EXHIBIT 4.6
LIQUIDATED DAMAGES AGREEMENT
THIS LIQUIDATED DAMAGES AGREEMENT (the "Agreement") is made and
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entered into as of August 25, 1997, among FOX/LIBERTY NETWORKS, LLC, a Delaware
limited liability company (the "Company"), FLN FINANCE, INC., a Delaware
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corporation ("FLN Finance" and, together with the Company, the "Issuers"), and
XXXXXXX XXXXX & CO., XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED and
BEAR, XXXXXXX & CO. INC. (each an "Initial Purchaser" and, collectively, the
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"Initial Purchasers").
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WHEREAS, as an inducement to the Initial Purchasers to enter into the
Purchase Agreement, dated August 25, 1997 (the "Purchase Agreement"), among the
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Issuers and the Initial Purchasers (providing for, among other things, the sale
by the Issuers to the Initial Purchasers of 500,000 of the Issuers' 8-7/8%
Senior Notes, principal amount $1,000 per Senior Note, due 2007 (the "Senior
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Notes"), and as a condition to the several obligations of the Initial
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Purchasers thereunder, the Issuers have agreed to provide to the Initial
Purchasers and their direct and indirect transferees certain registration and
related rights pursuant to and in accordance with the terms of the Registration
Rights Agreement, of even date herewith (the "Registration Rights Agreement"),
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among the Issuers and the Initial Purchasers;
WHEREAS, notwithstanding the fact that the Issuers have consummated or
will consummate an Exchange Offer, pursuant to Section 2(a) of the Registration
Rights Agreement, the Initial Purchasers may, under certain circumstances,
require the Issuers to file a Shelf Registration Statement for the resale of the
Private Exchange Securities held by them;
WHEREAS, the Registration Rights Agreement contains certain provisions
concerning the time within which the Issuers must file the Shelf Registration
Statement and the period for which such Shelf Registration Statement must
remain effective and usable for resales; and
WHEREAS, the Issuers and the Initial Purchasers desire to provide for
the payment of liquidated damages by the Issuers directly to the Initial
Purchasers in the
event that the Issuers fail to comply with such contractual provisions with
respect to the filing of a Shelf Registration Statement for the Private Exchange
Securities, as more fully set forth herein.
NOW, THEREFORE, in consideration of the foregoing, and for other good
and valuable consideration the receipt of which is hereby acknowledged, the
parties hereto agree as follows:
1. Definitions. Capitalized terms used herein (including in the
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foregoing recitals) but not defined shall have the meanings given to such terms
in the Registration Rights Agreement, except that (a) the term "Shelf
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Registration Statement" shall refer only to a Shelf Registration Statement filed
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by the Issuers pursuant to Section 2(b) of the Registration Rights Agreement,
and (b) the term "Registrable Securities" shall refer only to those Private
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Exchange Securities which are Registrable Securities held at such time by an
Initial Purchaser.
2. Payment of Liquidated Damages. (a) If: (i) the Shelf
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Registration Statement is not filed with the SEC on or prior to the 45th day
after such obligation arises pursuant to Section 2(b) of the Registration Rights
Agreement; or (ii) the Shelf Registration Statement is not declared effective
by the SEC on or prior to the later of the 45th day after the date such Shelf
Registration Statement was required to be filed pursuant to the terms of the
Registration Rights Agreement and the 180th date after the Issue Date; or (iii)
the Shelf Registration Statement has been declared effective and such Shelf
Registration Statement ceases at any time to be effective and available to an
Initial Purchaser for use in connection with the resale of Registrable
Securities held by that Initial Purchaser (whether or not that cessation is a
result of an event contemplated by Section 3(e) of the Registration Rights
Agreement), and such cessation continues for more than either (A) 30 consecutive
days, or (B) an aggregate of 90 days (whether or not consecutive), in the case
of (A) or (B), during the 180-day period (and any extensions of such period
pursuant to the last paragraph of Section 3 of the Registration Rights
Agreement) immediately following the date on which the Shelf Registration
Statement is first declared effective (other than after such time as all
Registrable
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Securities have been disposed of thereunder or otherwise cease to be Registrable
Securities pursuant to the terms of the Registration Rights Agreement), then in
each case the Issuers shall pay liquidated damages to each Initial Purchaser, at
a rate of 0.25% per annum in respect of the aggregate principal amount of the
Senior Notes which constitute Registerable Securities (as defined herein) held
by that Initial Purchaser, in respect of the period: (x) in the case of clause
(i) above, commencing on the 46th day after such request for the filing of a
Shelf Registration Statement is made by the Initial Purchaser and terminating
upon the filing of the Shelf Registration Statement; (y) in the case of clause
(ii) above, commencing on the later of the 46th day after the date the Shelf
Registration Statement was required to be filed and the 181st day after the
Issue Date and terminating upon the effectiveness of the Shelf Registration
Statement; or (z) in the case of clause (iii) above, commencing on, either (A)
the 31st consecutive day, or (B) the 91st day, after the day the Shelf
Registration Statement ceases to be effective or available for use and
terminating on the day that the Shelf Registration Statement again becomes
effective and available for use.
(b) Any amounts of liquidated damages payable by the Issuers pursuant
to this Section 2 shall be paid in cash directly to each Initial Purchaser on
the next succeeding February 15 and August 15, as the case may be, following the
period in respect of which such Liquidated Damages have become due and payable
hereunder.
3. General.
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(a) Counterparts. This Agreement may be executed in any number of
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counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(b) Amendments. This Agreement may be amended by the parties hereto
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by a written instrument duly executed on behalf of each of the parties hereto.
(c) Entire Agreement. This Agreement and the Registration Rights
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Agreement constitute the entire agreement, and supersede all prior agreements
and under-
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standings, both written and oral, among the parties with respect to the subject
matter hereof.
(d) GOVERNING LAW. THIS AGREEMENT SHALL BE DEEMED TO HAVE BEEN MADE
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IN THE STATE OF NEW YORK. THE VALIDITY AND INTERPRETATION OF THIS AGREEMENT,
AND THE TERMS AND CONDITIONS SET FORTH HEREIN, SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING
EFFECT TO ANY PROVISIONS RELATING TO CONFLICTS OF LAWS. EACH OF THE PARTIES
HERETO AGREES TO SUBMIT TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE
OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR ANY OF THE MATTERS CONTEMPLATED HEREBY, IRREVOCABLY WAIVES ANY
DEFENSE OF LACK OF PERSONAL JURISDICTION AND IRREVOCABLY AGREES THAT ALL CLAIMS
IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY
SUCH COURT. THE ISSUERS, ON BEHALF OF ITSELF AND ITS SUBSIDIARIES IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW, ANY
OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF SUCH
SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT AND ANY CLAIM THAT ANY SUCH
SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM.
(e) Notices. All notices and other communications hereunder shall be
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in writing and shall be deemed given if delivered to the parties at the
addresses set forth in, and in a manner contemplated by, the Registration
Rights Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
FOX/LIBERTY NETWORKS, LLC
By: /s/ Xxxx Xxxxx
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Name: Xxxx Xxxxx
Title: Senior Vice President,
Finance
FLN FINANCE, INC.
By: /s/ Xxxx Xxxxx
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Name: Xxxx Xxxxx
Title: Senior Vice President,
Finance
XXXXXXX LYNCH, PIERCE, XXXXXX &
XXXXX INCORPORATED
BEAR, XXXXXXX & CO. INC.
By: XXXXXXX LYNCH, PIERCE,
XXXXXX & XXXXX INCORPORATED
By: /s/ Xxxx Xxxxxxxx
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Authorized Signatory
For themselves and as Representatives
of the other Initial Purchasers
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