Turner Broadcasting System, Inc. and Subsidiaries - Page 13

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               Immediately following the closing, pursuant to MGM's prior             
          irrevocable instructions, the Disbursing Agent transferred                  
          $22,725,000 from MGM's account to UA's account in partial payment           
          of amounts due from MGM to UA under clause 6.4 of the Merger                
          Agreement.12  On or shortly after March 25, 1986, MGM made a net            
          intercompany loan of approximately $107.7 million cash to TBS, in           
          accordance with TBS' customary cash management procedures.  This            
          intercompany loan was reflected on MGM's books as an intercompany           
          receivable (i.e., as an asset of MGM).                                      
               The status of the parties on March 25, 1986, after the                 
          completion of the transactions contemplated in the transaction              
          documents, was as follows:                                                  
               a.  TBS, directly and through wholly owned subsidiaries,               
          owned 100 percent of MGM.                                                   
               b.  TBS had disbursed $994,902,740 cash and 49,745,137                 
          shares of TBS Preferred Stock and received $107.7 million cash in           
          an intercompany loan from MGM.                                              
               c.  MGM had disposed of UA.                                            
               d.  MGM had received $447,706,233 cash, which it had used in           
          part to prepay its $294,809,215 debt to the banks and to satisfy            
          a $40 million obligation to UA.                                             

               12Clause 6.4 of the Merger Agreement provided for "Post                
          Closing Adjustment[s]". These adjustments related to the                    
          allocation of the economic, financial and legal consequences of             
          transactions occurring during the period from May 31, 1985, to              
          March 25, 1986, as reflected in the intercompany accounts between           
          MGM and UA.                                                                 




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