SUBSCRIPTION AGREEMENT
This Subscription Agreement (the "AGREEMENT"), dated as of June 28, 1999,
is entered into by and among Fox Broadcasting Company, a Delaware corporation
(the "PURCHASER"), and Fox Kids Europe Holdings, Inc., a California corporation
(the "COMPANY"), on the following terms and conditions:
R E C I T A L S
WHEREAS, as of the date hereof, (i) there are 1000 shares of Common Stock
(the "COMMON STOCK") of the Company authorized and 1000 shares issued and
outstanding and (ii) after giving effect to the amendment required in Section
6.1 hereof, there will be 1000 shares of Class B Stock (as defined herein)
authorized, none of which shares is issued or outstanding
WHEREAS, the Company intends to make an initial public offering (the
"IPO") of shares of the Common Stock, or to sell privately to an unaffiliated
third-party purchaser shares of the Common Stock to be issued in connection with
such sale (the "PRIVATE SALE"), and thereafter may make one or more additional
public offerings (each a "SUBSEQUENT PUBLIC OFFERING") and/or one or more
additional private sales (each a "SUBSEQUENT PRIVATE SALE");
WHEREAS, on the terms and subject to the conditions set forth in this
Agreement, the Purchaser desires to purchase, and the Company desires to issue
and sell to Purchaser, shares ("SHARES") of the Class B Stock of the Company;
WHEREAS, on the terms and subject to the conditions set forth in this
Agreement, the Purchaser desires to participate in the IPO or Private Sale, as
applicable, and, subject to the conditions set forth herein, any Subsequent
Public Offerings and any Subsequent Private Sales, and the Company is willing to
grant the Purchaser such rights as an inducement to the Purchaser to enter into
this Agreement;
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration given to each party hereto, the receipt, value and
sufficiency of which are hereby acknowledged, the parties agree as follows.
1. DEFINITIONS. As used in this Agreement, the following terms shall have
the meaning set forth below:
1.1. "BORROWERS" has the meaning given that term in the Credit
Agreement.
1.2. "CALCULATED NUMBER OF SHARES" means, for any Closing, the
Purchase Price for such Closing divided by the Related Sale Price for such
Closing.
1.3. "COMMON STOCK" has the meaning set forth in the Recitals to this
Agreement.
1.4. "CLASS B STOCK" means the shares of Class B Non-Voting Common
Stock of the Company which shall be authorized by the amendment to the Company's
Articles of Incorporation required by Section 6.1 hereof, which amendment shall
provide that such Class B Non-Voting Common Stock of the Company shall
automatically convert to Common Stock upon the earlier to occur of (a)
Purchaser's obtaining HSR Act (as defined herein) approval, and/or other
required regulatory approval, or (b) the transfer by the Purchaser of the Shares
to any third party (or affiliate of Purchaser) if no regulatory approval is
required with respect to such transfer and subsequent conversion to Common
Stock.
1.5. "CLOSING" has the meaning set forth in Section 3 of this
Agreement.
1.6. "CLOSING DATE" has the meaning set forth in Section 3 of this
Agreement.
1.7. "CREDIT AGREEMENT" means that certain Second Amended and
Restated Credit Agreement dated as of October 28, 1997 among Saban
Entertainment, Inc., FCN Holding, Inc., International Family Entertainment,
Inc., Fox Kids Holdings, LLC, the banks, financial institutions and other
institutional lenders from time to time party thereto, Citicorp Securities,
Inc., Chase Securities, Inc. and BankBoston, N.A., as the Co-Arrangers for the
Facilities, and Citicorp USA, Inc., as the Administrative Agent for the Lenders
and the other Secured Parties, as amended.
1.8. "FINAL CLOSING" means the Closing for which the Purchase Price
equals the Total Purchase Price less the aggregate of Purchase Prices for all
prior Closings (if any).
1.9. "GOVERNMENTAL ENTITY" has the meaning set forth in Section 4.5
of this Agreement.
1.10. "HSR ACT" has the meaning set forth in Section 10.3 of this
Agreement.
1.11. "INTERCOMPANY LOAN" means a loan evidenced by an Intercompany
Note.
1.12. "INTERCOMPANY NOTES" has the meaning given that term in the
Credit Agreement.
1.13. "IPO" has the meaning set forth in the Recitals to this
Agreement.
1.14. "LOAN DOCUMENTS" has the meaning given that term in the Credit
Agreement.
1.15. "NOTICES" has the meaning set forth in Section 13.2 of this
Agreement.
1.16. "PIGGYBACK REGISTRATION" has the meaning set forth in Section
11.1 of this Agreement.
1.17. "PRIVATE SALE" has the meaning set forth in the Recitals to
this Agreement.
1.18. "PURCHASE PRICE" has the meaning set forth in Section 3 of this
Agreement.
1.19. "RELATED SALE" means, for any Closing, the IPO, Private Sale,
Subsequent Public Offering or Subsequent Private Sale in connection with which
such Closing occurs.
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1.20. "RELATED SALE PRICE" means, for any Closing, the price per
share at which shares of the Common Stock of the Company are sold in the Related
Sale (as to any Related Sale that is an IPO or Subsequent Public Offering, net
of underwriter's discount).
1.21. "SECURITIES ACT" has the meaning set forth in Section 5.4 of
this Agreement.
1.22. "SENIOR NOTES INDENTURES" means, collectively, (a) the 9 1/4%
Senior Notes Indenture dated on or about October 28, 1997 between Fox Family
Worldwide, Inc., a Delaware corporation ("FFWW"), and The Bank of New York, as
Trustee, and (b) the 10 1/4% Senior Discount Notes Indenture dated on or about
October 28, 1997 between FFWW and The Bank of New York, as Trustee, in each case
as such agreement, instrument or document may have been and/or be amended,
supplemented or otherwise modified from time to time in accordance with the
terms thereof.
1.23. "SHARES" has the meaning set forth in the Recitals to this
Agreement.
1.24. "SUBSEQUENT PRIVATE SALE" has the meaning set forth in the
Recitals to this Agreement.
1.25. "SUBSEQUENT PUBLIC OFFERING" has the meaning set forth in the
Recitals to this Agreement.
1.26. "TAG ALONG SALE" has the meaning set forth in Section 10.1 of
this Agreement.
1.27. "TAG ALONG SALE DATE" has the meaning set forth in Section 10.2
of this Agreement.
1.28. "TAG ALONG SALE NOTICE" has the meaning set forth in Section
10.2 of this Agreement.
1.29. "THIRD PARTY" has the meaning set forth in Section 10.1 of this
Agreement.
1.30. "TOTAL PURCHASE PRICE" means $100,000,000.00.
1.31. "VIOLATION" has the meaning set forth in Section 11.4(a) of
this Agreement.
2. AUTHORIZATION, ISSUANCE AND PURCHASE AND SALE OF THE SHARES OF CLASS B
STOCK. The Company hereby agrees to sell and the Purchaser hereby agrees to
purchase the Shares on the terms and subject to the conditions set forth in this
Agreement. At each Closing (as defined herein), the Company will issue and
deliver Shares to the Purchaser against prior payment by the Purchaser of the
Purchase Price (as defined herein) for such Closing (in connection with which
the parties acknowledge that payment by the Purchaser of the Total Purchase
Price shall constitute payment of the Purchase Price for each of the Closings).
The Purchaser agrees to pay the Total Purchase Price concurrently with the
execution of this Agreement by wire transfer to such account of the Company as
the Company has theretofore designated by notice to the Purchaser.
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3. CLOSINGS. In connection with the IPO or Private Sale, and in connection
with any Subsequent Public Offering or Subsequent Private Sale (until the Final
Closing (as defined herein)), the parties shall conduct a closing (each, a
"CLOSING"). At each Closing, the Purchaser shall purchase from the Company a
number of Shares equal to the Calculated Number of Shares for that Closing for a
purchase price (the "PURCHASE PRICE" for such Closing) equal to the lesser of
(a) the Total Purchase Price less the aggregate of Purchase Prices for all prior
Closings, if any, and (b) the product of (i) the number of shares of Common
Stock being sold in the Related Sale for such Closing and (ii) the Related Sale
Price for such Closing. Each Closing shall take place on the later to occur of
(a) the date the Company and an underwriter of recognized national standing
execute an underwriting agreement for a firm commitment public offering for the
Related Sale (if the Related Sale is the IPO or a Subsequent Public Offering) or
the Company's having entered into a binding agreement to complete the Private
Sale or Subsequent Private Sale (if the Related Sale is the Private Sale or a
Subsequent Private Sale), and (b) satisfaction or waiver of each and every one
of the conditions set forth in Sections 6 and 7 hereof as such conditions relate
to such Closing, or such other date and time as the parties shall otherwise
agree to. The date of each Closing is referred to herein as the "CLOSING DATE"
for such Closing. At each Closing, the Company shall issue and deliver to the
Purchaser one or more certificates representing the Shares purchased at such
Closing.
4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company represents
and warrants that the following representations and warranties are true and
correct in all material respects as of the date hereof, and covenants that each
such representation and warranty shall be true and correct in all material
respects on and as of each Closing Date, with the same force and effect as
though made on and as of such Closing Date, except for changes permitted or
contemplated by this Agreement. 4.1. ORGANIZATION, STANDING AND CORPORATE POWER.
The Company is a corporation duly organized, validly existing and in good
standing under the laws of the State of California, with adequate corporate
power and authority to own its properties and carry on its business as presently
conducted, except where the failure to be so incorporated or to have such power
and authority would not have a material adverse effect on the business,
financial condition or results of operation of the Company. Upon filing the
amendment to its Articles of Incorporation required by Section 6.1 hereof,
Company has all necessary corporate power and authority to enter into, execute
and deliver this Agreement and to consummate the transactions contemplated
hereby.
4.2. CAPITALIZATION. The authorized capital stock of the Company
consists of 1000 shares of the Common Stock of the Company. After giving effect
to the amendment to its Articles of Incorporation required by Section 6.1
hereof, the authorized capital stock of the Company will consist of 1000 shares
of the Common Stock of the Company and 1000 shares of the Class B Stock of the
Company. As of June 25, 1999, approximately 1000 shares of the Common Stock of
the Company and no shares of the Class B Stock of the Company were issued and
outstanding.
4.3. EXECUTION, DELIVERY, AND PERFORMANCE. The execution, delivery
and performance of this Agreement and the consummation of the transactions
contemplated hereby have been duly authorized by all necessary corporate action
of the Company, and the Company has taken all other actions required by law, its
Articles of Incorporation and its Bylaws in order to consummate the transactions
contemplated by this Agreement. This Agreement constitutes the valid and
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binding obligations of the Company, and is enforceable in accordance with its
terms, except as enforceability may be subject to or limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws relating to or
affecting creditors' rights generally.
4.4. ARTICLES OF INCORPORATION. The Company has furnished to the
Purchaser a copy of the Articles of Incorporation of the Company, which are in
full force and effect.
4.5. NO CONSENTS. No consent, authorization, order or approval of, or
filing or registration with, any governmental authority, commission, board or
other regulatory body of the United States or any state or political subdivision
thereof, or any foreign jurisdiction (each, a "GOVERNMENTAL Entity"), is
required to be made or obtained by the Company for or in connection with the
sale by the Company of the Shares to the Purchaser as contemplated hereby.
4.6. NO CONFLICTS. The execution, delivery and performance by the
Company of this Agreement will not conflict with or violate the Articles of
Incorporation or Bylaws of the Company, the Senior Notes Indentures or the
Credit Agreement or violate any other material agreement to which the Company is
a party, including, without limitation, any voting agreement, stockholders
agreement or voting trust, or otherwise contravene, conflict with or result in a
violation of, any federal, state, local, municipal, foreign, international,
multi-national or other administrative order, constitution, law, ordinance,
regulation or statute, or give any individual, corporation, partnership,
governmental authority or regulatory body or any other person the right to
prevent the consummation of the sale of the Shares contemplated hereby.
4.7. NO BROKER. Except as previously disclosed to the Purchaser, the
Company has not employed any investment banker, broker, finder, consultant or
intermediary in connection with the transactions contemplated by this Agreement
which would be entitled to any investment banking, brokerage, finder's or
similar fee or commission in connection with this Agreement or the transactions
contemplated hereby.
5. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER. The Purchaser
represents and warrants that the following representations and warranties are
true and correct in all material respects as of the date hereof, and covenants
that each such representation and warranty shall be true and correct in all
material respects on and as of each Closing Date, with the same force and effect
as though made on and as of such Closing Date, except for changes permitted or
contemplated by this Agreement:
5.1. ORGANIZATION, STANDING AND CORPORATE POWER OF THE PURCHASER. The
Purchaser is a corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware, with adequate corporate power and
authority to own its properties and carry on its business as presently
conducted. The Purchaser has the corporate power and authority to enter into,
execute and deliver this Agreement and to consummate the transactions
contemplated hereby.
5.2. EXECUTION, DELIVERY AND PERFORMANCE BY THE PURCHASER. The
execution, delivery and performance of this Agreement and the consummation of
the transactions contemplated hereby have been duly authorized by all necessary
corporate action of the Purchaser, and the Purchaser has taken all other actions
required by law, its Certificate of Incorporation and its Bylaws in order
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to consummate the transactions contemplated by this Agreement. This Agreement
constitutes the valid and binding obligations of the Purchaser and is
enforceable in accordance with its terms, except as enforceability may be
subject to or limited by bankruptcy, insolvency, reorganization, moratorium or
other similar laws relating to or affecting creditors' rights generally.
5.3. NO CONFLICTS. The execution, delivery and performance by the
Purchaser of this Agreement will not conflict with or violate the Certificate of
Incorporation or Bylaws of the Company or violate any other agreement to which
the Purchaser is a party, or otherwise contravene, conflict with or result in a
violation of, any federal, state, local, municipal, foreign, international,
multi-national or other administrative order, constitution, law, ordinance,
regulation or statute, or give any individual, corporation, partnership,
governmental authority or regulatory body or any other person the right to
prevent the consummation of the sale of the Shares contemplated hereby.
5.4. PURCHASER ACKNOWLEDGMENTS AND REPRESENTATIONS. The Purchaser is
acquiring the Shares for its own account and not for the account of any other
Person. The Purchaser acknowledges and represents: (i) that it is aware that the
Shares are not registered under the Securities Act of 1933, as amended (the
"SECURITIES ACT") and are subject to the restrictions thereof, including
pursuant to Rule 144 promulgated thereunder; (ii) that no federal or state
agency has passed upon the Shares or made any finding or determination as to the
fairness of the Purchaser's investment in the Shares; (iii) that there are risks
of loss associated with the Purchaser's purchase of the Shares; (iv) that the
investment in the Shares is an illiquid investment and the Purchaser may bear
the risk of its investment for an indefinite period of time; and (v) that it is
a an "accredited investor" as such term is defined in Rule 501 of Regulation D
promulgated under the Securities Act, and has such knowledge and experience in
financial and business matters that it is capable of evaluating the merits and
risks of the investment and is able to bear such financial risk.. The Purchaser
understands and agrees that the following restriction and limitation is
applicable to Purchaser's investment in the Shares pursuant to Section 4(2) of
the Securities Act and/or Rule 506 of Regulation D:
"THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED OR ANY STATE SECURITIES LAWS AND NEITHER THE
SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, TRANSFERRED, PLEDGED
OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE ACT OR SUCH LAWS OR AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT AND
SUCH LAWS WHICH, IN THE OPINION OF COUNSEL FOR THE HOLDER, WHICH COUNSEL AND
OPINION ARE SATISFACTORY TO COUNSEL FOR THIS COMPANY, IS AVAILABLE."
5.5. The foregoing statement will be affixed as a legend on all
certificates representing the Shares.
Page 6
5.6. NO CONSENTS. No consent, authorization, order or approval of, or
filing or registration with, any Governmental Entity, is required to be made or
obtained by the Purchaser for or in connection with the sale by the Company of
the Shares to the Purchaser as contemplated hereby or the receipt by Fox of such
Shares.
5.7. NO BROKER. The Purchaser has not employed any investment banker,
broker, finder, consultant or intermediary in connection with the transactions
contemplated by this Agreement which would be entitled to any investment
banking, brokerage, finder's or similar fee or commission in connection with
this Agreement or the transactions contemplated hereby.
6. CONDITIONS TO OBLIGATIONS OF THE PURCHASER. Unless waived, in whole or
in part, in writing by the Purchaser, the obligations of the Purchaser to
purchase the Shares shall be subject to the satisfaction at or prior to the
Closing Date of each of the following conditions:
6.1. AMENDMENT OF ARTICLES OF INCORPORATION. Prior to the IPO or
Initial Private Sale, the Company will file a Certificate of Amendment to its
Articles of Incorporation in a form mutually agreeable to the Company and the
Purchaser, authorizing the issuance of Class B Stock.
6.2. ACCURACY OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties of the Company contained herein shall be true and correct in all
material respects on and as of the Closing Date, with the same force and effect
as though made on and as of the Closing Date, except for changes permitted or
contemplated by this Agreement.
6.3. PERFORMANCE OF AGREEMENTS. The Company shall have performed in
all material respects all obligations and agreements contained in this Agreement
to be performed or complied with by it prior to or at the Closing Date.
6.4. OFFICER'S CERTIFICATE. The Purchaser shall have received a
certificate signed on behalf of the Company by the chief executive officer and
chief financial officer of the Company to the effect of Sections 6.2 and 6.3.
6.5. THE SHARES. The Company shall be prepared to deliver one or more
certificates for all the Shares to the Purchaser upon the Closing.
6.6. NO INJUNCTIONS. None of the parties hereto shall be subject to
any order or injunction of a court of competent jurisdiction that prohibits the
consummation of the sale of the Shares to the Purchaser contemplated by this
Agreement. In the event any such order or injunction shall have been issued,
each party agrees to use its reasonable efforts to have any such injunction
lifted.
6.7. NO ADVERSE ENACTMENTS. There shall not have been any statute,
rule, regulation or order promulgated, enacted or issued by any Government
Entity or court of competent jurisdiction which would make the consummation of
the sale of the Shares hereunder illegal.
7. CONDITIONS TO OBLIGATIONS OF THE COMPANY. Unless waived, in whole or in
part, in writing by the Company, the obligations of the Company to issue and
sell the Shares as contemplated by this Agreement shall be subject to the
fulfillment at or prior to the Closing Date of each of the following conditions:
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7.1. ACCURACY OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties of the Purchaser contained herein shall be true and correct in
all material respects on and as of the Closing Date, with the same effect as
though made on and as of the Closing Date, except for changes permitted or
contemplated by this Agreement.
7.2. PERFORMANCE OF AGREEMENTS. The Purchaser shall have performed in
all material respects all obligations and agreements contained in this Agreement
to be performed or complied with by it prior to or at the Closing Date. 7.3.
OFFICER'S CERTIFICATE. The Company shall have received a certificate signed on
behalf of the Purchaser by the chief executive officer and chief financial
officer of the Purchaser to the effect of Sections 7.1 and 7.2.
7.4. NO ADVERSE ENACTMENTS. There shall not have been any statute,
rule, regulation or order promulgated, enacted or issued by any Government
Entity or court of competent jurisdiction which would make the consummation of
the sale of the Shares hereunder illegal.
7.5. NO BREACH OF CREDIT AGREEMENT OR SENIOR NOTES INDENTURES;
CONSENTS, Etc. The consummation of the transactions contemplated by this
Agreement, including without limitation each of the Closings, shall not
constitute, cause or result in any Default (as that term is defined in the
Credit Agreement) or Event of Default (as that term is defined in the Credit
Agreement) or breach or default under any of the Loan Documents (as that term is
defined in the Credit Agreement), and the Company shall have obtained all such
consents, waivers and amendments under, of or to the Credit Agreement and Loan
Documents as are necessary to enable the consummation of the transactions
contemplated by this Agreement, including without limitation each of the
Closings, without constituting, causing or resulting in any such Default or
Event of Default under the Credit Agreement, or breach or default under any of
the Loan Documents; and the consummation of the transactions contemplated by
this Agreement, including without limitation each of the Closings, shall not
constitute, cause or result in any Event of Default (as that term is defined in
each of the Senior Notes Indentures).
7.6. NO INJUNCTIONS. None of the parties hereto shall be subject to
any order or injunction of a court of competent jurisdiction that prohibits the
consummation of the sale of the Shares to the Purchaser contemplated by this
Agreement. In the event any such order or injunction shall have been issued,
each party agrees to use its reasonable efforts to have any such injunction
lifted.
7.7. PURCHASE PRICE. The Purchaser shall have paid the Purchase Price
for all the Shares to the Company in the amount and manner contemplated hereby.
8. COVENANTS OF THE PURCHASER. The Purchaser hereby covenants and agrees as
follows: Subject to the terms and conditions of this Agreement, the Purchaser
agrees to use all reasonable efforts to take, or cause to be taken, all actions,
and to do, or cause to be done, all things necessary, proper or advisable to
consummate and make effective the transactions contemplated by this Agreement.
The Purchaser hereby agrees, while this Agreement is in effect, and except as
contemplated hereby, not to intentionally and knowingly take any action with the
intention and knowledge that such action would make any of its representations
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or warranties contained herein untrue or incorrect in any material respect or
have the effect of preventing or disabling it from performing its obligations
under this Agreement.
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9. COVENANTS OF THE COMPANY.
9.1. CONDUCT OF BUSINESS. The Company hereby covenants and agrees as
follows: Subject to the terms and conditions of this Agreement, the Company
agrees to use all reasonable efforts to take, or cause to be taken, all actions,
and to do, or cause to be done, all things necessary, proper or advisable to
consummate and make effective the transactions provided for by this Agreement.
The Company hereby agrees, while this Agreement is in effect, and except as
contemplated hereby, not to intentionally and knowingly take any action with the
intention and knowledge that such action would make any of its representations
or warranties contained herein untrue or incorrect in any material respect or
have the effect of preventing or disabling it from performing its obligations
under this Agreement. Without limiting the generality of the foregoing, and
except as contemplated by this Agreement, prior to the Final Closing Date, the
Company will not, without the prior written consent of Purchaser:
(a) Propose or adopt any amendments to the Articles of
Incorporation or Bylaws of the Company;
(b) Issue, sell or repurchase, or authorize or propose the
issuance, sale or repurchase of any shares of capital stock
of the Company, or securities convertible into such shares,
or any rights, warrants or options to acquire such shares or
other convertible securities; or
(c) Sell, lease, dispose of, convey or transfer or agree to
sell, lease, dispose of, convey or transfer substantially
all of the assets of the Company, except for sales in the
ordinary course of business.
9.2. REPAYMENT OF CREDIT AGREEMENT. The Company shall, on or before
the Closing Date for each Closing, apply the Purchase Price for such Closing to
repayment of the indebtedness owing under the Credit Agreement, PROVIDED,
HOWEVER, that the Company shall have complied with this Section 9.2 if (a) it
shall have made an Intercompany Loan to any of the Borrowers in the amount of
the Purchase Price for such Closing and (b) the Borrower to which such
Intercompany Loan is made uses the funds so lent to repay indebtedness under the
Credit Agreement in the amount of the funds so lent.
9.3. CONSENTS, WAIVERS AND AMENDMENTS TO CREDIT AGREEMENT. The
Company shall use its reasonable best efforts to obtain such consents, waivers
and amendments under, of or to the Credit Agreement and Loan Documents as the
Company reasonably believes are necessary to enable the consummation of the
transactions contemplated by this Agreement without constituting, causing or
resulting in any such Default or Event of Default under the Credit Agreement, or
breach or default under any of the Loan Documents.
10. TAG ALONG RIGHTS.
10.1. TAG ALONG RIGHTS. If the Company enters into an agreement (or
series of related agreements) to transfer or sell to one or more persons who,
directly or indirectly, own less than 10 percent of the outstanding Common Stock
of the Company (a "THIRD PARTY") any number of shares of Common Stock of the
Company (such transfer or sale, a "TAG ALONG SALE"), then the Purchaser shall
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have the obligation to participate in such Tag Along Sale. The Purchaser will be
entitled to sell all of its shares of Common Stock of the Company before the
Company is entitled to sell any shares.
10.2. SALE NOTICE. The Company shall provide the Purchaser with
written notice (the "TAG ALONG SALE NOTICE") not more than 60 nor less than 10
days prior to the proposed date of the Tag Along Sale (the "TAG ALONG SALE
Date"). Each Tag Along Sale Notice shall set forth: (i) the name and address of
each Third Party; (ii) the number of shares of Common Stock proposed to be
transferred or sold; (iii) the proposed amount and form of consideration to be
paid for such shares of Common Stock and the terms and conditions of payment
offered by the proposed transferee or purchaser, provided that if the form of
consideration proposed is other than cash, the Company may not require the
Purchaser's participation in the sale without the Purchaser's consent; (iv)
confirmation that the proposed purchaser or transferee has been informed of the
"Tag Along Rights" provided for herein and has agreed to purchase the shares of
the Purchaser before purchasing any shares from the Company; and (v) the Tag
Along Sale Date.
10.3. TAG ALONG PARTICIPATION. Upon receipt by the Purchaser of the
Tag Along Sale Notice, each of the Purchaser and the Company shall take all
actions necessary for the Purchaser to convert its Class B Stock into Common
Stock, including, if applicable, the filing of a Notification and Report Form
under the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of 1976, as amended (the
"HSR ACT"). Upon conversion of the Class B Stock and receipt of notice of
termination of the waiting period under the HSR Act, if applicable, the Company
and the Purchaser shall have the right to consummate the Tag Along Sale with the
Third Party on the terms and conditions included in the Tag Along Sale Notice.
11. REGISTRATION RIGHTS.
11.1. RIGHT TO PIGGYBACK. Whenever the Company proposes to register
any of its Common Stock under the Securities Act (other than a registration on
Form S-4 or Form S-8 or any successor or similar forms), and the registration
form to be used may be used for the registration of the shares of Common Stock
(a "PIGGYBACK REGISTRATION"), whether or not for sale for its own account, the
Company will give prompt written notice to the Purchaser of its intention to
effect such registration and will include in such registration all shares of the
Common Stock of the Company held by the Purchaser, to the extent such number of
shares is not greater than the number to be registered. Upon receipt of such
notice from the Company, the Purchaser will convert the Class B Stock into the
number of shares of Common Stock to be sold in the Piggyback Registration.
11.2. PRIORITY. If in a Piggyback Registration, the managing
underwriters advise the Company in writing that in their opinion the number of
shares of Common Stock requested to be included in such registration exceeds the
number which can be sold in such offering within a price range reasonably
acceptable to the Company, the Company will include in such registration (i)
first, the Common Stock of the Company that the Purchaser will sell and (ii)
second, the Common Stock of the Company that the Company proposes to sell.
11.3. REGISTRATION EXPENSES. The Company shall pay all Registration
Expenses relating to any registration of shares of Common Stock hereunder.
"Registration Expenses" shall include all fees and expenses incident to the
Company's performance of or compliance with this Agreement, including without
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limitation: (i) Securities and Exchange Commission, stock exchange or National
Association of Securities Dealers, Inc. registration and filing fees and all
listing fees with respect to the inclusion of the securities on a stock
exchange, (ii) fees and expenses of compliance with state securities or "blue
sky" laws, including without limitation, reasonable fees and expenses of blue
sky counsel, (iii) printing expenses, (iv) messenger and delivery expenses, (v)
fees and disbursements of counsel for the Company, (vi) reasonable fees and
expenses of one counsel for the Purchaser, (vii) fees and disbursements of all
independent public accountants and (viii) any other fees and disbursements of
underwriters, if any, customarily paid by issuers or sellers of securities.
11.4. INDEMNIFICATION. In the event any of the Purchaser's Common Stock is
included in a registration statement under this Agreement:
(a) To the extent permitted by law, the Company will indemnify
and hold harmless the Purchaser and each of its officers,
directors, employees and agents against any losses, claims,
damages or liabilities to which the Purchaser or its
officers, directors, employees or agents may become subject
under the Securities Act, the Securities Exchange Act of
1934 or other federal or state law, insofar as such losses,
claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any of the following
statements, omissions or violations (collectively, a
"Violation"): (i) any untrue statement or alleged untrue
statement of a material fact contained in such registration
statement, including any preliminary prospectus or final
prospectus contained therein or any amendments or
supplements thereto or (ii) the omission or alleged omission
to state therein a material fact required to be stated
therein, or necessary to make the statements therein not
misleading, and the Company will reimburse the Purchaser for
any legal or other expenses reasonably incurred by it in
connection with investigating or defending any such loss,
claim, damage, liability or action; PROVIDED, HOWEVER, that
the indemnity agreement contained in this Section shall not
apply to amounts paid in settlement of any such loss, claim,
damage, liability or action if such settlement is effected
without the consent of the Company, which consent shall not
be unreasonably withheld, nor shall the Company be liable in
any such case for any such loss, claim, damage, liability or
action to the extent that it arises out of or is based upon
a Violation which occurs in reliance upon and in conformity
with information furnished in writing for use in connection
with such registration by, or on behalf of, the Purchaser.
(b) To the extent permitted by law, the Purchaser will indemnify
and hold harmless the Company, each of its officers,
directors, agents or employees, and each Person, if any, who
controls the Company within the meaning of the Securities
Act, against any losses, claims, damages or liabilities to
which the Company or any such director, agent, employee,
officer or controlling Person, may become subject, under the
Securities Act, the Exchange Act or other federal or state
Page 12
law, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based
upon any Violation, in each case to the extent (and only to
the extent) that such Violation occurs in reliance upon and
in conformity with information furnished in writing by, or
on behalf of, the Purchaser for use in connection with such
registration; and the Purchaser will reimburse any legal or
other expenses reasonably incurred by the Company or any
such agent, employee, director, officer or controlling
Person, in connection with investigating or defending any
such loss, claim, damage, liability or action; PROVIDED,
HOWEVER, that the indemnity agreement contained in this
Section shall not apply to amounts paid in settlement of any
such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Purchaser,
which consent shall not be unreasonably withheld.
(c) Promptly after receipt by an indemnified party under this
Section of notice of the commencement of any action
(including any governmental action), such indemnified party
will, if a claim in respect thereof is to be made against
any indemnifying party under this Section, deliver to the
indemnifying party a written notice of the commencement
thereof and the indemnifying party shall have the right to
participate in, and, to the extent the indemnifying party so
desires, jointly with any other indemnifying party similarly
notified, to assume the defense thereof with counsel
mutually satisfactory to the parties; PROVIDED, HOWEVER,
that an indemnified party shall have the right to retain its
own counsel, with the fees and expenses to be paid by the
indemnifying party, if, in the reasonable opinion of counsel
for the indemnified party, representation of such
indemnified party by the counsel retained by the
indemnifying party would be inappropriate due to actual or
potential differing interests between such indemnified party
and any other party represented by such counsel in such
proceeding. The failure to deliver written notice to the
indemnifying party within a reasonable period of time of the
commencement of any such action shall relieve such
indemnifying party of any liability to the indemnified party
under this Section to the extent prejudicial to its ability
to defend such action, but the omission so to deliver
written notice to the indemnifying party will not relieve it
of any liability that it may have to any indemnified party
otherwise than under this Section.
(d) If the indemnification provided for in this Section is held
by a court of competent jurisdiction to be unavailable to an
indemnified party or insufficient to hold it harmless with
respect to any loss, liability, claim, damage or expense
referred to therein, then the indemnifying party, in lieu of
indemnifying such indemnified party hereunder, shall
Page 13
contribute to the amount paid or payable by such indemnified
party as a result of such loss, liability, claim, damage
or expense in such proportion as is appropriate to
reflect the relative fault of the indemnifying party
on the one hand and of the indemnified party on the
other in connection with the statements or omissions that
resulted in such loss, liability, claim, damage or expense
as well as any other relevant equitable considerations.
The relative fault of the indemnifying party and of the
indemnified party shall be determined by reference to,
among other things whether the untrue or alleged untrue
statements of a material fact or the omission to state
a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the
parties' relative intent, knowledge, access to information,
and opportunity to correct or prevent such statement or
omission.
12. POST-CLOSING COVENANTS; TERMINATION. The Company and the Purchaser
agree to execute such further documents or instruments and to take such other
actions as are necessary to transfer the Shares to the Purchaser and to
otherwise carry out the transactions provided for by this Agreement. Purchaser
agrees that, whether or not any Closings occur and whether or not the Final
Closing occurs, Purchaser shall not make any claim, assert or pursue any right
or remedy under this Agreement or otherwise take any action, that (as to any of
the foregoing) would either (a) constitute, cause or result in any Default (as
that term is defined in the Credit Agreement) or Event of Default (as that term
is defined in the Credit Agreement) or breach or default under any of the Loan
Documents (as that term is defined in the Credit Agreement), or (b) constitute,
cause or result in any Event of Default (as that term is defined in each of the
Senior Notes Indentures).
13. MISCELLANEOUS.
13.1. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective successors
and assigns. Other than as set forth in the immediately succeeding sentence, no
party may assign any of its rights, or delegate any of its duties or
obligations, hereunder without the prior written consent of the other party, and
any such purported assignment or delegation shall be void AB INITIO.
Notwithstanding the foregoing, the Purchaser, its affiliates, and its successors
and assigns, may assign their rights and delegate their duties (a) to any
successor entity resulting from any liquidation, merger, consolidation,
reorganization, or transfer of all or substantially all of the assets or stock
of the Purchaser, or (b) to any affiliate of the Purchaser, or (c) to Fox Family
Worldwide, Inc.; PROVIDED, that in either case, any such assignee shall
expressly assume all of the obligations the Purchaser hereunder.
13.2. NOTICES. All notices, demands and other communications
(collectively, "NOTICES") given or made pursuant to this Agreement shall be in
writing and shall be deemed to have been duly given if sent by registered or
certified mail, return receipt requested, postage and fees prepaid, by overnight
service with a nationally recognized "next day" delivery company such as Federal
Express or United Parcel Service, by facsimile transmission, or otherwise
actually delivered to the following addresses:
Page 14
(a) IF TO THE PURCHASER:
Fox Broadcasting Company
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Building 100, Room 5015
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
WITH A COPY TO:
Squadron, Ellenoff, Plesent & ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇
Fax: ▇▇▇.▇▇▇.▇▇▇▇
IF TO THE COMPANY:
Fox Kids Europe Holdings, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇-▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇
Fax: ▇▇▇.▇▇▇.▇▇▇▇
WITH A COPY TO:
Troop ▇▇▇▇▇▇▇ Pasich Reddick & ▇▇▇▇▇, LLP
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇-▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
Fax: ▇▇▇.▇▇▇.▇▇▇▇
Any Notice shall be deemed duly given when received by the addressee thereof.
Any of the parties to this Agreement may from time to time change its address
for receiving notices by giving written notice thereof in the manner set forth
above.
13.3. AMENDMENT: WAIVER. No provision of this Agreement may be waived
unless in writing signed by all of the parties to this Agreement, and the waiver
of any one provision of this Agreement shall not be deemed to be a waiver of any
other provision. This Agreement may be amended, supplemented or otherwise
modified only by a written agreement executed by all of the parties to this
Agreement.
13.4. JURISDICTION. The parties hereto irrevocably submit to the
non-exclusive jurisdiction of the state and federal courts located in California
for the purposes of any suit, action or other proceeding arising out of this
Agreement (and agree not to commence any action, suit or proceeding relating
hereto except in such courts). Each party hereto hereby irrevocably designates
the following individual as its designee, appointee and agent to receive, for
and on behalf of it, service of process in such respective jurisdictions
Page 15
in any legal action or proceeding with respect to this Agreement or any document
related thereto: the Company designates ▇▇▇ ▇▇▇▇▇; and the Purchaser designates
▇▇▇ ▇▇▇▇▇▇▇▇▇. It is understood that a copy of such process serviced on such
agent will be promptly forwarded by mail to it at its address set forth in
Section 13.2 hereof, but the failure to receive such copy shall not affect in
any way the service of such process. Each of the parties hereto further
irrevocably consents to the service of process of any of the aforementioned
courts in any such action or proceeding by the mailing of copies thereof by
registered or certified mail, postage prepaid, to it at its said address, such
service to become effective upon confirmed delivery. The parties irrevocably and
unconditionally waive any objection to the laying of venue of any action, suit
or proceeding arising out of this Agreement or the transactions contemplated
hereby in the state or federal courts located in California, and hereby further
irrevocably and unconditionally waive and agree not to plead or claim in any
such action, suit or proceeding brought in any such court that such action, suit
or proceeding has been brought in an inconvenient forum.
13.5. GOVERNING LAW. This Agreement shall be governed by and
construed both as to validity and performance and enforced in accordance with
the laws of the State of California without giving effect to the choice of law
principles thereof.
13.6. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
13.7. REMEDIES CUMULATIVE. Each of the various rights, powers and
remedies shall be deemed to be cumulative with, and in addition to, all the
rights, powers and remedies which either party may have hereunder or under
applicable law relating hereto or to the subject matter hereof, and the exercise
or partial exercise of any such right, power or remedy shall constitute neither
an exclusive election thereof nor a waiver of any other such right, power or
remedy.
13.8. HEADINGS. The section and subsection headings contained in this
Agreement are included for convenience only and form no part of the agreement
between the parties.
13.9. SEVERABILITY. Whenever possible, each provision of this
Agreement shall be interpreted in such a manner as to be effective and valid
under applicable law, but if any provision of this Agreement shall be or become
prohibited or invalid under applicable law, such provision shall be ineffective
to the extent of such prohibition or invalidity without invalidating the
remainder of such provision or the remaining provisions of this Agreement.
13.10. EXPENSES. Each party shall pay its own costs, expenses,
including without limitation, the fees and expenses of their respective counsel
and financial advisors.
13.11. ENTIRE AGREEMENT. This Agreement constitutes and embodies the
entire understanding and agreement of the parties hereto relating to the subject
matter hereof and there are no other agreements or understandings, written or
oral, in effect between the parties relating to such subject matter except as
expressly referred to herein.
Page 16
13.12. PUBLICITY. The Purchaser and the Company agree that press
releases and other announcements with respect to the transactions contemplated
hereby shall be subject to mutual agreement; PROVIDED, HOWEVER, that either
party may make such announcement as, in the opinion of its counsel, such party
is required to make pursuant to applicable law, but in such event such party
shall, to the extent practicable, give the other party reasonable prior notice
and an opportunity to comment on the proposed announcement.
13.13. SPECIFIC PERFORMANCE. Each of the parties hereto recognizes
and acknowledges that a breach by it of any covenants or agreements contained in
this Agreement will cause the other parties to sustain damages for which they
would not have an adequate remedy at law for money damages, and therefore each
of the parties hereto agrees that in the event of any such breach the aggrieved
party or parties shall be entitled to the remedy of specific performance of such
covenants and agreements and injunctive and other equitable relief, without the
posting of bond or other security, in addition to any other remedy to which it
or they may be entitled, at law or in equity.
13.14. NO THIRD PARTY BENEFICIARIES. This Agreement is not intended
to benefit, and shall not run to the benefit of or be enforceable by, any other
person or entity other than the parties hereto and their permitted successors
and assigns.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
COMPANY
FOX KIDS EUROPE HOLDINGS, INC.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
-----------------------------
Its:
----------------------------
PURCHASER
FOX BROADCASTING COMPANY
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇
-----------------------------
Its:
----------------------------
Page 17