EXHIBIT
10.40


 


EXECUTION
COPY


 


PURCHASE
AGREEMENT


 


This Purchase Agreement (this “Agreement”) is
entered into as of December 12, 2003 by and among Fox Sports Net Bay Area
Holdings, LLC, a Delaware limited liability company (the “Pacific Seller”),
Fox Sports Net Chicago Holdings, LLC, a Delaware limited liability company (the
“Chicago Seller” and, collectively with the Pacific Seller, the “Sellers”)
and Fox Sports Net, LLC, a Delaware limited liability company (“Fox Sports
Net” and , collectively with the Sellers, the “Fox Parties”), on the
one hand, and Regional Pacific Holdings II, L.L.C., a Delaware limited
liability company (the “Pacific Purchaser”) and Regional Chicago
Holdings II, L.L.C., a Delaware limited liability company (the “Chicago
Purchaser” and, collectively with the Pacific Purchaser, the “Purchasers”).  Capitalized terms used but not otherwise
defined herein shall have the meanings set forth in Section 1.1 hereof.


 


RECITALS


 


Sports Channel Pacific Associates, a New York general
partnership (the “Pacific Partnership”), owns and operates a regional
sports programming service in the San Francisco Bay area.


 


Sports Channel Chicago Associates, a New York general
partnership (the “Chicago Partnership” and, collectively with the
Pacific Partnership, the “Partnerships”), owns and operates a regional
sports programming service in the Chicago metropolitan area


 


As of the date of this Agreement, the Pacific Seller
beneficially owns all right, title and interest to a fifty percent (50%)
general partnership interest in the Pacific Partnership and the Chicago Seller
beneficially owns all right, title and interest to a fifty percent (50%)
general partnership interest in the Chicago Partnership.


 


Subject to the terms and conditions of each of the
Partnership Agreements (as defined below) of each of the Partnerships, the
Sellers have initiated the IPO-Call Procedure (as defined in each of the
Partnership Agreements) and the Sellers and the Purchasers have agreed upon the
Fair Market Value (as defined in the Partnership Agreements) of all of the
partnership interests in each of the Partnerships and determined that the Call
Price (as defined in the Partnership Agreements) for each of the Partnerships
is equal to the respective Partnership Interest Purchase Price set forth
herein.


 


Pursuant to this Agreement, in simultaneous
transactions, (i) the Pacific Purchaser desires to purchase and the Pacific
Seller desires to sell, convey, transfer, assign and deliver to the Pacific
Purchaser, the Pacific Seller’s partnership interest in the Pacific Partnership
and (ii) the Chicago Purchaser desires to purchase and the Chicago Seller
desires to sell, convey, transfer, assign and deliver to the Chicago Purchaser,
the Chicago Seller’s partnership interest in the Chicago Partnership.


 

















 


TERMS
OF AGREEMENT


 


In consideration of the mutual representations,
warranties, covenants and agreements contained herein and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:


 


ARTICLE I

DEFINITIONS


 


1.1           Defined Terms.  As used herein the following terms shall
have the following meanings:


 


“Affiliate” shall have the meaning ascribed to
it in Rule 405 of the rules promulgated under the Securities Act, as in effect
on the date hereof.


 


“Agreement” shall mean this Purchase Agreement
including all Exhibits and Schedules hereto.


 


“Chicago Indemnified Party” has the meaning
specified in Section 7.2(b) of this Agreement.


 


“Chicago Indemnifying Party” has the meaning specified
in Section 7.2(b) of this Agreement.


 


“Chicago Note” means the Subordinated Note of
the Chicago Purchaser substantially in the form of Exhibit A-2 hereto and
delivered pursuant to Section 3.1(b)(i) hereof.


 


“Chicago Partnership” means Sports Channel
Chicago Associates, a New York general partnership.


 


“Chicago Partnership Agreement” means that
certain Third Amended and Restated Partnership Agreement of the Chicago
Partnership among the Existing Chicago RPP Partner and the Chicago Seller and
dated as of December 18, 1997.


 


“Chicago Partnership Interest Purchase Price”
has the meaning specified in Section 2.1 of this Agreement.


 


“Chicago Purchased Partnership Interest” has
the meaning specified in Section 2.1 of this Agreement.


 


“Chicago Purchaser” means Regional Chicago
Holdings II, L.L.C., a Delaware limited liability company.


 


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“Chicago Seller” means Fox Sports Net Chicago
Holdings, LLC, a Delaware limited liability company.


 


“Closing” has the meaning specified in Article
III of this Agreement.


 


“Closing Date” has the meaning specified in
Article III of this Agreement.


 


“Contract” means any indenture, lease,
sublease, loan agreement, mortgage, note, commitment, obligation or other
contract, agreement or instrument.


 


“Existing Chicago RPP Partner” means Regional
Chicago Holdings, L.L.C., a Delaware limited liability company.


 


“Existing Pacific RPP Partner” means Regional
Pacific Holdings, L.L.C., a Delaware limited liability company.


 


“Fox Chicago Parties” means Fox Sports and the
Chicago Seller.


 


“Fox Pacific Parties” means Fox Sports and the
Pacific Seller.


 


“Fox Parties” means Fox Sports and the Sellers.


 


“Fox Sports” means Fox Sports Net, LLC, a
Delaware limited liability company.


 


“Governmental Authority” means any nation or
government, any state or other political subdivision thereof, and any entity or
official exercising executive, legislative, judicial regulatory or
administrative functions of or pertaining to government.


 


“Hart-Scott Rodino Act” means the Hart-Scott
Rodino Antitrust Improvements Act of 1976, as amended.


 


“Indemnified Parties” has the meaning specified
in Section 7.2(b) of this Agreement.


 


“Indemnifying Parties” has the meaning
specified in Section 7.2(b) of this Agreement.


 


“Lien” means any mortgage, pledge, security
interest, encumbrance, restriction, lien or charge of any kind (including,
without limitation, any conditional sale or other title retention agreement,
any lease in the nature thereof, the filing of or agreement to give any
financing statement under the Uniform Commercial Code or comparable law of any
jurisdiction in connection with such mortgage, pledge, security interest,
encumbrance, restriction, lien or charge).


 


“Losses” has the meaning specified in Section
7.2(a) of this Agreement.


 


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“Notes” means collectively the Pacific Note and
the Chicago Note.


 


“Pacific Indemnified Party” has the meaning
specified in Section 7.2(a) of this Agreement.


 


“Pacific Indemnifying Party” has the meaning
specified in Section 7.2(a) of this Agreement.


 


“Pacific Note” means the Subordinated Note of
the Pacific Purchaser substantially in the form of Exhibit A-1 hereto and
delivered pursuant to Section 3.1(b)(i) hereof.


 


“Pacific Partnership” means Sports Channel
Pacific Associates, a New York general partnership.


 


“Pacific Partnership Agreement” means that
certain Second Amended and Restated Partnership Agreement of the Pacific
Partnership among the Existing Pacific RPP Partner and the Pacific Seller and
dated as of December 18, 1997.


 


“Pacific Partnership Interest Purchase Price”
has the meaning specified in Section 2.1 of this Agreement.


 


“Pacific Purchased Partnership Interest” has
the meaning specified in Section 2.1 of this Agreement.


 


“Pacific Purchaser” means Regional Pacific
Holdings II, L.L.C., a Delaware limited liability company.


 


“Pacific Seller” means Fox Sports Net Bay Area
Holdings, LLC, a Delaware limited liability company.


 


“Partner Loans” means loans made by the partners
of the Partnership to the Partnership pursuant to the terms of the Partnership
Agreement.


 


“Partnerships” means the Chicago Partnership
and the Pacific Partnership.


 


“Partnership Agreements” means the Chicago
Partnership Agreement and the Pacific Partnership Agreement.


 


“Partnership Interest Purchase Prices” has the
meaning specified in Section 2.1 of this Agreement.


 


“Person” means an individual, partnership,
limited liability company, corporation, business trust, joint stock company,
trust, unincorporated association, joint venture, Governmental Authority or
other entity, of whatever nature.


 


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“Pledge Agreement” means the Pledge Agreement
by and among the Pacific Purchaser, the Existing Pacific RPP Partner, the
Pacific Seller and the Chicago Seller securing the obligations of the Pacific
Purchaser under the Pacific Note and the Chicago Purchaser  under the Chicago Note and delivered
pursuant to Section 3.1(b)(iv) hereof.


 


“Purchased Partnership Interests” has the
meaning specified in Section 2.1 of this Agreement.


 


“Purchasers” means the Chicago Purchaser and
the Pacific Purchaser.


 


“Requirement of Law” means as to any Person,
any domestic or foreign and federal, state or local law, rule, regulation,
statute or ordinance or determination of any arbitrator or a court or other
Governmental Authority, in each case applicable to or binding upon such Person
or any of its properties or to which such Person or any of its property is
subject.


 


“Securities Act” means the Securities Act of
1933, as amended.


 


“Sellers” means the Chicago Seller and the
Pacific Seller.


 


1.2           Other Definitional
Provisions.


 


(a)           All
terms defined in this Agreement shall have the defined meanings when used in
any certificates, reports or other documents made or delivered pursuant hereto
or thereto, unless the context otherwise requires.


 


(b)           Terms
defined in the singular shall have a comparable meaning when used in the
plural, and vice versa.


 


(c)           The
words “hereof,” “herein” and “hereunder,” and words of similar import, when
used in this Agreement shall refer to this Agreement as a whole (including any
Exhibits or Schedules hereto) and not to any particular provision of this
Agreement.


 


ARTICLE II

PURCHASE AND SALE


 


2.1           Transfer of Purchased Interest.  Subject to the terms and conditions of this
Agreement, at the Closing, in simultaneous transactions


 


(a)           the
Pacific Seller will sell, assign, transfer, convey and deliver to the Pacific
Purchaser and the Pacific Purchaser will purchase and accept from the Pacific
Seller, a fifty percent (50%) general partnership interest in the Pacific
Partnership (the “Pacific


 


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Purchased Partnership Interest”),
representing all of the Pacific Seller’s interests in the Pacific Partnership,
for an aggregate purchase price of One Hundred Ten Million Dollars
($110,000,000) for the Pacific Purchased Partnership Interest (the “Pacific
Partnership Interest Purchase Price”), which is payable in the form of the
Pacific Note substantially in the form attached as Exhibit A-1 hereto; and


 


(b)          
the Chicago Seller will sell, assign, transfer, convey and deliver to the
Chicago Purchaser and the Chicago Purchaser will purchase and accept from the
Chicago Seller, a fifty percent (50%) general partnership interest in the
Chicago Partnership (the “Chicago Purchased Partnership Interest” and,
collectively with the Pacific Purchased Partnership Interest, the “Purchased
Partnership Interests”), representing all of the Chicago Seller’s interests
in the Chicago Partnership, for an aggregate purchase price of Forty Million
Dollars ($40,000,000) for the Chicago Purchased Partnership Interest (the “Chicago
Partnership Interest Purchase Price” and, collectively with the Pacific
Partnership Interest Purchase Price, the “Partnership Interest Purchase
Prices”), which is payable in the form of the Chicago Note substantially in
the form attached as Exhibit A-2 hereto.


 


ARTICLE III

CLOSING


 


3.1           Closing and Closing Conditions.  The transactions contemplated herein shall
be consummated at a closing (the “Closing”) to be held at the offices of
Sullivan & Cromwell LLP, 125 Broad Street, New York, New York 10004 (or at
such other place or places as the parties may agree) at 10:00 a.m. on the date
hereof (the “Closing Date”).  All
transactions at Closing shall be deemed to take place simultaneously and none
shall be deemed to take place unless and until all shall have taken place.  The Purchasers collectively and the Sellers
collectively shall have the right to waive receipt of any documents at
Closing.  At the Closing, the following
shall occur:


 


(a)           The
Sellers shall deliver the following to the Purchasers:


 


(i)                                     assignments
of the Purchased Partnership Interests in form and substance reasonably
satisfactory to the Purchasers;


 


(ii)                                  copies
of all documents evidencing required consents and governmental approvals, if
any, as may be required by or with respect to this Agreement or the
transactions contemplated hereby to be obtained by either of the Sellers on or
prior to the Closing Date;


 


(iii)                               a
certificate dated as of the Closing Date, duly signed by an authorized officer
of each of the Sellers, certifying that (a) the representations and warranties
of such Seller are true and correct at and as of the Closing Date with the same
force and effect as though made at and as of that time, except that those
representations and warranties which address matters only as of a particular
date shall remain true and correct in all material respects as of such date,
and (b) that all obligations required to be


 


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performed by such Seller under this Agreement on or
prior to the Closing Date have been complied with and performed;


 


(iv)                              copies
of Uniform Commercial  Code and lien
searches in the jurisdictions requested by either of the Purchasers evidencing
the absence of any Liens in respect of the Purchased Partnership Interests;


 


(v)                                 the
appropriate Release by each Seller substantially in the form attached as
Exhibit C-1; and


 


(vi)                              such
other documents as may be necessary in the reasonable opinion of either of the
Purchasers, to transfer ownership of the Purchased Partnership Interests, free
and clear of any Liens, or to evidence the satisfaction of any other obligation
of the Sellers hereunder.


 


(b)           The
Purchasers shall deliver the following to the Sellers:


 


(i)                                     the
Pacific Note and the Chicago Note substantially in the form attached as Exhibit
A-1 and A-2 hereto, respectively;


 


(ii)                                  copies
of all documents evidencing required consents and governmental approvals, if
any, as may be required by or with respect to this Agreement or the
transactions contemplated hereby to be obtained by either of the Purchaser on
or prior to the Closing Date;


 


(iii)                               a
certificate, dated as of the Closing Date, duly signed by an authorized officer
of each of the Purchasers, certifying that (a) the representations and
warranties of such Purchaser are true and correct at and as of the Closing Date
and with the same force and effect as though made at and as of that time,
except that those representations and warranties which address matters only as
of a particular date shall remain true and correct in all material respects as
of such date, and (b) that all obligations required to be performed by such Purchaser
under this Agreement on or prior to the Closing Date have been complied with
and performed;


 


(iv)                              the
appropriate Release by the Existing Chicago RPP Partner and the Existing
Pacific RPP Partner substantially in the form attached as Exhibit C-2; and


 


(v)                                 the
Pledge Agreement substantially in the form attached as Exhibit B hereto.


 


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ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF THE SELLER


 


Each Seller represents and warrants to the Purchaser
purchasing its Purchased Partnership Interest as follows:


 


4.1           Limited Liability Status.  Such Seller is a limited liability company
duly organized, validly existing and in good standing under the laws of the
State of Delaware.  Such Seller has all
requisite power and authority to own or lease, as the case may be, its
properties and to carry on its business as now conducted.  Such Seller is qualified or licensed to
conduct business in all jurisdictions where its ownership, lease or operation
of property or the conduct of its business requires such qualification.  There is no pending or, to the best of the
knowledge of such Seller, threatened proceeding or other action by any other
party with respect to the dissolution, liquidation, insolvency or
rehabilitation of such Seller.


 


4.2           Power and Authority; Enforceability.  Such Seller has the power and authority to
execute and deliver this Agreement and to perform its obligations hereunder and
consummate the transactions contemplated hereby.  Such Seller has taken all necessary limited liability company
action to authorize the execution, delivery and performance of this Agreement
and the transactions contemplated hereby by it.  This Agreement has been duly executed and delivered by such
Seller and constitutes a legal, valid and binding obligation of such Seller,
enforceable against such Seller in accordance with its terms, except as the
same may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the enforcement of creditors’ rights
generally and general equitable principles, regardless of whether such
enforceability is considered in a proceeding at law or in equity.


 


4.3           Consents/Approvals.  Other than as described in Section 6.5 and
other than the consents described on Schedule 4.3, no consents, filings,
authorizations or actions of any Governmental Authority are required for such
Seller’s execution, delivery and performance of this Agreement.  No consent, approval, waiver or other
actions (“Consents”) by any Person (other than any Governmental
Authority referred to in the preceding sentence) under any Contract to which
such Seller is a party or by which such Seller or any of its properties or
assets are bound is required or necessary for the execution, delivery and
performance by such Seller of this Agreement and the consummation of the
transactions contemplated hereby.


 


4.4           No Violation.


 


(a)           Such
Seller is not in default under (and is not subject to any right of any other
party to, with the giving of notice or the passage of time or both, declare a
default or accelerate any obligation under) or in violation of (i) any
provision of its certificate of formation or limited liability company
agreement or (ii) the applicable Partnership Agreement or any Contract to which
such Seller is a party or by which any of its properties or assets are bound or
any Requirement of Law applicable to it, in any respect


 


8

















 


that could have a material adverse effect on its ability to execute and
deliver this Agreement and to perform its obligations hereunder.


 


(b)           The
execution and delivery by such Seller of this Agreement and the consummation of
the transactions contemplated hereby will not result in a default under (or
give any other party the right, with the giving of notice or the passage of
time or both, to declare a default or accelerate any obligation under) or
violate (x) its certificate of formation or limited liability company agreement
or (y) any Contract to which such Seller is a party or by which it or any of
its properties or assets are bound, or any Requirement of Law applicable to it,
or result in the creation or imposition of any Lien upon any of its membership
interests, properties or assets in any case under this clause (y) in any respect
that could have a material adverse effect on it or its ability to execute and
deliver this Agreement and perform its obligations hereunder.


 


4.5           Litigation.  There is no claim, action, suit, or legal, administrative or
other proceeding or governmental investigation pending or, to the best
knowledge of such Seller, threatened, anticipated or contemplated against such
Seller which, in any single case or in the aggregate, challenges or questions
in any respect the validity of, or would prevent or hinder the consummation of,
the transactions contemplated by this Agreement.


 


4.6           Title to Purchase Partnership Interests.  Such Seller owns beneficially and of record
the Purchased Partnership Interest that it is transferring hereunder.  Such Seller has good, valid and marketable
title to the Purchased Partnership Interest it is transferring hereunder, free
and clear of any Liens, and has complied with or obtained waivers of all
conditions to the transfer thereof.  At
the Closing, the Purchaser to which such Seller is transferring its Purchased
Partnership Interest will acquire good, valid, indefeasible and marketable
title to and beneficial and record ownership of the Purchased Partnership
Interest such Seller is transferring hereunder, free and clear of any Liens.


 


4.7           Governing Documents.  Other than any rights of the Purchaser to
which such Seller is transferring its Purchased Partnership Interest pursuant
to the applicable Partnership Agreement, there are no preemptive rights, rights
of first refusal or similar rights with respect to such Seller’s Purchased
Partnership Interest and no such rights arise by virtue of or in connection
with the transactions contemplated hereby. 
There are no other voting or similar contracts or agreements with
respect to such Purchased Partnership Interest other than such Partnership
Agreement.


 


4.8           Investment Intent.  Such Seller is acquiring the Note that it is
acquiring hereunder for its own account and with no present intention of
distributing or transferring such Note in violation of the Securities Act or
any applicable state securities laws.


 


4.9           No Commissions.  Such Seller has not incurred any obligation
for any finder’s or broker’s or agent’s fees or commissions in connection with
the transactions contemplated hereby.


 


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4.10         Affiliate Transactions.  Such Seller has not on behalf of either of
the Partnerships entered into any Contract or understanding between such
Partnership, on the one hand, and (i) either Seller or any Affiliate of
either Seller (each, a “Related Party Contract”) or (ii) any other
party, on the other hand. To the best knowledge of such Seller, no event has
occurred which constitutes, or after notice or the passage of time (or both)
would constitute, a default by such Seller, any Affiliate of such Seller or the
applicable Partnership under any Related Party Contract.


 


4.11         Exclusivity of Representations.  THE REPRESENTATIONS AND WARRANTIES MADE BY
THE SELLERS IN THIS AGREEMENT ARE IN LIEU OF AND ARE EXCLUSIVE OF ALL OTHER
REPRESENTATIONS AND WARRANTIES RELATING TO THE TRANSACTIONS CONTEMPLATED
HEREUNDER, INCLUDING ANY IMPLIED WARRANTIES. 
THE SELLERS HEREBY DISCLAIM ANY SUCH OTHER OR IMPLIED REPRESENTATIONS OR
WARRANTIES, NOTWITHSTANDING THE DELIVERY OR DISCLOSURE TO THE PURCHASERS OR
THEIR OFFICERS, DIRECTORS, EMPLOYEES, AGENTS OR REPRESENTATIVES OF ANY
DOCUMENTATION OR OTHER INFORMATION (INCLUDING, WITHOUT LIMITATION, ANY
FINANCIAL PROJECTIONS OR OTHER SUPPLEMENTAL DATA).


 


ARTICLE V

REPRESENTATIONS AND WARRANTIES OF THE PURCHASER


 


Each Purchaser represents and warrants to the Seller
from which it is purchasing a Purchased Partnership Interest as follows:


 


5.1           Limited Liability Status.  Such Purchaser is a limited liability
company duly organized, validly existing and in good standing under the laws of
the State of Delaware.  Such Purchaser
has all requisite power and authority to own or lease, as the case may be, its
properties and to carry on its business as now conducted.  Such Purchaser is qualified or licensed to
conduct business in all jurisdictions where its ownership, lease or operation
of property or the conduct of its business requires such qualification.  There is no pending or, to the best of the
knowledge of such Purchaser, threatened proceeding or other action by any other
party with respect to the dissolution, liquidation, insolvency or
rehabilitation of such Purchaser.


 


5.2           Power and Authority: Enforceability.  Such Purchaser has the power and authority
to execute and deliver this Agreement and to perform its obligations hereunder
and consummate the transactions contemplated hereby.  Such Purchaser has taken all necessary limited liability company
action to authorize the execution, delivery and performance of this Agreement
and the transactions contemplated hereby by it.  This Agreement has been duly executed and delivered by such
Purchaser and constitutes a legal, valid and binding obligation of such
Purchaser, enforceable against such Purchaser in accordance with its terms,
except as the same may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the


 


10

















 


enforcement of creditors’ rights generally and general equitable
principles, regardless of whether such enforceability is considered in a
proceeding at law or in equity.


 


5.3           Consents/Approvals.  Other than as described in Section 6.5 and
other than the consents of the Federal Communications Commission (the “FCC”) to
the transfer of the control of the Chicago Partnership relating to certain FCC
licenses held by the Chicago Partnership, no consents, filings, authorizations
or actions of any Governmental Authority are required for such Purchaser’s
execution, delivery and performance of this Agreement.  No Consents by any Person (other than any
Governmental Authority referred to in the preceding sentence) under any
Contract to which such Purchaser is a party or by which such Purchaser or any
of its properties or assets are bound is required or necessary for the
execution, delivery and performance by such Purchaser of this Agreement and the
consummation of the transactions contemplated hereby.


 


5.4           No Violation.


 


(a)           Such
Purchaser is not in default under (and is not subject to any right of any other
party to, with the giving of notice or the passage of time or both, declare a
default or accelerate any obligation under) or in violation of (i) any
provision of such Purchaser’s certificate of formation or limited liability
company agreement or (ii) the applicable Partnership Agreement or any Contract
to which such Purchaser is a party or by which it or any of its properties or
assets are bound or any Requirement of Law applicable to it, in any respect
that could have a material adverse effect on its ability to execute and deliver
this Agreement and to perform its obligations hereunder.


 


(b)           The
execution and delivery by such Purchaser of this Agreement and the consummation
of the transactions contemplated hereby will not result in a default under (or
give any other party the right, with the giving of notice or the passage of
time or both, to declare default or accelerate any obligation under) or violate
(x) its certificate of formation or limited liability company agreement, or (y)
any Contract to which such Purchaser is a party or by which its properties or
assets are bound, or any Requirement of Law applicable to it, or result in the
creation or imposition of any Lien upon any of its membership interests,
properties or assets in any case under this clause (y) in any respect that
could have a material adverse effect on it or its ability to execute and
deliver this Agreement and perform its obligations hereunder.


 


5.5           Litigation.  There is no claim, action, suit, or legal, administrative or
other proceeding or governmental investigation pending or, to the best
knowledge of such Purchaser, threatened, anticipated or contemplated against
such Purchaser which, in any single case or in the aggregate, challenges or
questions in any respect the validity of, or would prevent or hinder the
consummation of, the transactions contemplated by this Agreement.


 


5.6           Investment Intent.  Such Purchaser is acquiring the Purchased
Partnership Interest that it is acquiring hereunder for its own account and
with no present


 


11

















 


intention of distributing or selling such Purchased Partnership
Interest, in violation of the Securities Act or any applicable state securities
law.


 


5.7           No Commissions.  Such Purchaser has not incurred any
obligation for any finder’s or broker’s or agent’s fees or commissions in
connection with the transactions contemplated hereby.


 


5.8           Exclusivity of Representations.  THE REPRESENTATIONS AND WARRANTIES MADE BY
THE PURCHASERS IN THIS AGREEMENT ARE IN LIEU OF AND ARE EXCLUSIVE OF ALL OTHER
REPRESENTATIONS AND WARRANTIES RELATING TO THE TRANSACTIONS CONTEMPLATED
HEREUNDER, INCLUDING ANY IMPLIED WARRANTIES. 
THE PURCHASERS HEREBY DISCLAIM ANY SUCH OTHER OR IMPLIED REPRESENTATIONS
OR WARRANTIES, NOTWITHSTANDING THE DELIVERY OR DISCLOSURE TO THE SELLERS OR
THEIR OFFICERS, DIRECTORS, EMPLOYEES, AGENTS OR REPRESENTATIVES OF ANY
DOCUMENTATION OR OTHER INFORMATION (INCLUDING, WITHOUT LIMITATION, ANY
FINANCIAL PROJECTIONS OR OTHER SUPPLEMENTAL DATA).


 


ARTICLE VI

COVENANTS


 


6.1           Filings.  Each of the Purchasers and the Sellers shall make (or cause the
Partnerships to make), on a prompt and timely basis, all governmental or
regulatory notifications and filings required to be made by it for the consummation
of the transactions contemplated hereby.


 


6.2           Public Announcements.  The form and content of all press releases
or other public communications of any sort relating to the subject matter of
this Agreement, and the method of their release, or publication thereof, shall,
except as required by law, be subject to the prior approval of the parties
hereto, which approval shall not be unreasonably withheld or delayed.


 


6.3           Further Assurances.  Each party shall execute and deliver such
additional instruments and other documents and shall take such further actions
as may be necessary or appropriate to effectuate, carry out and comply with all
of the terms of this Agreement and the transactions contemplated hereby.


 


6.4           Cooperation.  The Purchasers and the Sellers each agree to cooperate with the
other in the preparation and filing of all forms, notifications, reports and
information, if any, required or reasonably deemed advisable pursuant to any
Requirement of Law in connection with the transactions contemplated by this
Agreement.


 


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6.5           Tax.


 


(a)           The
Sellers and the Purchasers agree that upon the Closing each Partnership will
adopt the “closing of the books” method of income allocation as prescribed in
Treasury Regulation Section 1.706-1(c)(2) for purposes of allocating income,
gain, loss, deductions and credits between the Sellers and the Purchasers for
the year of sale.


 


(b)           Sellers
and Purchasers hereby agree to cause each Partnership to make an Internal
Revenue Code Section 754 election in respect of each sale and purchase of the
Purchaser Partnership Interests.  Each
Purchaser hereby covenants to keep such Section 754 election in effect for any
taxable period that any obligations under the Notes remain outstanding.


 


ARTICLE VII

INDEMNIFICATION


 


7.1           Survival.  The representations,
warranties, agreements, covenants and obligations of the Purchasers and the
Sellers contained in this Agreement, the Schedules and Exhibits hereto, and any
certificate, documents or statement delivered to the other parties pursuant
hereto, shall survive for a period of three (3) years following the Closing and
not be affected in any respect by the Closing, any investigations conducted by
any parties or any knowledge of any party; provided,
that the survival of the representations and warranties of each Seller in
Section 4.6 hereof shall not be limited.


 


7.2           Indemnification.


 


(a)           The
Fox Pacific Parties, on the one hand, and the Pacific Purchaser, on the other
hand (each, an “Pacific Indemnifying Party”), shall indemnify the others
and their respective officers, members and Affiliates (each, an “Pacific
Indemnified Party”) from and against any and all losses, damages,
liabilities, claims, charges, actions, proceedings, demands, judgments,
deficiencies, settlement costs and expenses of any nature whatsoever
(including, without limitation, reasonable attorneys fees and expenses but net
of any insurance proceeds and tax benefits received in connection with such
indemnification claim by such Indemnified Party) (collectively, “Losses”)
directly or indirectly incurred by a Pacific Indemnified Party and resulting
from (i) the inaccuracy, in any material respect, of any representation or
warranty of a Pacific Indemnifying Party or (ii) any breach of or failure to
perform by a Pacific Indemnifying Party any agreement, covenant or obligation
contained in or made pursuant to this Agreement and all claims, charges,
actions or proceedings incident to or arising out of the foregoing.


 


(b)           The
Fox Chicago Parties, on the one hand, and the Chicago Purchaser, on the other
hand (each, an “Chicago Indemnifying Party” and, collectively with the
Pacific Indemnifying Parties, the “Indemnifying Parties”), shall
indemnify the others and their respective officers, members and Affiliates
(each, an “Chicago Indemnified Party” and, collectively with the Pacific
Indemnifying Parties, the “Indemnified Parties”) from and


 


13

















 


against any and all Losses directly or indirectly incurred by a Chicago
Indemnified Party and resulting from (i) the inaccuracy, in any material
respect, of any representation or warranty of a Chicago Indemnifying Party or
(ii) any breach of or failure to perform by a Chicago Indemnifying Party any
agreement, covenant or obligation contained in or made pursuant to this
Agreement and all claims, charges, actions or proceedings incident to or
arising out of the foregoing.


 


7.3           Indemnification Procedures.  Each Indemnified Party shall give notice as
promptly as reasonably practicable to each Indemnifying Party from which it is
entitled to seek indemnity under Section 7.2 of any action commenced against it
in respect of which indemnity may be sought hereunder, but failure to so notify
an Indemnifying Party shall not relieve such Indemnifying Party from any
liability that it may have on account of this indemnity agreement or otherwise
so long as such failure shall not have materially prejudiced the position of
the Indemnifying Party.  Upon such
notification, the Indemnifying Party shall assume the defense of such action
and after such assumption the Indemnified Party shall not be entitled to
reimbursement of any expenses incurred by it in connection with such action
except as described below.  In any such
action, any Indemnified Party shall have the right to retain its own counsel,
but the fees and expenses of such counsel shall be at the expense of such
Indemnified Party unless (i) the applicable Indemnifying Party and the
Indemnified Party shall have mutually agreed to the contrary or (ii) the named  parties in any such action (including any
impleaded parties) include both the applicable Indemnifying Party and the
Indemnified Party and representation of both parties by the same counsel would
be inappropriate due to actual or potential differing interests between
them.  The Indemnifying Party shall not
be liable for any settlement of any proceeding effected without its written
consent (which shall not be unreasonably withheld or delayed by such
Indemnifying Party), but if settled with such consent or if there be final
judgment for the plaintiff, the Indemnifying Party shall indemnify the
applicable Indemnified Party from and against any loss, damage or liability by
reason of such settlement or judgment. 
To the extent permitted by law, indemnification payments shall be
treated as adjustments to the appropriate Partnership Interest Purchase Price
for all tax purposes.


 


7.4           Subrogation.  In the event that an Indemnifying Party shall be obligated to
indemnify an Indemnified Party pursuant to this Article VII, the Indemnifying
Party shall upon payment of such indemnity in full, be subrogated to all rights
of the applicable Indemnified Party with respect to the claims for which such
indemnification relates.


 


ARTICLE VIII

MISCELLANEOUS


 


8.1           Notices.  All notices, requests, demands, claims, and other communications
hereunder shall be in writing and shall be delivered by certified or registered
mail (first class postage pre-paid), guaranteed overnight delivery, or
facsimile transmission if such transmission is confirmed by delivery by
certified or registered mail (first class postage pre-paid) or guaranteed
overnight delivery, to the following addresses


 


14

















 


and facsimile numbers (or to such other addresses or facsimile numbers
which such party shall designate in writing to the other party):


 


(a)           if
to either of the Purchasers to:


 


Regional Programming
Partners


c/o Rainbow Media Holdings,
LLC


200 Jericho Quadrangle


Jericho, N.Y. 11753


Attention: President


Facsimile: (516) 803-4755


With a copy to Attention:
General Counsel/Senior Vice President


Business
Affairs


 


cc:                                 Cablevision Systems Corporation

1111 Stewart Avenue

Bethpage, New York 11714

Attention:  Vice Chairman
Facsimile: (516) 803-2577


 


(b)           If
to any of the Fox Parties:


 


c/o Fox Cable Networks Group


10000 Santa Monica Boulevard


Los Angeles, CA 90067


Telephone:  (310) 284-2399


Telecopier:  (310) 299-5656


Attention:  Daniel M. Fawcett, Esq.


 


With a copy to:


 


The News Corporation Limited


1211 Avenue of the Americas


New York, New York 10036


Telephone:  (212) 852-7000


Telecopier:  (212) 768-2029


Attention:  Arthur M. Siskind, Esq.


 


and:


 


15

















 


Hogan & Hartson L.L.P.


875 Third Avenue


New York, New York 10022


Telephone:  (212) 918-3000


Telecopier:  (212) 918-3100


Attention:  Ira S. Sheinfeld, Esq.


 


8.2           Entire
Agreement.  This
Agreement, including the Exhibits and Schedules attached hereto and other
documents delivered at the Closing pursuant to this Agreement, contain the
entire understanding of the parties in respect of its subject matter and
supersede all prior agreements and understanding between or among the parties
with respect to such subject matter. 
The Exhibits and Schedules constitute a part hereof as though set forth in
full above.


 


8.3           Expenses; Taxes.  The parties shall pay their own fees and
expenses, including their own counsel fees, incurred in connection with this
Agreement or any transaction contemplated by this Agreement.  Any income tax on either of the Sellers or
capital gains tax on either of the Sellers or stamp duty arising out of the
sale by either of the Sellers of the Purchased Partnership Interests to the
Purchasers shall be the sole responsibility of and shall be paid by the
Sellers.  Any deed, transfer or other
tax arising out of the sale of the Purchased Partnership Interests and the
filing fees for the filing under the Hart-Scott-Rodino Act shall be paid
one-half each by the Sellers and the Purchasers.


 


8.4           Amendment; Waiver.  This Agreement may not be modified, amended,
supplemented, canceled or discharged, except by written instrument executed by
all of the parties.  Except as expressly
provided herein, no failure to exercise, and no delay in exercising, any right,
power or privilege under this Agreement shall operate as a waiver, nor shall
any single or partial exercise of any right, power or privilege hereunder
preclude the exercise of any other right, power or privilege.  No waiver of any breach of any provision
shall be deemed to been a waiver of any preceding or succeeding breach of the
same or any other provision, nor shall any waiver be implied from any course of
dealing between or among the parties. 
No extension of time for performance of any obligations or other acts
hereunder or under any agreement shall be deemed to be an extension of the time
or performance of any obligations or any other acts.  The rights and remedies of the parties under this Agreement are
in addition to all other rights and remedies, at law or equity, that they may
have against each other.


 


8.5           Binding Effect; Assignment.  The rights and obligations under this
Agreement shall bind and inure to the benefit of the parties and their
respective successors and permitted assigns. 
The rights and obligations of this Agreement may not be assigned by any
of the parties without the prior written consent of the other parties.


 


16

















 


8.6           Counterparts.  This Agreement may be executed in any number of counterparts,
each of which shall be an original but all of which together shall constitute
one and the same instrument.


 


8.7           Headings.  The headings contained in this Agreement are for the convenience
of reference only and are not to be given any legal effect and shall not affect
the meaning or interpretation of this Agreement.


 


8.8           Governing Law; Interpretation.  This Agreement shall be construed in
accordance with and governed for all purposes by the laws of the State of New
York applicable to contracts to be wholly performed within such State.  The Sellers and Purchasers hereby (i)
irrevocably submit to the jurisdiction of any New York State or Federal court
sitting in New York City in any action or proceeding arising out of or relating
to this Agreement, (ii) waive any defense based on doctrines of venue or forum
non conveniens, or similar rules or doctrines, and (iii) irrevocably agree that
all claims in respect of such an action or proceeding may be heard and
determined in such New York State or Federal court.  The Sellers and Purchasers hereby waive any right to trial by
jury in any action, proceeding or counterclaim arising out of or relating to
this Agreement.


 


8.9           Severability.  The parties stipulate that the terms and provisions of this
Agreement are fair and reasonable as of the date of this Agreement.  However, if any provision of this Agreement
is determined by a court of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and restrictions
of this Agreement shall remain in full force and effect and shall in no way be
affected, impaired or invalidated.  If,
moreover, any of those provisions shall for any reason be determined by a court
of competent jurisdiction to be unenforceable because excessively broad or
vague as to duration, geographical scope, activity or subject, it shall be
construed by limiting, reducing or defining it, so as to be enforceable.


 


8.10         Benefit.  Nothing in this Agreement, express or implied, is intended or
shall be construed to confer upon or give to any person, firm or corporation
other than the parties hereto any remedy or claim under or by reason of this
Agreement or any term, covenant or condition hereof, all of which shall be for
the sole and exclusive benefit of the parties hereto.


 


8.11         Non-Recourse.  Notwithstanding anything contained in this Agreement to the
contrary, it is expressly understood and agreed by the parties hereto that no
representation, undertaking or agreement made in this Agreement on the part of
any party hereto was made or intended to be made as a personal or individual
representation, undertaking or agreement on the part of any incorporator,
stockholder, director, officer, agent, member or partner (past, present or
future), of any party and no personal or individual liability or responsibility
is assumed by, nor shall any recourse at any time be asserted or enforced
against, any such incorporator, stockholder, director, officer, agent, member
or partner, all of which recourse (whether in common law, in equity, by statute
or otherwise) is hereby forever waived and released.


 


17

















 


IN WITNESS WHEREOF,
the parties hereto have caused this Agreement to be duly executed and delivered
as of the day and year first above written.


 


	
   

  	
  FOX SPORTS NET BAY AREA
  HOLDINGS,

  LLC

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name

  
	
   

  	
   

  	
  Title:

  



 


	
   

  	
  FOX SPORTS NET CHICAGO
  HOLDINGS,  LLC

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name

  
	
   

  	
   

  	
  Title:

  



 


	
   

  	
  FOX SPORTS NET,  LLC

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name

  
	
   

  	
   

  	
  Title:

  



 


18

















 


	
   

  	
  REGIONAL PACIFIC
  HOLDINGS II, L.L.C.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Regional Programming
  Partners, its 

  sole member

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Rainbow Regional
  Holdings LLC,

  its Managing Partner

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  RRH I, LLC, a member

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Rainbow Media Holdings,
  LLC

  its sole member

  



 


	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


	
   

  	
  REGIONAL CHICAGO
  HOLDINGS II, L.L.C.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Regional Programming
  Partners, its

  sole member

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Rainbow Regional
  Holdings LLC,

  its Managing Partner

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  RRH I, LLC, a member

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Rainbow Media Holdings,
  LLC

  its sole member

  



 


	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


The undersigned hereby unconditionally and irrevocably
guarantees to the Fox Parties the punctual performance of all obligations of
the Pacific Purchaser hereunder.


 


	
   

  	
  REGIONAL PACIFIC
  HOLDINGS, L.L.C.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


19

















 


The undersigned hereby unconditionally and irrevocably
guarantees to the Fox Parties the punctual performance of all obligations of
the Chicago Purchaser hereunder.


 


 


	
   

  	
  REGIONAL CHICAGO
  HOLDINGS, L.L.C

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


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