Exhibit 3
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TERMINATION TO SHAREHOLDER AGREEMENT
This TERMINATION TO SHAREHOLDER AGREEMENT (this "Agreement"), dated as
of June 11, 1997, is made and entered into by and among M.G. "Xxx" Xxxxxxxxx
("Xxx Xxxxxxxxx"), individually and as trustee of the Xxxxxxxxx Charitable
Remainder Unitrust, u/t/a dated January 22, 1990 (the "PR Charitable Trust"),
Xxxxxxx X. Xxxxxxxxx ("Xxx Xxxxxxxxx"), individually and as trustee of the
Xxxxxxx and Xxxx Xxxxxxxxx Children's Trust, u/t/a dated September 18, 1995
(the "TR Family Trust"), The Christian Broadcasting Network, Inc., a Virginia
corporation ("CBN"), Liberty IFE, Inc., a Colorado corporation ("LIFE"), and
International Family Entertainment, a Delaware corporation (the "Company")
R E C I T A L S
WHEREAS, the parties have entered into that certain Amended and Restated
Shareholder Agreement, dated as of September 1, 1995, which provides, inter
alia, for the grant to LIFE of certain rights of first refusal with respect
to sales of Class A Common Stock, par value $0.01 per share, of the Company
(the "Class A Stock"), the grant to LIFE and CBN of certain go along rights,
the grant to LIFE of a put option, the grant to LIFE and CBN of certain
registration rights, the covenant by the Company to issue no additional
shares of Class A Stock, and the grant to Xxx Xxxxxxxxx, Xxx Xxxxxxxxx, the
PR Charitable Trust, LIFE and CBN of certain preemptive rights (the
"Shareholder Agreement");
WHEREAS, it is intended that Xxx Xxxxxxxxx, individually and as trustee
of the PR Charitable Trust, and as trustee of the Xxxxxx X. Xxxxxxxxx
Irrevocable Trust, u/t/a dated December 18, 1996, the Xxxxxxxxx X. Xxxxxxxx
Irrevocable Trust, u/t/a dated December 18, 1996, and the Xxx X. Xxxxxxx
Irrevocable Trust, u/t/a dated December 18, 1996 (the Xxxxxx X. Xxxxxxxxx
Irrevocable Trust, the Xxxxxxxxx X. Xxxxxxxx Irrevocable Trust and the Xxx X.
Xxxxxxx Irrevocable Trust, together, the "Irrevocable Trusts"), Xxxx X.
Xxxxxxxxx and Xxx Xxxxxxxxx, as joint tenants, Xxx Xxxxxxxxx, individually,
and as trustee of each of the TR Family Trust and the Xxxxxxx X. Xxxxxxxxx
Charitable Trust, u/t/a dated December 30, 1996 (the "TR Charitable Trust"),
and as custodian to and for each of Xxxxxxx X. Xxxxxxxxx, Xxxxx X. Xxxxxxxxx,
Xxxxxxxxx X. Xxxxxxxxx, Xxxxxx X. Xxxxxxxxx and Xxxxxxxx X. Xxxxxxxxx under
the Virginia Uniform Transfers to Minors Act (Xxx Xxxxxxxxx, the PR
Charitable Trust, the Irrevocable Trusts, Xxxx X. Xxxxxxxxx, Xxx Xxxxxxxxx,
the TR Family Trust and the TR Charitable Trust, collectively, the
"Robertsons"), and Fox Kids Worldwide, Inc., a Delaware corporation ("FKWW")
enter into that certain Stock Purchase Agreement, pursuant to which FKWW will
agree, on the terms and subject to the conditions therein, to purchase from
the Robertsons those shares of Class A Stock, in the form of Class B Common
Stock, par value $0.01 per share, of the Company (the "Class B Stock")
issuable upon the conversion thereof, and shares of Class B Stock owned by
the Robertsons (as amended from time to time in accordance with its terms,
the "Xxxxxxxxx Purchase Agreement");
WHEREAS, it is intended that CBN and FKWW enter into that certain Stock
Purchase Agreement, pursuant to which FKWW will agree, on the terms and
subject to the conditions therein, to purchase from CBN those shares of Class
B Stock owned by CBN (as amended from time to time in accordance with its
terms, the "CBN Purchase Agreement");
WHEREAS, it is intended that Regent University, a Virginia corporation
("Regent") and FKWW enter into that certain Stock Purchase Agreement,
pursuant to which FKWW will agree, on the terms and subject to the conditions
therein, to purchase from Regent those shares of Class B Stock owned by
Regent (as amended from time to time in accordance with its terms, the
"Regent Purchase Agreement");
WHEREAS, it is intended that FKWW, Liberty Media Corporation, a Delaware
corporation, and LIFE enter into that certain Contribution and Exchange
Agreement (as amended from time to time in accordance with its terms, the
"Contribution Agreement"), pursuant to which LIFE will agree, on the terms
and subject to the conditions therein, to contribute its shares of Class C
Common Stock, par value $0.01 per share, of the Company and its $23 million
principal amount of 6% Convertible Secured Notes due 2004 of the Company (the
"Notes"), to FKWW (the "Contribution") in exchange for shares of Series A
Preferred Stock of FKWW;
WHEREAS, in connection with the execution of the Contribution Agreement,
LIFE and CBN have executed that certain Waiver, dated as of the date hereof
(the "Waiver"), which, subject to its terms and conditions, waives certain
rights under the Shareholder Agreement;
WHEREAS, as a condition to its willingness to enter into the Agreement
and Plan of Merger, dated as of the date hereof, by and among FKWW, Fox Kids
Merger Corporation, a Delaware corporation and wholly-owned subsidiary of
FKWW, and the Company (the "Merger Agreement"), the Xxxxxxxxx Purchase
Agreement, the CBN Purchase Agreement, the Regent Purchase Agreement and the
Contribution Agreement, FKWW has required that the parties agree to terminate
the Shareholder Agreement by entering into this Agreement; and
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration given to each party hereto, the receipt of which is
hereby acknowledged, the parties agree as follows.
1. Termination. Effective upon (but not prior to) the earlier of (i)
the closing of the Contribution under the Contribution Agreement and (ii) the
Effective Time of the Merger (as defined in the Merger Agreement), each and
every provision of the Shareholder Agreement shall be terminated in full and
from and after such date the Shareholder Agreement shall be void and of no
further force and effect, and the rights and obligations of the parties
thereunder shall terminate. If both the Xxxxxxxxx Purchase Agreement and the
Merger Agreement shall be terminated, this Agreement shall thereupon
terminate and be of no effect, unless the termination pursuant to this
provision has already become effective.
2. Miscellaneous.
2.1 Successors and Assigns. This Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective
successors and assigns. Other than as set forth in the immediately
succeeding sentence, no party may assign any of its rights, or delegate any
of its duties or obligation hereunder, under this Agreement without the prior
written consent of the other parties, and any such purported assignment or
delegation shall be void ab initio.
2.2 Dispute Resolution. Any dispute or claim arising hereunder
shall be settled by arbitration. Any party may commence arbitration by
sending a written notice of arbitration to the other party. The notice will
state the dispute with particularity. The arbitration hearing shall be
commenced thirty (30) days following the date of delivery of notice of
arbitration by one party to the other, by the American Arbitration
Association ("AAA") as arbitrator. The arbitration shall be conducted in
Alexandria, Virginia in accordance with the commercial arbitration rules
promulgated by AAA, and each party shall retain the right to cross-examine
the opposing party's witnesses, either through legal counsel, expert
witnesses or both. The decision of the arbitrator shall be final, binding
and conclusive on all parties (without any right of appeal therefrom) and
shall not be subject to judicial review. As part of his decision, the
arbitrator may allocate the cost of arbitration, including fees of attorneys
and experts, as he or she deems fair and equitable in light of all relevant
circumstances. Judgment on the award rendered by the arbitrator may be
entered in any court of competent jurisdiction.
2.3 Governing Law. This Agreement shall be governed by and
construed both as to validity and performance and enforced in accordance with
the laws of the Commonwealth of Virginia without giving effect to the choice
of law principles thereof.
2.4 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all of
which together shall constitute one and the same instrument.
2.5 Headings. The section and subsection headings contained in
this Agreement are included for convenience only and form no part of the
agreement between the parties.
2.6 Amendments. This Agreement may not be modified, amended,
altered or supplemented, except upon the execution and delivery of a written
agreement executed by the parties hereto.
2.7 No Third Party Beneficiaries. This Agreement is not intended
to benefit, and shall not run to the benefit of or be enforceable by, any
other person or entity other than the Parties hereto and their permitted
successors and assigns.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
/s/ M.G. "Xxx"
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M.G. "Xxx" Xxxxxxxxx
THE XXXXXXXXX CHARITABLE
REMAINDER UNITRUST
/s/ M.G. "Xxx" Xxxxxxxxx
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By: M.G. "Xxx" Xxxxxxxxx, as Trustee
/s/ Xxxxxxx X. Xxxxxxxxx
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Xxxxxxx X. Xxxxxxxxx
THE XXXXXXX AND XXXX XXXXXXXXX
CHILDREN'S TRUST
/s/ Xxxxxxx Xxxxxxxxx
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By: Xxxxxxx Xxxxxxxxx, as Trustee
THE CHRISTIAN BROADCASTING
NETWORK, INC.
By: /s/ Xxxxxxx X. Xxxxxx
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Its: President
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LIBERTY IFE, INC.
By: /s/ Xxxxx Xxxx
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Its: Vice President
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INTERNATIONAL FAMILY
ENTERTAINMENT, INC.
By: /s/ M.G. "Xxx" Xxxxxxxxx
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Its: Chairman of the Board
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