Exhibit 10.6
TIME BROKERAGE AGREEMENT
TIME BROKERAGE AGREEMENT, made as of this _____ day of __________, 1997
by and between American Radio Systems Corporation, a Delaware corporation (the
"Programmer") and Precision Media Corporation, a Delaware corporation (the
"Licensee").
WHEREAS Licensee owns and operates Broadcast Stations WSRZ-FM, WZNN-AM,
WMYF-AM and WERZ-FM (collectively referred to herein as the "Stations") pursuant
to a license issued by the Federal Communications Commission ("FCC").
WHEREAS Programmer is involved in radio Stations ownership and
operation.
WHEREAS the Licensee wishes to retain Programmer to provide programming
for the Stations that is in conformity with the Stations' and FCC policies for
time brokerage arrangements and as set forth herein.
WHEREAS Programmer agrees to use the Stations exclusively to broadcast
such programming of its selection that is in conformity with all rules,
regulations and policies of the FCC and subject to Licensee's full authority to
control the operation of the Stations.
WHEREAS Programmer and Licensee agree to work in a cooperative fashion
to make their time brokerage agreement work to the benefit of both parties and
as contemplated in this Agreement.
WHEREAS, Programmer and Licensee have entered into an Asset Purchase
Agreement (the "Asset Purchase Agreement") under which Licensee has agreed to
sell the Stations to Programmer, and have filed an application for FCC consent
to assign the Stations license from Licensee to
Programmer.
NOW, THEREFORE, in consideration of the above recitals and mutual
promises and covenants contained herein, the parties, intending to be bound
legally, agree as follows:
Section 1
Use of Stations Air Time
1.1 Representations. Both Licensee and Programmer represent that they
are authorized to enter into this Agreement and that this Agreement constitutes
the legal, valid and binding obligation of each, enforceable against it in
accordance with its terms.
1.2 Effective Date; Term. The Effective Date of this Agreement shall be
July 1, 1997. It shall continue in force until December 31, 1997, or until
consummation of the assignment of the Stations license from Licensee to
Programmer pursuant to the Asset Purchase Agreement, whichever event occurs
earlier, unless otherwise extended or terminated by the parties hereto in
writing.
1.3 Scope. During the term hereof, Licensee shall make available to
Programmer time on the Stations as set forth in this Agreement. Programmer shall
deliver such programming, at its expense, to the Stations' transmitter
facilities or other authorized remote control point as reasonably designated by
Licensee. Subject to Licensee's reasonable approval, as set forth in this
Agreement, Programmer shall provide entertainment
programming of its selection complete with commercial matter, news, public
service announcements and other suitable programming to the Licensee up to one
hundred sixty-four (164) hours per week. The Licensee may use the remaining four
hours per broadcast week for the broadcast of its own regularly scheduled news,
public affairs and other non-entertainment programming and shall provide
Programmer with advance written notice of such hours of programming. All time
not reserved by or designated for Licensee shall be available for use by
Programmer and no other party.
1.4 Consideration. As consideration for the air time made available
hereunder, Programmer shall pay to Licensee a monthly fee of Thirty-Two Thousand
Five Hundred Dollars ($32,500), payable no later than the fifteenth (15th) day
of the month to which such fee pertains, and Programmer shall reimburse Licensee
for certain Stations expenses as set forth in Section 1.7 hereof.
1.5 Licensee Operation of the Stations. Licensee will have full
authority, power and control over the operations of the Stations during the term
of this Agreement. Licensee will bear all responsibility for the Stations'
compliance with all applicable provisions of the Communications Act of 1934, as
amended, the rules, regulations and policies of the FCC and all other applicable
laws. Licensee shall be solely responsible for all non-capital, ordinary and
customary operating expenses of the Stations, including but not limited to
maintenance of the studio and transmitting facility and costs of electricity
except that Licensee shall be entitled to reimbursement pursuant to Section
1.7(b) and Programmer shall be responsible for the costs of its programming and
personnel as provided in Sections 1.7(a) and 2.3 hereof, and shall pay directly,
or reimburse Licensee for, all other non-capital, ordinary and customary
operating expenses of the Stations. Licensee shall employ at its expense
employees consisting of, at a minimum, those personnel required pursuant to FCC
regulations, who will report to and be accountable to the Licensee. Licensee
shall be responsible for the salaries, taxes, insurance and related costs for
all personnel it employs at the Stations and shall maintain insurance at its
present levels covering the Stations' transmission facilities. During the term
of the Agreement, Programmer agrees to perform, without charge, routine
monitoring of Licensee's transmitter performance and tower lighting if and when
requested by Licensee.
1.6 Licensee Representations and Warranties. Licensee represents
and warrants as follows:
Licensee holds the licenses and other permits and authorizations
necessary for the present operation of the Stations as set forth in Attachment
I. There is not now pending, or to Licensee's best knowledge, threatened, any
action by the FCC or by any other party to revoke, cancel, suspend, refuse to
renew or modify adversely any of such licenses, permits or authorizations except
as previously revealed in writing to Programmer. To the Licensee's best
knowledge, after due inquiry, Licensee, with respect to the Stations, is not in
material violation of any statute, ordinance, rule, regulation, policy, order or
decree of any federal, state or local entity, court or authority having
jurisdiction over it or the Stations, which would have a material adverse effect
upon the Licensee, its assets utilized in the operation of the Stations, the
Stations or upon Licensee's ability to perform this Agreement. Licensee shall
not knowingly take any action or omit to take any action which would have a
material adverse impact upon the Licensee, its assets utilized in the operation
of the Stations, the Stations or upon Licensee's ability to perform this
Agreement. To Licensee's best
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knowledge, all reports, annual regulatory fees and applications required to be
filed with the FCC or any other governmental body have been, and during the
course of the term of this Agreement or any extension thereof, will be filed in
a timely and complete manner. The facilities of the Stations are and will
continue to comply in all material respects with the engineering requirements
set forth in the FCC licenses of the Stations. Licensee shall, during the term
of this Agreement, not dispose of, transfer or assign any of such assets and
properties except with the prior written consent of the Programmer or in the
ordinary course of the Licensee's business.
1.7 Programmer Responsibility.
(a) Programmer shall be solely responsible for any expenses
incurred in the origination and/or delivery of programming fro any remote
location and for any publicity or promotional expenses incurred by Programmer,
including, without limitation, ASCAP, BMI, SESAC music license fees for all
programming provided by Programmer.
(b) Upon presentation to Programmer by Licensee of a
certificate outlining in reasonable detail (with invoices attached thereto to
the extent such invoices exist) the non-capital, ordinary and customary expenses
incurred by Licensee in operating the Stations including lease payments,
utilities, taxes, etc., Programmer shall reimburse Licensee for all such
payments within five (5) business days after presentation of any and each
certificate of payment.
1.8 Contracts. Programmer will be required to assume performance of any
of the Contracts (as defined in the Asset Purchase Agreement) pertaining to the
Stations, except as indicated on Attachment III hereof. Programmer will enter
into no third-party contracts, leases or agreements which will bind Licensee in
any way except with Licensee's prior written approval. Licensee will enter into
no third-party contracts, leases or agreements which will bind Programmer in any
way except with Programmer's prior written approval. Programmer shall assume the
obligations of Licensee, of all existing trade and barter agreements as listed
on Attachment III-A and Licensee shall assign all of its rights under those
trade and barter agreements to Programmer.
1.9 Hourly Credit. Programmer shall receive from Licensee, as a refund
consisting of a flat rate credit of $55.00 per hour ("Hourly Credit"), for any
part of the weekly one hundred sixty-four (164) hours of programming time that
Licensee uses to broadcast its own programming including periods during which
Licensee is unable, for any reason (except for Programmer's failure to deliver
its programming to Licensee), to broadcast the Programmer's programming. Such
refunds to Programmer shall be paid within ten (10) days of the end of each
month.
1.10 Stations Operation. Licensee shall notify Programmer in writing at
least five (5) business days prior to (i) making any changes in management
personnel, (ii) entering into any material contractual obligations, (iii)
purchasing equipment for a purchase price in excess of $5,000, or (iv) making
any other material changes in the operation of the Stations. Licensee agrees to
purchase such equipment or other material or services which are reasonably
required for the Stations' operations provided that Programmer agrees to
reimburse (in accordance with (1.7) the Licensee for all costs associated with
such purchases including, without limitation, installation, wiring and similar
related costs.
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1.11 Use of Stations Studios. Licensee agrees to provide Programmer
with access to the Stations' complete facilities including the studios and
broadcast equipment for use by Programmer, if it so desires, in providing
programming for the Stations; provided, however, that Licensee shall maintain,
for its sole use, sufficient space at the Stations' studios for its management
level employees. Under the overall supervision of Licensee, Programmer shall and
may peacefully and quietly have the full use of and enjoy the use of the
Stations' facilities, studios and equipment free from any material hindrance
from any person or persons whomsoever claiming by, through or under Licensee.
Programmer shall use the studios and equipment only for the purpose of producing
programming for the Stations or for any other Stationss owned or time-brokered
by the Programmer within the same market and shall at all times be subject to
the good faith oversight of the Licensee.
Section 2
Stations Obligations to the Community of License
2.1 Licensee Authority. Notwithstanding any other provision of this
Agreement, Programmer recognizes that Licensee has certain obligations to
broadcast programming to meet the needs and interests of the community of
license for the Stations. On a regular weekly basis the Licensee shall air
specific programming on issues of importance to the local community. Nothing in
this Agreement shall abrogate the unrestricted authority of the Licensee to
discharge its obligations to the public and to comply with the law, rules and
policies of the FCC with respect to meeting the ascertained needs and interests
of the public.
2.2 Additional Licensee Obligations. Although both parties shall
cooperate in the broadcast of emergency information over the Stations, Licensee
shall also retain the right to interrupt Programmer's programming in case of an
emergency or for programming which, in the reasonable good faith judgment of
Licensee, is of overriding public importance. Such interruption shall not
entitle Programmer to any credits on fees. Licensee shall also coordinate with
Programmer the Stations' hourly Stations identification announcements to be
aired in accord with FCC rules. Licensee shall continue to maintain a main
studio, as that term is defined by the FCC, within the Stations' principal
community contour, shall maintain its local public inspection file within the
community of license and shall prepare and place in such inspection file its
quarterly issues and program lists on a timely basis. Programmer shall, upon
request by Licensee, provide Licensee with information with respect to certain
of Programmer's programs which should be included in Licensee's quarterly issues
and programs lists. Licensee shall also maintain the Stations logs, receive and
respond to the telephone inquiries, control and oversee any remote control point
for the Stations.
2.3 Responsibility for Employees and Expenses. Programmer shall employ
and be solely responsible for the salaries, taxes, insurance and related costs
for all personnel employed by Programmer (including, without limitation,
salespeople, traffic personnel, board operators and programming staff). Licensee
will provide and be responsible for the Stations personnel employed by Licensee
and necessary to fulfill Licensee's obligations hereunder, and will be
responsible for the salaries, taxes, insurance and related costs for all the
personnel it employs. All personnel shall be subject to the overall supervision
of Licensee, consistent with Programmer's right to the use of the Stations
facilities pursuant to Section 1.12 hereof.
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Section 3
Stations Programming Policies
3.1 Broadcast Stations Programming Policy Statement. Licensee has
adopted and will enforce a Broadcast Stations Programming Policy Statement (the
"Policy Statement"), a copy of which appears as Attachment IV hereto and which
may be amended from time to time by Licensee upon notice to Programmer.
Programmer agrees and covenants to comply in all material respects with the
Policy Statement, with all rules and regulations of the FCC, and with all
reasonable changes subsequently made by Licensee or the FCC. If Licensee
reasonably determines that a program supplied by Programmer does not comply with
the Policy Statement it may suspend or cancel such program and shall provide
written notice to Programmer of such decision. Programmer shall furnish or cause
to be furnished the Artistic personnel and material for the programs as provided
by this Agreement and all programs shall be in accordance with the Policy
Statement and FCC requirements. All advertising spots and promotional material
or announcements shall comply with applicable federal, state and local
regulations and policies, the Policy Statement, and shall be produced in
accordance with quality standards established by Programmer.
3.2 Licensee Control of Programming. Programmer recognizes that the
Licensee has full authority to control the operation of the Stations. The
parties agree that Licensee's authority includes but is not limited to the right
to reject or refuse such portions of the Programmer's programming which Licensee
reasonably believes to be unsatisfactory, unsuitable or contrary to the public
interest. Programmer shall have the right to change the programming elements
and/or format of the programming supplied to Licensee by giving Licensee at
least forty-eight (48) hours notice of such changes.
3.3 Programmer Compliance with Copyright Act. Programmer represents and
warrants to Licensee that Programmer has full authority to broadcast its
programming on the Stations, and that Programmer shall not broadcast any
material in violation of any law, rule, regulation or the Copyright Act. All
music supplied by Programmer shall be: (i) licensed by ASCAP, SESAC or BMI; (ii)
in the public domain; or (iii) cleared at the source by Programmer. Consistent
with Section 1.7 hereof, Licensee will maintain ASCAP, BMI and SESAC licenses as
necessary. The right to use the programming and to authorize its use in any
manner shall be and remain vested in Programmer.
3.4 Sales.
(a) Programmer shall retain all revenues from the sale of
advertising time within the programming it provides to the Licensee.
Programmer may sell advertising, consistent with applicable rules,
regulations and the Policy Statement, on the Stations in combination
with any other broadcast Stations of its choosing. Programmer shall be
responsible for payment of the commissions due to any sales (national
or otherwise) representative engaged by it for the purpose of selling
advertising (national or otherwise) which is carried during the
programming it provides to Licensee. Licensee shall retain all revenues
from the sale of Stations' advertising during the hours each week in
which the Licensee airs its own non-entertainment programming, with the
exception provided for certain political advertising as set forth in
Section 5.2 herein.
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(b) Programmer acknowledges that all accounts receivable
arising in connection with the operation of the Stations, including but
not limited to accounts receivable for advertising revenues for
programs and announcements performed at the tations prior to the
Effective Date and other broadcast revenues for services performed at
the Stations prior to the Effective Date shall remain the property of
Licensor and that, except as provided for below, Programmer shall not
acquire any beneficial right or interest therein or responsibility
therefor.
(c) Programmer is hereby designated as agent for Licensor for
the purposes of billing, if unbilled, and collecting accounts
receivable of the Stations existing on or before the Effective Date and
arising out of the operations of the Stations on or before the
Effective Date, togerther with advertising broadcast by the Stations
prior to the Effective Date and not yet billed to advertisers, and
Programmer shall account for all monies attributable to all of the
Stations' accounts receivable collected. On the last day of each
calendar month following the Effective Date, Programmer shall render
and deliver to Licensor any monies collected with respect to the
Stations' accounts receivable, its written account of such billing and
collection efforts, together with copies of such bills, correspondence,
documents, instruments, and such other information as the Licensor
shall reasonably request. On the day which is one hundred eighty (180)
days after the Effective Date, or if such day is not a business day,
the next preceding business day, Programmers shall deliver to Licensor
one hundred percent (100%) of all monies actually collected by
Programmer on Licensor's behalf and any additional bills,
correspondance, documents, instruments, files and other
information concerning the billing of the accounts receivable of the
Stations to which such monies relate and which have not yet been
delivered to Licensor. Notwithstanding the foregoing, Licensor and
Programmer hereby agree that Programmer shall in no way be obligated to
pay Licensor any amounts received by Programmer as payments on accoutns
receivable which arise after the Effective Date (the "Post-Effective
Date Accounts Receivable").
(d) Programmer shall receive no remuneration for services
rendered pursuant to this Section 3.4 and shall not be liable in any
way for non-collection or failure of any such collection of accounts
receivable ( except for liability arising in connection with the gross
negligence or willful misconduct of the Programmer in connection with
such accounts receivable.). On or before the Effective Date, Licensor
shall deliver Programmer a list of the Stations' accounts receivable
existing on or before the Effective Date, as well as its unbilled
broadcast advertising, existing as of the Effective Date, as well as
its unbilled broadcast advertising, existing as of the Effective Date
("Pre-Effective Date Accounts Receivable") which shall be attached
hereto as Schedule 3.4. Any cash received by Programmer as payments on
such accounts receivable after the Effective Date from customers
included in the Pre-Effective Date Accounts Receivable will be applied
first to Pre-Effective Date Accounts Receivable and then to
Post-Effective Date Accounts Receivable. If a customer, in writing,
disputes all or any portion of the Pre-Effective Date Account
Receivable, Programmer may credit any cash payment to the
Post-Effective Date Account Receivable from the same customer. The
disputed Pre-Effective Date Accounts Receivable shall be
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returned for Licensor for it to collect. Any Pre-Effective Date Account
Receivable which is outstanding one hundred eighty (180) days after the
Effective Date shall be returned to Licensor on such one hundred and
eightieth (180th) day for it to collect. The obligations of Programmer
under this Section 3.4(d) shall survivor the termination of this
Agreement.
(e) Programmer and Licensor hereby agree that (i) the
provisions of the (3.4 apply only to accounts receivable of the
Licensor arising in connection with the operations of the Stations on
or before the Effective Date and (ii) nothing set forth herein shall
affect or refer to in any way any other accounts receivable of the
Licensor.
3.5 Payola. Programmer agrees that it will not accept any
consideration, compensation, gift or gratuity of any kind whatsoever, regardless
of its value or form, including, but not limited to, a commission, discount,
bonus, material, supplies or other merchandise, services or labor (collectively
"Consideration"), whether or not pursuant to written contracts or agreements
between Programmer and merchants or advertisers, unless the payer is identified
in the program for which Consideration was provided as having paid for or
furnished such Consideration, in accordance with the Communications Act and FCC
requirements. Programmer agrees to quarterly, or more frequently at the request
of the Licensee, execute and provide Licensee with a Payola Affidavit,
substantially in the form attached hereto as Attachment V.
3.6 Staffing Requirements. Licensee shall comply with the main
studio staff requirements as specified by the FCC.
Section 4
Indemnification
4.1 Programmer's Indemnification. Programmer shall indemnify and hold
harmless Licensee from and against any and all claims, losses, costs,
liabilities, damages, FCC forfeitures and expenses (including reasonable legal
fees and other expenses incidental thereto) of every kind, nature and
description, including but not limited to, slander or defamation or otherwise
arising out of Programmer's broadcasts and sale of advertising time under this
Agreement to the extent permitted by law.
4.2 Licensee's Indemnification. Licensee shall indemnify and hold
harmless Programmer from and against any and all claims, losses, costs,
liabilities, damages, and expenses (including reasonable legal fees and other
expenses incidental thereto) of every kind, nature and description, arising out
of Licensee' broadcasts to the extent permitted by law.
4.3 Limitation. Neither Licensee nor Programmer shall be entitled
to indemnification pursuant to this section unless such claim for
indemnification is asserted in writing delivered to the other party.
4.4 Time Brokerage Challenge. If this Agreement is challenged at the
FCC, whether or not in connection with the Stations' license renewal
application, counsel for the Licensee and counsel for the Programmer shall, at
the sole control and expense of the Programmer, jointly defend the Agreement and
the parties' performance thereunder throughout all FCC proceedings at the sole
expense of the Programmer. If portions of this Agreement do not receive the
approval of the FCC staff, then the parties shall reform the
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Agreement or, at Programmer's option and expense, seek reversal of the staff
decision and approval from the full Commission on appeal.
Section 5
Access to Programmer Materials and Correspondence
5.1 Confidential Review. At least two (2) business days prior to the
provision of any programming by Programmer to Licensee under this Agreement,
Programmer shall acquaint the Licensee with the nature and type of the
programming to be provided. Licensee, solely for the purpose of ensuring
Programmer's compliance with the law, FCC rules and the Stations' policies,
shall be entitled to review at its discretion from time to time on a
confidential basis any programming material it may reasonably request.
Programmer shall promptly provide Licensee with copies of all correspondence and
complaints received from the public (including any telephone logs of complaints
called in), copies of all program logs and promotional materials. However,
nothing in this section shall entitle Licensee to review the internal corporate
or financial records of the Programmer.
5.2 Political Advertising. Programmer shall cooperate with Licensee to
assist Licensee in complying with all rules of the FCC regarding political
advertising. Programmer shall supply such information promptly to Licensee as
may be necessary to comply with the lowest unit rate, equal opportunities and
reasonable access requirements of federal law. In the event that Programmer
fails to meet its political time obligations under the Communications Act of
1934, as amended, and the rules and regulations of the FCC and such failure
inhibits Licensee in the performance of its political time obligations, then to
the extent reasonably necessary to assure the Licensee's performance, Programmer
shall release advertising availabilities to Licensee; provided, however, that
all revenues realized by Licensee as a result of such a release of advertising
time shall be immediately paid to Programmer.
Section 6
Termination and Remedies Upon Default
6.1 Termination. In addition to other remedies available at law or
equity and the provisions of Section 1.2 hereof, this Agreement may be
terminated as set forth below by either Licensee or Programmer by written notice
to the other if the party seeking to terminate is not then in material default
or breach hereof, upon the occurrence of any of the following:
(a) this Agreement is declared invalid or illegal in whole or
substantial part by an order or decree of an administrative agency or court of
competent jurisdiction and such order or decree has become final and no longer
subject to further administrative or judicial review;
(b) the other party is in material breach of its obligations
hereunder and has failed to cure such breach within thirty (30) days of notice
from the non-breaching party;
(c) the mutual consent of both parties;
(d) there has been a material change in FCC rules, policies or
precedent that would cause this Agreement to be in violation thereof and such
change is in effect and not the subject of an appeal or further administrative
review;
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(e) the Asset Purchase Agreement is terminated in
accordance with its terms; or
(f) in accordance with (6.2 hereof
6.2 Programmer's Remedies for Operational Deficiencies.
Programmer shall have the following remedies for deficiencies in or events
related to Licensee's transmitting facility:
(a) If Programmer receives during the first thirty (30) days
of this Agreement a report of a consulting engineer, chosen by Programmer, which
concludes that the Stations is not operating substantially within the parameters
authorized by the FCC or that the Stations' actual coverage of the market is
materially less than it should be, Licensee may either (i) terminate the
Agreement or (ii) at its expense, take such steps as are reasonably necessary to
restore the effective coverage or operating parameters of the relevant Stations
or demonstrate, by the use of the report of another consulting engineer, hired
at its expense, that the coverage or operating parameters are not materially
deficient. If the Stations' effective coverage or operating parameters are not
restored within thirty (30) days of notice of the coverage or operating
deficiencies, then Programmer shall be entitled to a full refund, on a daily
basis, of the Hourly Credit amount set forth in Section 1.9 until such
deficiencies are corrected or the date of the termination of this Agreement by
the Licensee, whichever is earlier, and such refunds shall be made within ten
(10) days of the end of the month.
(b) If for a period of five consecutive days or more Licensee
reduces its transmitter output power on the Stations by fifty percent (50%) or
more, Programmer may elect a refund equal to one half of the Hourly Credit
amount set forth in Section 1.9 for so long as such power reduction continues to
occur if Programmer has, in fact, been required to ake rebates and/or other
financial accommodations to its advertisers and such refund shall be reflected
in a refund payment by Licensee to Programmer within ten (10) days of the end of
the month.
(c) If Licensee uses an auxiliary or alternate transmitter for
the Stations for a period of five (5) consecutive days or more, then the refund
for such period shall be twenty-five percent (25%) of the Hourly Credit amount
set forth in Section 1.9 for so long as such auxiliary or alternate transmitter
site is in use if Programmer has, in fact, been required to make rebates and/or
other financial accommodations to its advertisers. Should such transmitter site
move continue for more than thirty (30) days, the refund for such period shall
be equal to fifty percent (50%) of the Hourly Credit amount set forth in Section
1.9 for so long as such alternate transmitter site is in use. The refund shall
be reflected in a refund payment by Licensee to Programmer within ten (10) days
of the end of the month.
(d) If, due to damage to or failure of transmission equipment,
the Stations is off the air for five (5) consecutive days or for a total of one
hundred twenty (120) hours during any thirty (30) day period, Programmer shall
be entitled to a full refund, on a daily basis, of the Hourly Credit amount set
forth in Section 1.9 and such refund shall be made within ten (10) days of the
end of the month.
6.3 Force Majeure. Any failure or impairment of the Stations'
facilities or any delay or interruption in the broadcast of programs, or failure
at any time to furnish facilities, in whole or in part, for broadcast, due to
acts of god, strikes, lockouts, material or labor restrictions by any
governmental authority, civil riot, floods and any other cause not reasonably
within the control of Licensee will not be liable to Programmer, except to the
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extent of allowing in each such case an appropriate refund for time not provided
based upon the Hourly Credit set forth under Section 1.9 calculated upon the
length of time during which the failure or impairment exists or continues.
6.4 Other Agreements. During the term of this Agreement, Licensee will
not enter into any other time brokerage, program provision, local management or
similar agreement with any third party with respect to the Stations.
Section 7
Miscellaneous
7.1 Assignment. This Agreement shall be binding upon and insure to the
benefit of the parties hereto, their successors and assignees, including
specifically any purchaser of the Stations from Licensee. Neither party may
assign its rights under this Agreement without the prior written consent of the
other party which shall not be unreasonable withheld, provided, however that
Programmer has the absolute right to assign this Agreement and all of its rights
and obligations hereunder, following written notice to the Licensee, to an
entity controlled by American Radio Systems Corporation (but only if American
Radio Systems Corporation continues to remain liable for all of the obligations
of such assignee hereunder) and Licensee has the right to assign its payments
hereunder to its Lenders upon written notification to Programmer.
7.2 Call Letters. Upon request of Programmer and at Programmer's
expense, Licensee shall apply to the FCC for authority to change the call
letters of the Stations (with the consent of the FCC) to such call letters that
Programmer shall reasonably designate. Licensee shall cooperate with Programmer
and receive Programmer's consent prior to making any change in the call letters
of the Stations.
7.3 Counterparts. This Agreement may be executed in one or more
counterparts, each of which will be deemed an original but all of which together
will constitute one and the same instrument.
7.4 FCC Certification (47 C.F.R. ss. 73.3555(a) (2) (ii). The parties
shall execute a Certification in the form of Attachment VI hereto, as required
by Section 73.3555(a) (2) (ii) of the FCC's rules.
7.5 Entire Agreement. This Agreement and the Attachments hereto and the
Asset Purchase Agreement between Programmer and Licensee embody the entire
agreement and understanding of the parties and supersede any and all prior
agreements, arrangements and understandings relating to matters provided for
herein. No amendment, waiver of compliance with any provision or condition
hereof, or consent pursuant to this Agreement will be effective unless evidenced
by an instrument in writing signed by the parties.
7.6 Taxes. Licensee and Programmer shall each pay its own ad valorem
taxes, if any, which may be assessed on such party's respective personal
property for the periods that such items are owned by such party. Programmer
shall pay all taxes if any, to which the consideration specified in Section 1.4
herein is subject, provided that Licensee is responsible for payment of its own
income taxes. Each party shall be responsible for any sales tax imposed on
advertising aired during the programming provided by that party.
7.7 Headings. The headings are for convenience only and will not
control or affect the meaning or construction of the provisions of this
Agreement.
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7.8 Governing Law. The obligations of Licensee and Programmer are
subject to applicable federal, state and local law, rules and regulations,
including, but not limited to, the Communications Act of 1934, as amended, and
the Rules and Regulations of the FCC. The construction and performance of the
Agreement will be governed by the laws of the Commonwealth of Massachusetts.
7.9 Notices. Any notice, demand or request required or permitted to be
given under the provisions of the Agreement shall be in writing and shall be
deemed to have been duly delivered on the date of personal delivery or on the
date of receipt if mailed by registered or certified mail, postage prepaid and
return receipt requested, and shall be deemed to have been received on the date
of personal delivery or on the date set forth on the return receipt, to the
following addresses, or to such other address as any party may request, in the
case of Licensee, by notifying Programmer, and in the case of Programmer, by
notifying Licensee.
To Licensee: Precision Media Corporation
00 Xxx Xxxxx Xxxx
Xxxxxxxxx, XX
Attn: Xxxxxx X. Law, President
To Programmer: American Radio Systems Corporation
000 Xxxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxxxxx X. Xxxxx, President
Fax: (000) 000-0000
Copies To: American Radio Systems Corporation
000 Xxxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxx, Esq.
Fax: (000) 000-0000
Dow, Xxxxxx and Xxxxxxxxx
0000 Xxx Xxxxxxxxx Xxx., X.X.
Xxxxx 000
Xxxxxxxxxx, XX 00000
Xxxx X. Xxxxx, Xx. Esq.
Fax: (000) 000-0000
7.10 Severability. If any provision of this Agreement or the
application thereof to any person or circumstances shall be invalid or
unenforceable to any extent, the remainder of this Agreement and the application
of such provision to other persons or circumstances shall not be affected
thereby and shall be enforced to the greatest extent permitted by law.
7.11 Public Announcements. The parties will coordinate and consult with
one another before making any press release or other public announcement
concerning the transaction contemplated under this Agreement. Programmer
acknowledges that announcements and direct or indirect communications concerning
any changes which Programmer may plan for the future operation of the Stations
prior to the Effective Date may have a deleterious effect on the business,
operation, and reputation of the Stations and Licensee. Accordingly, Programmer
agrees that neither it nor its employees, representatives or agents shall make
any formal or information announcements to or communication with any employees
of the Stations or to any person with whom the Stations does business without
written approval of Licensee. Programmer further agrees that neither it nor its
employees will release or publicize any such planes changes within the community
of license or service area or operations of the Stations without the written
approval of Licensee, which shall not be unreasonably with held, and which shall
be granted if necessary or appropriate to comply with the rules, regulations or
policies of the FCC.
11
IN WITNESS WHEREOF, the parties hereto have executed this Agreement the
day and year first above written.
LICENSEE:
PRECISION MEDIA CORPORATION
By: ______________________________
PROGRAMMER:
AMERICAN RADIO SYSTEMS CORPORATION
By: _____________________________
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ATTACHMENT I
Stations Coverage
WMYF(AM) and WERZ(FM), Exeter, New Hampshire and WZNN(AM) and WSRI(FM),
Rochester, New Hampshire current FCC Licenses and contour maps on file with the
FCC.
ATTACHMENT II
Stations Expenses
The following expenses relating to the operation of the Stations shall be paid
by the Licensee:
a) Salary, payroll taxes, benefits and other costs relating to
the employment of the Stations' [_____________].
b) Salary, payroll taxes benefits, and other costs relating to
the employment of the Stations' [_________________].
c) Cost of tower rent electricity and other utilities directly
related to the operation of the Stations' transmitter
facilities.
ATTACHMENT IV
Broadcast Stations Programming Policy Statement
BROADCAST STATIONS
PROGRAMMING POLICY STATEMENT
Programmer agrees to cooperate with Licensee in the broadcasting of
programs of the highest possible standard of excellence and for this purpose to
observe the following regulations in the preparation, writing and broadcasting
of its programs.
I. No Plugola or Payola. The mention of any business activity or
"plug" for any commercial, professional, or other related
endeavor, except where contained in an actual commercial
message of a sponsor, is prohibited.
II. No Lotteries. Announcements giving any information about
lotteries or games prohibited by federal or state law or
regulation are prohibited.
III. Election Procedures. At least ninety (90) days before the
start of any primary or election campaign, Programmer will
clear with Licensee's general manager the rate Programmer will
charge for the time to be sold to candidates for the public
office and/or their supporters to make certain that the rate
charged is in conformance with the applicable law and Stations
policy.
IV. Required Announcements. Progammer shall broadcast (I) an
announcement in a form satisfactory to Licensee at the
beginning of each hour to identify the Stations, (ii) an
announcement at the beginning and end of each program to
indicate that program time has been purchased by Programmer,
and (iii) any other announcements that may be required by law,
regulation, or Stations policy.
V. Commercial Recordkeeping. Programmer shall not receive any
consideration in money, goods, services, or otherwise,
directly or indirectly (including to relatives) from any
persons or company for the presentation of any programming
over the Stations without reporting the same in advance to and
receiving the prior written consent of Licensee's general
manager. No commercial messages ("plugs") or undue references
shall be made in programming presented over Stations to any
business venture, profit making activity, or other interest
(other than noncommercial announcements for bona fide
charities, church activities or other public service
activities) in which Programmer (or anyone else) is directly
or indirectly interested without the same having been approved
in advance by the general manager/chief engineer and such
broadcast being announced and logged and sponsored.
VI. No Illegal Announcements No announcements or promotion
prohibited
by federal or state law or regulation of any lottery or game
shall be made over the Stations. Any game, contest, or
promotion relating to or to be presented over the Stations
must be fully stated and explained in advance to Licensee,
which reserves the right in its sole discretion to reject any
game, contest, or promotion.
VII. Licensee Discretion Paramount In accordance with the
Licensee's responsibility under the Communications Act of
1934, as amended, and the Rules and Regulations of the Federal
Commissions, Licensee reserves the right to reject or
terminate any advertising proposed to be presented or being
presented over the Stations which is in conflict with
Licensee's policy or which in Licensee's or its general
manager/chief engineer's sole judgment would not serve the
public interest.
Licensee may waive any of the foregoing regulations in specific
instances, if, in its opinion, good broadcasting in the public interest is
served.
In any case where questions of policy or interpretation arise,
Programmer should submit the same to Licensee for decision before making any
commitments in connection therewith.
2
ATTACHMENT V
Payola Statement
FORM OF PAYOLA AFFIDAVIT
City of ____________________ )
County of __________________ ) ss.
State of ___________________ )
ANTI-PAYOLA/PLUGOLA AFFIDAVIT
___________________________, being first duly sworn, deposes and says as
follows:
1. He is _________________________ for ________________________________.
(Position)
2. He has acted in the above capacity since _____________.
3. No matter has been broadcast by Stations __________ for which service,
money or other valuable consideration has been directly or indirectly
paid, or promised to, or charged, or accepted, by him from any person,
which matter at the time so broadcast has not been announced or
otherwise indicated as paid for or furnished by such person.
4. So far as he is aware, no matter has been broadcast by Stations _______
for which service, money, or other valuable consideration has been
directly or indirectly paid, or promised to, or charged, or accepted by
Stations _______ in furnishing programs, from any person, which matter
at the time so broadcast has not been announced or otherwise indicated
as paid for or furnished by such person.
5. In future, he will not pay, promise to pay, request, or receive any
service, money, or any other valuable consideration, direct or
indirect, from a third party, in exchange for the influencing of, or
the attempt to influence, the preparation of presentation or broadcast
matter on Stations ________.
6. Nothing contained herein is intended to, or shall prohibit receipt or
acceptance of anything with the expressed knowledge and approval of my
employer, but henceforth any such approval must be given in writing by
someone expressly authorized to give such approval.
7. He, his spouse and his immediate family do____ do not ____ have any
present direct or indirect ownership interest in (other than an
investment in a corporation whose stock is publicly held), serve as an
officer or director of, whether with or without compensation, or serve
as an employee of, any person, firm or corporation engaged in:
1. The publishing of music;
2. The production, distribution (including wholesale and retail
sales outlets), manufacture or exploitation of music, films,
tapes, recordings or electrical transcriptions of any program
material intended for radio broadcast use;
3. The exploitation, promotion, or management of persons
rendering artistic, production and/or other services in the
entertainment field;
4. The ownership or operation of one or more radio or television
Stationss;
5. The wholesale or retail sale of records intended for public
purchase;
6. Advertising on Stations ______, or any other Stations owned by
its licensee (excluding nominal stockholdings in publicly
owned companies).
8. The facts and circumstances relating to such interest are none _______
as follows________:
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
__________________________________
Affiant
Subscribed and sworn to before me
this ______ day of ________________, 199___.
__________________________________________
Notary Public
My Commission expires: __________________
2
ATTACHMENT VI
FCC Certification
CERTIFICATION
Pursuant to Section 73.3555(a) (2) (ii) of the FCC's Rules:
1. The licensee of the brokered Stationss affected by the foregoing Time
Brokerage Agreement hereby certifies that it will at all times maintain
ultimate control (as defined in FCC rules and regulations) over the
Stations' facilities, including specifically control over the Stations'
finances, personnel and programming; and
2. The licensee of the brokering Stationss hereby certifies that the
proposed Agreement for the time brokerage complies with the provisions
of Section 73.3555(a) (2) (ii) of the FCC's rules.
Dated this ________ day of _____________________, 199______.
LICENSEE:
By: ______________________________
Its: _____________________________
PROGRAMMER: AMERICAN RADIO SYSTEMS CORPORATION
By: ______________________________
Its: _____________________________
