indirectly, of any
interest in (a) any BDTV Limited Entity by Liberty or (b) any BDTV Entity by
Xxxxxx will be permitted without the consent of the other; PROVIDED (i) Liberty
shall be entitled to transfer all or part of its interest in a BDTV Entity to
members of the Liberty Stockholder Group, (ii) at such time Liberty becomes the
owner of any voting securities of any BDTV Limited Entity, such BDTV Limited
Entity shall be deemed to be a BDTV Unrestricted Entity, and (iii) in connection
with any sale by Xxxxxx entitling Liberty to a right pursuant to Section 4.2,
Liberty and Xxxxxx shall take such reasonable action as may be required in order
for Liberty's interest in a BDTV Limited Entity to be sold in any such
transaction. Without the prior written consent of Liberty, Xxxxxx shall not
Transfer any interest in a BDTV Entity (other than to Liberty or, subject to
Liberty's reasonable consent, a member of the Xxxxxx Stockholder Group).
For purposes of determining whether Liberty is permitted to transfer
the Common Shares held by a BDTV Unrestricted Entity, (i) such BDTV Unrestricted
Entity shall be deemed to be a member of the Liberty Stockholder Group and the
restrictions on transfers of interests in BDTV Entities shall not apply to
Liberty (subject, however, to the other restrictions on transfer of Common
Shares set forth herein, including the Right of First Refusal applicable to the
Class B Common Stock) and (ii) in connection with any proposed sale by any
member of the Liberty Stockholder Group of the Common Shares held by a BDTV
Entity (or its equity interest in such BDTV Entity), such member of the Liberty
Stockholder Group shall be entitled to purchase Xxxxxx'x entire interest in such
BDTV Entity for an amount in cash equal to the Xxxxxx Interest Purchase Price
or, at such purchaser's election, require Xxxxxx to sell his interest in such
BDTV Entity to any such transferee for a pro rata portion of the consideration
to be paid by the applicable transferee in such transaction.
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At such time as (i) the CEO Termination Date has occurred or Xxxxxx
becomes Disabled or (ii) the Xxxxxx Stockholder Group ceases to own its Eligible
Stockholder Amount of Common Shares, Xxxxxx shall be required to sell his entire
interest in the BDTV Entities to Liberty (or Liberty's designee) at a price
equal to the Xxxxxx Interest Purchase Price.
ARTICLE VI
MISCELLANEOUS
Section 6.1. CONFLICTING AGREEMENTS. Each of the parties hereto
represents and warrants that such party has not granted and is not a party to
any proxy, voting trust or other agreement that is inconsistent with or
conflicts with any provision of this Agreement.
Section 6.2. DURATION OF AGREEMENT. Except as otherwise provided in
this Agreement, the rights and obligations of a Stockholder under this Agreement
shall terminate as follows:
(a) Each of Liberty and Xxxxxx shall cease to be entitled to exercise any
rights and shall cease to have any obligations under this Agreement as of the
date that its Stockholder Group collectively ceases to own its Eligible
Stockholder Amount of Common Shares; provided that Liberty shall cease to be
entitled to exercise any rights and shall cease to have any obligations under
Section 4.2 at such time as the Liberty Stockholder Group ceases to beneficially
own at least 5% of the outstanding Common Shares (the "LIBERTY TERMINATION
DATE").
(b) Xxxxxx and each member of his Stockholder Group shall cease to be
entitled to exercise any rights under this Agreement if the CEO Termination Date
has occurred or Xxxxxx has become Disabled (the "XXXXXX TERMINATION DATE").
In addition, at such time as the CEO Termination Date has occurred or
Xxxxxx has become Disabled, neither the Xxxxxx Stockholder Group nor the Liberty
Stockholder Group shall have any obligation under this Agreement with respect to
the matters covered under Sections 3.3, 4.1 and 4.3.
Section 6.3. FURTHER ASSURANCES. At any time or from time to time after
the date hereof, the parties agree to cooperate with each other, and at the
request of any other party, to execute and deliver any further instruments or
documents and to take all such further action as the other party may reasonably
request in order to evidence or effectuate the consummation of the transactions
contemplated hereby and to otherwise carry out the intent of the parties
hereunder.
Section 6.4. AMENDMENT AND WAIVER. This Agreement may not be amended,
modified, or waived except in a written instrument executed by the parties. The
failure of any party to enforce any of the provisions of this Agreement shall in
no way be construed as a waiver of such provisions and shall not affect the
right of such party thereafter to enforce each and every provision of this
Agreement in accordance with its terms.
Section 6.5. SEVERABILITY. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be invalid,
illegal or unenforceable in any respect under any
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applicable law or rule in any jurisdiction, such invalidity, illegality or
unenforceability shall not affect any other provision or any other jurisdiction,
but this Agreement shall be reformed, construed and enforced in such
jurisdiction as if such invalid, illegal or unenforceable provision had never
been contained herein.
Section 6.6. EFFECTIVE TIME. This Agreement shall become effective
immediately following the effective time of the Company's spin off of Expedia,
Inc.
Section 6.7. ENTIRE AGREEMENT. Except as otherwise expressly set forth
herein, (a) this Agreement, (b) the Governance Agreement, (c) as provided in
Section 5.1 hereof, the 1997 Stockholders Agreement, and (d) as provided in
Section 5.2 hereof, the agreements relating to Expedia, Inc., embody the
complete agreement and understanding among the parties hereto with respect to
the subject matter hereof or thereof and supersede and preempt any prior
understandings, agreements or representations by or among the parties, written
or oral, that may have related to the subject matter hereof in any way.
Effective upon the effective time of this Agreement, the 2001 Stockholders
Agreement shall terminate and shall be superseded by this Agreement.
Section 6.8. SUCCESSORS AND ASSIGNS. Neither this Agreement nor any of
the rights or obligations under this Agreement shall be assigned, in whole or in
part (except by operation of law pursuant to a merger whose purpose is not to
avoid the provisions of this Agreement), by any party without the prior written
consent of the other party hereto. Subject to the foregoing, this Agreement
shall bind and inure to the benefit of and be enforceable by the parties hereto
and their respective successors and assigns.
Section 6.9. COUNTERPARTS. This Agreement may be executed in separate
counterparts each of which shall be an original and all of which taken together
shall constitute one and the same agreement.
Section 6.10. LIABILITIES UNDER FEDERAL SECURITIES LAWS. The exercise
by any party (or its Affiliates or Stockholder Group, if applicable) (and
including, in the case of the Liberty Stockholder Group, its exercise of the
preemptive rights under Article III of the Governance Agreement) of any rights
under this Agreement shall be subject to such reasonable delay as may be
required to prevent any party or its respective Stockholder Group from incurring
any liability under the federal securities laws and the parties agree to
cooperate in good faith in respect thereof.
Section 6.11. REMEDIES. (a) Each party hereto acknowledges that money
damages would not be an adequate remedy in the event that any of the covenants
or agreements in this Agreement are not performed in accordance with its terms,
and it is therefore agreed that in addition to and without limiting any other
remedy or right it may have, the non-breaching party will have the right to an
injunction, temporary restraining order or other equitable relief in any court
of competent jurisdiction enjoining any such breach and enforcing specifically
the terms and provisions hereof.
(b) All rights, powers and remedies provided under this Agreement or
otherwise available in respect hereof at law or in equity shall be cumulative
and not alternative, and the
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exercise or beginning of the exercise of any thereof by any party shall not
preclude the simultaneous or later exercise of any other such right, power or
remedy by such party.
Section 6.12. NOTICES. Except as otherwise provided herein, any notice,
request, claim, demand or other communication under this Agreement shall be in
writing, shall be either personally delivered, delivered by facsimile
transmission, or sent by reputable overnight courier service (charges prepaid)
to the address for such Person set forth below or such other address as the
recipient party has specified by prior written notice to the other parties
hereto and shall be deemed to have been given hereunder when receipt is
acknowledged for personal delivery or facsimile transmission or one day after
deposit with a reputable overnight courier service.
If to Liberty:
Liberty Media Corporation
00000 Xxxxxxx Xxxxxxxxx
Xxxxxxxxx, XX 00000
Attention: General Counsel
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Xxxxx Xxxxx LLP
00 Xxxxxxxxxxx Xxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxxxx X. XxXxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to Xxxxxx:
c/o IAC/InterActiveCorp
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: General Counsel
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Wachtell, Lipton, Xxxxx & Xxxx
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx, Esq.
Xxxxxx X. Xxxxxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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Section 6.13. ADJUSTMENT OF SHARES NUMBERS. If, after the effective
time of this Agreement, there is a subdivision, split, stock dividend,
combination, reclassification or similar event with respect to any of the shares
of Capital Stock referred to in this Agreement, then, in any such event, the
numbers and types of shares of such Capital Stock referred to in this Agreement
(and if applicable, the share prices thereof) shall be adjusted to the number
and types of shares of such Capital Stock that a holder of such number of shares
of such Capital Stock would own or be entitled to receive as a result of such
event if such holder had held such number of shares immediately prior to the
record date for, or effectiveness of, such event.
Section 6.14. GOVERNING LAW; CONSENT TO JURISDICTION. This Agreement
shall be governed by and construed in accordance with the laws of the State of
Delaware without giving effect to the principles of conflicts of law. Each of
the parties hereto hereby irrevocably and unconditionally consents to submit to
the exclusive jurisdiction of the courts of the State of Delaware for any
action, proceeding or investigation in any court or before any governmental
authority ("LITIGATION") arising out of or relating to this Agreement and the
transactions contemplated hereby and further agrees that service of any process,
summons, notice or document by U.S. mail to its respective address set forth in
this Agreement shall be effective service of process for any Litigation brought
against it in any such court. Each of the parties hereto hereby irrevocably and
unconditionally waives any objection to the laying of venue of any Litigation
arising out of this Agreement or the transactions contemplated hereby in the
courts of the State of Delaware, and hereby further irrevocably and
unconditionally waives and agrees not to plead or claim in any such court that
any such Litigation brought in any such court has been brought in an
inconvenient forum. Each of the parties irrevocably and unconditionally waives,
to the fullest extent permitted by applicable law, any and all rights to trial
by jury in connection with any Litigation arising out of or relating to this
Agreement or the transactions contemplated hereby.
Section 6.15. INTERPRETATION. The table of contents and headings
contained in this Agreement are for convenience only and shall not affect in any
way the meaning or interpretation of this Agreement. Whenever the words
"include", "includes" or "including" are used in this Agreement, they shall be
deemed to be followed by the words "without limitation".
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IN WITNESS WHEREOF, the parties hereto have executed this Amended and
Restated Stockholders Agreement as of the date first written above.
LIBERTY MEDIA CORPORATION
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Senior Vice President
XXXXX XXXXXX
By: /s/ Xxxxx Xxxxxx
-----------------------------------
[SIGNATURE PAGE TO AMENDED AND RESTATED STOCKHOLDERS AGREEMENT]
