G.                                      Regional Ohio Holdings I LLC, a Delaware limited liability company (“ RPP Ohio Partner I ”);

 

H.                                     Regional Ohio Holdings II LLC, a Delaware limited liability company (“ RPP Ohio Partner II ”);

 

I.                                          Metro Channel Holdings I, LLC, a Delaware limited liability company (“ RPP Metro Channel Partner I ”);

 

J.                                         Metro Channel Holdings II, LLC, a Delaware limited liability company (“ RPP Metro Channel Partner II ”);

 

K.                                     Regional Cincinnati Holdings I LLC, a Delaware limited liability company (“ RPP Cincinnati Partner I ”);

 

L.                                       Regional Cincinnati Holdings II LLC, a Delaware limited liability company (“ RPP Cincinnati Partner II ”);

 

M.                                  SC Florida Holding Company, L.L.C., a Delaware limited liability company (“ RPP Florida Partner I ”);

 

N.                                     SportsChannel Florida Holding Company, L.L.C., a Delaware limited liability company (“ RPP Florida Partner II ”);

 

O.                                     Regional Pacific Holdings LLC, a Delaware limited liability company (“ RPP Pacific Partner I ”);

 

P.                                       Regional Pacific Holdings II, L.L.C., a Delaware limited liability company (“ RRP Pacific Partner II ”);

 

Q.                                     Regional Chicago Holdings, L.L.C., a Delaware limited liability company (“ RPP Chicago Partner I ”);

 

R.                                      Regional Chicago Holdings II, L.L.C., a Delaware limited liability company (“ RPP Chicago Partner II ”); and

 

S.                                       WSN, LLC, a Delaware limited liability company (“ WSN ”).

 

WHEREAS, Rainbow NSP Partner and Fox Sports Net National Network Holdings, LLC, a Delaware limited liability company (“ Fox NSP Partner I ”), own National Sports Partners, a New York general partnership (“ NSP ”), which, among other things, owns and operates a national sports network under the name Fox Sports Net.

 

WHEREAS, Rainbow NAP Partner and Fox Sports Net Ad Sales Holdings LLC, a Delaware limited liability company (“ Fox NAP Partner I ”), own National Advertising Partners, a New York general partnership (“ NAP ”), which, among

 

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other things, owns and operates a national advertising business to sell advertising for national and regional sports networks.

 

Pursuant to this Agreement:

 

1.                                        RMH shall contribute $100,000 of cash to RPP and in consideration thereof shall receive a 0.1% general partnership interest in RPP;

 

Thereafter, in simultaneous transactions:

 

2.                                        The note payable (the “ Pacific Note ”) issued by RPP Pacific Partner II to Fox Former Pacific Partner shall be assigned by Fox Former Pacific Partner to Fox RPP Partner and then shall be contributed by Fox RPP Partner to RPP as a capital contribution for no additional ownership interest or percentage interest and the security interest in the partnership interest in SportsChannel Pacific Associates owned by RPP Pacific Partner II for the benefit of Fox Former Pacific Partner shall be released and terminated and RPP shall contribute the Pacific Note to RPP Pacific Partner II as a capital contribution;

 

3.                                        The note payable (the “ Chicago Note ”) issued by RPP Chicago Partner II to Fox Former Chicago Partner shall be assigned by Fox Former Chicago Partner to Fox RPP Partner and then shall be contributed by Fox RPP Partner to RPP as a capital contribution for no additional ownership interest or percentage interest and the security interest in the partnership interest in SportsChannel Pacific Associates owned by RPP Pacific Partner II for the benefit of Fox Former Chicago Partner shall be released and terminated and RPP shall contribute the Chicago Note to RPP Chicago Partner II as a capital contribution;

 

4.                                        RPP shall form Pacific Regional Programming Partners, a New York general partnership (“ Pacific RPP ”), and shall contribute all of its right, title and interest in its ownership interests in the following entities to Pacific RPP:

 

•                   RPP Pacific Partner I; and

 

•                   RPP Pacific Partner II.

 

5.                                        The Notes shall be cancelled;

 

6.                                        RPP shall distribute all its right, title and interest in a 60% general partnership interest in Pacific RPP to Rainbow RPP Partner or its designee;

 

7.                                        RPP shall redeem all of the partnership interests in RPP owned by Fox RPP Partner in exchange for all RPP’s right, title and interest in a 40% general partnership interest in Pacific RPP and its ownership interests in the following entities (collectively, the “ Fox Distributed Entities ”):

 

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•                   RPP Ohio Partner I;

 

•                   RPP Ohio Partner II;

 

•                   RPP Cincinnati Partner I;

 

•                   RPP Cincinnati Partner II;

 

•                   RPP Florida Partner I; and

 

•                   RPP Florida Partner II.

 

8.                                        The partnership agreement of Pacific RPP shall be executed and delivered substantially in the form set forth in Exhibit A hereto;

 

9.                                        Fox RPP Partner shall release and terminate all of its right, title and interest in its membership interest in MSG Flight Operations, LLC;

 

10.                                  In consideration of the payment of $1.00 from Fox NSP Partner II to Rainbow NSP Partner, RMH shall cause Rainbow NSP Partner to transfer all of its right, title and interest to its entire general partnership interest in NSP to Fox NSP Partner II;

 

11.                                  In consideration of the payment of $1.00 from Fox NAP Partner II to Rainbow NAP Partner, RMH shall cause Rainbow NAP Partner to transfer all of its right, title and interest to its entire general partnership interest in NAP to Fox NAP Partner II;

 

12.                                  Rainbow RPP Partner shall cause each of SportsChannel Associates, SportsChannel New England Limited Partnership, SportsChannel Pacific Associates and SportsChannel Chicago Associates to enter into amended and restated affiliation agreements with NSP in the form set forth in Exhibit B hereto and such entities and MSG shall enter into amended and restated advertising representation agreements with NAP in the form set forth in Exhibit C hereto; and

 

13.                                  The parties shall execute mutual releases in the form set forth in Exhibit D hereto.

 

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:

 

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ARTICLE I

 

DEFINITIONS

 

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

 

“ Acquiror ” has the meaning set forth in Section 8.2(c) hereof

 

“ Advertising Representation Agreement Amendments ” means the advertising representation agreements between each of SportsChannel Associates, SportsChannel New England Limited Partnership, the Pacific Partnership, MSG and the Chicago Partnership, on the one hand, and NAP, on the other hand, substantially in the form of Exhibit C hereto.

 

“ 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.

 

“ Affiliation Agreement Amendments ” means the affiliation agreements between each of SportsChannel Associates, SportsChannel New England Limited Partnership, the Pacific Partnership and the Chicago Partnership, on the one hand, and NSP, on the other hand, substantially in the form of Exhibit B hereto.

 

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

 

“ Basket Amount ” has the meaning set forth in Section 10.2(a).

 

“ Business Employee ” means any employee, consultant or independent contractor who is on the payroll of Fox Distributed Partnerships, Fox Distributed Entities or any of their respective ERISA Affiliates (including, without limitation, any employee, consultant or independent contractor who is paid through a payroll service), who is employed by or associated with Fox Distributed Partnerships or Fox Distributed Entities, and whose services are primarily related to the Fox Distributed Partnerships or Fox Distributed Entities, whether such employee is actively at work or on leave of absence, disability or medical leave.

 

“ Cablevision ” means Cablevision Systems Corporation, a Delaware corporation.

 

“ Chicago Note ” means the note payable, dated as of December 12, 2003, issued by RPP Chicago Partner II to Fox Former Chicago Partner.

 

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

 

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“ Cincinnati Partnership ” means SportsChannel Cincinnati Associates, a New York general partnership.

 

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

 

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

 

“ COBRA ” means the Consolidated Omnibus Budget Reconciliation Act of 1985.

 

“ Code ” means the Internal Revenue Code of 1986, as amended.

 

“ Consent ” has the meaning set forth in Section 4.3 hereof.

 

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

 

“ Covered Interest ” has the meaning set forth in Section 8.2(a) hereof.

 

“ Covered Region ” means the New York Region or the Pacific Region.

 

“ Employee Benefit Plan ” has the meaning specified in Section 7.6(a) hereof.

 

“ Employing Partnership ” has the meaning specified in Section 8.8 hereof.

 

“ Employment Period ” has the meaning specified in Section 8.8 hereof.

 

“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended.

 

“ ERISA Affiliate ” of any entity means any other entity (whether or not incorporated) that, together with such entity, would be treated as a single employer under Section 414 of the Code or Section 4001 of ERISA.

 

“ FCS Agreement ” has the meaning specified in Section 11.13.

 

“ Financial Statements ” means, for the Florida Partnership and for the Cincinnati Partnership and Ohio Partnership in the aggregate, the statement of operations for the year ended December 31, 2004 and the balance sheet as of December 31, 2004, in each case prepared in accordance with GAAP applied on a consistent basis through the periods presented (subject to the inclusion of footnotes and other adjustments in connection with the preparation of audited financial statements, which are not expected to be material in amount).

 

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“ Florida Partnership ” means SportsChannel Florida Associates, a New York general partnership.

 

“ Florida Region ” means the state of Florida.

 

“ Fox Cable ” has the meaning specified in Section 11.13.

 

“ Fox Distributed Entities ” means RPP Cincinnati Partner I, RPP Cincinnati Partner II, RPP Florida Partner I, RPP Florida Partner II, RPP Ohio Partner I and RPP Ohio Partner II.

 

“ Fox Distributed Partnerships ” means Cincinnati Partnership, Florida Partnership and Ohio Partnership.

 

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

 

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

 

“ Fox Indemnified Parties ” has the meaning set forth in Section 10.2(b).

 

“ Fox Indemnified Liability ” has the meaning set forth in Section 10.2(b).

 

“ Fox Indemnifying Parties ” has the meaning set forth in Section 10.2(a).

 

“ Fox NAP Partner I ” means Fox Sports Net National Ad Sales Holdings II, LLC, a Delaware limited liability company.

 

“ Fox NAP Partner II ” means Fox Sports Net National Ad Sales Holdings, LLC, a Delaware limited liability company.

 

“ Fox NSP Partner I ” means Fox Sports Net National Network Holdings, LLC, a Delaware limited liability company.

 

“ Fox NSP Partner II ” means Fox Sports Net National Network Holdings II, LLC, a Delaware limited liability company.

 

“ Fox Pacific Restriction Date ” means the day on which either (i) Fox RPP Partner (or any Affiliate of Fox RPP Partner) or (ii) Rainbow RPP Partner Sub (or an Affiliate of Rainbow RPP Partner Sub) ceases to be a partner of the Pacific Partnership, unless, in either case, the transferee of or successor to such partnership interest agrees to be bound by the provisions of Section 8.2(c), in which event, (a) if Fox RPP Partner (or any Affiliate of Fox RPP Partner) is the party that has ceased to be a partner of the Pacific Partnership, the Fox Pacific Restriction Date shall be deferred for two (2) years from such date, or (b) if Rainbow RPP Partner Sub (or an Affiliate of Rainbow RPP Partner Sub) is the party that has ceased to be a partner of the Pacific Partnership, the Fox Pacific

 

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Restriction Date shall be deferred and such transferee or successor shall thereafter be treated as Rainbow RPP Partner Sub when applying clause (ii) of this definition of the Fox Pacific Restriction Date.

 

“ Fox Parties ” means Fox RPP Partner, Fox NSP Partner II, Fox NAP Partner II, Fox Sports Net, Fox Former Pacific Partner and Fox Former Chicago Partner.

 

“ Fox Release ” means the Release executed by Fox Sports Net, on behalf of itself and its subsidiaries and affiliates, substantially in the form attached as Exhibit D-2.

 

“ Fox RPP Partner ” means Fox Sports RPP Holdings, Inc., a Delaware corporation.

 

“ Fox Sports Net ” means Fox Sports Net, Inc., a Delaware corporation.

 

“ GAAP ” shall mean generally accepted accounting principles in the United States as in effect from time to time and as consistently applied.

 

“ 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 10.2(a) hereof.

 

“ Indemnifying Parties ” has the meaning specified in Section 10.2(a) hereof.

 

“ League Consents ” means the consent and approval of the National Basketball Association and the National Hockey League to the distribution of MSG Partner I and MSG Partner II from RPP to Rainbow RPP Partner and the other transactions contemplated hereby.

 

“ Liabilities ” means any and all debts, liabilities to pay money and obligations to pay money, whether accrued or fixed, absolute or contingent, matured or unmatured or determined or determinable.  For the avoidance of doubt, the term Liabilities is not intended to include obligations of a Person to perform under or comply with any law, action, judgment or Contract (in each case, other than an obligation to pay money) but would include such obligations if there has been a default or failure to perform or comply by such Person with any such obligation if such default or failure would, with the giving of notice or passage of time or both, reasonably be expected to result in a monetary obligation.

 

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“ Liability Limit ” has the meaning specified in Section 10.2(a) 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 10.2(a) of this Agreement.

 

“ Material Contract ” has the meaning specified in Section 7.4 of this Agreement.

 

“ Metro Channel ” means Metro Channel, L.L.C., a Delaware limited liability company.

 

“ MSG ” means Madison Square Garden, L.P., a Delaware limited partnership.

 

“ NAP ” means National Advertising Partners, a New York general partnership.

 

“ NAP Transferred Interest ” means the fifty percent (50%) general partnership interest in NAP being transferred by Rainbow NAP Partner to Fox NAP Partner II.

 

“ New England Partnership ” means SportsChannel New England Limited Partnership, a Connecticut limited partnership.

 

“ New York Region ” means the geographic region listed on Schedule 1.1.

 

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

 

“ NSP ” means National Sports Partners, a New York general partnership.

 

“ NSP Transferred Interest ” means the fifty percent (50%) general partnership interest in NSP being transferred by Rainbow NSP Partner to Fox NSP Partner II.

 

“ Ohio Partnership ” means SportsChannel Ohio Associates, a New York general partnership.

 

“ Order ” has the meaning specified in Section 9.1(b) hereof.

 

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“ Pacific Note ” means the note payable, dated as of December 12, 2003, issued by RPP Pacific Partner II to Fox Former Pacific Partner.

 

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

 

“ Pacific Region ” means the geographic regions listed on Schedule 1.2.

 

“ Pacific RPP ” means Pacific Regional Programming Partners, a New York general partnership.

 

“ Pacific RPP Partnership Agreement ” means the General Partnership Agreement of Pacific Regional Programming Partners, dated the Closing Date, substantially in the form of Exhibit B hereto.

 

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

 

“ Partnerships ” means each of RPP, NSP, NAP, Radio City Networks, the New England Partnership, MSG, the Ohio Partnership, Metro Channel, the Cincinnati Partnership, the Florida Partnership, the Pacific Partnership, the Chicago Partnership and WSN.

 

“ Pay Television ” means any method, whether presently existing or hereafter developed, of distribution or dissemination (whether microwave, satellite, over-the-air, fiber-optics or otherwise) of video, audio and/or similar signals other than by means of conventional over-the-air broadcast television, and shall be deemed to include without limitation cable television, any other form of wire delivery, over-the-air pay television, multipoint distribution system television, direct to home satellite television, TVRO, DBS, subscription television, computer distribution (e.g., Internet), pay-per-view television, low power television and closed circuit television, whether positioned on a premium, basic or other basis.

 

“ PBGC ” has the meaning specified in Section 7.6(f) hereof.

 

 “ 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.

 

 “ Pledge Agreement ” means the Pledge Agreement, dated as of December 12, 2003, by and among the RPP Pacific Partner I, RPP Pacific Partner II, Fox Former Pacific Partner and Fox Former Chicago Partner.

 

“ Programming Rights ” has the meaning set forth in Section 8.2(a) hereof.

 

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“ Radio City Networks ” means Radio Networks LLC, a Delaware limited liability company.

 

“ Rainbow Indemnified Parties ” has the meaning set forth in Section 10.2(a).

 

“ Rainbow Indemnified Liability ” has the meaning set forth in Section 10.2(a).

 

“ Rainbow Indemnifying Parties ” has the meaning set forth in Section 10.2(b).

 

“ Rainbow NAP Partner ” means Rainbow Advertising Holdings LLC, a Delaware limited liability company.

 

“ Rainbow NSP Partner ” means Rainbow National Sports Holdings LLC, a Delaware limited liability company.

 

“ Rainbow Pacific Restriction Date ” means the day on which either (i) Fox RPP Partner (or any Affiliate of Fox RPP Partner) or (ii) Rainbow RPP Partner Sub (or an Affiliate of Rainbow RPP Partner Sub) ceases to be a partner of the Pacific Partnership, unless, in either case, the transferee of or successor to such partnership interest agrees to be bound by the provisions of Section 8.2(c), in which event, (a) if Rainbow RPP Partner Sub (or any Affiliate of Rainbow RPP Partner Sub) is the party that has ceased to be a partner of the Pacific Partnership, the Rainbow Pacific Restriction Date shall be deferred for two (2) years from such date, or (b) if Fox RPP Partner (or an Affiliate of Fox RPP Partner) is the party that has ceased to be a partner of the Pacific Partnership, the Rainbow Pacific Restriction Date shall be deferred and such transferee or successor shall thereafter be treated as Fox RPP Partner when applying clause (i) of this definition of the Rainbow Pacific Restriction Date.

 

“ Rainbow Parties ” means RMH, Rainbow NAP Partner, Rainbow NSP Partner and Rainbow RPP Partner.

 

“ Rainbow Release ” means the Release executed by RMH, on behalf of itself and its subsidiaries and affiliates, substantially in the form attached as Exhibit D-1.

 

“ Rainbow RPP Partner ” means Rainbow Regional Holdings LLC, a Delaware limited liability company.

 

“ Rainbow RPP Partner Sub ” means Rainbow Regional Holdings Sub LLC, a Delaware limited liability company.

 

“ Rainbow RSNs ” has the meaning specified in Section 11.13.

 

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“ Regional ” shall mean a Pay Television sports programming service featuring sporting events and other sports programming on a local or regional basis in regions in the United States, and in which Fox Sports Net or RMH (or their respective Affiliates), or both, has an ownership interest on the date hereof.

 

“ Releases ” means, collectively, the Fox Release and the Rainbow Release.

 

“ 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.

 

“ RMH ” means Rainbow Media Holdings, LLC, a Delaware limited liability company.

 

“ RNC Agreement Amendments ” means the amendments to the agreements between Rainbow Network Communications and each of Fox Sports Net Ohio and Fox Sports Net Florida, substantially in the form attached as Exhibit E hereto.

 

“ RPP ” means Regional Programming Partners, a New York general partnership.

 

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

 

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

 

“ RPP Cincinnati Partner I ” means Regional Cincinnati Holdings I LLC, a Delaware limited liability company.

 

“ RPP Cincinnati Partner II ” means Regional Cincinnati Holdings II LLC, a Delaware limited liability company.

 

“ RPP Florida Partner I ” means SC Florida Holding Company, L.L.C., a Delaware limited liability company.

 

“ RPP Florida Partner II ” means SportsChannel Florida Holding Company, L.L.C., a Delaware limited liability company.

 

“ RPP Metro Channel Partner I ” means Metro Channel Holdings I, LLC, a Delaware limited liability company.

 

“ RPP Metro Channel Partner II ” means Metro Channel Holdings II, LLC, a Delaware limited liability company.

 

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“ RPP MSG Partner I ” means Regional MSG Holdings LLC, a Delaware limited liability company.

 

“ RPP MSG Partner II ” means Rainbow Garden Corporation, a Delaware corporation.

 

“ RPP NE Partner I ” means Regional NE Holdings I LLC, a Delaware limited liability company.

 

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

 

“ RPP Ohio Partner I ” means Regional Ohio Holdings I LLC, a Delaware limited liability company.

 

“ RPP Ohio Partner II ” means Regional Ohio Holdings II LLC, a Delaware limited liability company.

 

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

 

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

 

“ RPP Radio City Partner I ” means Radio City Networks Holdings I, LLC, a Delaware limited liability company.

 

“ RPP Radio City Partner II” means Radio City Networks Holdings II, LLC, a Delaware limited liability company.

 

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

 

“ Side Letter to the Formation Agreement ” means the Letter Agreement, dated as of December 18, 1997, by and between Rainbow Media Sports Holdings, Inc. and Fox Sports Net, LLC.

 

“ Taxes ” shall mean all taxes, charges, fees, duties, levies, penalties or other assessments, including, without limitation, income, gross receipts, excise, real and personal property, sales, use, transfer, license, payroll, withholding, social security, medicare, franchise, gains, built-in gains, unemployment insurance, workers’ compensation, employer health tax or other taxes, imposed by any Governmental Authority and shall include any interest, penalties or additions to tax attributable to any of the foregoing, including, without limitation, any liability for Taxes as a transferee or successor, by contract or otherwise.

 

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“ Tax Return ” shall mean all returns, declarations, reports, forms, estimates, information returns, statements or other documents (including any related or supporting information) filed or required to be filed with or supplied to any Governmental Authority in connection with any Taxes.

 

“ Transaction Documents ” means, collectively, this Agreement, the Releases, the Advertising Representation Agreements and the Affiliation Agreement Amendments.

 

“ Transferred Employees ” has the meaning specified in Section 8.8 hereof.

 

“ Transferred Interests ” means, collectively, the NAP Transferred Interest and the NSP Transferred Interest.

 

“ WSN ” means WSN, LLC, a Delaware limited liability company.

 

Section 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

 

DISTRIBUTION AND TRANSFER

 

Section 2.1                                       Distributions and Transfers .  Subject to the terms and conditions of this Agreement, at the Closing:

 

(a)                                   RMH shall make a capital contribution of $100,000 in cash to RPP and in consideration thereof shall receive a 0.1% general partnership interest in RPP;

 

Thereafter, in simultaneous transactions:

 

(b)                                  the Pacific Note shall be assigned by Fox Former Pacific Partner to Fox RPP Partner and then shall be contributed by Fox RPP Partner to RPP, and the security interest in the general partnership interest in SportsChannel Pacific Associates

 

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owned by RPP Pacific Partner II pursuant to the Pledge Agreement shall be released and terminated by Fox Former Pacific Partner;

 

(c)                                   the Chicago Note shall be assigned by Fox Former Chicago Partner to Fox RPP Partner and then shall be contributed by Fox RPP Partner to RPP pursuant to a contribution agreement, and the security interest in the general partnership interest in SportsChannel Pacific Associates owned by RPP Pacific Partner II pursuant to the Pledge Agreement shall be released and terminated by Fox Former Chicago Partner;

 

(d)                                  the Pacific Note shall be assigned by RPP to RPP Pacific Partner II;

 

(e)                                   the Chicago Note shall be assigned by RPP to RPP Chicago Partner II;

 

(f)                                     RPP shall form Pacific RPP and shall contribute all its right, title and interest in RPP Pacific Partner I and RPP Pacific Partner II, representing all of RPP’s interests in RPP Pacific Partner I and RPP Pacific Partner II, to Pacific RPP;

 

(g)                                  the holder of the Pacific Note shall execute and deliver a release and cancellation releasing, canceling and terminating all obligations of RPP Pacific Partner II under the Pacific Note;

 

(h)                                  the holder of the Chicago Note shall execute and deliver a release and cancellation releasing, canceling and terminating all obligations of RPP Chicago Partner II under the Chicago Note;

 

(i)                                      RPP shall distribute all its right, title and interest in a 60% general partnership interest in Pacific RPP to Rainbow RPP Partner;

 

(j)                                      RPP shall redeem all of the partnership interests owned by Fox RPP Partner in RPP in exchange for all its right, title and interest in a 40% general partnership interest in Pacific RPP and the Fox Distributed Entities, representing all of RPP’s interests in the Fox Distributed Entities, to Fox RPP Partner;

 

(k)                                   RPP Partner shall execute and deliver the assignment and release agreement in connection with the termination of its interest in MSG Flight Operations, LLC;

 

(l)                                      In consideration of the payment or $1.00 from Fox NSP Partner II to Rainbow NSP Partners, RMH shall cause Rainbow NSP Partner to sell, transfer, assign, convey and deliver to Fox NSP Partner II its entire general partnership interest in NSP (the “ NSP Transferred Interest ”); and

 

(m)                                In consideration of the payment of $1.00 from Fox NAP Partner II to Rainbow NAP Partner, RMH shall cause Rainbow NAP Partner to sell, transfer,

 

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assign, convey and deliver to Fox NAP Partner II its entire general partnership interest in NAP (the “ NAP Transferred Interest ” and, collectively with the NSP Transferred Interest, the “ Transferred Interests ”).

 

ARTICLE III

 

CLOSING

 

Section 3.1                                       Closing .  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 such date (the “ Closing Date ”) that is three (3) business days subsequent to the date that any applicable Hart-Scott Rodino Act waiting period has expired or been terminated and all other conditions to the Closing, including the receipt of the League Consents, shall have been satisfied or waived.  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 Rainbow Parties collectively and the Fox Parties collectively shall have the right to waive receipt of any documents at Closing.  At the Closing, the following shall occur:

 

(a)                                   Rainbow RPP Partner and Fox RPP Partner shall cause RPP to deliver the following to the Rainbow Parties and the Fox Parties:

 

(i)                                      the contribution agreements with respect to the Pacific Note and the Chicago Note;

 

(ii)                                   the release and termination agreement with respect to the security interest in the general partnership interest in SportsChannel Pacific Associates owned by RPP Pacific Partner II pursuant to the Pledge Agreement;

 

(iii)                                the assignment agreements with respect to the Pacific Note and the Chicago Note;

 

(iv)                               the assignment and assumption agreement with respect to the contribution of RPP Pacific Partner I and RPP Pacific Partner II to Pacific RPP;

 

(v)                                  the contribution agreement with respect to the capital contribution by RMH to RPP;

 

(vi)                               the assignment and assumption agreements with respect to RPP’s 60% general partnership interest in Pacific RPP;

 

(vii)                            the assignment and assumption agreement with respect to the redemption of the partnership interest owned by Fox RPP Partner in RPP in exchange for a 40% general partnership interest in Pacific RPP and the Fox Distributed Entities; and

 

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(viii)                         such other documents as may be necessary in the reasonable opinion of the Rainbow Parties or the Fox Parties to transfer ownership of the 60% general partnership interest in Pacific RPP and the Fox Distributed Entities, free and clear of any Liens, or to evidence the satisfaction of any other obligation of RPP and its subsidiaries hereunder.

 

(b)                                  The Rainbow Parties shall deliver the following to the Fox Parties:

 

(i)                                      The contribution agreement with respect to the capital contribution by RMH to RPP;

 

(ii)                                   the assignment and assumption agreements with respect to a 60% general partnership interest in Pacific RPP;

 

(iii)                                the assignment and assumption agreements with respect to the Transferred Interests;

 

(iv)                               copies of all documents evidencing League Consents and 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 the Rainbow Parties on or prior to the Closing Date;

 

(v)                                  a certificate dated as of the Closing Date, duly signed by an authorized officer of each of the Rainbow Parties, certifying that (a) the representations and warranties of such Rainbow Party are true and correct in all material respects 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 performed by such Rainbow Party under this Agreement on or prior to the Closing Date have been complied with and performed in all material respects;

 

(vi)                               the Pacific RPP Partnership Agreement;

 

(vii)                            the Advertising Representation Agreement Amendments;

 

(viii)                         the Affiliation Agreement Amendments;

 

(ix)                                 the Rainbow Release;

 

(x)                                    the RNC Agreement Amendments;

 

(xi)                                 an agreement terminating the Reimbursement Agreement other than as to any obligation relating to the Pacific Partnership; and

 

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(xii)                              such other documents as may be necessary in the reasonable opinion of the Fox Parties to transfer ownership of the 40% general partnership interest in Pacific RPP, the Fox Distributed Entities and the Transferred Interests, free and clear of any Liens, or to evidence the satisfaction of any other obligation of the Rainbow Parties hereunder.

 

(c)                                   The Fox Parties shall deliver the following to the Rainbow Parties:

 

(i)                                      The contribution agreements and the release and termination agreements to be executed by Fox Former Pacific Partner and Fox Former Chicago Partner;

 

(ii)                                   the release and cancellations in connection with the termination of the Notes;

 

(iii)                                the assignment and assumption agreements with respect to a 40% general partnership interest in Pacific RPP and the Fox Distributed Entities;

 

(iv)                               the assignment and release agreement in connection with the termination of the interest of Fox RPP Partner in MSG Flight Operations, LLC;

 

(v)                                  the assignment and assumption agreements with respect to the Transferred Interests;

 

(vi)                               copies of all documents evidencing League Consents and 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 the Fox Parties on or prior to the Closing Date;

 

(vii)                            a certificate, dated as of the Closing Date, duly signed by an authorized officer of each of the Fox Parties, certifying that (a) the representations and warranties of such Fox Party are true and correct in all material respects 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 Fox Party under this Agreement on or prior to the Closing Date have been complied with and performed in all material respects;

 

(viii)                         the Pacific RPP Partnership Agreement;

 

(ix)                                 the Advertising Representation Agreement Amendments;

 

(x)                                    the Affiliation Agreement Amendments;

 

(xi)                                 the Fox Release;

 

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(xii)                              the RNC Agreement Amendments;

 

(xiii)                           an agreement terminating the Reimbursement Agreement other than as to any obligation relating to the Pacific Partnership; and

 

(xiv)                          such other documents as may be necessary in the reasonable opinion of the Rainbow Parties to transfer ownership of the 60% general partnership interest in Pacific RPP, free and clear of any Liens, or to evidence the satisfaction of any other obligation of the Fox Parties hereunder.

 

ARTICLE IV

 

[INTENTIONALLY OMITTED]

 

ARTICLE V

 

REPRESENTATIONS AND WARRANTIES OF THE RAINBOW PARTIES

 

Each Rainbow Party represents and warrants to the Fox Parties as follows:

 

Section 5.1                                       Limited Liability Status .  Such Rainbow Party is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Delaware.  Such Rainbow Party 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.  There is no pending or, to the best of the knowledge of such Rainbow Party, threatened proceeding or other action by any other party with respect to the dissolution, liquidation, insolvency or rehabilitation of such Rainbow Party.

 

Section 5.2                                       Power and Authority; Enforceability .  Such Rainbow Party has the power and authority to execute and deliver the Transaction Documents to which it is a party and to perform its obligations hereunder and thereunder and consummate the transactions contemplated hereby and thereby.  Such Rainbow Party has taken all necessary limited liability company action to authorize the execution, delivery and performance of the Transaction Documents to which it is a party and the transactions contemplated hereby and thereby by it.  Each of the Transaction Documents has been duly executed and delivered by such Rainbow Party to the extent a party thereto and constitutes a legal, valid and binding obligation of such Rainbow Party, enforceable against such Rainbow Party 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.

 

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Section 5.3                                       Consents/Approvals .  Other than as described in Section 8.7 and other than the consents described on Schedule 5.3 , no consents, filings, authorizations or actions of any Governmental Authority are required for such Rainbow Party’s execution, delivery and performance of the Transaction Documents to which it is a party.  Other than the League Consents and as contemplated by Article 3 hereof, no Consent by any Person (other than any Governmental Authority referred to in the preceding sentence) under any Contract to which such Rainbow Party is a party or by which such Rainbow Party or any of its properties or assets are bound is required or necessary for the execution, delivery and performance by such Rainbow Party of the Transaction Documents to which it is a party and the consummation of the transactions contemplated hereby and thereby.

 

Section 5.4                                       No Violation .

 

(a)                                   Such Rainbow Party 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) any Contract to which such Rainbow Party 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 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 Rainbow Party of the Transaction Documents to which it is a party and the consummation of the transactions contemplated hereby and thereby 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 (i) its certificate of formation or limited liability company agreement or (ii) any Contract to which such Rainbow Party 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 (ii) 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.

 

Section 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 Rainbow Party, threatened, anticipated or contemplated against such Rainbow Party 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.

 

Section 5.6                                       Title to Purchase Partnership Interests .  With respect to Rainbow NAP Partner and Rainbow NSP Partner, (i) such Rainbow Party owns beneficially and of record the Transferred Interest that it is transferring hereunder, (ii) such Rainbow Party

 

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has good, valid and marketable title to the Transferred 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, and (iii) at the Closing, the Fox Party to which such Rainbow Party is transferring its Transferred Interest will acquire good, valid, indefeasible and marketable title to and beneficial and record ownership of the Transferred Interest such Rainbow Party is transferring hereunder, free and clear of any Liens.

 

Section 5.7                                       Governing Documents .  With respect to Rainbow NAP Partner and Rainbow NSP Partner, other than any rights of the applicable Fox Parties pursuant to the applicable partnership agreements, the Rainbow Parties have not created or granted any preemptive rights, rights of first refusal or similar rights with respect to the Transferred Interests and no such rights arise by virtue of or in connection with the transactions contemplated hereby.  With respect to the Cincinnati Partnership, the Florida Partnership and the Ohio Partnership, other than the rights of RPP Cincinnati Partner I, RPP Cincinnati Partner II, RPP Florida Partner I, RPP Florida Partner II, RPP Ohio Partner I and RPP Ohio Partner II, the Rainbow Parties have not created or granted any preemptive rights, rights of first refusal or similar rights with respect to such partnerships and no such rights arise by virtue of or in connection with the transactions contemplated hereby.

 

Section 5.8                                       No Commissions .  Such Rainbow Party 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.

 

Section 5.9                                       Affiliate Transactions .  With respect to Rainbow NAP Partner and Rainbow NSP Partner, such Rainbow Party has not on behalf of either of NAP or NSP entered into any Contract or understanding between such partnership, on the one hand, and (i) any Rainbow Party or any Affiliate of a Rainbow Party or (ii) any other party, on the other hand.

 

Section 5.10                                 Cash Balances .  For each of the subsidiaries of RPP listed on Schedule 5.10 , Schedule 5.10 sets forth the amount of cash (less outstanding checks) held by such subsidiary of RPP as of the close of business of the day prior to the date hereof.

 

Section 5.11                                 Exclusivity of Representations .  THE REPRESENTATIONS AND WARRANTIES MADE BY THE RAINBOW PARTIES 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 RAINBOW PARTIES HEREBY DISCLAIM ANY SUCH OTHER OR IMPLIED REPRESENTATIONS OR WARRANTIES, NOTWITHSTANDING THE DELIVERY OR DISCLOSURE TO THE FOX PARTIES OR THEIR OFFICERS, DIRECTORS, EMPLOYEES, AGENTS OR REPRESENTATIVES OF ANY DOCUMENTATION OR OTHER INFORMATION (INCLUDING, WITHOUT LIMITATION, ANY FINANCIAL PROJECTIONS OR OTHER SUPPLEMENTAL DATA).

 

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ARTICLE VI

 

REPRESENTATIONS AND WARRANTIES OF THE FOX PARTIES

 

Each Fox Party represents and warrants to the Rainbow Parties as follows:

 

Section 6.1                                       Status .  Such Fox Party is a limited liability company or corporation, as applicable, duly organized, validly existing and in good standing under the laws of the State of Delaware.  Such Fox Party 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.  There is no pending or, to the best of the knowledge of such Fox Party, threatened proceeding or other action by any other party with respect to the dissolution, liquidation, insolvency or rehabilitation of such Fox Party.

 

Section 6.2                                       Power and Authority: Enforceability .  Such Fox Party has the power and authority to execute and deliver the Transaction Documents to which it is a party and to perform its obligations hereunder and thereunder and consummate the transactions contemplated hereby and thereby.  Such Fox Party has taken all necessary limited liability company action to authorize the execution, delivery and performance of the Transaction Documents to which it is a party and the transactions contemplated hereby and thereby by it.  Each of the Transaction Documents has been duly executed and delivered by such Fox Party to the extent a party thereto and constitutes a legal, valid and binding obligation of such Fox Party, enforceable against such Fox Party 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.

 

Section 6.3                                       Consents/Approvals .  Other than as described in Section 8.7, no consents, filings, authorizations or actions of any Governmental Authority are required for such Fox Party’s execution, delivery and performance of the Transaction Documents to which it is a party.  Other than the League Consents and as contemplated by Article 3 hereof, no Consent by any Person (other than any Governmental Authority referred to in the preceding sentence) under any Contract to which such Fox Party is a party or by which such Fox Party or any of its properties or assets are bound is required or necessary for the execution, delivery and performance by such Fox Party of the Transaction Documents to which it is a party and the consummation of the transactions contemplated hereby and thereby.

 

Section 6.4                                       No Violation .

 

(a)                                   Such Fox Party 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 Fox Party’s certificate of formation or limited liability company agreement or (ii) any Contract to which such Fox Party is a party or by which it or any of its properties or

 

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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 Fox Party of the Transaction Documents to which it is a party and the consummation of the transactions contemplated hereby and thereby 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 (i) its certificate of formation or limited liability company agreement or (ii) any Contract to which such Fox Party 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.

 

Section 6.5                                       Litigation .  There is no claim, action, suit, or legal, administrative or other proceeding or governmental investigation pending or, to the best knowledge of such Fox Party, threatened, anticipated or contemplated against such Fox Party 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.

 

Section 6.6                                       Investment Intent .  Each Fox Party that is acquiring a Transferred Interest acquiring such Transferred Interest hereunder for its own account and with no present intention of distributing or selling such Transferred Interest, in violation of the Securities Act or any applicable state securities law.

 

Section 6.7                                       No Commissions .  Such Fox Party 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.

 

Section 6.8                                       Affiliate Transactions .  With respect to Fox RPP Partner, such Fox Party has not on behalf of RPP entered into any Contract or understanding between RPP or any of its subsidiaries, on the one hand, and (i) any Fox Party or any Affiliate of a Fox Party or (ii) any other party, on the other hand.

 

Section 6.9                                       Cash Balances .  For each of NSP and NAP, Schedule 6.9 sets forth the amount of cash (less outstanding checks) held by each of NSP and NAP as of the close of business on February 1, 2005.

 

Section 6.10                                 Exclusivity of Representations .  THE REPRESENTATIONS AND WARRANTIES MADE BY THE FOX PARTIES 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 FOX PARTIES

 

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HEREBY DISCLAIM ANY SUCH OTHER OR IMPLIED REPRESENTATIONS OR WARRANTIES, NOTWITHSTANDING THE DELIVERY OR DISCLOSURE TO THE RAINBOW PARTIES 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 VII

 

REPRESENTATIONS AND WARRANTIES OF RAINBOW
RPP PARTNER AS TO THE FOX DISTRIBUTED ENTITIES
AND THE FOX DISTRIBUTED PARTNERSHIPS

 

Rainbow RPP Partner represents and warrants to Fox RPP Partner with respect to the Fox Distributed Entities and the Fox Distributed Partnerships as follows:

 

Section 7.1                                       Ownership of and Title to Assets .  RPP owns, directly or indirectly, the Fox Distributed Entities and the Fox Distributed Partnerships.  Each Fox Distributed Entity owns no other assets other than the partnership interests in the Fox Distributed Partnership in which it is a partner.  No Fox Distributed Partnership has any subsidiaries.  The assets of the Fox Distributed Entities and the Fox Distributed Partnerships are not subject to any Lien, except Liens that do not have a material adverse effect on the Fox Distributed Entities and the Fox Distributed Partnerships, taken as a whole.  None of the Fox Distributed Entities has issued any ownership interests (or options, warrants or similar rights to acquire any ownership interests) to any party other than RPP.  None of the Fox Distributed Partnerships has issued any ownership interests (or options, warrants or similar rights to acquire any ownership interests) to any party other than the Fox Distributed Entities that are its general partners.

 

Section 7.2                                       Sufficiency of Assets .  Except as set forth on Schedule 7.2, the Fox Distributed Partnerships own or have rights to use the properties and assets that are necessary in the continued conduct of the businesses of the Fox Distributed Partnerships at the places and in the manner in which the businesses are now conducted.  Since December 31, 2004, no Fox Distributed Partnership has sold any of its long-term assets other than in the ordinary course of business.

 

Section 7.3                                       Financial Statements .  Except for the lack of footnotes therein, the Financial Statements have been prepared in accordance with GAAP and fairly present in all material respects the financial position and results of operations of the Fox Distributed Partnerships as of the dates and for the periods presented therein.

 

Section 7.4                                       Compliance with Applicable Laws and Material Contracts .  Each of the Fox Distributed Entities and the Fox Distributed Partnerships is in conformity with all applicable governmental or judicial laws, ordinances, regulations, rules and orders except where the failure to be in such conformity would not have a material adverse effect upon the Fox Distributed Entities and the Fox Distributed Partnerships, taken as a

 

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whole.  Each of the Fox Distributed Entities and the Fox Distributed Partnerships has all requisite authority and other power and all governmental or judicial permits, certificates, licenses, approvals and other authorizations required to carry on and conduct its businesses and to own, lease, use and operate its properties at the places and in the manner in which its businesses are now conducted except where the failure to have such authority, power, licenses, approvals and authorizations does not have a material adverse effect on the Fox Distributed Entities and the Fox Distributed Partnerships, taken as a whole.  None of the Fox Distributed Entities or the Fox Distributed Partnerships is bound by any order, injunction or decree of any court, governmental department, commission, board, agency or instrumentality which would prevent any of the Fox Distributed Entities or the Fox Distributed Partnerships from conducting its business in substantially the same manner as such business has heretofore been conducted, or from operating and leasing its assets, properties, structures and facilities and/or its buildings and improvements substantially as heretofore operated and leased, except for such orders, injunctions or decrees which do not have a material adverse effect on the Fox Distributed Entities and the Fox Distributed Partnerships, taken as a whole.  Any and all reports and forms required to be filed with any Governmental Authority by the Fox Distributed Entities and the Fox Distributed Partnerships have been duly filed, except for such reports and forms, the failure of which to be filed will not have a material adverse effect on the Fox Distributed Entities and the Fox Distributed Partnerships, taken as a whole.

 

Schedule 7.4 lists each Contract to which any Fox Distributed Entity or Fox Distributed Partnership is a party and which (a) currently obligates (including by way of any guarantee) a party to pay an amount in excess of $1 million in the aggregate over a 12 month period; (b) limits or restricts the right of any of the Fox Distributed Entities or the Fox Distributed Partnerships to compete in any geographical area in any material manner; (c) is a joint venture agreement or an agreement governing an equity investment held by the entity in any third party; or (d) is an agreement with an Affiliate of RMH that is not an Approved Agreement (as defined in the relevant partnership agreement) (each of which shall be deemed to be a “ Material Contract ”).  The Rainbow RPP Partner has made available to the Fox RPP Partner true, correct and complete copies of all Material Contracts or, as applicable, true correct and complete summaries of any oral Material Contracts.  Each Material Contract is in full force and effect, and is a valid and binding agreement; and, in the case of written Material Contracts, enforceable against the Fox Distributed Entity or Fox Distributed Partnership which is a party thereto and, to their knowledge in the case of written Material Contracts, enforceable against third parties, except, in each case, 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; except as set forth on Schedule 7.4 , the relevant Fox Distributed Entity or the Fox Distributed Partnership has duly performed in all material respects its obligations thereunder to the extent that such obligations to perform have accrued; and except as contemplated in the Financial Statements or set forth on Schedule 7.4 , no breach or default or event that would (with the passage of time, notice or both) constitute a breach or default thereunder by the

 

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relevant Fox Distributed Entity or Fox Distributed Partnership has occurred or as a result of the execution of this Agreement or consummation of the transactions contemplated hereby will occur, other than such defaults or breaches as would not have a material adverse effect on the Fox Distributed Entities and the Fox Distributed Partnerships, taken as a whole.  As of the date hereof, to the knowledge of Rainbow RPP Partner, no party to any Material Contract has made or asserted in writing any defense, setoff or counterclaim under such Material Contract and no party has exercised any option granted to it to cancel or terminate any Material Contract or to shorten the term thereof, except, in each case, as would not have a material adverse effect on the Fox Distributed Entities and the Fox Distributed Partnerships, taken as a whole.  The transactions contemplated by this Agreement will not terminate or alter any material rights or obligations of any Party, or give any Person the right to terminate or amend or otherwise modify any material rights, or obligations of, any of the Material Contracts.

 

Section 7.5                                       Taxes and Reports .

 

(a)                                   Each Fox Distributed Entity and each Fox Distributed Partnership has timely filed all Tax Returns required to be filed with respect to or attributable to such Fox Distributed Entity and Fox Distributed Partnership and each such Tax Return is true, complete and correct in all material respects.  All Taxes shown to be due on such Tax Returns, all Taxes required to be paid by each Fox Distributed Entity and each Fox Distributed Partnership, and all Taxes required to be withheld by or with respect to such Fox Distributed Entity and each Fox Distributed Partnership have been timely paid or, if applicable, withheld and paid to the appropriate Governmental Authority.  Except as listed in Schedule 7.5 , there are (i) no deficiencies or assessment of Taxes from any taxing authority with respect to or attributable to any of the Fox Distributed Entities and Fox Distributed Partnerships, (ii) no ongoing audits or examinations of any of the Tax Returns relating to or attributable to such Fox Distributed Entity or Fox the Company, and (iii) no Fox Distributed Entity nor Fox Distributed Partnership has granted any requests, agreements, consents or waivers to extend the statutory period of limitations applicable to the assessment of any Taxes with respect to or attributable to such respective Fox Distributed Entity or Fox Distributed Partnership.

 

(b)                                  There are no liens for Taxes on any of the assets of the Fox Distributed Entities or Fox Distributed Partnerships.

 

(c)                                   None of the Fox Distributed Entities or Fox Distributed Partnerships is a party to any tax allocation or sharing agreement.  None of the Fox Distributed Entities or Fox Distributed Partnerships has any liability for the Taxes of any person (other than such respective Fox Distributed Entity or Fox Distributed Partnership), as a transferee or successor, by contract, or otherwise.

 

(d)                                  Each Fox Distributed Entity and each Fox Distributed Partnership has since the date of creation been treated either as a partnership or disregarded entity for U.S. federal income tax purposes.

 

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(e)                                   All material Tax elections that have been made by each Fox Distributed Entity, each Fox Distributed Partnership and RPP have been disclosed to Fox RPP Partner.

 

Section 7.6                                       Employee Benefit Matters; Employee Relations . 

 

(a)                                   In this Agreement, the term “ Employee Benefit Plan ” means any of the following: an “employee pension benefit plan,” as defined in Section 3(2) of ERISA, an “employee welfare benefit plan,” as defined in Section 3(1) of ERISA, an employment, consulting, severance or similar contract, plan, program, arrangement or policy and any other plan, program, policy or arrangement providing for benefits, compensation, retention payments, bonuses, fees, profit-sharing, stock option, stock purchase or other stock related rights or other forms of incentive or deferred compensation, change in control benefits, vacation benefits, health or medical benefits, employee assistance programs, disability or sick leave benefits, workers’ compensation, supplemental unemployment benefits, severance benefits and post-employment (excluding COBRA) or retirement benefits that is maintained, administered or contributed to by any of the Fox Distributed Partnerships or Fox Distributed Entities or any of their respective ERISA Affiliates and covers any Business Employee or former Business Employee (if such former Business Employee is eligible for or entitled to payment or benefits under such Employee Benefit Plan).  Schedule 7.6(a) sets forth a complete list of each Employee Benefit Plan.

 

(b)                                  Schedule 7.6(b) sets forth the following information with respect to each Business Employee as of January 31, 2005:  job location, job title, current annual base salary, 2003 and 2004 bonuses and 2003 and 2004 commissions, years of service, accrued but unused vacation, personal and sick time, whether such Business Employee is actively at work or on leave of absence and whether such Business Employee is employed under written contract.

 

(c)                                   Rainbow RPP Partner has furnished or otherwise made available to Fox RPP Partner true and complete copies of each written Employee Benefit Plan and a summary of each unwritten Employee Benefit Plan.  Schedule 7.6(c) sets forth each Employee Benefit Plan that is a nonqualified deferred compensation plan or arrangement that covers any of the Business Employees and the aggregate amounts deferred under each such nonqualified deferred compensation plan or arrangement as of January 31, 2005 for such Business Employee.

 

(d)                                  Except as set forth on Schedule 7.6(d) , no Employee Benefit Plan is a “defined benefit plan” (as such term is defined in Section 3(35) of ERISA) and, within the last six years neither the Fox Distributed Partnerships or Fox Distributed Entities, nor any of their respective ERISA Affiliates has sponsored, maintained or contributed to a “defined benefit plan” (as such term is defined in Section 3(35) of ERISA) that covers or covered any current or former Business Employee.  At no time has any of the Fox Distributed Partnerships or Fox Distributed Entities, or any of their

 

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respective ERISA Affiliates maintained a “multiemployer plan” (as such term is defined in Section 3(37) of ERISA) that covers or covered any current or former Business Employee, and within the last six years neither the Fox Distributed Partnerships or Fox Distributed Entities, nor any of their respective ERISA Affiliates has incurred any withdrawal liability within the meaning of Section 4201 of ERISA to any “multiemployer plan” (as such term is defined in Section 3(37) of ERISA).  Neither the Fox Distributed Partnerships or the Fox Distributed Entities, nor any of their ERISA Affiliates or any employees of the foregoing, or any trust created under the Employee Benefit Plans, or any other “disqualified person” or “party in interest” (as such terms are defined in Section 4975 of the Code and Section 3(14) of ERISA, respectively) has breached fiduciary rules of ERISA or engaged in a prohibited transaction that could subject the Employee Benefit Plans, the Fox Distributed Partnerships or the Fox Distributed Entities to any material tax or penalty imposed under Section 4975 of the Code which would have a material adverse effect on the Fox Distributed Partnerships and the Fox Distributed Entities, taken as a whole.  To the best knowledge of the Rainbow RPP Partner, no proceedings (other than routine claims for benefits) are pending or threatened against or relating to any Employee Benefit Plan.

 

(e)                                   Each Employee Benefit Plan has been established and at all times maintained, funded and operated in all material respects in accordance with its terms and applicable laws, including, but not limited to, ERISA and the Code.

 

(f)                                     Neither any of the Fox Distributed Partnerships or Fox Distributed Entities nor any of their respective ERISA Affiliates has incurred any material unsatisfied liability (other than Pension Benefit Guaranty Corporation (“ PBGC ”) premiums) to the PBGC, the Internal Revenue Service or any other individual or entity under Title IV of ERISA, Sections 412 or 4980B of the Code or Part 6 of Title I of ERISA and no event or condition exists that could result in the imposition of any liability on any of the Fox Distributed Partnerships or Fox Distributed Entities, or any of their respective ERISA Affiliates under such provisions that could reasonably have a material adverse effect on the Fox Distributed Partnerships and Fox Distributed Entities, taken as whole.

 

(g)                                  Neither the execution and delivery of this Agreement or any of the Transaction Documents, nor the consummation of the transactions contemplated hereby or thereby will: (i) result in any payment becoming due to any Business Employee; (ii) increase any benefit for any Business Employee under any Employee Benefit Plan; (iii) result in the acceleration of the time of payment or vesting of any such benefits under any Employee Benefit Plan for any Business Employee or (iv) result in any payment made under any of the Employee Benefit Plans which would not be deductible under Section 280G of the Code.

 

(h)                                  (i) There are no labor or collective bargaining agreements to which Fox Distributed Partnerships, Fox Distributed Entities, or any of their respective ERISA Affiliates is a party and covers any Business Employee, (ii) there is no labor organization or union that is certified or recognized as the collective bargaining representative for any

 

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of the Business Employees, (iii) to the best knowledge of the Rainbow RPP Partner, no unfair labor practice charges or representation petitions have been filed with the National Labor Relations Board against, or with respect to, the Business Employees, and neither Rainbow RPP Partner nor any of the Fox Distributed Partnerships or Fox Distributed Entities has received any notice or communication (whether written or oral) reflecting an intention or a threat to file any such complaint or petition, (iv) there are not, and in the preceding twelve (12) months have not been, any strikes or concerted refusals to work or any threats thereof by any of the Business Employees, (v) to the best knowledge of the Rainbow RPP Partner, no union organizing activities are taking place with respect to the Business Employees, and (vi) neither the Fox Distributed Partnerships nor the Fox Distributed Entities is a party to, or bound by, any agreement for the leasing of employees.

 

(i)                                      Fox Distributed Partnerships and Fox Distributed Entities have complied in all material respects with all laws relating to the hiring and retention of all Business Employees, leased employees and independent contractors relating to wages, hours, equal opportunity and collective bargaining.  To the best knowledge of Rainbow RPP Partner, there are no discrimination charges or administrative claims pending or threatened against the Fox Distributed Partnerships, Fox Distributed Entities, or any of their respective ERISA Affiliates by or before any state, local or federal agencies that would result in the imposition of any liability that would have a material adverse effect on Fox Distributed Partnerships and Fox Distributed Entities, taken as a whole.  To the best knowledge of Rainbow RPP Partner, there are no current Occupational Safety and Health Administration investigations or citations pending or threatened against the Fox Distributed Partnerships, Fox Distributed Entities, or any of their respective ERISA Affiliates that could result in the imposition of any liability that would have a material adverse effect on the Fox Distributed Partnerships or Fox Distributed Entities, taken as a whole.  There are no demands for arbitration or, to the best knowledge of Rainbow RPP Partner, pending grievances against the Fox Distributed Partnerships, Fox Distributed Entities, or any of their respective ERISA Affiliates that could result in the imposition of any liability that would have a material adverse effect on the Fox Distributed Partnerships or Fox Distributed Entities, taken as a whole.

 

Section 7.7                                       Absence of Undisclosed Liabilities .  None of the Fox Distributed Partnerships has any Liabilities required to be recorded on a balance sheet prepared in accordance with GAAP, other than Liabilities (i) reflected or reserved on the December 31, 2004 balance sheet forming part of the Financial Statements or (ii) incurred since December 31, 2004 in the ordinary course of business, consistent with past practice, of the Fox Distributed Partnerships.  None of the Fox Distributed Partnerships has entered into any off-balance-sheet financing arrangements.

 

Section 7.8                                       Litigation .  There is no action, suit, litigation, proceeding or investigation by or before any Governmental Authority pending or, to the best knowledge of Rainbow RPP Partner, threatened, against or relating to a Fox Distributed Entity or a

 

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Fox Distributed Partnership, which, in each case, would have a material adverse effect on the Fox Distributed Entities and the Fox Distributed Partnerships, taken as a whole.

 

Section 7.9                                       Exclusivity of Representations .  THE REPRESENTATIONS AND WARRANTIES MADE BY RAINBOW RPP PARTNER 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.  RAINBOW RPP PARTNER HEREBY DISCLAIMS ANY SUCH OTHER OR IMPLIED REPRESENTATIONS OR WARRANTIES, NOTWITHSTANDING THE DELIVERY OR DISCLOSURE TO FOX RPP PARTNER OR ITS OFFICERS, DIRECTORS, EMPLOYEES, AGENTS OR REPRESENTATIVES OF ANY DOCUMENTATION OR OTHER INFORMATION (INCLUDING, WITHOUT LIMITATION, ANY FINANCIAL PROJECTIONS OR OTHER SUPPLEMENTAL DATA).

 

ARTICLE VIII

 

COVENANTS AND AGREEMENTS

 

Section 8.1                                       Conduct Pending the Closing .  From and after the date hereof until the Closing,

 

(a)                                   Rainbow RPP Partner shall conduct and operate the businesses of RPP in the ordinary course in a manner consistent with past practice and consistent with the RPP Partnership Agreement and, with respect to the business of each of the Cincinnati Partnership, the Florida Partnership and the Ohio Partnership, shall use its commercially reasonable efforts to preserve the business intact, keep available the services of the current officers and employees of the business and maintain the existing relations with customers, suppliers, advertisers, distributors, business partners and others having business dealings with such partnerships, and shall not permit any Fox Distributed Partnership to sell any long-term asset other than in the ordinary course of business; provided that (i) no distributions shall be made by RPP or by any Fox Distributed Entity or Fox Distributed Partnership to Cablevision or any of its subsidiaries, and (ii) no cash advances or loans or other payments shall be made by any subsidiary of RPP that is a Fox Distributed Entity or a Fox Distributed Partnership to Cablevision or any of its subsidiaries (other than Scheduled payments under Approved Agreements (as defined in the relevant partnership agreement as in effect on the date hereof), in each case prior to the Closing or the termination of this Agreement pursuant to its terms; it being understood that notwithstanding the foregoing, nothing herein shall prevent a Fox Distributed Entity or a Fox Distributed Partnership from allocating payments received by any such entity from a third party which, pursuant to the current contract under which such payments are received, among such entity, other RPP subsidiaries and either DirecTV or EchoStar, are allocable to other subsidiaries of RPP. 1

 

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(b)                                  Except as set forth in Section 8.2(e), RMH, on behalf of itself and each of its Affiliates, agrees that from and after the Closing until the fifth (5 ^th ) anniversary of the Closing, neither it nor any of its Affiliates will, directly or indirectly, bid for or acquire Programming Rights of professional sports teams whose “home” arena or stadium is located in the Florida Region, or own any Covered Interest in any other Person that owns or bids for or acquires Programming Rights (including through ownership of an interest in a professional sports team) of professional sports teams whose “home” arena or stadium is located in the Florida Region.

 

(c)                                   Except as set forth in Section 8.2(e), RMH, on behalf of itself and each of its Affiliates, agrees that from and after the Closing until the Rainbow Pacific Restriction Date, neither it nor any of its Affiliates will, directly or indirectly, bid for or acquire Programming Rights of professional sports teams whose “home” arena or stadium is located in the Pacific Region, or own any Covered Interest in any other Person that owns or bids for or acquires Programming Rights (including through ownership of an interest in a professional sports team) of professional sports teams whose “home” arena or stadium is located in the Pacific Region.  Except as set forth in Section 8.2(e), Fox Sports Net, on behalf of itself and each of its Affiliates, agrees that from and after the Closing until the Fox Pacific Restriction Date, neither it nor any of its Affiliates will, directly or indirectly, bid for or acquire Programming Rights of professional sports teams whose “home” arena or stadium is located in the Pacific Region, or own any Covered Interest in any other Person that owns or bids for or acquires Programming Rights (including through ownership of an interest in a professional sports team) of professional sports teams whose “home” arena or stadium is located in the Pacific Region.

 

(d)                                  The provisions of this Section 8.2 shall not prohibit or restrict the following:

 

(i)                                      a party or its Affiliates from owning or acquiring a Covered Interest in any Person that directly or through one or more subsidiaries or other entities owns a professional sports franchise or the Programming Rights to the sports events of a professional sports franchise, so long as (A) such franchise or Programming Rights are not a principal business of such Person and (B) the professional sports franchises and Programming Rights to sports events of professional sports franchises owned by such Person (directly or through one or more subsidiaries) were owned on the date of initial acquisition of the Covered Interest therein by the party or its Affiliates; or

 

(ii)                                   a party or its Affiliates from owning or acquiring a Covered Interest in a professional sports franchise but no Programming Rights with respect to the events of that professional sports franchise may be owned by any entity in which such party or such Affiliate, or any of its Affiliates, has a direct or indirect ownership interest other than a Regional in which either one of the Fox Parties (if RMH or one of its Affiliates owns such Covered Interest) or one the Rainbow

 

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Parties (if Fox Sports Net or one of its Affiliates owns such Covered Interest) has a direct or indirect ownership interest, or

 

(iii)                                prohibit or restrict any party or its Affiliates from acquiring, solely as an investment and through private and market purchases, or owning securities of any corporation which are registered under Section 12(b) or 12(g) of the Securities Exchange Act of 1934, as amended, and which are publicly traded, so long as such party and its Affiliates are not a part of any Control group of such corporation and such securities constitute (after conversion, exchange or exercise, in the case of any such securities that are convertible into, or exercisable or exchangeable for, voting securities) less than 15% of the outstanding voting power of that public company or prohibit or restrict such corporation from bidding for or acquiring Programming Rights; or

 

(iv)                               any party or its Affiliates from owning or acquiring any Covered Interest in NSP or any other “national” sports programming network so long as NSP or such successor or other network, as the case may be, is operating as a “national” sports programming network and is not acquiring Programming Rights for the sole or primary purpose of distributing such programming through Pay Television to a Covered Region; or

 

(v)                                  any Person (an “ Acquiror ”) from acquiring an interest in a party or any of its Affiliates after the date of this Agreement and continuing to own such interest and conduct its existing businesses and activities and its Affiliates’ conducting their existing business and activities notwithstanding that such ownership or conduct of business and activities would violate the restrictions on Affiliates contained in this Section 8.2; provided that (A) this clause (v) shall not authorize any actions, ownership or activities by RMH or Fox Sports Net or any entities Controlled by any of them or by their successors and (B) this clause (v) shall not authorize an Acquiror or its Affiliates to engage in new activities or enter into, acquire or develop new businesses in violation of this Section 8.2; or

 

(vi)                               any Person that is a cable television operator or an Affiliate thereof from developing and distributing nonsports programming to cable systems provided that no license fee is paid by such cable systems for such programming.

 

(e)                                   Notwithstanding the foregoing, this Section 8.2 shall not apply to Programming Rights relating to professional sports teams that are not Major League Baseball teams, National Football League teams, National Hockey League teams, Major League Soccer teams or National Basketball Association teams, in each case in a Covered Region and whose games are currently carried on a Regional other than the Regional in whose Covered Region such team has its “home” arena or stadium.

 

(f)                                     RMH and Fox Sports Net hereby agree that the rights and obligations of the parties and their Affiliates under (i) the Formation Agreement and (ii)

 

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the Side Letter to the Formation Agreement shall be terminated and released upon the Closing.

 

Section 8.3                                       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.

 

Section 8.4                                       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.

 

Section 8.5                                       Cooperation .  The Fox Parties and the Rainbow Parties 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.  Without limiting the foregoing, the Fox Parties and the Rainbow Parties each agree to cooperate with the other in the preparation and filing of all forms, notifications, reports and information, if any, required or deemed advisable in connection obtaining League Consents.

 

Section 8.6                                       Tax .

 

(a)                                   The Rainbow Parties and the Fox Parties agree that upon the Closing each Partnership other than the Pacific 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 Rainbow Parties and the Fox Parties for the year of distributions and transfers contemplated hereby.

 

(b)                                  The Rainbow Parties and Fox Parties hereby agree, for each Partnership in the tax year of the respective distributions and transfers hereunder,  to cause each Partnership to make an Internal Revenue Code Section 754 election in respect of each distribution and transfer hereunder.

 

(c)                                   The Rainbow Parties and Fox Parties hereby covenant and agree, from and after the Closing, for all tax purposes, including tax returns and any tax controversies, to prepare information and report and file tax returns on a basis consistent with the foregoing covenants.

 

(d)                                  The Fox Parties and the Rainbow Parties agree to cooperate and work together to structure the distributions and transfers hereunder in a manner so that Code Section 751(b) does not apply to such distributions and transfers.  To the extent, if any, that Code Section 751(b) does apply to such distributions and transfers, the Fox

 

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Parties and the Rainbow Parties agree to cooperate and work together to minimize any gain recognized by the Fox Parties, the Rainbow Parties and RPP.

 

Section 8.7                                       Hart-Scott Rodino Act .  The Rainbow Parties and the Fox Parties (through their respective appropriate Affiliates) agree to prepare and properly file Notification and Report Forms under the Hart-Scott Rodino Act (“ HSR Filing ”) with the Federal Trade Commission and the Antitrust Division of the United States Department of Justice and shall use their respective reasonable best efforts to obtain as promptly as practicable the termination or expiration of the waiting period under the Hart-Scott Rodino Act.  The Rainbow Parties and the Fox Parties (through their respective appropriate Affiliates) further agree that in the event that any of them shall receive a request for documents or further information from the Federal Trade Commission, the Antitrust Division of the United States Department of Justice or a court, then each shall use its reasonable best efforts to comply with such request as promptly as practicable and to cooperate with the other parties to satisfy any document or information requests from the Federal Trade Commission, the Antitrust Division of the United States Department of Justice or a court.  The Rainbow Parties and the Fox Parties (through their respective appropriate Affiliates) shall make, on a prompt and timely basis, all other governmental or regulatory notifications and filings required to be made by it for the consummation of the transactions contemplated hereby.

 

Section 8.8                                       Employees and Employee Benefits .

 

(a)                                   Subject to the right to terminate employees for cause, Cincinnati Partnership, Florida Partnership and Ohio Partnership, as the case may be (the “Employing Partnership”), shall, for a period of three months after the Closing Date (the “Employment Period”), continue the employment of all employees except those employees on disability as of the Closing Date (the “Transferred Employees”) of Cincinnati Partnership, Florida Partnership and Ohio Partnership, in all cases at a compensation level at least equal to the then-current annual base salary and bonus target (such bonus being subject to achieving individual and corporate performance measures to be determined by Fox Sports Net in its discretion) of such Transferred Employee as of the Closing Date, at a comparable position for such employee as of the execution of this Agreement and at a place of employment that is within thirty-five miles of such Transferred Employee’s place of employment as of the Closing Date.  In the event that any Transferred Employee is terminated without cause or is transferred more than thirty-five miles from such Transferred Employee’s place of employment as of the Closing Date within a twelve month period following the Employment Period, the Employing Partnership will make a severance payment to such Transferred Employee in an amount not less than the amount determined in accordance with Schedule 8.8 hereto, provided that all payments and obligations owed to such employee shall be conditioned upon the execution and delivery, and the expiration of any applicable revocation period, of a general release by the applicable employee in a form that is generally used for similarly situated Fox Sports Net employees.

 

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(b)                                  The Employing Partnership shall maintain during the Employment Period, without interruption, employee compensation and benefit plans, programs and policies and fringe benefits (including bonuses, commissions, vacations and severance arrangements) to the Transferred Employees that are no less favorable than those provided by the Fox Sports Net and its Affiliates to comparable employees of Fox Sports Net and its Affiliates.

 

(c)                                   Transferred Employees shall be given credit for all service with RMH and its Affiliates, in each case under all employee benefit plans, programs and policies (including vacation and severance arrangements) and fringe benefits in which they become participants as provided in Section 8.8(b) for purposes of eligibility and vesting, except for benefit accruals under a defined benefit plan of Fox Sports Net and its Affiliates, and no Transferred Employee will be subjected to any waiting periods or limitations on benefits for pre-existing conditions.  Each Transferred Employee will be credited with the amount of vacation time accrued by such Transferred Employee through 12:01 a.m. on the Closing Date.

 

(d)                                  Subject to applicable law, during the Employment Period, the Employing Partnership shall only have the right to terminate the employment of any Transferred Employee if such termination is for cause.

 

(e)                                   Fox Sports Net shall within thirty (30) days of receipt of written request by Rainbow RPP Partner reimburse Rainbow RPP Partner for the costs of providing short-term disability benefits to any Business Employee who was on short-term disability as of the Closing Date.  Fox Sports Net agrees to cause the Employing Partnership to offer employment to any Business Employee of the Employing Partnership who was on disability as of the Closing Date and ceases to be on disability during the Employment Period in accordance with the terms of Section 8.8(a) hereof.

 

Section 8.9                                       EchoStar Affiliation Agreements .  Neither a Rainbow Party nor a Fox Party shall cause or permit RPP Chicago Partner I, RPP Chicago Partner II, RPP Metro Channel Partner I, RPP Metro Channel Partner II, RPP MSG Partner I, RPP MSG Partner II, RPP NE Partner I, RPP NE Partner II, RPP Radio City Partner I, RPP Radio City Partner II, WSN or a Fox Distributed Entity, either directly or through a subsidiary, to terminate EchoStar’s carriage of all of the Sports Services (as defined in and pursuant to Section 2 of the December 31, 2004 amendment to the affiliation agreement dated as of January 1, 2003 as amended between EchoStar Satellite Corporation and the network entities which are parties thereto), without the prior written consent of the other parties hereto.

 

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ARTICLE IX

 

Conditions

 

Section 9.1                                       Conditions to All Parties Obligations .  The obligations of each party to effect the transactions contemplated to occur at the Closing are subject to the satisfaction or waiver at or prior to the Closing of each of the following conditions:

 

(a)                                   Regulation and League Consents .  (i) The waiting period applicable to the consummation of the transactions contemplated hereby under the HSR Act shall have expired or been terminated and (ii) the parties shall have received the League Consents.

 

(b)                                  Orders .  No court or other governmental entity of competent jurisdiction shall have enacted, issued, promulgated, enforced or entered any law, statute, rule, regulation, judgment order injunction, decree or award, (whether temporary, preliminary or permanent) that is in effect and restrains, enjoins or otherwise prohibits consummation of the transactions contemplated by this Agreement (collectively, an “Order”) and no governmental entity shall have instituted an action or proceeding seeking such an Order.

 

Section 9.2                                       Conditions to Obligations of Rainbow Parties .  The obligations of Rainbow Parties to effect the transactions contemplated to occur at the Closing are also subject to the satisfaction or waiver by the Rainbow Parties or prior to the Closing of the following conditions:

 

(a)                                   Representations and Warranties .  (i) The representations and warranties of the Fox Parties set forth in this Agreement shall be true and correct in all material respects as of the date of this Agreement and as of the Closing Date as though made on and as of such date and time (except to the extent such representation and warranty contains a qualification or limitation as to “material adverse effect”, in which case such representation and warranty shall be true and correct as of the date of this Agreement and as of the Closing Date and except to the extent that any such representation and warranty expressly speaks as of an earlier date, in which case such representation and warranty shall be true and correct as of such earlier date) and the Rainbow Parties shall have received the certificate contemplated by Section 3.1(c)(vii).

 

(b)                                  Performance of Obligations of the Fox Parties .  The Fox Parties shall have performed in all material respects all obligations required to be performed by each of them under this Agreement at or prior to the Closing, and the Rainbow Parties shall have received the certificate contemplated by Section 3.1(c)(vii).

 

(c)                                   Deliveries .  All of the documents required to be delivered or caused to be delivered by a Fox Party pursuant to Section 3.1(a) and 3.1(c) shall have been delivered contemporaneous with the Closing.

 

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Section 9.3                                       Conditions to Obligation of the Fox Parties .  The obligations of the Fox Parties to effect the transactions contemplated to occur at the Closing are also subject to the satisfaction or waiver by the Fox Parties at or prior to the Closing of the following conditions:

 

(a)                                   Representations and Warranties .  (i) The representations and warranties of the Rainbow Parties set forth in this Agreement shall be true and correct in all material respects as of the date of this Agreement and as of the Closing Date as though made on and as of such date and time (except to the extent such representation and warranty contains a qualification or limitation as to “material adverse effect”, in which case such representation and warranty shall be true and correct as of the date and as of the Closing Date and except to the extent that any such representation and warranty expressly speaks as of an earlier date, in which case such representation and warranty shall be true and correct as of such earlier date) and the Rainbow Parties shall have received the certificate contemplated by Section 3(b)(v).

 

(b)                                  Performance of Obligations of the Rainbow Parties .  The Rainbow Parties shall have performed in all material respects all obligations required to be performed by each of them under this Agreement at or prior to the Closing, and the Fox Parties shall have received the certificate contemplated by Section 3(b)(v).

 

(c)                                   Deliveries .  All of the documents required to be delivered or caused to be delivered by a Rainbow Party pursuant to Sections 3.1(a) and 3.1(b) shall have been delivered contemporaneous with the Closing.

 

ARTICLE X

 

INDEMNIFICATION

 

Section 10.1                                 Survival .  The representations, warranties, agreements, covenants and obligations of the Fox Parties and the Rainbow Parties 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 one (1) year 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 (i) the representations and warranties contained in Sections 5.6 and 7.1 shall survive the Closing indefinitely, and (ii) the representations and warranties contained in Section 7.5 shall survive the Closing for the applicable statute of limitations (including any extensions thereof).  If written notice of a claim has been given prior to the expiration of the applicable representations, warranties or covenants, then the relevant representations, warranties or covenants shall survive as to such claim, until such claim has been finally resolved.

 

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Section 10.2                                 Indemnification .

 

(a)                                   The Fox Parties (the “ Fox Indemnifying Parties ” and, together with the Rainbow Indemnifying Parties, “ Indemnifying Parties ”) shall indemnify each Rainbow Party and its officers, members and Affiliates (the “ Rainbow Indemnified Parties ” and, together with Fox Indemnified Parties, “ Indemnified Parties ”) 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 such Indemnified Party and resulting from (i) the inaccuracy, in any material respect, of any representation or warranty of Fox Party, (ii) any breach of or failure to perform by a Fox Party any agreement, covenant or obligation contained in or made pursuant to this Agreement, and (iii) the Notes, and all claims, charges, actions or proceedings incident to or arising out of the foregoing (each such Loss, a “ Rainbow Indemnified Liability ”).  For purposes of seeking indemnity pursuant to this Section 10.2(a), the representations and warranties of the Fox Parties shall be interpreted without giving effect to any qualifications or limitations as to “material adverse effect”.  The obligation of the Fox Indemnifying Parties to indemnify the Rainbow Indemnified Parties as provided in this Section 10.2(a) shall be subject to the following limitations: (I) the Fox Indemnifying Parties shall not, in any case, be obligated to indemnify against any Loss from Rainbow Indemnified Liabilities to the extent the amount thereof does not exceed in the aggregate $5,000,000 (the “ Basket Amount ”) and shall only be liable for amounts in excess of the Basket Amount; (II) the claims under clauses (i) and (ii) of this Section 10.2(a) shall not, in any event, exceed $250 million (the “ Liability Limit ”) and the claims under clause (iii) of this Section 10.2(a) shall not, in any event, exceed $150 million; (III) as to any particular claim or series of claims arising out of the same or related facts, events or circumstances, a Rainbow Indemnified Party shall be entitled to seek indemnity for such claim or claims only if such claim or claims equals or exceeds $50,000 in which case the Rainbow Indemnified Party shall be entitled to seek indemnity for the full amount of such claim or claims, subject to the other limitations herein, and (IV) the Rainbow Indemnified Liabilities shall not include any Loss that any Rainbow Indemnified Party would have suffered had this Agreement not been executed and delivered, including as a direct or indirect partner in any Partnership.  Subject to the immediately preceding sentence, loss or damage suffered by the Rainbow Indemnified Parties with respect to any loss in a Partnership shall be equal to, without limitation, the incremental indirect interest in any Rainbow Indemnified Liability obtained as a result of the incremental ownership interest acquired hereunder by the Rainbow Parties, but shall not include any diminution in the value of any asset other than as a result of the assertion of a Rainbow Indemnified Liability that directly reduces the value of an asset by offset or otherwise.

 

(b)                                  The Rainbow Parties (the “ Rain