Exhibit 10.2

 

SERVICES AGREEMENT

 

SERVICES AGREEMENT (this “Agreement”), dated as of January 11, 2013, by and between Starz (f/k/a Liberty Media Corporation), a Delaware corporation (“Starz”), and Liberty Media Corporation (f/k/a Liberty Spinco, Inc.), a Delaware corporation (the “Provider”).

 

RECITALS

 

WHEREAS, on the date hereof, the Provider is a wholly owned subsidiary of Starz and holds all of the businesses, assets and liabilities of Starz other than those associated with Starz, LLC and its subsidiaries (“LLC”) following the consummation of the transactions described in the plan of restructuring set forth in Schedule 1.1 to that certain Reorganization Agreement, dated January 10, 2013 (the “Reorganization Agreement”), to which the Provider and Starz are each parties;

 

WHEREAS, in accordance with the Reorganization Agreement, 100% of the issued and outstanding shares of common stock of the Provider will be distributed as a pro rata dividend to the stockholders of Starz, with the effect that the Provider will be spun-off (the “Spin-Off”) from Starz, and Starz will cease to have an equity interest in the Provider;

 

WHEREAS, immediately following the Spin-Off, the Provider and Starz will be separate and independent publicly-traded companies;

 

WHEREAS, the officers and employees of Starz prior to the Spin-Off (other than the officers and employees of LLC) who provide services to Starz as a public company will, following the Spin-Off, be officers and employees of the Provider and compensated by the Provider and not Starz.

 

WHEREAS, the parties desire that, following the date of the Spin-Off (the “Spin-Off Effective Date”), (i) Starz obtain from the Provider the services described in Section 1.2 hereof and that Starz compensate the Provider for the performance of such services on the basis described herein and (ii) the Provider obtain from Starz the services described in Section 1.3 hereof and that Starz offset any compensation owed to Starz for the performance of such services against amounts owed by Starz to the Provider for the performance of the services described in Section 1.2 hereof; and

 

WHEREAS, on the date hereof a subsidiary of the Provider is also entering into a facilities sharing agreement with Starz with respect to 12300 Liberty Boulevard, Englewood, Colorado (the “Facilities Sharing Agreement”) and a separate lease agreement with respect to the lease of the corporate headquarters of Starz at 8900 Liberty Circle, Englewood Colorado (the “Lease Agreement”) following the Spin-Off.

 











 

AGREEMENT

 

NOW THEREFORE, in consideration of the foregoing recitals, the mutual agreements contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be bound legally, agree as follows:

 

ARTICLE I

 

ENGAGEMENT AND SERVICES

 

Section 1.1                                    Engagement of the Provider by Starz; Engagement of Starz by the Provider.

 

(a)                                 Starz engages the Provider to provide to Starz, commencing on the Spin-Off Effective Date, the services set forth in Section 1.2 (collectively, the “Services”), and the Provider accepts such engagement, subject to and upon the terms and conditions of this Agreement.  Starz acknowledges that certain of the Services will be performed by officers, employees or consultants of the Provider, who may also serve as officers, employees or consultants of Starz and/or Liberty Interactive Corporation (“Liberty Interactive”).

 

(b)                                 The Provider engages Starz to provide to the Provider, commencing on the Spin-Off Effective Date, the services set forth in Section 1.3 (collectively, the “IT Services”), and Starz accepts such engagement, subject to and upon the terms and conditions of this Agreement. The Provider acknowledges that certain of the services set forth in Section 1.3 will be performed by officers, employees or consultants of Starz.

 

Section 1.2                                    Services to be Provided to Starz.

 

(a)                                 The Services will include the following, if and to the extent requested by Starz during the Term:

 

(i)                                     insurance administration and risk management services;

 

(ii)                                  services performed by the Provider’s investor relations, internal audit, tax and law departments; and

 

(iii)                               such other services as the Provider may obtain from its officers, employees and consultants in the management of its own operations that Starz may from time to time request.

 

(b)                                 The Services are intended to be those services and functions that are appropriate for the operation and management of Starz as a publicly-traded company, and are not intended to be duplicative of services and functions for the operating subsidiaries of Starz that are to be performed by officers, employees and consultants of those companies.

 

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Section 1.3                                    Services to be Provided to the Provider.

 

(a)                                 The IT Services will include the following, if and to the extent requested by the Provider during the Term (as defined below):  technical and information technology assistance, including management information systems, data storage network and telecommunications services.

 

(b)                                 The IT Services are not intended to be duplicative of services and functions that are to be performed by officers, employees and consultants of the Provider.

 

Section 1.4                                    Services Not to Interfere with Business.

 

(a)                                 Starz acknowledges and agrees that in providing Services hereunder the Provider will not be required to take any action that would disrupt, in any material respect, the orderly operation of the Provider’s own business activities.

 

(b)                                 The Provider acknowledges and agrees that in providing the IT Services Starz will not be required to take any action that would disrupt, in any material respect, the orderly operation of Starz’s own business activities.

 

Section 1.5                                    Books and Records.  Each of the Provider and Starz will maintain separate books and records, in reasonable detail in accordance with its standard business practices, with respect to its provision of services pursuant to this Agreement, including, as to the Provider, records supporting the computation of the Allocated Expenses (as such term is defined below) pursuant to Article II (collectively, “Supporting Records”). Each party will provide to the other and its respective duly authorized representatives, agents, and attorneys, reasonable access to all of their respective Supporting Records during business hours upon request after reasonable advance notice.

 

ARTICLE II

 

COMPENSATION

 

Section 2.1                                    Starz Allocated Compensation and Expenses.

 

(a)                                 For each officer, employee or consultant of the Provider that provides Services to Starz (each, an “Attributed  Employee”), Starz shall be allocated an amount (the “Allocated Employee Compensation”) equal to his or her aggregate salary, bonus and health, retirement and other compensation and benefits paid by the Provider (other than, in all cases, equity-based compensation paid by the Provider) (“Provider Employee Compensation”) multiplied by his or her Starz Percentage (as defined below); provided, however, that the Allocated Employee Compensation allocable to any Attributed Employee who holds the office of Vice President or higher of Starz, including Chairman of the Board (each, a “Starz Officer”), will not take into account any bonus amounts paid to such Attributed Employee by the Provider as part of his or her Provider Employee Compensation.  The “Starz Percentage” with respect to any officer, employee or consultant of the Provider will equal, over a defined period of time, an estimate of the amount of time that he or she will spend over such period of time providing Services to Starz relative to the amount of time he or she will spend over such period of time

 

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performing his or her duties and responsibilities as an officer, employee or consultant of the Provider (including time spent providing services pursuant to the Services Agreement, dated September 23, 2011, as amended, between Liberty Interactive and the Provider).  Starz will pay to the Provider the aggregate Allocated Employee Compensation, together with such other costs and expenses as may be incurred by the Provider in connection with the provision of Services to Starz hereunder (collectively with the aggregate Allocated Employee Compensation but exclusive of any Out-of-Pocket Costs (as defined below), the “Allocated Expenses”), in accordance with Section 2.3 below; provided, however, that Starz will reduce any amounts payable hereunder by Starz to the Provider, each month, by the Offset Amount (as defined below) with respect to the corresponding payment period. The Allocated Expenses will be more fully set forth in, or determined from time to time in the manner set forth in, Schedule 2.1(a) attached hereto, as such Schedule may be periodically amended and revised by the parties.  It is intended that the payments by Starz to the Provider under this Agreement in respect of Allocated Expenses are equivalent to those which Starz would pay to a third party on an arm’s length basis for the same services. If the cost of any Service to be provided to Starz under this Agreement is included in the Annual Allocation Expense (as such term is defined in the Facilities Sharing Agreement) payable by Starz under the Facilities Sharing Agreement, then the cost of such Service shall not also be payable by Starz under this Agreement.

 

(b)                                 The Starz Percentage applicable to each Attributed Employee and the Allocated Expenses (other than the initial Starz Percentage and Allocated Expenses) will be determined by the Provider, in consultation with Starz, on or about December 15th of each year during the Term (commencing December 15, 2013).  The Starz Percentage of an Attributed Employee shall be based on the anticipated Services to be provided by such Attributed Employees to Starz during the upcoming fiscal year, among other things deemed relevant by the Provider and Starz.  The Provider and Starz will review and evaluate the Starz Percentages and Allocated Expenses for reasonableness quarterly during the Term, and will negotiate in good faith to reach agreement on any appropriate adjustments to the Starz Percentages and Allocated Expenses based on such review and evaluation, including:  (i) adjustments that reflect changes to the Provider Employee Compensation of each Attributed Employee; (ii) adjustments that reflect changes to any other costs or expenses included in the Allocated Expenses; (iii) adjustments that reflect changes in the allocable percentages of time spent by particular Attributed Employees providing Services to Starz; and (iv) determinations as to the appropriate effective date (which may be retroactive) for any such adjustment to a Starz Percentage and Allocated Expenses. The Allocated Expenses set forth on Schedule 2.1(a) hereto shall be reviewed on March 1, 2013 and amended and revised by the parties accordingly. In connection with each review and evaluation hereunder, the Provider will provide Starz with a composite schedule of the percentage of time spent by each of the Provider’s officers, employees or consultants providing the Services to Starz relative to the amount of time he or she has spent over such period of time performing his or her duties and responsibilities as an officer, employee or consultant of the Provider (including time spent providing services pursuant to the Services Agreement, dated September 23, 2011, as amended, between Liberty Interactive and the Provider) during the period since the immediately preceding review and evaluation.

 

(c)                                  For each officer, employee or consultant of Starz that provides IT Services to the Provider (each, an “IT Employee”), the Provider shall be allocated an amount (the “IT Employee Compensation”) equal to his or her aggregate salary, bonus and health, retirement and

 

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other compensation and benefits paid by Starz (other than, in all cases, equity-based compensation paid by Starz) (“Starz Employee Compensation”) multiplied by his or her IT Percentage (as defined below).  The “IT Percentage” with respect to any officer, employee or consultant of Starz will equal, over a defined period of time, an estimate of the amount of time that he or she will spend over such period of time providing IT Services to the Provider relative to the amount of time he or she will spend over such period of time performing his or her duties and responsibilities as an officer, employee or consultant of Starz. As described in Section 2.1(a) above, Starz will offset against amounts payable by Starz to the Provider hereunder an amount equal to the aggregate IT Employee Compensation, together with such other costs and expenses as may be incurred by Starz in connection with the provision of IT Services to the Provider hereunder (collectively with the aggregate IT Employee Compensation but exclusive of any IT Out-of-Pocket Costs (as defined below), the “IT Allocated Expenses”) (such amount, the “Offset Amount”). The IT Allocated Expenses will be more fully set forth in, or determined from time to time in the manner set forth in, Schedule 2.1(c) hereto, as such Schedule may be periodically amended and revised by the parties. The IT Allocated Expenses will include allocated portions of Starz costs associated with office space for IT Employees, data centers, bandwidth, license and maintenance incurred in providing the IT Services, all in the manner set forth in Schedule 2.1(c) hereto.  It is intended that the amount to be offset in favor of Starz under this Agreement in respect of IT Allocated Expenses is equivalent to the amount the Provider would pay to a third party on an arm’s length basis for the same services.

 

(d)                                 The IT Percentage applicable to each IT Employee and the IT Allocated Expenses (other than the initial IT Percentage and IT Allocated Expenses) will be determined by Starz, in consultation with the Provider, on or about December 15th of each year during the Term (commencing December 15, 2013).  The IT Percentage of an IT Attributed Employee shall be based on the anticipated IT Services to be provided by such IT Attributed Employees to the Provider during the upcoming fiscal year, among other things deemed relevant by the Provider and Starz.  The Provider and Starz will review and evaluate the IT Percentages and IT Allocated Expenses for reasonableness quarterly during the Term, and will negotiate in good faith to reach agreement on any appropriate adjustments to the IT Percentages and IT Allocated Expenses based on such review and evaluation, including:  (i) adjustments that reflect changes to the Starz Employee Compensation of each IT Attributed Employee; (ii) adjustments that reflect changes to any other costs or expenses included in the IT Allocated Expenses; (iii) adjustments that reflect changes in the allocable percentages of time spent by particular IT Attributed Employees providing IT Services to the Provider; and (iv) determinations as to the appropriate effective date (which may be retroactive) for any such adjustment to a IT Percentage and IT Allocated Expenses. The IT Allocated Expenses set forth on Schedule 2.1(c) hereto shall be reviewed on March 1, 2013 and amended and revised by the parties accordingly. In connection with each review and evaluation hereunder, Starz will provide the Provider with a composite schedule of the percentage of time spent by each of Starz’s officers, employees or consultants providing the IT Services to the Provider relative to the amount of time he or she has spent over such period of time performing his or her duties and responsibilities as an officer, employee or consultant of Starz during the period since the immediately preceding review and evaluation.

 

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Section 2.2                                    Cost Reimbursement.

 

(a)                                 In addition to (and without duplication of) the Allocated Expenses payable pursuant to Section 2.1, Starz also will reimburse the Provider, on a monthly basis, for all direct out-of-pocket costs, with no markup (“Out-of-Pocket Costs”), reasonably incurred by the Provider in performing the Services on behalf of Starz (e.g., postage and courier charges, travel and meal expenses, and other miscellaneous expenses that are incurred by the Provider or the Attributed Employees in the conduct of the Services). No Out-of-Pocket Costs in excess of $1,000, individually or at any one time outstanding in the aggregate, will be reimbursed unless approved in advance by Starz (which approval may be oral or in writing, including in electronic format).

 

(b)                                 In addition to (and without duplication of) the IT Allocated Expenses payable pursuant to Section 2.1, the Provider also will reimburse Starz, on a monthly basis, for all direct out-of-pocket costs, with no markup (“IT Out-of-Pocket Costs”), reasonably incurred by Starz in performing the IT Services on behalf of the Provider (e.g., software license fees attributable to desktop or laptop computers utilized by the Provider and other miscellaneous expenses that are incurred by Starz in the conduct of the IT Services). No IT Out-of-Pocket Costs in excess of $1,000, individually or at any one time outstanding in the aggregate, will be reimbursed unless approved in advance by the Provider (which approval may be oral or in writing, including in electronic format).

 

Section 2.3                                    Payment Procedures.

 

(a)                                 Starz will pay the Provider, by wire or intrabank transfer of funds or in such other manner specified by the Provider to Starz, in arrears on or before the last day of each calendar month beginning February 2013, the aggregate Allocated Expenses then in effect, in monthly installments, less the Offset Amount then in the effect, in monthly installments; provided, however, that the first payment due hereunder shall include the prorated portion of the Allocated Expenses less an offset for the prorated portion of the Offset Amount, in each case, applicable to the period between the Spin-Off Effective Date and January 31, 2013.

 

(b)                                 Any reimbursement to be made to the Provider pursuant to Section 2.2(a) will be paid to the Provider within 30 days after receipt by Starz of an invoice therefor, by wire or intrabank transfer of funds or in such other manner acceptable to the Provider.  The Provider will invoice Starz monthly for reimbursable expenses incurred by the Provider on its behalf during the preceding calendar month as contemplated in Section 2.2(a); provided, however, that the Provider may separately invoice Starz at any time for any single reimbursable expense incurred by the Provider on Starz’s behalf in an amount equal to or greater than $25,000.  Any invoice or statement pursuant to this Section 2.3(b) will be accompanied by supporting documentation in reasonable detail consistent with the Provider’s own expense reimbursement policy.

 

(c)                                  Any reimbursement to be made to Starz pursuant to Section 2.2(b) will be paid to Starz within 30 calendar days after receipt by the Provider of an invoice therefor, by wire or intrabank transfer of funds or in such other manner acceptable to Starz, including as an offset against any reimbursements then payable to the Provider under Section 2.3(b). Starz will invoice the Provider monthly for reimbursable expenses incurred by Starz on its behalf during the preceding calendar month as contemplated in Section 2.2(b); provided, however, that Starz may

 

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separately invoice the Provider at any time for any single reimbursable expense incurred by Starz on the Provider’s behalf in an amount equal to or greater than $25,000. Any invoice or statement pursuant to this Section 2.3(c) will be accompanied by supporting documentation in reasonable detail consistent with Starz’s own expense reimbursement policy.

 

(d)                                 Any payments not made when due under this Section 2.3 will bear interest at the rate of 1.5% per month on the outstanding amount from and including the due date to but excluding the date paid.

 

Section 2.4                                    Survival.  The terms and conditions of this Article II will survive the expiration or earlier termination of this Agreement.

 

ARTICLE III

 

TERM

 

Section 3.1                                    Term Generally.  The term of this Agreement will commence on the Spin-Off Effective Date and will continue until the third anniversary of the Spin-Off Effective Date (the “Term”). This Agreement is subject to termination prior to the end of the Term in accordance with Section 3.3.

 

Section 3.2                                    Discontinuance of Select Services; Discontinuation of IT Services.

 

(a)                                 At any time during the Term, on not less than 30 days’ prior written notice to the Provider, Starz may elect to discontinue obtaining any of the Services from the Provider.  In such event, the Provider’s obligation to provide Services that have been discontinued pursuant to this Section 3.2(a) to Starz, and the obligation of Starz to compensate the Provider for such discontinued Services (other than as described below), will cease as of the end of such 30-day period (or such earlier date as may be agreed by the parties), and this Agreement will remain in effect for the remainder of the Term with respect to those Services that have not been so discontinued.  The Provider and Starz will promptly evaluate the Allocated Expenses for reasonableness following the discontinuance of any Services to Starz and will negotiate in good faith to reach agreement on any appropriate adjustment thereto.  Starz will remain liable for any required payment or performance accrued prior to the effective date of discontinuance of any Service. To the extent that as a result of any termination of Services under this Section 3.2(a), the Offset Amount exceeds the Allocated Expenses for any given month, Starz shall be entitled to receive a payment equal to such excess in a manner similar to that described in Section 2.3(a) with respect to payments made by Starz.

 

(b)                                 At any time during the Term, on not less than 30 days’ prior written notice to Starz, the Provider may elect to discontinue obtaining any of the IT Services from Starz.  In such event, Starz’s obligation to provide IT Services that have been discontinued pursuant to this Section 3.2(b) to the Provider, and the obligation of the Provider to compensate Starz for such discontinued IT Services (other than as described below), will cease as of the end of such 30-day period (or such earlier date as may be agreed by the parties), and this Agreement will remain in effect for the remainder of the Term with respect to those IT Services that have not been so discontinued.  The Provider and Starz will promptly evaluate the IT Allocated Expenses for

 

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reasonableness following the discontinuance of any IT Services to the Provider and will negotiate in good faith to reach agreement on any appropriate adjustment thereto.  The Provider will remain liable for any required payment or performance accrued prior to the effective date of discontinuance of any IT Service.

 

Section 3.3                                    Termination.

 

(a)                                 This Agreement will be terminated prior to the expiration of the Term in the following events:

 

(i)                                     (A) with respect to the provision of the Services, at any time upon at least 30 days’ prior written notice by Starz to the Provider, (B) with respect to the provision of the IT Services, at any time upon at least 30 days’ prior written notice by the Provider to Starz, or (C) in its entirety upon the mutual written agreement of the parties hereto;

 

(ii)                                  immediately upon written notice (or at any later time specified in such notice) by the Provider to Starz if a Change in Control or Bankruptcy Event occurs with respect to Starz; or

 

(iii)                               immediately upon written notice (or at any later time specified in such notice) by Starz to the Provider if a Change in Control or Bankruptcy Event occurs with respect to the Provider.

 

(b)                                 For purposes of this Section 3.3, a “Change in Control” will be deemed to have occurred with respect to a party if a merger, consolidation, binding share exchange, acquisition, or similar transaction (each, a “Transaction”), or series of related Transactions, involving such party occurs as a result of which the voting power of all voting securities of such party outstanding immediately prior thereto represent (either by remaining outstanding or being converted into voting securities of the surviving entity) less than 75% of the voting power of such party or the surviving entity of the Transaction outstanding immediately after such Transaction (or if such party or the surviving entity after giving effect to such Transaction is a subsidiary of the issuer of securities in such Transaction, then the voting power of all voting securities of such party outstanding immediately prior to such Transaction represent (by being converted into voting securities of such issuer) less than 75% of the voting power of the issuer outstanding immediately after such Transaction).

 

For purposes of this Section 3.3, a “Bankruptcy Event” will be deemed to have occurred with respect to a party upon such party’s insolvency, general assignment for the benefit of creditors, such party’s voluntary commencement of any case, proceeding, or other action seeking reorganization, arrangement, adjustment, liquidation, dissolution, or consolidation of such party’s debts under any law relating to bankruptcy, insolvency, or reorganization, or relief of debtors, or seeking appointment of a receiver, trustee, custodian, or other similar official for such party or for all or any substantial part of such party’s assets (each, a “Bankruptcy Proceeding”), or the involuntary filing against such party of any Bankruptcy Proceeding that is not stayed within 60 days after such filing.

 

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Each party will remain liable to the other for any required payment accrued prior to the termination of this Agreement.

 

ARTICLE IV

 

PERSONNEL AND EMPLOYEES FOR SERVICES

 

Section 4.1                                    Personnel to Provide Services.

 

(a)                                 The Provider will make available to Starz, on a non-exclusive basis, the appropriate personnel to perform the Services.  The personnel made available to perform selected Services are expected to be substantially the same personnel who provide similar services in connection with the management and administration of the business and operations of the Provider.

 

(b)                                 Starz acknowledges that:

 

(i)                                     any Attributed Employee providing Services may also be performing (x) similar services for Liberty Interactive; (y) services to the Provider in his or her capacity as an officer, employee or consultant of the Provider; and (z) services for certain Subsidiaries and Affiliates of the Provider or Liberty Interactive, in each case, while also potentially performing services directly for Starz and certain of its Subsidiaries and Affiliates under a direct employment, consultancy or other service relationship between such person and Starz and irrespective of this Agreement; and

 

(ii)                                  the Provider may elect, in its discretion, to utilize independent contractors rather than officers, employees or consultants of the Provider to perform some or all of the Services for Starz from time to time, and such independent contractors will be deemed included within the definition of “Attributed Employees” for all purposes of this Agreement.

 

Section 4.2                                    Personnel to Provide IT Services.

 

(a)                                 Starz will make available to the Provider, on a non-exclusive basis, the appropriate personnel to perform the IT Services.  The personnel made available to perform selected IT Services are expected to be substantially the same personnel who provide similar services in connection with the management and administration of the business and operations of Starz.

 

(b)                                 The Provider acknowledges that:

 

(i)                                     any IT Attributed Employee providing IT Services may also be performing services to Starz and certain Subsidiaries and Affiliates of Starz in his or her capacity as an officer, employee or consultant of Starz while also potentially performing services directly for the Provider and certain of its Subsidiaries and Affiliates under a direct employment, consultancy or other service relationship between such person and the Provider and irrespective of this Agreement; and

 

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(ii)                                  Starz may elect, in its discretion, to utilize independent contractors rather than officers, employees or consultants of Starz to perform some or all of the IT Services for the Provider from time to time, and such independent contractors will be deemed included within the definition of “IT Attributed Employees” for all purposes of this Agreement.

 

(c)                                  Each of the Provider and Starz agrees that the personnel performing IT Services hereunder may also be asked by the Provider to perform IT Services for Liberty Interactive and that any such IT Services so provided to Liberty Interactive will be treated for all purposes hereunder as IT Services provided to the Provider.

 

Section 4.3                                    Provider as Payor.  The parties acknowledge and agree that the Provider, and not Starz, will be solely responsible for the payment of salaries, wages, benefits (including health insurance, retirement, and other similar benefits, if any) and other compensation applicable to all Attributed Employees; provided, however, that Starz is responsible for (i) the payment of the Allocated Expenses in accordance with Sections 2.1 and 2.3, and (ii) the payment of all compensation based on, comprised of or related to the equity securities of Starz (the “Excluded Compensation”).  The parties acknowledge that Attributed Employees may provide services directly to Starz in consideration for the receipt of Excluded Compensation or any other compensation pursuant to any separate employment, consultancy or other service relationship between such person(s) and Starz (“Separate Starz Compensation”). All Attributed Employees will be subject to the personnel policies of the Provider and will be eligible to participate in the Provider’s employee benefit plans to the same extent as similarly situated employees of the Provider performing services in connection with the Provider’s business.  Except as otherwise required by the terms of the Tax Sharing Agreement, (i) the Provider will be responsible for the payment of all federal, state, and local withholding taxes and other such employment related taxes as are required by law with respect to the compensation of all Attributed Employees (other than with respect to any Excluded Compensation and any Separate Starz Compensation) and (ii) Starz will be responsible for the payment of all federal, state, and local withholding taxes and such other employment related taxes as are required by law with respect to all Excluded Compensation and any Separate Starz Compensation paid to any Attributed Employee by Starz. Starz will cooperate with the Provider to facilitate the Provider’s compliance with applicable federal, state, and local laws, rules, regulations, and ordinances applicable to the employment of all Attributed Employees.

 

Section 4.4                                    Starz as Payor.  The parties acknowledge and agree that Starz, and not the Provider, will be solely responsible for the payment of salaries, wages, benefits (including health insurance, retirement, and other similar benefits, if any) and other compensation applicable to all IT Attributed Employees.  All IT Attributed Employees will be subject to the personnel policies of Starz and will be eligible to participate in Starz’s employee benefit plans to the same extent as similarly situated employees of Starz performing services in connection with Starz’s business.  Except as otherwise required by the terms of the Tax Sharing Agreement, Starz will be responsible for the payment of all federal, state, and local withholding taxes and other such employment related taxes as are required by law with respect to the compensation of all IT Attributed Employees. The Provider will cooperate with Starz to facilitate Starz’s compliance

 

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with applicable federal, state, and local laws, rules, regulations, and ordinances applicable to the employment of all IT Attributed Employees.

 

Section 4.5                                    Additional Employee Provisions.

 

The Provider will have the right to terminate its employment of or consultancy with any Attributed Employee at any time and Starz will have the right to terminate its employment of or consultancy with any IT Attributed Employee at any time.

 

ARTICLE V

 

REPRESENTATIONS AND WARRANTIES

 

Section 5.1                                    Representations and Warranties of the Provider.  The Provider represents and warrants to Starz as follows:

 

(a)                                 The Provider is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware.

 

(b)                                 The Provider has the power and authority to enter into this Agreement and to perform its obligations under this Agreement, including the Services.

 

(c)                                  The Provider is not subject to any contractual or other legal obligation that materially interferes with its full, prompt, and complete performance under this Agreement.

 

(d)                                 The individual executing this Agreement on behalf of the Provider has the authority to do so.

 

(e)                                  Subject to Section 1.4 hereof, all Services will be performed promptly and in an accurate, complete, professional and workmanlike manner, in compliance with all applicable laws.

 

Section 5.2                                    Representations and Warranties of Starz.  Starz represents and warrants to the Provider as follows:

 

(a)                                 Starz is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware.

 

(b)                                 Starz has the power and authority to enter into this Agreement and to perform its obligations under this Agreement.

 

(c)                                  Starz is not subject to any contractual or other legal obligation that materially interferes with its full, prompt, and complete performance under this Agreement.

 

(d)                                 The individual executing this Agreement on behalf of Starz has the authority to do so.

 

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(e)                                  Such to Section 1.4 hereof, all IT Services will be performed promptly and in an accurate, complete, professional and workmanlike manner, in compliance with all applicable laws.

 

ARTICLE VI

 

INDEMNIFICATION

 

Section 6.1                                    Indemnification.

 

(a)                                 The Provider will indemnify, defend, and hold harmless Starz and each of its Subsidiaries, Affiliates, officers, directors, employees and agents, successors and assigns (collectively, the “Starz Indemnitees”), from and against any and all Actions, judgments, Liabilities, losses, costs, damages, or expenses, including reasonable counsel fees, disbursements, and court costs (collectively, “Losses”), that any Starz Indemnitee may suffer arising from or out of, or relating to (a) any material breach by the Provider of its obligations under this Agreement, (b) any acts or omissions of Starz in providing the IT Services pursuant to this Agreement (except to the extent such Losses (i) arise from or relate to any material breach by Starz of its obligations under this Agreement, (ii) are attributable to the gross negligence, willful misconduct, fraud, or bad faith of Starz  or any other Starz Indemnitee seeking indemnification under this Section 6.1(a), (iii) are fully covered by insurance maintained by Starz or such other Starz Indemnitee, or (iv) are payable by Starz pursuant to Section 7.11), or (c) the gross negligence, willful misconduct, fraud or bad faith of the Provider or Liberty Interactive, in each case, in connection with the performance of any provision of this Agreement.

 

(b)                                 Starz will indemnify, defend, and hold harmless the Provider and its Subsidiaries, Affiliates, officers, directors, employees and agents, successors and assigns (collectively, the “Provider Indemnitees”), from and against any and all Losses that any Provider Indemnitee may suffer arising from or out of, or relating to (a) any material breach by Starz of its obligations under this Agreement, (b) any acts or omissions of the Provider in providing the Services pursuant to this Agreement (except to the extent such Losses (i) arise from or relate to any material breach by the Provider of its obligations under this Agreement, (ii) are attributable to the gross negligence, willful misconduct, fraud, or bad faith of the Provider, any other Provider Indemnitee seeking indemnification under this Section 6.1(b) or Liberty Interactive, (iii) are fully covered by insurance maintained by the Provider or such other Provider Indemnitee, or (iv) are payable by the Provider pursuant to Section 7.11), or (c) the gross negligence, willful misconduct, fraud or bad faith of Starz, in each case, in connection with the performance of any provision of this Agreement.

 

Section 6.2                                    Indemnification Procedures.

 

(a)                                 (i)            In connection with any indemnification provided for in Section 6.1, the party seeking indemnification (the “Indemnitee”) will give the party from which indemnification is sought (the “Indemnitor”) prompt notice whenever it comes to the attention of the Indemnitee that the Indemnitee has suffered or incurred, or may suffer or incur, any Losses for which it is entitled to indemnification under Section 6.1 and, if and when known, the facts constituting the basis for such claim and the projected amount of such Losses (which shall not be conclusive as

 

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to the amount of such Losses), in each case in reasonable detail. Without limiting the generality of the foregoing, in the case of any Action commenced by a third party for which indemnification is being sought (a “Third-Party Claim”), such notice will be given no later than ten business days following receipt by the Indemnitee of written notice of such Third-Party Claim.  Failure by any Indemnitee to so notify the Indemnitor will not affect the rights of such Indemnitee hereunder except to the extent that such failure has a material prejudicial effect on the defenses or other rights available to the Indemnitor with respect to such Third Party Claim.  The Indemnitee will deliver to the Indemnitor as promptly as practicable, and in any event within five business days after Indemnitee’s receipt, copies of all notices, court papers and other documents received by the Indemnitee relating to any Third-Party Claim.

 

(ii)                                  After receipt of a notice pursuant to Section 6.2(a)(i) with respect to any Third-Party Claim, the Indemnitor will be entitled, if it so elects, to take control of the defense and investigation with respect to such Third-Party Claim and to employ and engage attorneys reasonably satisfactory to the Indemnitee to handle and defend such claim, at the Indemnitor’s cost, risk and expense, upon written notice to the Indemnitee of such election, which notice acknowledges the Indemnitor’s obligation to provide indemnification under this Agreement with respect to any Losses arising out of or relating to such Third-Party Claim. The Indemnitor will not settle any Third-Party Claim that is the subject of indemnification without the written consent of the Indemnitee, which consent will not be unreasonably withheld, conditioned or delayed; provided, however, that, after reasonable notice, the Indemnitor may settle a claim without the Indemnitee’s consent if such settlement (A) makes no admission or acknowledgment of Liability or culpability with respect to the Indemnitee, (B) includes a complete release of the Indemnitee and (C) does not seek any relief against the Indemnitee other than the payment of money damages to be borne by the Indemnitor. The Indemnitee will cooperate in all reasonable respects with the Indemnitor and its attorneys in the investigation, trial and defense of any lawsuit or action with respect to such claim and any appeal arising therefrom (including the filing in the Indemnitee’s name of appropriate cross-claims and counterclaims).  The Indemnitee may, at its own cost, participate in any investigation, trial and defense of any Third-Party Claim controlled by the Indemnitor and any appeal arising therefrom, including participating in the process with respect to the potential settlement or compromise thereof.  If the Indemnitee has been advised by its counsel that there may be one or more legal defenses available to the Indemnitee that conflict with those available to, or that are not available to, the Indemnitor (“Separate Legal Defenses”), or that there may be actual or potential differing or conflicting interests between the Indemnitor and the Indemnitee in the conduct of the defense of such Third-Party Claim, the Indemnitee will have the right, at the expense of the Indemnitor, to engage separate counsel reasonably acceptable to the Indemnitor to handle and defend such Third-Party Claim, provided, that, if such Third-Party Claim can be reasonably separated between those portion(s) for which Separate Legal Defenses are available (“Separable Claims”) and those for which no Separate Legal Defenses are available, the Indemnitee will instead have the right, at the expense of the Indemnitor, to engage separate counsel reasonably acceptable to the Indemnitor to handle and defend the Separable Claims, and the Indemnitor will not have the right to control the defense or investigation of such Third-Party Claim or such Separable Claims, as the case may be (and, in which latter case, the Indemnitor will have the right to control the defense or investigation of the remaining portion(s) of such Third-Party Claim).

 

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(iii)                               If, after receipt of a notice pursuant to Section 6.2(a)(i) with respect to any Third-Party Claim as to which indemnification is available hereunder, the Indemnitor does not undertake to defend the Indemnitee against such Third-Party Claim, whether by not giving the Indemnitee timely notice of its election to so defend or otherwise, the Indemnitee may, but will have no obligation to, assume its own defense, at the expense of the Indemnitor (including attorneys fees and costs), it being understood that the Indemnitee’s right to indemnification for such Third Party Claim shall not be adversely affected by its assuming the defense of such Third Party Claim.  The Indemnitor will be bound by the result obtained with respect thereto by the Indemnitee; provided, that the Indemnitee may not settle any lawsuit or action with respect to which the Indemnitee is entitled to indemnification hereunder without the consent of the Indemnitor, which consent will not be unreasonably withheld, conditioned or delayed; provided further, that such consent shall not be required if (i) the Indemnitor had the right under this Section 6.2 to undertake control of the defense of such Third-Party Claim and, after notice, failed to do so within thirty days of receipt of such notice (or such lesser period as may be required by court proceedings in the event of a litigated matter), or (ii) (x) the Indemnitor does not have the right to control the defense of the entirety of such Third-Party Claim pursuant to Section 6.2(a)(ii) or (y) the Indemnitor does not have the right to control the defense of any Separable Claim pursuant to Section 6.2(a)(ii) (in which case such settlement may only apply to such Separable Claims), the Indemnitee provides reasonable notice to Indemnitor of the settlement, and such settlement (A) makes no admission or acknowledgment of Liability or culpability with respect to the Indemnitor, (B) does not seek any relief against the Indemnitor and (C) does not seek any relief against the Indemnitee for which the Indemnitor is responsible other than the payment of money damages.

 

(b)                                 In no event will the Indemnitor be liable to any Indemnitee for any special, consequential, indirect, collateral, incidental or punitive damages, however caused and on any theory of liability arising in any way out of this Agreement, whether or not such Indemnitor was advised of the possibility of any such damages;  provided, that the foregoing limitations shall not limit a party’s indemnification obligations for any Losses incurred by an Indemnitee as a result of the assertion of a Third Party Claim.

 

(c)                                  The Indemnitor and the Indemnitee shall use commercially reasonable efforts to avoid production of Confidential Information, and to cause all communications among employees, counsel and others representing any party with respect to a Third Party Claim to be made so as to preserve any applicable attorney-client or work-product privilege.

 

(d)                                 The Indemnitor shall pay all amounts payable pursuant to this Section 6.2 by wire transfer of immediately available funds, promptly following receipt from an Indemnitee of a bill, together with all accompanying reasonably detailed backup documentation, for any Losses that are the subject of indemnification hereunder, unless the Indemnitor in good faith disputes the amount of such Losses or whether such Losses are covered by the Indemnitor’s indemnification obligation in which event the Indemnitor shall promptly so notify the Indemnitee. In any event, the Indemnitor shall pay to the Indemnitee, by wire transfer of immediately available funds, the amount of any Losses for which it is liable hereunder no later than three (3) days following any final determination of the amount of such Losses and the Indemnitor’s liability therefor. A “final determination” shall exist when (a) the parties to the dispute have reached an agreement in

 

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writing or (b) a court of competent jurisdiction shall have entered a final and non-appealable order or judgment.

 

(e)                                  If the indemnification provided for in this Section 6.2 shall, for any reason, be unavailable or insufficient to hold harmless an Indemnitee in respect of any Losses for which it is entitled to indemnification hereunder, then the Indemnitor shall contribute to the amount paid or payable by such Indemnitee as a result of such Losses, in such proportion as shall be appropriate to reflect the relative benefits received by and the relative fault of the Indemnitor on the one hand and the Indemnitee on the other hand with respect to the matter giving rise to such Losses.

 

(f)                                   The remedies provided in this Section 6.2 shall be cumulative and shall not preclude assertion by any Indemnitee of any other rights or the seeking of any and all other remedies against an Indemnitor, subject to Section 6.2(b).

 

(g)                                  For the avoidance of doubt, the provisions of this Article VI are not intended to, and shall not, apply to any Loss, claim or Liability to which the provisions of the Tax Sharing Agreement are applicable.

 

(h)                                 To the fullest extent permitted by applicable law, the Indemnitor will indemnify the Indemnitee against any and all reasonable fees, costs and expenses (including attorneys’ fees), incurred in connection with asserting, preserving or enforcing his, her or its rights under this Article VI.

 

Section 6.3                                    Survival.  The terms and conditions of this Article VI will survive the expiration or termination of this Agreement.

 

ARTICLE VII

 

MISCELLANEOUS

 

Section 7.1                                    Defined Terms.

 

(a)                                 The following terms will have the following meanings for all purposes of this Agreement:

 

“Action” means any demand, action, claim, suit, countersuit, litigation, arbitration, prosecution, proceeding (including any civil, criminal, administrative, investigative or appellate proceeding), hearing, inquiry, audit, examination or investigation commenced, brought, conducted or heard by or before, or otherwise involving, any court, grand jury or other governmental authority or any arbitrator or arbitration panel.

 

“Affiliate” means, with respect to any Person, any other Person controlled by such first Person, with “control” for such purpose meaning the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities or voting interests, by contract, or otherwise. Notwithstanding the foregoing, for purposes of this Agreement, none of the Persons listed in clause (i), (ii) or (iii) shall be deemed to be Affiliates of any Person listed in any other such

 

15











 

clause: (i) Provider taken together with its Subsidiaries, (ii) Liberty Interactive taken together with its Subsidiaries or (iii) Starz taken together with any of its Subsidiaries.

 

“Confidential Information” means any information marked, noticed, or treated as confidential by a party which such party holds in confidence, including all trade secrets, technical, business, or other information, including customer or client information, however communicated or disclosed, relating to past, present and future research, development and business activities.

 

“Liabilities” means any and all debts, liabilities, commitments and obligations, whether or not fixed, contingent or absolute, matured or unmatured, direct or indirect, liquidated or unliquidated, accrued or unaccrued, known or unknown, and whether or not required by GAAP to be reflected in financial statements or disclosed in the notes thereto (other than taxes).

 

“Person” means any natural person, corporation, limited liability corporation, partnership, trust, unincorporated organization, association, governmental authority, or other entity.

 

“Subsidiary” when used with respect to any Person, means (i)(A) a corporation a majority in voting power of whose share capital or capital stock with voting power, under ordinary circumstances, to elect directors is at the time, directly or indirectly, owned by such Person, by one or more Subsidiaries of such Person, or by such Person and one or more Subsidiaries of such Person, whether or not such power is subject to a voting agreement or similar encumbrance, (B) a partnership or limited liability company in which such Person or a Subsidiary of such Person is, at the date of determination, (1) in the case of a partnership, a general partner of such partnership with the power affirmatively to direct the policies and management of such partnership or (2) in the case of a limited liability company, the managing member or, in the absence of a managing member, a member with the power affirmatively to direct the policies and management of such limited liability company, or (C) any other Person (other than a corporation) in which such Person, one or more Subsidiaries of such Person or such Person and one or more Subsidiaries of such Person, directly or indirectly, at the date of determination thereof, has or have (1) the power to elect or direct the election of a majority of the members of the governing body of such Person, whether or not such power is subject to a voting agreement or similar encumbrance, or (2) in the absence of such a governing body, at least a majority ownership interest or (ii) any other Person of which an aggregate of 50% or more of the equity interests are, at the time, directly or indirectly, owned by such Person and/or one or more Subsidiaries of such Person.  Notwithstanding the foregoing, for purposes of this Agreement, none of the Subsidiaries of the Provider will be deemed to be Subsidiaries of Starz or any of its Subsidiaries, nor will any of Starz or any of its Subsidiaries be deemed to be Subsidiaries of the Provider or any of its Subsidiaries.

 

“Tax Sharing Agreement” means the Tax Sharing Agreement, dated January 11, 2013, between Starz and the Provider.

 

(b)                                 The following terms will have the meanings for all purposes of this Agreement set forth in the Section reference provided next to such term:

 

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Definition
    	
 
    	
Section Reference
    
	
 
    	
 
    	
 
    
	
Agreement
    	
 
    	
Preamble
    
	
Allocated   Employee Compensation
    	
 
    	
Section 2.1(a)
    
	
Allocated   Expenses
    	
 
    	
Section 2.1(a)
    
	
Attributed   Employee
    	
 
    	
Section 2.1(a)
    
	
Bankruptcy   Event
    	
 
    	
Section 3.3(c)
    
	
Bankruptcy   Proceeding
    	
 
    	
Section 3.3(c)
    
	
Change   in Control
    	
 
    	
Section 3.3(c)
    
	
Excluded   Compensation
    	
 
    	
Section 4.3
    
	
Facilities   Sharing Agreement
    	
 
    	
Recitals
    
	
Indemnitee
    	
 
    	
Section 6.3(a)(i)
    
	
Indemnitor
    	
 
    	
Section 6.3(a)(i)
    
	
IT   Allocated Expenses
    	
 
    	
Section 2.1(c)
    
	
IT   Employee
    	
 
    	
Section 2.1(c)
    
	
IT   Employee Compensation
    	
 
    	
Section 2.1(c)
    
	
IT   Out-of-Pocket Costs
    	
 
    	
Section 2.2(b)
    
	
IT   Services
    	
 
    	
Section 1.1(b)
    
	
Lease   Agreement
    	
 
    	
Recitals
    
	
Liberty   Interactive
    	
 
    	
Section 1.1(a)
    
	
Losses
    	
 
    	
Section 6.1(a)
    
	
Offset   Amount
    	
 
    	
Section 2.1(c)
    
	
Out-of-Pocket   Costs
    	
 
    	
Section 2.2(a)
    
	
Provider
    	
 
    	
Preamble
    
	
Provider   Employee Compensation
    	
 
    	
Section 2.1(a)
    
	
Provider   Indemnitees
    	
 
    	
Section 6.1(b)
    
	
Reorganization   Agreement
    	
 
    	
Recitals
    
	
Separable   Claim
    	
 
    	
Section 6.3(a)(ii)
    
	
Separate   Legal Defenses
    	
 
    	
Section 6.3(a)(ii)
    
	
Separate   Starz Compensation
    	
 
    	
Section 4.3
    
	
Services
    	
 
    	
Section 1.1(a)
    
	
Spin-Off
    	
 
    	
Recitals
    
	
Spin-Off   Effective Date
    	
 
    	
Recitals
    
	
Starz
    	
 
    	
Preamble
    
	
Starz   Employee Compensation
    	
 
    	
Section 2.1(c)
    
	
Starz   Indemnitees
    	
 
    	
Section 6.1(a)
    
	
Starz   Percentage
    	
 
    	
Section 2.1(a)
    
	
Starz   Officer
    	
 
    	
Section 2.1(a)
    
	
Supporting   Records
    	
 
    	
Section 1.5
    
	
Term
    	
 
    	
Section 3.1
    
	
Third-Party   Claim
    	
 
    	
Section 6.3(a)(i)
    
	
Transaction
    	
 
    	
Section 3.3(c)
    


 

Section 7.2                                    Entire Agreement; Severability.  This Agreement (including the Schedules attached hereto), the Tax Sharing Agreement, the Facilities Sharing Agreement, the Lease Agreement and the Reorganization Agreement constitute the entire agreement among the parties hereto with respect to the subject matter hereof and thereof, and supersede all prior agreements 

 

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and understandings, oral and written, among the parties hereto with respect to such subject matter. It is the intention of the parties hereto that the provisions of this Agreement will be enforced to the fullest extent permissible under all applicable laws and public policies, but that the unenforceability of any provision hereof (or the modification of any provision hereof to conform with such laws or public policies, as provided in the next sentence) will not render unenforceable or impair the remainder of this Agreement. Accordingly, if any provision is determined to be invalid or unenforceable either in whole or in part, this Agreement will be deemed amended to delete or modify, as necessary, the invalid or unenforceable provisions and to alter the balance of this Agreement in order to render the same valid and enforceable, consistent (to the fullest extent possible) with the intent and purposes hereof.  If the provisions of this Agreement conflict with any provisions of the Facilities Sharing Agreement, the provisions of this Agreement shall control, and, if the provisions of this Agreement conflict with any provisions of the Tax Sharing Agreement, the provisions of the Tax Sharing Agreement shall control.

 

Section 7.3                                    Notices.  All notices and communications hereunder will be in writing and will be deemed to have been duly given if delivered personally or mailed, certified or registered mail with postage prepaid, or sent by confirmed facsimile, addressed as follows:

 

	
If to   the Provider:
    	
 
    	
Liberty   Media Corporation  
    12300   Liberty Boulevard  
    Englewood,   Colorado 80112
   Attention: General Counsel  
    Facsimile:   (720) 875-5382
    
	
 
    	
 
    	
 
    
	
If to   Starz :
    	
 
    	
Starz  
    8900   Liberty Circle  
    Englewood,   Colorado 80112  
    Attention:   General Counsel  
    Facsimile:   (720) 852-6279
    


 

or to such other address (or to the attention of such other person) as the parties may hereafter designate in writing.  All such notices and communications will be deemed to have been given on the date of delivery if sent by facsimile or personal delivery, or the third day after the mailing thereof, except that any notice of a change of address will be deemed to have been given only when actually received.

 

Section 7.4                                    Governing Law.  This Agreement and the legal relations among the parties hereto will be governed in all respects, including validity, interpretation and effect, by the laws of the State of Colorado applicable to contracts made and performed wholly therein, without giving effect to any choice or conflict of laws provisions or rules that would cause the application of the laws of any other jurisdiction.

 

Section 7.5                                    Rules of Construction.  The descriptive headings in this Agreement are inserted for convenience of reference only and are not intended to be part of or to affect the meaning or interpretation of this Agreement.  Words used in this Agreement, regardless of the gender and number specifically used, will be deemed and construed to include any other gender, 

 

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masculine, feminine, or neuter, and any other number, singular or plural, as the context requires.  As used in this Agreement, the word “including” or any variation thereof is not limiting, and the word “or” is not exclusive.  The word day means a calendar day.  If the last day for giving any notice or taking any other action is a Saturday, Sunday, or a day on which banks in New York, New York or Denver, Colorado are closed, the time for giving such notice or taking such action will be extended to the next day that is not such a day.

 

Section 7.6                                    No Third-Party Rights.  Nothing expressed or referred to in this Agreement is intended or will be construed to give any Person other than the parties hereto and their respective successors and permitted assigns any legal or equitable right, remedy or claim under or with respect to this Agreement, or any provision hereof, it being the intention of the parties hereto that this Agreement and all of its provisions and conditions are for the sole and exclusive benefit of the parties to this Agreement and their respective successors and assigns.

 

Section 7.7                                    Counterparts.  This Agreement may be executed in one or more counterparts, each of which will be an original and all of which together will constitute one and the same instrument.

 

Section 7.8                                    Payment of Expenses.  From and after the Spin-Off Effective Date, and except as otherwise expressly provided in this Agreement, each of the parties to this Agreement will bear its own expenses, including the fees of any attorneys and accountants engaged by such party, in connection with this Agreement.

 

Section 7.9                                    Binding Effect; Assignment.

 

(a)                                 This Agreement will inure to the benefit of and be binding on the parties to this Agreement and their respective legal representatives, successors and permitted assigns.

 

(b)                                 Except as expressly contemplated hereby (including by Section 4.1 or 4.2), this Agreement, and the obligations arising hereunder, may not be assigned by a party to this Agreement, provided, however, that a party may assign its respective rights, interests, duties, liabilities and obligations under this Agreement to one or more wholly-owned Subsidiaries of such party, but such assignment shall not relieve the assignor of its obligations hereunder.

 

Section 7.10                             Amendment, Modification, Extension or Waiver.  Any amendment, modification or supplement of or to any term or condition of this Agreement will be effective only if in writing and signed by each party affected thereby.  A party to this Agreement may (a) extend the time for the performance of any of the obligations or other acts of the other party to this Agreement, or (b) waive compliance by the other party with any of the agreements or conditions contained herein or any breach thereof. Any agreement on the part of a party to any such extension or waiver will be valid only if set forth in an instrument in writing signed on behalf of such party. No waiver of any term, provision or condition of this Agreement, whether by conduct or otherwise, in any one or more instance, will be deemed or construed as a further or continuing waiver of any such term, provision or condition or of any other term, provision or condition, but any party hereto may waive its rights in any particular instance by written instrument of waiver.

 

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Section 7.11                             Legal Fees; Costs.  If a party to this Agreement institutes any action or proceeding to enforce any provision of this Agreement, the prevailing party will be entitled to receive from the party against which such action or proceeding was brought reasonable attorneys’ fees, disbursements and costs incurred in such action or proceeding, whether or not such action or proceeding is prosecuted to judgment.

 

Section 7.12                             Force Majeure.  No party will be liable to another party with respect to any nonperformance or delay in performance of its obligations under this Agreement to the extent such failure or delay is due to any action or claims by any third party, labor dispute, labor strike, weather conditions or any cause beyond a party’s reasonable control.  Each party agrees that it will use all commercially reasonable efforts to continue to perform its obligations under this Agreement, to resume performance of its obligations under this Agreement, and to minimize any delay in performance of its obligations under this Agreement notwithstanding the occurrence of any such event beyond such party’s reasonable control.

 

Section 7.13                             Specific Performance.  Each party agrees that irreparable damage would occur and that the parties would not have any adequate remedy at law in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached.  It is accordingly agreed that each of the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement, this being in addition to any other remedy to which they are entitled at law or in equity.

 

Section 7.14                             Further Actions.  The parties will execute and deliver all documents, provide all information, and take or forbear from all actions that may be necessary or appropriate to achieve the purposes of this Agreement.

 

Section 7.15                             Confidentiality.

 

(a)                                 Except with the prior consent of the disclosing party, each party will:

 

(i)                                     limit access to the Confidential Information of the other party disclosed to such party hereunder to its employees, agents, representatives, and consultants on a need-to-know basis;

 

(ii)                                  advise its employees, agents, representatives, and consultants having access to such Confidential Information of the proprietary nature thereof and of the obligations set forth in this Agreement; and

 

(iii)                               safeguard such Confidential Information by using a reasonable degree of care to prevent disclosure of the Confidential Information to third parties, but not less than that degree of care used by that party in safeguarding its own similar information or material.

 

(b)                                 A party’s obligations respecting confidentiality under Section 7.15(a) will not apply to any of the Confidential Information of the other party that a party can demonstrate: (i) was, at the time of disclosure to it, in the public domain; (ii) after disclosure to it, is published or otherwise becomes part of the public domain through no fault of the receiving party; (iii) was 

 

20











 

in the possession of the receiving party at the time of disclosure to it without being subject to any obligation of confidentiality; (iv) was received after disclosure to it from a third party who, to its knowledge, had a lawful right to disclose such information to it; (v) was independently developed by the receiving party without reference to the Confidential Information; (vi) was required to be disclosed to any regulatory body having jurisdiction over a party or any of their respective clients; or (vii) was required to be disclosed by reason of legal, accounting, or regulatory requirements beyond the reasonable control of the receiving party.  In the case of any disclosure pursuant to clauses (vi) or (vii) of this paragraph (b), to the extent practical, the receiving party will give prior notice to the disclosing party of the required disclosure and will use commercially reasonable efforts to obtain a protective order covering such disclosure.

 

(c)                                  The provisions of this Section 7.15 will survive the expiration or termination of this Agreement.

 

[Signature Page Follows]

 

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IN WITNESS WHEREOF, each of the parties has signed this Agreement, or has caused this Agreement to be signed by its duly authorized officer, as of the date first above written.

 

	
 
    	
PROVIDER:
    
	
 
    	
 
    
	
 
    	
LIBERTY   MEDIA CORPORATION (f/k/a Liberty Spinco, Inc.)
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Pamela L. Coe
    
	
 
    	
Name:   Pamela L. Coe
    
	
 
    	
Title:   Vice President
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
STARZ:
    
	
 
    	
 
    
	
 
    	
STARZ   (f/k/a Liberty Media Corporation)
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Craig Troyer
    
	
 
    	
Name:   Craig Troyer
    
	
 
    	
Title:   Vice President
    


 

[Signature Page to Services Agreement]

 











 

List of Omitted Schedules

 

The following schedules to the Services Agreement, dated as of January 11, 2013, by and between Liberty Media Corporation and Starz have not been provided herein:

 

Schedule 2.1(a)—Allocated Expenses in Effect for Calendar Year 2013

 

Schedule 2.1(c)—IT Allocated Expenses in Effect for Calendar Year 2013

 

The Registrant hereby undertakes to furnish supplementally a copy of any omitted schedule to the Securities and Exchange Commission upon request.