Exhibit 10.71
ASSET PURCHASE AGREEMENT
This Purchase Agreement (the "Agreement"), dated as of March24, 1998, made
and entered into by and between WSEA, Inc. ("Seller"), a South Carolina
corporation, Cumulus Broadcasting, Inc. ("Broadcasting"), a Nevada corporation,
and Cumulus Licensing Corporation, a Nevada corporation ("Licensing").
Broadcasting and Licensing are referred to collectively herein as the "Buyer".
R E C I T A L S:
1. Seller is the licensee of Radio Station WSEA(FM), Atlantic Beach, South
Carolina, (the "Station") and holds the license and other authorizations issued
by the Federal Communications Commission (the "FCC") for the operation of the
Station. Seller also owns or leases all tangible and intangible assets used or
useful in the business and operations of the Station.
2. Buyer desires to acquire all of the assets of Seller used or useful in
the operation of the Station, and Seller is willing to convey such assets to
Buyer, subject to the terms and conditions set forth in this Agreement.
3. The purchase and sale contemplated herein is subject to prior approval by
the FCC.
NOW THEREFORE, in consideration of the mutual covenants, agreements,
representations and warranties contained herein, Seller and Buyer hereby agree
as follows:
ARTICLE I
TERMINOLOGY
1.1 Acquired Assets. The FCC Authorizations and the Assets as defined
herein.
1.2 Act. The Communications Act of 1934, as amended.
1.3 Closing. The closing with respect to the transactions contemplated by
this Agreement.
1.4 Closing Date. The date on which the transactions contemplated by this
Agreement shall be consummated as provided in Section 11.1.
1.5 Commencement Date of the TBA. The date on which Buyer begins providing
programming to Seller for broadcast on the Station, as defined in Section 8.
1.6 Documents. This Agreement and all Exhibits and Schedules hereto, and
each other agreement, certificate, or instrument delivered pursuant to or in
connection with this
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Agreement, including amendments thereto that are expressly permitted under, or
agreed upon by the parties pursuant to, the terms of this Agreement.
1.7 FCC Authorizations. All license, permits and other authorizations,
including any temporary waiver or special temporary authorization issued by the
FCC to Seller in connection with the conduct of the business and operation of
the Station, as set forth on Schedule 3.3.
1.8 FCC Order. An order or decision of the FCC granting its consent to the
assignment of the FCC Authorizations to Buyer.
1.9 Final Action. An action of the FCC that has not been reversed, stayed,
enjoined, set aside, annulled or suspended, with respect to which no timely
petition for reconsideration or administrative or judicial appeal or sua sponte
action of the FCC with comparable effect is pending and as to which the time for
filing any such petition or appeal (administrative or judicial) or for the
taking of any such sua sponte action of the FCC has expired.
1.10 Lien. Any mortgage, deed or trust, pledge, hypothecation, security
interest, encumbrance, claim, lien, lease or charge of any kind, whether
voluntarily incurred or arising by operation of law or otherwise, affecting any
assets or property including any written or oral agreement to give or grant any
of the foregoing, any conditional sale or other title retention agreement, and
the filing of or agreement to give any financing statement with respect to any
assets or property under the Uniform Commercial Code or comparable law of any
jurisdiction.
1.11 Permitted Lien. Any statutory lien which secures a payment not yet due
that arises, and is customarily discharged, in the ordinary course of the
Station's business; any easement, right-of-way or similar imperfection in the
Seller's title to its Assets or properties that, as reasonably perceived by
Buyer individually and in the aggregate, are not material in character or amount
and do not and are not reasonably expected to materially impair the value or
materially interfere with the use of any asset or property of the Station
material to the operation of its business as it has been and is now conducted;
liens in favor of Seller's lenders which shall be removed at or prior to the
Closing and any other claims which will be removed at or prior to the Closing,
in each case solely at Seller's expense.
1.12 Station Agreements. The agreements, leases, commitments, contracts, and
other items described in Schedule 2.1.3.
1.13 TBA. The Time Brokerage Agreement which Seller and Buyer will enter
into simultaneously with this Agreement.
ARTICLE II
PURCHASE AND SALE OF ASSETS
2.1 Sale and Purchase of Assets. On the terms and conditions herein set
forth, at Closing, Seller shall sell, assign, transfer, and convey to (i)
Licensing, and Licensing shall
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purchase and acquire from Seller, all of the FCC Authorizations listed on
Schedule 3.3; and (ii) Broadcasting, and Broadcasting agrees to purchase and
acquire from Seller all of the assets (except the FCC Authorizations and as
otherwise expressly excluded) now owned or hereafter acquired and used by Seller
or useful in operating the Station (the "Assets"), free and clear of all Liens
(except Permitted Liens), including without limitation the following:
2.1.1 Personal Property. Title or assignment of leases to all tangible
personal property, whether owned or leased, of Seller used or useful in the
operation of the Station, including all broadcasting and office equipment,
furniture, furnishings, equipment, machinery, installations and fixtures,
including but not limited to, all replacements and additions thereto and
deletions therefrom arising in the ordinary course of business between the date
of this Agreement and the Closing Date as listed on Schedule 3.4 hereto.
2.1.2 Station Agreements. All Station Agreements which are set forth on
Schedule 2.1.3 hereto. Material Station Agreements shall be marked on Schedule
2.1.3 with an asterisk.
2.1.3 FCC Reports/Files. Copies of all documents required by the FCC to
be maintained by the Seller relating to the operation of the Station, including
but not limited to, the local public inspection files, and all books of account
(other than those covered by section 2.2.5), logs, and records necessary for the
Buyer's operation of the Station;
2.1.4 Intangible Assets. The call signs "WSTU", logos, jingles, music
formats and music libraries used by Seller or useful in Station's operations,
together with the goodwill associated therewith and other intangible property
listed and described in Schedule 2.1.5 hereto (collectively, the "Intellectual
Property").
2.1.5 Leases. Any lease agreements or equipment lease agreements used
or useful in the operation of the Station as set forth in Schedule 2.1.3,
including but not limited to the tower lease .
2.2 Excluded Assets. The following assets are expressly excluded from the
Station's assets to be purchased and sold:
2.2.1 Cash on hand as of the Closing Date;
2.2.2 Deposit accounts as of the Closing Date;
2.2.3 Accounts receivable; and
2.2.4 All of Seller's corporate books and records related to internal
corporate matters and financial relationship's with Seller's lenders.
2.3 No Assumption of Liabilities. Buyer shall assume no liabilities or
obligations of
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Seller, including, without limitation, accounts payable, debts, liabilities, and
other obligations, whether pursuant to a contract or otherwise, except
liabilities and obligations under the Station Agreements that arise during and
are attributable to any period on or after the Commencement Date of the TBA (the
"Assumed Obligations") or as otherwise expressly provided herein, and Seller
agrees to pay and discharge all Liabilities and obligations of Seller other than
the Assumed Obligations on or before the Closing Date.
2.4 Purchase Price. The Buyer agrees to pay Seller, as consideration for the
purchase of the Acquired Assets, the purchase price ("Purchase Price") described
in Schedule 2.4 to this Agreement, and agrees to make the escrow deposit (the
Deposit") in the form and manner described in Schedule 2.4 and the Escrow
Agreement attached as Exhibit 1.
2.5 Allocation of Purchase Price. The Purchase Price shall be allocated
among the Acquired Assets as mutually agreed to by Buyer and Seller at or before
the Closing. Said allocation schedule shall be prepared pursuant to Section 1060
of the Internal Revenue Code.
2.6 Proration of Expenses. Subject to the TBA and except as otherwise
provided in this Agreement, the following items shall be pro-rated as of the
Commencement Date of the TBA and paid, as between Seller, on the one hand, and
Buyer, on the other hand, at the Closing (to the extent possible) in the manner
provided for herein below:
2.6.1 All pre-paid expenses and deposits, and all expenses for which
liability has accrued but whose payment is not yet due or paid as of the
Commencement Date of the TBA, including but not limited to (i) such expenses in
connection with the Station Agreements, (ii) rents and deposits, (iii) utility
deposits and charges, including electricity, water and sewer charges, (iv)
business and license fees, including any retroactive adjustments thereof, (v)
property and equipment rentals, (vi) applicable copyright or other fees, (vii)
sales and service charges, (viii) real and personal property taxes in connection
with the Acquired Assets, (ix) operating expenses, (x) all wages and salaries,
vacation pay, sick leave and other leave allowances, awards, bonuses,
commissions, and other forms of employment compensation and benefits that have
accrued in favor of (but that as of the Commencement Date of the TBA have not
yet been paid or provided to), any employees of Seller who shall become
employees of Buyer after the Closing, and (xi) similar prepaid and deferred
items and all revenues arising from the operation of the Station, shall be
pro-rated and adjusted between Buyer and Seller in accordance with the principle
that Seller shall receive all revenues, and shall be responsible for all
expenses, costs, and liabilities allocable to the conduct of the business or
operations of the Station up to midnight on the Commencement Date of the TBA.
Any credit to Seller for a pre-paid expense shall not exceed an amount
commensurate with the value to Buyer of the pre-paid expense. All prorations
shall be made in accordance with generally accepted accounting principles.
Notwithstanding the foregoing, there shall be no adjustment for, and Seller
shall remain solely liable with respect to, any contract other than the Station
Agreements in Schedule 2.1.3 hereto, or any other obligation or liability not
being assumed by Buyer.
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2.6.2 At the conclusion of sixty (60) days from and after the Closing
Date, a final adjustment shall be made of the items to be pro-rated between
Buyer and Seller pursuant to Section 2.6.1.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller hereby represents and warrants to Buyer that the statements contained in
this Article III are correct and complete as of the date of this Agreement and
will be correct and complete as of the Closing Date, except as set forth in the
schedules attached hereto.
3.1 Organization and Good Standing; Ownership. Seller is a corporation
validly organized, existing, in good standing and qualified to do business under
the laws of the State of South Carolina. Seller has all requisite power and
authority to own, operate and lease the Acquired Assets and carry on the
business of the Station as it is now being conducted. Seller has paid (or shall
pay when due) all franchise and similar fees imposed by the State of South
Carolina.
3.2 Authorization and Binding Effect of Documents. Seller has the power and
authority to execute, deliver and perform its obligations under this Agreement
and each of the other Documents and to consummate the transactions contemplated
hereby. By the Closing, necessary corporate actions approving this Agreement and
Seller's obligations hereunder shall have been taken, including without
limitation, the Board of Directors of Seller has duly authorized the execution,
delivery, and performance of this Agreement and the other Documents. This
Agreement and each of the other Documents executed or to be executed by Seller
have been, or at or prior to the Closing will be, duly executed and delivered by
Seller. The execution, delivery and performance of the terms of this Agreement
and each of the other Documents, and the consummation by Seller of the
transactions contemplated hereby and thereby, will not conflict with or result
in the breach, alteration or modification of or constitute a violation of or
default under, any of the terms, conditions or provisions of Seller's articles
of incorporation, by-laws, or any license, judgment, order, decree, law,
regulation, rule or ruling of any court, arbitration or governmental authority
to which Seller is subject, or conflict with, result in the breach of, or
constitute a default under, any other agreement, lease, contract or other
commitment to which Seller, its principals or any of the Acquired Assets are
subject and will not result in the creation of any Lien on any of the Acquired
Assets to be conveyed. Subject to obtaining the FCC Order and any consents to
assignment of the Station Agreements, the execution, delivery and performance of
this Agreement by Seller does not require the consent of any governmental
authority or other third party. This Agreement constitutes (and each of the
other Documents, when executed and delivered by Seller, will constitute) the
legal, valid and binding obligation of Seller enforceable against it in
accordance with its terms, except to the extent limited by bankruptcy,
insolvency, moratorium and other laws of general applicability relating to or
affecting the enforcement of creditors' rights.
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3.3 FCC Authorizations.
3.3.1 Seller is the legal holder of the FCC Authorizations listed on
Schedule 3.3. There is not now pending, or to the knowledge of the Seller
threatened, any action by the FCC to revoke, cancel, rescind, modify or refuse
to renew in the ordinary course any of the FCC Authorizations, or any
investigation, Order to Show Cause, Notice of Violation or of Apparent Liability
or of Forfeiture, or material complaint, objection, petition to deny, or
opposition issued by or filed with the FCC or any other governmental authority
in connection with the operation of or authorizations for the Station or Seller.
All material reports, forms, applications, statements, and other information
required to be filed by Seller with the FCC with respect to the Station have
been filed, are complete and accurate in all material respects, and will
continue to be filed as required through the Closing Date. The Station is
operating in material accordance with its respective FCC Authorizations, and in
material compliance with the Act and the rules and regulations of the FCC,
including but not limited to the FCC's policy on exposure to radio frequency
radiation. The renewal of the FCC Authorization for the Station xxxx not
constitute a major environmental action under the FCC's rules or regulations.
3.3.2 The FCC Authorizations (a) are in full force and effect,
unimpaired by any material act or omission of Seller, or its agents, and
constitute all of the permits and Authorizations required by the Act, the rules
and regulations thereunder or the FCC for, or used in, the operation of the
Station as now operated; (b) constitute all the Authorizations, including
amendments and modifications thereto, issued by the FCC to Seller for or in
connection with the operation of the Station; and (c) are not subject to any
restriction or condition which would limit in any respect the full operation of
the Station as now conducted.
3.4 Tangible Personal Property.
3.4.1 Schedule 3.4 lists all tangible personal property (other than
office supplies and other incidental items) used or useful in the conduct of the
business and operations of the Station (the "Tangible Personal Property").
3.4.2 Seller has good and marketable title to all of the Tangible
Personal Property (except for the items indicated on Schedule 3.4 as leased or
licensed by Seller), free and clear of all Liens, except Permitted Liens.
3.5 Litigation. Except as described in Schedule 3.5 and except for any
investigations and rule-making proceedings affecting the broadcasting industry
generally, there are no actions, judgments (issued or outstanding), suits,
claims, investigations or administrative, arbitration or other proceedings
pending or, to the knowledge of Seller, threatened against Seller, its
principals or the Station before or by any court, arbitration tribunal or
governmental department or agency of any kind, domestic or foreign that would
give any third party the right to enjoin the transactions contemplated by this
Agreement; that could adversely affect Seller's ability to consummate the
transactions contemplate hereunder;
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or that could adversely affect Buyer as the owner of any of the Station. Seller
does not know of any basis for such claim, litigation, proceeding or
investigation. Should any such litigation or other proceeding commence or be
threatened after the date of this Agreement, Seller shall promptly, and in no
event later than five (5) days after becoming aware of it, notify Buyer and use
its best efforts to accomplish the prompt removal or dismissal thereof.
3.6 Broker's or Finder's Fees. Other than American Media Services, LLC, to
which no fee shall be due from either Seller or Buyer, no agent, broker or other
person or firm acting on behalf of or under the authority of Seller is or will
be entitled to any broker's or finder's fee or any other commission or similar
fee, directly or indirectly, from Seller in connection with the transactions
contemplated by this Agreement.
3.7 Disclosure. No representation, warranty or other statement by Seller in
this Agreement or any other Document furnished by Seller or on its behalf
contains, or will contain, any untrue statement of a material fact, or omits to
state a material fact necessary to make any representation, warranty or
statement contained herein or therein not misleading, in any such case that was
knowingly or willingly made or omitted, as the case may be, by Seller.
3.8 Undisclosed Obligations and Discharge of Liens. There are no material
commitments, liabilities or obligations relating to the Station, whether
accrued, absolute, contingent or otherwise including, without limitation,
guaranties by Seller of the liabilities of third parties, other than the
Permitted Liens or as otherwise disclosed to Buyer herein. As of the Closing
Date, Seller will have paid and discharged all taxes, assessments, excises,
liens, levies and judgments for which it is obligated and which are then due and
payable and Seller shall promptly pay and discharge, as and when any of them
become due and payable after Closing, all taxes, assessments, excises, liens,
levies and judgments for which it is obligated or which are a Lien on any of the
Acquired Assets immediately prior to the Closing.
3.9 Insurance. Seller currently has, and subject to the TBA, through the
Closing Date will maintain, insurance on the Acquired Assets in an amount
sufficient to cover the value of said Acquired Assets and consistent with the
terms of this Agreement will use the proceeds of any claims for loss to repair,
replace or restore any damaged property. All such policies are outstanding and
full in force and effect and will continue to be outstanding and in full force
and effect until the Closing Date.
3.10 Real Property. The Acquired Assets include no owned Real Property. All
Real Property on which facilities owned, leased or otherwise used by Seller in
the operation of the Station are located is leased by Seller (the "Leased Real
Property"). To the best of Seller's knowledge, the Leased Real Property is free
and clear of all conditions, equities, reservations, restrictions,
encroachments, adverse uses, easements, servitudes or limitations except as
listed and described in Schedule 3.11, none of which shall interfere with
Buyer's intended use of the Leased Real Property for the Station's operations.
To the best of Seller's knowledge, Seller's improvements upon and use of the
Leased Real Property conform in all material
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respects to all restrictions, restrictive covenants, building codes, fire
regulations, building restrictions, and federal, state and local laws,
regulations and ordinances. To the best of Seller's knowledge, there is no
pending, threatened or contemplated action to take by eminent domain or
otherwise to condemn any of the Leased Real Property.
3.11 Other Matters Related to Leased Real Property. Except as set forth in
Schedule 3.11, there are no leases or rental agreements regarding the occupancy
or use of the Leased Real Property with respect to the Station. To the best of
Seller's knowledge, with respect to those transmitting facilities of the Station
located on the Leased Real Property, all towers, guy lines, anchors, ground
systems and all other structures are located entirely within the confines of the
Leased Real Property. To the best of Seller's knowledge, the Leased Real
Property is freely accessible directly from public streets, or, if not, any use
of adjoining private land to access the same is done in accordance with valid
easements of record.
3.12 Environmental Representations. Except as set forth in Schedule 3.13:
(a) to the best of Seller's knowledge, none of the Leased Real Property has ever
been used by Seller, by the owners and/or prior owners or operators, to treat,
produce, handle, transfer, process, transport, dispose or otherwise release
petroleum products, a "hazardous substance," "hazardous waste," "pollutant" or
"contaminant" (as such terms are defined in any applicable federal, state, or
local laws, ordinances, rules and regulations, and including any and all other
terms which are or may be used in any applicable environmental laws to define
prohibited or regulated substances (collectively "Toxic Substances")), other
than in compliance with all applicable laws, ordinances, rules and regulations
of all federal, state or local governmental authorities. To the best of Seller's
knowledge no Toxic Substances are present on or below the surface of the Leased
Real Property; (b) Seller has no knowledge of any notification having been filed
with regard to a release of any Toxic Substances on or into the Leased Real
Property; (c) neither Seller nor, to the best of Seller's knowledge, any present
or former owner or operator of the Leased Real Property has been identified as a
potentially responsible party for clean up liability with regard to the
emission, discharge or release of any hazardous substance or for any other
matter arising under law in any litigation, administrative proceeding, finding,
order, citation, notice, investigation or complaint, nor has Seller been
threatened with such; (d) Seller has no knowledge of any: (1) generation,
treatment, recycling, storage or disposal of any hazardous waste, (2)
underground storage tank, surface impoundment, lagoon or other containment
facility (past or present) for the temporary or permanent storage, treatment or
disposal of hazardous substance, (3) landfill or solid waste disposal area, (4)
asbestos-containing materials, (5) "friable" asbestos (as defined in the Toxic
Substances Control Act, 15 U.S.C. ss.2601 et seq., and the regulations
promulgated thereunder), (6) electrical transformers, fluorescent light fixtures
with ballasts or other equipment containing polychlorinated biphenyls (PCBs) in,
on or at any Leased Real Property. Seller is in compliance in all material
respects with all applicable federal state and local regulations concerning any
USTs that are located at the Leased Real Property. To the best of its knowledge,
Seller has not committed violations of any environmental law, statute, ordinance
or regulation with regard to the Leased Real Property.
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3.13 Contracts. Schedule 2.1.3 is a true and complete list of all Station
Agreements to be assigned to and assumed by Buyer. Schedule 2.1.3 indicates for
each Station Agreement whether a consent thereunder is required for assignment
of the Station Agreement. Seller is not in material default under any of these
Station Agreements and Seller has no knowledge of the breach of any material
provision of such Agreements. Seller has not been granted, and has not granted,
any material waiver or forbearance with respect to any of the Station
Agreements. No event has occurred which, but for the passage of time or giving
of notice, or both, would or might constitute a material default by Seller under
such Station Agreements, and there is no outstanding notice of material default
or termination under any such Agreement. Except for the consents required
pursuant to the terms of the Station Agreements, Seller has authority to assign
its rights thereunder to Buyer on terms and conditions no less favorable to
Buyer than those in effect on the date hereof, and such assignment will not
affect the validity, enforceability and continuity of any of such Agreements.
The Material Station Agreements as designated in Schedule 2.1.3 include all
those necessary to conduct, in all material respects, the business and
operations of the Station as now conducted. Each of the Station Agreements is
valid, binding and enforceable in accordance with its terms and is in full force
and effect. Seller holds the right to enforce and receive the benefits under
each of the Station Agreements free and clear of any Lien but subject to the
terms and provisions of each Station Agreement. The Station Agreements listed on
Schedule 2.1.3 include all leases for the Leased Real Property. Schedule 2.1.3-A
lists all arrangements for the sale of air time or advertising on the Station in
excess of $1,000 since January 1, 1997, and the amount to be paid to the Seller
therefor. The Seller has no reason to believe and has not received a notice or
indication of the intention of any of the advertisers or any third parties to
material contracts of Seller to cease doing business or to reduce in any
material respect the business transacted with the Seller or to terminate or
modify any agreements with the Seller (whether as a result of consummation of
the transactions contemplate hereby or otherwise).
3.14 Taxes and Reports. Seller has filed all material federal, state and
local tax returns and state franchise returns which are required to be filed by
Seller, and has paid in full all taxes, interest, penalties, assessments and
deficiencies owed by or which have been assessed or levied against Seller or any
of its assets or properties (except any such obligations as are being contested
in good faith). Any additional taxes, interest, penalties, assessments and
deficiencies that shall become due and payable with respect to any tax return or
tax obligation of Seller arising from the operation of the Station prior to the
Closing Date shall be the responsibility of Seller. All other material federal,
state, county and local tax returns, reports and declarations of estimated tax
or estimated tax deposit forms required to be filed by the Seller in connection
with the Station's operations, personal property, real estate or payroll have
been duly and timely filed. Seller has paid all taxes which have become due
pursuant to such returns or pursuant to any assessment received by it (except
any such obligations being contested in good faith), and has paid all
installments of estimated taxes due. All taxes, levies and other assessments
which the Seller is required by law to withhold or to collect have been duly
withheld and collected, and have been paid over to the proper governmental
authorities or held by the Seller for such payment.
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3.15 Operation in Ordinary Course. Since January 1, 1997, except as set
forth on Schedule 3.15, there has not been any material adverse change in the
assets, liabilities, business, financial condition, operations, or future
prospects of the Seller with respect to the operation of the Station. Without
limiting the generality of the foregoing, Seller (i) has operated the Station in
the ordinary course of business consistent with past practices; (ii) other than
this Agreement, has not entered into any agreement, contract, lease, sublease,
license or sublicense outside of the ordinary course of business; (iii) has not
delayed or postponed (beyond its normal practice in the ordinary course of
business) the payment of accounts payable and other liabilities; (iv) has not
altered its credit and collection policies or its accounting policies; (v) has
not entered into or terminated any employment arrangement, employment contract
or severance agreement or collective bargaining agreement, written or oral, or
modified the terms of any existing such contract or agreement, except in the
ordinary course of business; (vi) has not materially altered the programming,
formal or all letters of the Station or its promotional or marketing activities,
except in the ordinary course of business; (vii) except as set forth on Schedule
3.15, has not applied to the FCC for any modification of the FCC Authorizations
or failed to take any action necessary to preserve the FCC Authorizations and
has operated the Station in material compliance therewith and with the rules and
regulations of the FCC; (viii) has not terminated or received notice of
termination for any syndicated programming; and (ix) has not committed to any of
the foregoing.
3.16 Intellectual Property. Schedule 2.1.5 lists all Intellectual Property
applied for, owned, used or licensed (either as licensor or licensee) in
connection with the operation of the Station. Except as disclosed on Schedule
2.1.5:
3.16.1 Seller owns, free and clear of conflicting claims or
restrictions and without infringement on the rights of others, all right and
interest in, and right and authority to use in connection with the conduct of
the Station as presently conducted, all of the Intellectual Property listed on
Schedule 2.1.5 and all such Intellectual Property is in full force and effect.
3.16.2 There are no outstanding or, to the knowledge of
Seller, threatened judicial or adversary proceedings with respect to any of the
Intellectual Property listed on Schedule 2.1.5.
3.16.3 No person or entity has been granted any license or
other right or interest in or to any of the Intellectual Property listed on
Schedule 2.1.5 or to the use thereof.
3.16.4 Seller has no knowledge of any infringement or unlawful
use of any of the Intellectual Property listed on Schedule 2.1.5 and Seller has
never received any charge, complaint, or notice alleging interference,
infringement, misappropriation or violation of any Intellectual Property rights
of third parties.
3.17 Employees. Schedule 3.17 sets forth a listing of the names, positions,
job descriptions, salary or wage rates and all other forms of compensation paid
for work at the
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Station by each employee as of the date hereof. Seller is not a party to nor
bound by any collective bargaining or similar agreement, nor has it experienced
any strikes, grievances, claims of unfair labor practices or collective
bargaining disputes. Seller has no knowledge of any organizational effort
presently being made or threatened by or on behalf of any labor union with
respect to the employees of the Station. Seller has no knowledge of any basis
for any claim by past or current employees of Seller or applicants for
employment that Seller or its management has discriminated based upon the
individual's race, sex, national origin, religion, ethnicity, handicap or other
protected characteristic under applicable law.
3.18 Employee Benefits. Seller maintains, and in the past has maintained, no
Employee Benefit Plan to which it contributes or is required to contribute for
the benefit of any current or former employee of Seller. Seller does not have
any commitment to create any Employee Benefit Plan that would affect any
employee of Seller.
3.19 Financial Statements. Included in Schedule 3.19 are the following
financial statements (collectively, the "Financial Statements"): (i) unaudited
balance sheets and statements of income, and cash flow as of and for the fiscal
years ended December 31, 1994, December 31, 1995, and December 31, 1996; and
(ii) unaudited balance sheets and statements of income, as of and for each month
during 1997 for Seller. The Financial Statements have been prepared in
conformity with Seller's normal accounting policies, practices and procedures
applied on a consistent basis throughout the periods covered thereby, are
correct and complete, fairly present the financial condition of Seller and the
results of operation of Seller at the dates and for the periods, indicated, and
are consistent with the books and records of Seller.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer hereby represents and warrants to Seller that the statements contained
in this Article IV are correct and complete as of the date of this Agreement and
will be correct and complete as of the Closing Date, except as set forth in the
schedules attached hereto.
4.1 Organization and Good Standing. Buyer is a corporation duly organized,
validly existing and in good standing, and qualified to do business under the
laws of the State of Nevada. Buyer has or as of the Closing Date shall have,
authority to conduct business in the State of Nevada and each such other state
in which it conducts business, including South Carolina. Licensing has all
requisite corporate power to acquire the FCC Authorizations and to become the
licensee of the Station. Buyer agrees to furnish at Closing a Certificate of
Good Standing for the State of Nevada and a Certificate of Foreign Corporation
Authorization to Do Business in the State of South Carolina.
4.2 Authorization and Binding Effect of Documents. Buyer has full power and
authority to execute, deliver, and perform its obligations under this Agreement
and each of the other Documents and to consummate the transactions contemplated
hereby and thereby. By the Closing, all necessary corporate actions approving
this Agreement and Buyer's
11
obligations hereunder shall have been taken, including without limitation, the
Boards of Directors of Licensing and Broadcasting have duly authorized the
execution, delivery and performance of this Agreement and each of the Documents.
This Agreement and each of the other Documents to be executed by Buyer have
been, or at or prior to the Closing will be, duly executed and delivered by
Buyer. The execution, delivery and performance of the terms of this Agreement
and each of the other Documents, and the consummation by Buyer of the
transactions contemplated hereby and thereby, will not conflict with or result
in the breach, alteration or modification of or constitute a violation of or
default under any of the terms, conditions or provisions of Buyer's articles of
incorporation, by-laws, or any license, judgement, order, decree, law,
regulation, rule or ruling of any court, arbitration or governmental authority
to which Buyer is subject, or result in the breach of, or constitute a default
under, any other agreement, lease, contract or other commitment to which Buyer,
its principals or any of its assets are subject. Subject to obtaining the FCC
Order, the execution, delivery and performance of this Agreement does not
require the consent of any third party. This Agreement constitutes (and each of
the other Documents, when executed and delivered by Buyer will constitute) legal
and valid obligations of Buyer enforceable against Buyer in accordance with its
terms, except to the extent limited by bankruptcy, insolvency, moratorium and
other laws of general applicability relating to or affecting the enforcement of
creditors' rights.
4.3 Governmental Consents and Consents of Third Parties. With the exception
of the FCC, Buyer's execution, delivery, and performance of its obligations
under this Agreement and each of the other Documents and the consummation by
Buyer of the transactions contemplated hereby and thereby, do not require the
consent, waiver, approval, permit, license, clearance or authorization of, or
any declaration or filing with, any court or public agency or other authority,
or the consent of any person under any agreement, arrangement or commitment of
any nature which Buyer is a party to or bound by, the failure of which to obtain
would have a material adverse effect on the ability of Buyer to consummate the
transactions or perform its obligations hereunder or under any other Document.
4.4 Qualifications. Buyer has no knowledge of any facts concerning Buyer or
any person with an attributable interest in Buyer (as such term is defined under
decisions, rules and regulations of the FCC) which would, under present law
(including the Act) and present rules, regulations and practices of the FCC (i)
disqualify Buyer from owning and operating the Station; or (ii) raise a
substantial and material question of fact (within the meaning of Section 309(a)
of the Act) respecting Buyer's qualifications. Buyer will not take, or fail to
take, any action it knows or has reason to know would cause such
disqualification or raise such question of fact. Should Buyer become aware of
any such facts, it will promptly notify Seller in writing thereof and use us
best efforts to prevent such disqualification. Buyer further represents and
warrants that (i) no waiver is required under Section 73.3555 of the FCC's rules
and regulations regarding ownership of multiple radio stations with overlapping
signals; and (ii) it is financially qualified to meet all terms, conditions and
obligations arising or contemplated under this Agreement.
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4.5 Broker's or Finder's Fees. No agent, broker or other person or firm
acting on behalf of or under the authority of Buyer is or will be entitled to
any broker's or finder's fee or any other commission or similar fee, directly or
indirectly, from Buyer in connection with the transactions contemplated by this
Agreement.
4.6 Litigation. There are no legal, administrative, arbitration or other
proceedings, unsatisfied judgments, orders, or decrees, injunctions, suits,
claims, or governmental investigations pending or, to the knowledge of Buyer,
threatened against Buyer before any court, arbitration tribunal or governmental
department or agency that would give any third party the right to enjoin the
transactions contemplated by this Agreement or that could adversely affect
Buyer's ability to consummate the transactions contemplate hereunder. Buyer does
not know of any basis for such claim, litigation, proceeding, or investigation.
Should any such litigation commence after the date of this Agreement and before
the Closing, Buyer shall promptly, andin no event later than five (5) days after
becoming aware of it, notify Seller, and use its best efforts to accomplish the
prompt removal or dismissal thereof.
4.7 Disclosure. No representation, warranty or other statement by Buyer in
this Agreement or any other Document furnished by Buyer or on its behalf
contains, or will contain, any untrue statement of a material fact, or omit to
state a material fact necessary to make any representation, warranty or
statement contained herein or therein not misleading, in any such case that was
knowingly or willingly made or omitted, as the case may be, by Buyer.
ARTICLE V
COVENANTS
5.1 Affirmative Covenants of Seller. Between the date hereof and the Closing
Date, except as otherwise expressly provided in this Agreement or the TBA,
Seller shall:
5.1.1 Continued Operation of Station. Prior to the Commencement Date of
the TBA, continue to operate the Station in the ordinary course consistent with
past practices, and at all times between the date hereof and the Closing Date,
continue to operate the Station in conformity with the FCC Licenses, the Act,
the rules and regulations of the FCC, and all other applicable laws, ordinances,
regulations, rules and orders. If Seller receives any finding, order, complaint,
citation or notice prior to Closing which asserts that any aspect of the
Station's operations violates any rule, regulation or order of the FCC or any
other governmental authority (an "Administrative Violation"), Seller shall
promptly notify Buyer of any Administrative Violation, take action promptly to
remove or correct any Administrative Violation, and, subject to the TBA, be
responsible for the payment of all costs associated therewith, including any
fines or back pay that may be assessed.
5.1.2 Reasonable Access. Subject to the terms of the TBA, provide Buyer
and representatives of Buyer with reasonable access, during normal business
hours, to the properties, contracts, books, files, logs, records and affairs of
the Station, and furnish such
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additional information concerning the Station as Buyer may from time to time
reasonably request.
5.1.3 Notice and Consent to Assignment. Use reasonable efforts to
procure and accomplish the consent of any third parties necessary for the
assignment to Buyer of all Material Station Agreements and shall give notice to
all third parties as reasonably requested by Buyer.
5.1.4 Maintain Acquired Assets. Subject to the terms of the TBA,
maintain all of the Acquired Assets in their present operating condition, repair
and order, reasonable wear and tear in ordinary usage excepted, and maintain the
inventories of spare parts and tubes for the technical operating equipment of
Station at the levels normally maintained for Station.
5.1.5 Maintain Licenses. Use its best efforts to maintain in full force
and effect, or renew when required, the FCC Authorizations and any other
licenses, permits and authorizations relating to the Station and timely file all
FCC required reports or fees.
5.1.6 Notice of Developments. Subject to the TBA, Seller will give
Buyer prompt notice of any material development affecting business, operations
or prospects of the Station or the Acquired Assets or the ability of the Seller
to perform hereunder.
5.1.7 No Solicitation. From the date hereof until the earlier of
Closing or termination of this Agreement, neither Seller nor any affiliate of
Seller shall directly or indirectly (i) solicit, initiate or encourage
submission of any proposal or offer from any person relating to any acquisition
or purchase of any interest in Seller or any material assets of any of the
Station or any merger, consolidation or business combination with Seller (each
an "Acquisition Proposal"), or (ii) participate in any discussions or
negotiations regarding, furnish to any person any information with respect to,
or otherwise assist, facilitate, encourage or participate in or cooperate with,
any effort or attempt by any person to make or effect an Acquisition Proposal.
5.2 Negative Covenants of Seller. Between the date hereof and the Closing
Date, except as contemplated by this Agreement, Seller will not, without the
prior written consent of Buyer which will not unreasonably be withheld, it being
understood that such consent does not alleviate Seller's obligation to ensure
that all warranties an representations hereunder remain true and correct as of
the Closing Date:
5.2.1 Mortgages. Create, assume or permit to exist any new mortgage or
pledge, or subject to lien or encumbrance, any of the Acquired Assets, whether
now owned or hereafter acquired, unless discharged of record prior to or at
Closing.
5.2.2 Transfers. Sell, assign, lease or otherwise transfer or dispose
of any of the Acquired Assets, whether now owned or hereafter acquired, except
for disposal and
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consumption of supplies and inventories in the ordinary course and retirements
in the normal and usual course of business of items no longer required for use
in connection with the Station's operations, or in connection with the
acquisition of similar property or assets of equal or greater value, with the
cost of any such replacement property to be Seller's responsibility.
5.2.3 Call Letters. Change the call letters of the Station.
5.2.4 Collective Bargaining. Voluntarily enter into any collective
bargaining agreement covering employees of the Station and voluntarily enter
into any such collective bargaining agreement that contains a provision
requiring assignment to and assumption of the agreement by a purchaser of the
Station.
5.2.5 Inconsistent Action. Take any action inconsistent with its
warranties, representations or obligations hereunder or which could jeopardize
or delay consummation of the transactions contemplated hereunder.
5.2.6 Contractual Obligations. Do, or omit to do, any act which will
cause a material breach of, or material default under, or termination of, any
Material Station Agreement.
5.3 Covenants of Buyer. Between the date hereof and the Closing Date,
5.3.1 Inconsistent Action. Buyer shall not take any action inconsistent
with its representations, warranties and other obligations hereunder or which
could jeopardize or delay the consummation of the transactions contemplated
hereunder.
5.3.2 Title Insurance, Surveys and Environmental Assessments. Buyer, at
its own expense, will obtain with respect to each parcel of Leased Real Property
(i) a leasehold owner's policy issued by a title insurer reasonably satisfactory
to Seller, in an amount equal to the fair market value of such Leased Real
Property (including all improvements thereon), insuring over the standard
pre-printed exceptions and insuring leasehold title to such Leased Real Property
in the Buyer as of the Closing subject only to the lien for taxes not yet due
and payable for the year of Closing, municipal and zoning ordinances, recorded
utility easements and other easements of record, together with such endorsements
for zoning, contiguity, public access and extended coverage as Buyer or its
lender may reasonably request; (ii) a current "as built" survey (each, a
"Survey"). Each Survey shall be prepared by a registered surveyor, shall comply
with current ALTA Minimum Standard Detail Requirements, shall be certified to
Buyer and its lender and sufficient for the title insurer's deletion of the
standard exceptions relating to survey matters, and shall not disclose
15
any matters which would materially impair Buyer's ability to use any of the
surveyed Leased Real Property in the operation of the Station in the manner in
which it is now used; and (iii) a Phase I environmental site assessment from an
environmental consultant or engineer reasonably satisfactory to Seller which
does not indicate that Seller or the Lease Real Property are not in compliance
with any Environmental Law and which does not disclose or recommend any action
with respect to any condition to be remediated or investigated or any
contamination on the site assessed. Buyer shall cause the environmental
consultant or engineer to deliver a copy of the environmental report(s) to
Seller at the same time as such report(s) are delivered to Buyer.
ARTICLE VI
OTHER COVENANTS
6.1 Good Faith; Reasonable Efforts. Subject to the terms and conditions of
this Agreement, each of the parties hereto will use its reasonable efforts to
take all action and to do all things necessary, proper or advisable in good
faith to satisfy any condition to the parties' obligations hereunder in its
power to satisfy and to consummate and make effective as soon as practicable the
transactions contemplated by this Agreement.
6.2 Control of Station. Subject to the TBA, the transactions contemplated by
this Agreement shall not be consummated until after the FCC has given its
consent and approval to the Assignment Application. Between the date of this
Agreement and the Closing Date, Buyer and their employees or agents shall not
directly or indirectly control, supervise or direct, or attempt to control,
supervise or direct, the operation of the Station, and such operation shall be
the sole responsibility of and in the control of the Seller.
ARTICLE VII
FCC CONSENT
7.1 FCC Consent. Within ten (10) days of the execution of this Agreement,
Seller and Buyer shall jointly file with the FCC an application seeking approval
of the FCC to the assignment of the FCC Authorizations from Seller to Buyer (the
"Assignment Application"). Seller and Buyer shall take all commercially
reasonable steps necessary to prosecute such filing with diligence and shall
diligently oppose any objections to, appeals from or petitions to reconsider the
FCC Order, to the end that the FCC Order shall become a Final Action as soon as
practicable. Seller shall not take, nor permit any officer or director of Seller
to take, and Buyer shall not take, nor permit any shareholder, officer or
director of Buyer to take, any action that such party knows or has reason to
know would materially and adversely affect or materially delay issuance of the
FCC Order, or materially and adversely affect or materially delay the FCC Order
from becoming a Final Action. Should Buyer or Seller become aware of any facts
not disclosed which could reasonably be expected to materially and adversely
affect or materially delay issuance of the FCC Order, or prevent or materially
delay the FCC Order from becoming a Final Action, such party shall promptly
notify the other party thereof in writing. Seller and Buyer shall share equally
any filing fee required by the FCC for the Assignment Application, but the
parties shall otherwise each bear its own expenses, including attorney's fees,
in connection with the Assignment Application. If the FCC imposes any condition
on either party to the Assignment Application, such party shall use commercial
reasonable efforts to comply with such condition, provided that neither party
shall be required hereunder to comply with any condition that would have a
material adverse effect on the
16
Station or such party. If necessary under this Agreement, Seller and Buyer shall
jointly request from the FCC an extension of the effective period of the FCC
Order if the Closing shall not have occurred prior to the expiration of the
original effective period of the FCC Order. Nothing in this Section 7.1 shall be
construed to limit either party's right to terminate this Agreement pursuant to
the terms of Article XIII.
ARTICLE VIII
TIME BROKERAGE AGREEMENT
8.1 Time Brokerage Agreement. Concurrent with the execution of this
Agreement, Buyer and Seller shall enter into a Time Brokerage Agreement ("TBA")
pursuant to which Buyer will provide programming, commencing on March 23, 1998
(the "Commencement Date of the TBA"), for broadcast on the Station pending the
FCC Order and the Closing contemplated hereunder.
8.2 Accounts Receivable. Buyer agrees, as Seller's agent, to use its best
efforts for a period of ninety (90) days following the Commencement Date of the
TBA (the "Collection Period") to collect in the usual and ordinary course of
business the accounts receivable of the Station in existence as of the
Commencement Date of the TBA. Buyer shall not be required to institute any legal
proceedings to enforce the collection of any Accounts Receivable or to refer any
of the Accounts Receivable to a collection agency. Buyer shall not adjust any
Accounts Receivable or grant credit without Seller's written consent, and any
Accounts Receivable amounts collected on behalf of Seller shall be paid to
Seller on the forty-fifth (45th) and ninetieth (90th) days after the
Commencement Date of TBA. On the ninetieth (90th) day after the Commencement
Date of the TBA, Buyer shall return to Seller the uncollected Accounts
Receivables, together will all files concerning the collection or attempts to
collect the Accounts Receivable, and Buyer's responsibility shall cease. Buyer
shall incur no liability to Seller for any uncollected account. All sums
collected by Buyer during the Collection Period from any person obligated with
respect to any Account Receivable shall be applied first to Seller's Accounts
Receivable. After full satisfaction of Seller's account the balance, if any,
shall be applied to Buyer's accounts.
ARTICLE IX
CONDITIONS PRECEDENT TO THE
OBLIGATION OF BUYER TO CLOSE
Buyer's obligation to close the transaction contemplated by this Agreement
is subject to the satisfaction, on or prior to the Closing Date, of each of the
following conditions, unless waived by Buyer in writing:
9.1 Accuracy of Representations and Warranties. The representations and
warranties of Seller contained in this Agreement or in any other Document shall
be complete and correct in all material respects at the Closing Date with the
same effect as though made at such time, except for changes permitted under this
Agreement.
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9.2 Performance of Agreement. Seller shall have performed in all material
respects all of its covenants, agreements and obligations required by this
Agreement to be performed or complied with by it prior to or upon the Closing
Date.
9.3 FCC and Other Consents.
9.3.1 The FCC Order shall have been issued by the FCC (this condition
may not be waived) without any condition materially adverse to Seller, Buyer or
Station, and shall have become a Final Action.
9.3.2 Conditions which the FCC Order or any order, ruling or decree of
any judicial or administrative body relating thereto or in connection therewith
specifies and requires to be satisfied prior to assignment of the Station to
Buyer and which must be satisfied under Section 7.1 above shall have been
satisfied.
9.3.3 All other authorizations, consents, approvals and clearances of
all federal, state and local governmental agencies required to permit the
consummation by Buyer of the transactions contemplated by this Agreement shall
have been obtained; all statutory and regulatory requirements for such
consummation shall have been fulfilled; and no such authorizations, consents,
approvals or clearances shall contain any conditions that individually or in the
aggregate would have a material adverse effect on the Station or Buyer's
operation thereof.
9.3.4 All necessary approvals and consents to the assignment to Buyer
of the Material Station Agreements on terms no less favorable to Buyer than
exist in said agreements today shall have been obtained and delivered to Buyer.
9.4 No Adverse Proceedings. No order, decree or judgment of any court,
agency or other governmental authority shall have been rendered against Seller
or Buyer that would prevent or make it unlawful to consummate the transactions
contemplated by this Agreement in accordance with the terms hereof or to impose
damages or penalties upon any of the parties if such transaction is consummated;
and, except for proceedings affecting the broadcasting industry generally, no
suit, action or governmental proceeding shall be pending or threatened against
Seller or Buyer which specifically seeks to prevent or make it unlawful to
consummate the transactions contemplated by this Agreement in accordance with
the terms hereof or to impose damages or penalties on any party if the
transaction is consummated.
9.5 Delivery of Closing Documents. Seller shall have delivered on or before
the Closing Date each of the documents required to be delivered pursuant to
Section 11.2 or as otherwise provided in this Agreement.
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ARTICLE X
CONDITIONS PRECEDENT TO THE
OBLIGATION OF SELLER TO CLOSE
The obligation of Seller to close the transaction contemplated by this
Agreement is subject to the satisfaction, on or prior to the Closing Date, or
each of the following conditions, unless waived by Seller in writing:
10.1 Accuracy of Representations and Warranties. The representations and
warranties of Buyer contained in this Agreement or in any other Document shall
be complete and correct in all material respects on the date hereof and at the
Closing Date with the same effect as though made at such time, except for
changes permitted under this Agreement.
10.2 Performance of Agreement. Buyer shall have performed in all material
respects all of its covenants, agreements and obligations required by this
Agreement to be performed or complied with by it prior to or upon the Closing
Date.
10.3 FCC and Other Consents.
10.3.1 The FCC Order shall have been issued by the FCC (this condition
may not be waived), and shall have become a Final Action.
10.3.2 Conditions which the FCC Order or any order, ruling or decree of
any judicial or administrative body relating thereto or in connection therewith
specifies and requires to be satisfied prior to assignment of the Station to
Buyer and which must be satisfied under Section 7.1 above shall have been
satisfied.
10.3.3 All other authorizations, consents, approvals and clearances of
all federal, state and local governmental agencies required to permit the
consummation by Seller of the transactions contemplated by this Agreement shall
have been obtained; all statutory and regulatory requirements for such
consummation shall have been fulfilled; and no such authorizations, consents,
approvals or clearances shall contain any conditions that individually or in the
aggregate would have a material adverse effect on the Station or Buyer's
operation thereof.
10.4 No Adverse Proceedings. No order, decree or judgment of any court,
agency or other governmental authority shall have been rendered against Seller
or Buyer that would prevent or make it unlawful to consummate the transactions
contemplated by this Agreement in accordance with the terms hereof or to impose
damages or penalties upon any of the parties if such transaction is consummated;
and, except for proceedings affecting the broadcasting industry generally, no
suit, action or governmental proceeding shall be pending or threatened against
Seller or Buyer which specifically seeks to prevent or make it unlawful to
consummate the transactions contemplated by this Agreement in accordance with
the terms hereof or to impose damages or penalties on any party if the
transaction is
19
consummated.
10.5 Delivery of Closing Documents. Buyer shall have delivered on or before
the Closing Date each of the documents required to be delivered pursuant to
Section 11.3 or as otherwise provided in this Agreement.
ARTICLE XI
CLOSING
11.1 Closing Date. The Closing shall take place between five (5) and ten
(10) business days after the FCC Order becomes a Final Action, unless waived by
Buyer. If finality is waived by Buyer, then Closing shall take place on such
date as the parties may mutually agree (the "Closing Date"). The Closing shall
occur at a mutually agreeable location.
11.2 Seller's Performance. At the Closing hereunder Seller shall deliver or
cause to be delivered to Buyer the following in each case in form and substance
reasonably satisfactorily to Buyer:
11.2.1 License Assignments. Assignments of the FCC Authorizations in
customary form and substance;
11.2.2 Xxxx of Sale. A xxxx of sale and all other appropriate documents
and instruments in a form and substance reasonably acceptable to counsel for
Buyer assigning good and marketable title to the Tangible Personal Property and
all other Acquired Assets not otherwise conveyed (except the Leased Real
Property), free and clear of any Liens;
11.2.3 Leases/Contracts. Such assignments and further instruments of
transfer to assign to Buyer on terms no less favorable to Buyer than in said
leases as they exist today all of Seller's rights under the Station Agreements
free and clear of all Liens and any other adverse claims with, where required,
the necessary consents to such assignments;
11.2.4 Records. Deliver to Buyer copies of the records and documents
referenced in Section 2.1.4 above. Such documents need not be provided in person
but may be located at the studio/offices of the Station.
11.2.5 Certificates. (i) A Certificate by Seller, dated as of the
Closing Date, certifying that, except as set forth in such Certificate, all of
Seller's undertakings and obligations under this Agreement are satisfied as of
the Closing Date and all of its warranties and representations remain true and
accurate in all material respects as of the Closing Date; (ii) a certificate of
the secretary of Seller attesting to the incumbency of each officer of Seller
who executes this Agreement and any of the other Documents; and (iii) certified
resolutions of Seller's Board of Directors evidencing the authorization and
20
approval of Seller's execution, delivery and performance of this Agreement.
11.2.6 Opinions of Seller's Counsel. (a) The written opinion of
Seller's corporate counsel, dated as of the Closing Date and addressed to Buyers
and their lender, that (1) Seller is a corporation duly formed and in good
standing in the State of South Carolina; (2) Seller is authorized to sell the
Station and the Acquired Assets; (3) all corporate actions necessary to sell the
Station and the Acquired Assets pursuant to this Agreement have been duly and
properly taken; (4) to the knowledge of counsel, no suit, action or proceeding
is pending or threatened that questions or may affect the validity of any action
to be taken by Seller pursuant to this Agreement or that seeks to restrain
Seller from carrying out the transactions provided for herein; (5) to the
knowledge of counsel, there is no outstanding judgment or any suit, action or
claim pending, threatened or deemed by counsel to be probable of assertion, or
any governmental proceeding or investigation in progress that could reasonably
be expected to have a material adverse effect upon the Acquired Assets to be
conveyed hereunder or the Station after Closing, and (b) The written opinion of
Seller's FCC Counsel, dated as of the Closing Date and addressed to Buyers and
their lender, that: (1) Seller holds the FCC Authorizations, each of which is in
full force and effect; (2) they are not subject to any conditions other than
those shown on the face of the FCC Authorizations or imposed under generally
applicable rules of the FCC; (3) the FCC has granted the FCC Order and such
order has become a Final Action (unless the condition on finality has been
waived by Buyer as permitted herein); and (4) other than proceeding affecting
the broadcast industry generally, there are no proceedings pending or, to such
counsel's knowledge, threatened by or before the FCC affecting or relating to
the Station or the FCC Authorizations;
11.2.7 Joint Escrow Instructions. Written instructions to the Escrow
Agent directing that the Deposit be delivered to Seller and all interest thereon
be delivered to Buyer;
11.2.8 Wire Instructions. Three (3) days prior to the Closing Date,
Seller shall provide to Buyer wire instructions for the payment of the Cash
Payment due on the Closing Date.
11.2.9 Allocation of Purchase Price. Seller and Buyer shall have agreed
to allocate the Purchase Price among the Acquired Assets in accordance with a
mutually agreeable allocation schedule to be delivered at closing.
11.2.10 Additional Documents. Such other information, materials and
documentation as counsel for Buyer shall have reasonably requested for the
purpose of consummating the transactions described herein and to evidence
satisfaction of the conditions to Seller's obligations hereunder, and any other
documents expressly required by this Agreement to be delivered by Seller at
Closing;
11.3 Deliveries to Seller by Buyer. At the Closing, Buyer shall deliver or
cause to
21
be delivered to Seller the following, in each case in form and substance
reasonably satisfactory to Seller:
11.3.1 Cash. A wire transfer of immediately available funds to Seller,
in the amount set forth on Schedule 2.4;
11.3.2 Certificates. (i) A certificate by Buyer dated as of the Closing
Date certifying that, except as set forth in such certificate, all of Buyer's
undertakings and obligations under this Agreement are satisfied as of the
Closing Date, and all of its warranties and representations remain true and
accurate in all material respects as of the Closing Date; (ii) certificates from
the Secretary of State of the State of Nevada, dated as near as practicable to
the Closing Date, showing that Licensing and Broadcasting are incorporated and
in existence in the State of Nevada; (iii) certificates from the Secretary of
State of the State of South Carolina, dated as near as practicable to the
Closing Date, showing that Licensing and Broadcasting are authorized to do
business in the State of South Carolina; (iv) certificates of the secretaries of
Licensing and Broadcasting attesting to the incumbency of each officer of
Licensing and Broadcasting who execute this Agreement and any of the other
Documents; and (iv) certified resolutions of Boards of Directors of Licensing
and Broadcasting evidencing the authorization and approval of Licensing's and
Broadcasting's execution, delivery and performance of this Agreement.
11.3.3 Allocation of Purchase Price. Seller and Buyer shall have agreed
to allocate the Purchase Price among the Acquired Assets in accordance with a
mutually agreeable allocation schedule to be delivered at closing.
11.3.4 Joint Escrow Instructions. Written instructions to the Escrow
Agent directing that the Deposit be delivered to Seller and all interest thereon
be delivered to Buyer.
11.3.5 Additional Documentation. Such additional information,
materials, and documentation as counsel to Seller shall have reasonably
requested to evidence satisfaction of the conditions to Buyer's obligations
hereunder, and any other documents expressly required by this Agreement to be
delivered by Buyer at Closing;
ARTICLE XII
SURVIVAL OF REPRESENTATIONS AND WARRANTIES:
INDEMNIFICATION
12.1 Survival of Representations and Warranties. All representations,
warranties, covenants and agreements contained in this Agreement shall survive
the Closing and continue in full force and effect for a period of ninety (90)
days after the applicable statute of limitations has expired with respect to any
claim by Buyer based upon a claim or action by a third party and for a period of
two (2) years following Closing with respect to any claim by Buyer not based on
a claim or action by a third party. No claim may be brought
22
under this Agreement or any other Document, unless written notice describing in
reasonable detail the nature and basis of such claim is given on or prior to the
last day of the relevant survival period. In the event such a notice is so
given, the right to indemnification with respect thereto under this Article
shall survive the applicable survival period until such claim is finally
resolved and any obligations with respect thereto are fully satisfied.
12.2 Indemnification in General. Buyer and Seller agree that the rights to
be indemnified and held harmless set forth in this Agreement, as between the
parties hereto and their respective permitted successors and assigns, shall be
exclusive of all rights to be indemnified and held harmless that such party (or
its permitted successors or assigns) would otherwise have by statute, common law
or otherwise.
12.3 Indemnification by Seller. Seller shall indemnify, defend, and hold
harmless Buyer, any officer or director thereof, and their permitted assigns
with respect to any and all demands, claims, actions, suits, proceedings,
assessments, judgments, costs, losses, damages, obligations, liabilities,
recoveries, deficiencies, and expenses (including interest, penalties and
reasonable attorneys' fees) of every kind and description (collectively "Claim")
relating to or arising out of:
12.3.1 Any breach or non-performance by Seller of any of its
representations, warranties, covenants or agreements set forth in this Agreement
or any other Document; or
12.3.2 Except as otherwise provided in the TBA, any debt, liability or
obligation of Seller or the Station that arises or results from or is
attributable to the operations or business of the Seller or the Station prior to
the Closing Date, including but not limited to, liabilities and obligations
under Station Agreements to the extent such liabilities and obligations relate
to any period before the Closing Date, regardless of whether disclosed in any
Schedule or Document and regardless of whether constituting a breach by Seller
of any representation, warranty, covenant or agreement, and any liability or
obligation of Seller other than the Assumed Obligations arising after the
Closing Date; provided, however, that Seller shall not be liable for any Claim
arising out of or resulting from Buyer's action or failure to act under the TBA.
12.4 Indemnification by Buyer. Buyer shall indemnify, defend, and hold
harmless Seller, any officer or director thereof, and their permitted assigns,
with respect to any and all demands, claims, actions, suits, proceedings,
assessments, judgments, costs, losses, damages, obligations, liabilities,
recoveries, deficiencies, and expenses (including interest, penalties and
reasonable attorneys' fees) of every kind and description relating to or arising
out of:
12.4.1 Any breach or non-performance by Buyer of any of its
representations, warranties, covenants or agreements set forth in this Agreement
or any
23
other Document; or
12.4.2 The Assumed Obligations and any other liability, obligation or
debt of Buyer or the Station that arises or results from and is attributable to
the operations or business of the Station on or after the Closing Date or the
Commencement Date of the TBA as applicable.
12.5 Indemnification Procedure. For purposes of administering the
indemnification provisions set forth in Sections 12.3 and 12.4, the following
procedure shall apply:
12.5.1 Whenever a claim for indemnification shall arise under this
Article, the party entitled to indemnification (the "Indemnified Party") shall
promptly and in no event later than fifteen (15) days after receipt of such a
claim, give written notice to the party from whom indemnification is sought (the
"Indemnifying Party") setting forth in reasonable detail, to the extent then
available, the facts concerning the nature of such claim and the basis upon
which the Indemnified Party believes that it is entitled to indemnification
hereunder, provided that the Indemnified Party's failure to do so shall not
preclude it from seeking indemnification hereunder unless such failure has
materially prejudiced the Indemnifying Party's ability to defend such claim.
12.5.2 In the event of any claim for indemnification hereunder
resulting from or in connection with any claim, action, suit or legal
proceedings brought by a third party, the Indemnifying Party shall be entitled,
at its sole expense, either: (i) to participate therein, or (ii) to assume the
entire defense thereof with counsel who is selected by it and who is reasonably
satisfactory to the Indemnified Party provided that (a) the Indemnifying Party
agrees in writing that it does not and will not contest its responsibility for
indemnifying the Indemnified Party in respect of such claim or proceeding, and
(b) no settlement shall be made without the prior written consent of the
Indemnified Party which shall not be unreasonably withheld (except that no such
consent shall be required if the claimant is entitled under the settlement to
only monetary damages to be paid solely by the Indemnifying Party). If, however,
(1) the claim, action, suit or proceeding would, if successful, result in the
imposition of damages for which the Indemnifying Party would not be solely
responsible hereunder, or (2) representation of both parties by the same counsel
would otherwise be inappropriate due to actual or potential differing interests
between them, then the Indemnifying Party shall not be entitled to assume the
entire defense and each party shall be entitled to retain counsel (in the case
of Clause (a) of this sentence, at their own expense) who shall cooperate with
one another in defending against such action, claim or proceeding.
12.5.3 If the Indemnifying Party does not choose to defend against a
claim, action, suit or legal proceeding by a third party, the Indemnified Party
may defend against such claim, action, suit or proceeding in such manner as it
deems appropriate or settle such claim, action, suit or proceeding (after giving
notice thereof to the Indemnifying
24
Party) on such terms as the Indemnified Party may deem appropriate, and the
Indemnified Party shall be entitled to periodic reimbursement of expenses
incurred in connection therewith and prompt indemnification from the
Indemnifying Party, including reasonable attorneys' fees, in accordance with
this Article.
12.5.4 The Indemnifying Party will not, without the Indemnified Party's
written consent, settle or compromise any claim or consent to any entry of
judgment which does not include, as an unconditional term thereof, the giving by
the claimant to the Indemnified Party of a release from all liability with
respect to such claim. Neither Buyer nor Seller shall be deemed to have notice
of any claim by reason of any knowledge acquired on or prior to the Closing Date
by an employee of the Station unless express evidence is available establishing
actual notice to either party.
12.6 Limitation of Liability. Notwithstanding anything in this Agreement to
the contrary, after the Closing neither Seller nor Buyer shall indemnify or
otherwise be liable to the other party from and after the Closing Date except to
the extent that the aggregate claims for indemnification by the Indemnified
Party exceed Ten Thousand Dollars ($10,000.00) and indemnification shall be made
by the Indemnifying Party only to the extent of such excess over Ten Thousand
Dollars ($10,000); provided, however, that such limitation shall not apply to
the indemnification obligations under Sections 12.3.2 and 12.4.2.
ARTICLE XIII
TERMINATION
13.1 Termination of Agreement. Seller and/or Buyer may terminate this
Agreement upon written notice from one party to the other as provided below:
13.1.1 by either Seller or Buyer if Closing has not occurred on or
before the 270th day following the date of this Agreement; or
13.1.2 by one party upon written notice by the non-breaching party to
the breaching party at any time prior to the Closing specifying a material
breach hereunder by the breaching party provided such breach, if capable of
being cured, remains uncured for fifteen (15) days after written notice thereof
is received by the breaching party; or
13.1.3 By Seller upon termination of the TBA only by reason of Broker's
material breach, or by Buyer upon termination of the TBA by reason of Licensee's
material breach; or
13.1.4 By Buyer as provided in Article XIV; or
13.1.5 By Seller or Buyer if the Assignment Application is denied by a
Final Order; or
25
13.1.6 By mutual written consent of Seller and Buyer at any time prior
to the Closing. Notwithstanding the foregoing, no party shall be entitled to
terminate this Agreement while such party is in material breach hereunder. In
the event this Agreement is terminated for any reason other than Buyer's
material breach hereunder or under the TBA, Buyer shall be entitled to receive
the return of the Deposit together will all interest and other earnings earned
thereon while held by the Escrow Agent. If this Agreement is terminated by
Seller by reason of Buyer's material breach hereunder or under the TBA, Seller
shall be entitled to the Deposit plus all accrued interest and other earnings
earned thereon while held by the Escrow Agent. Buyer and Seller shall cooperate
in taking such action as necessary to assist the designated party in receiving,
the return of the Deposit and the interest and earnings earned while held by the
Escrow Agent to the designated party(ies).
ARTICLE XIV
RISK OF LOSS
14.1 The risk of loss, damage or destruction to any of the Acquired Assets
from fire, casualty or other cause (except as the result of the action or
inaction of Buyer or its agents or employees arising under the TBA) shall be
upon Seller at all times up to 12:01 a.m. on the Closing Date, and it shall be
the responsibility of Seller prior to Closing to repair or cause to be repaired
and to restore the Acquired Assets as closely as practicable to their condition,
prior to any such loss or damage. Upon the occurrence of any such casualty,
loss, damage or destruction material to the operation of the Station prior to
the Closing (except as the result of the action or inaction of Buyer, its agents
or employees arising under the TBA), Seller shall immediately give Buyer written
notice setting forth in detail the extent of such loss, damage or destruction,
the cause thereof if known, and the insurance coverage and Seller shall use its
best efforts promptly to commence and thereafter diligently to proceed to repair
or replace any such lost, damaged or destroyed property. However, in the event
that such repair or replacement is not fully completed prior to the Closing
Date, then the Closing Date shall be extended (with FCC consent, if necessary)
for up to sixty (60) days to permit such repair or replacement. If repair or
replacement cannot be accomplished within sixty (60) days of the scheduled
Closing Date and Buyer determines that Seller's failure to repair or replace
would have a material adverse effect on the operation of the Station, Buyer may
elect:
14.1.1 to terminate this Agreement; or
14.1.2 to consummate the transactions contemplated hereby on the
Closing Date with the Acquired Assets in their "as is" condition, in which event
Seller shall pay to Buyer the portion of the insurance deductible, if any, not
previously met, and assign to Buyer the portion of the insurance proceeds, if
any, not previously expended by Seller to repair or replace the damaged or
destroyed property; or
26
14.1.3 to postpone the Closing Date until fifteen (15) days after
Seller provides written notice to Buyer of completion of the repair or
replacement of the damaged or destroyed property in a manner and to an extent
satisfactory to Buyer, provided that if Seller is unable through its reasonable
best efforts to complete such repair or replacement within ninety (90) days
after the Seller's notice to Buyer of the casualty, Buyer may then terminate
this Agreement on written notice to Seller.
ARTICLE XV
DEFAULT AND REMEDIES
15.1 Non-Material Breaches. Non-material breaches or failures to perform by
a party hereunder shall not be grounds for postponing the Closing, or
terminating this Agreement, but such breaches or failures shall apply to the
limitation of liability in Section 12.6 above.
15.2 Opportunity to Cure. No party to this Agreement shall be deemed in
default hereunder unless such material breach continues for fifteen (15) days
after receipt of written notice from the other party specifying in reasonable
detail the nature of such default. The defaulting party shall have the right to
cure such default within such 15-day period, provided that if Closing is
scheduled prior to the end of this period, cure must be accomplished by the
Closing Date.
15.3 Buyer's Remedies. Seller agrees that the Acquired Assets to be conveyed
hereunder include unique property that cannot be readily obtained on the open
market and that Buyer will be irreparably injured if this Agreement is not
specifically enforced. Therefore, Buyer shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to specifically enforce
Seller's performance under this Agreement by action instituted in any court of
the United States or any state thereof having jurisdiction over the Seller and
Buyer and the matter, and Seller agrees to waive the defense in any such suit
that Buyer has an adequate remedy at law and to interpose no opposition, legal
or otherwise, as to the propriety of specific performance as a remedy. In the
event Buyer terminates of this Agreement as a result of Seller's material breach
of this Agreement instead of seeking specific performance, Buyer shall be
entitled to the return of the Deposit, plus all accrued interest, and in
addition Buyer shall be entitled to recover from Seller Buyer's actual out-of
pocket damages arising from such breach.
15.4 Liquidated Damages. In the event of Seller's termination of this
Agreement due to a material breach of Buyer hereunder or under the TBA, then the
Deposit, plus all accrued interest, shall be paid to Seller as liquidated
damages, it being agreed that the Deposit shall constitute full payment for any
and all damages suffered by reason of, and shall constitute Seller's sole remedy
at law or in equity for, Buyer's material breach hereunder.
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ARTICLE XVI
MISCELLANEOUS
16.1 Further Actions. From time to time before, at and after the Closing,
each party, at its expense and without further consideration, will execute and
deliver such documents to the other party as the other party may reasonably
request in order to accomplish the transactions contemplated hereby.
16.2 Payment of Expenses.
16.2.1 All state or local sales or use, stamp or transfer, grant and
other similar taxes payable in connection with consummation of the transactions
contemplated hereby shall be paid by the party primarily liable under applicable
law to pay such tax.
16.2.2 Except as otherwise expressly provided in this Agreement, each
party shall bear its own expenses, including the fees of any attorneys and
accountants engaged by such party, in connection with this Agreement and the
consummation of the transactions contemplated herein.
16.3 Notices. All notices, demands or other communications given hereunder
shall be in writing and shall be sufficiently given if delivered by hand, by
courier (including nationally-recognized overnight delivery service) or sent by
registered or certified mail, first class mail, postage prepaid, or by facsimile
with receipt confirmation and a follow-up copy sent by nationally-recognized
overnight delivery service on the same day as such facsimile, addressed as
follows:
If to Seller: WSEA, Inc.
0000 X. Xxxx Xxxxxx
Xxxxxxxx, XX 00000
Tel: 000-000-0000
Fax: 000-000-0000
Copy (which shall not constitute notice to Seller) to:
Xxxxx X. Xxxxx, Esquire
Xxxxxxxx Xxxxx & Xxxxxxxx, PLC
0000 X. 00xx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, XX 00000
Tel: 000-000-0000
Fax: 000-000-0000
28
If to Buyer: Cumulus Broadcasting, Inc.
Cumulus Licensing Corp.
c/o QUAESTUS Management Corp.
000 X. Xxxxxxxx Xxx., Xxxxx 000
Xxxxxxxxx, XX 00000
Attention: Xxxxxxxx X. Xxxxx
Tel: 000-000-0000
Fax: 000-000-0000
Copy (which shall not constitute notice to Buyer) to:
Cumulus Broadcasting, Inc.
Cumulus Licensing Corp.
000 X. Xxxxxxxx Xxx., Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx
Tel: 000-000-0000
Tel: 000-000-0000
or such other address with respect to either party hereto as such party may from
time to time specify (as provided above) to the other party hereto. Any such
notice, demand or communication shall be deemed to have been given:
16.3.1 if sent by first class mail, as of the close of the third
business day following the date so mailed;
16.3.2 if personally delivered or sent by overnight courier, on the
date delivered; and
16.3.3 if faxed, on the date faxed, provided written or verbal
confirmation of receipt has been obtained by the sending party.
16.4 Entire Agreement. This Agreement, the Schedules and Exhibits hereto,
and the other Documents, constitute the entire agreement and understanding
between the parties hereto with respect to the subject matter hereof and
supersedes any prior offers, negotiations, agreements, understandings or
arrangements between the parties hereto with respect to the subject matter
hereof.
16.5 Benefit and Assignment. No party may assign this Agreement of its
rights or obligations hereunder to another party without the advance written
consent of the other party provided, however, that (i) Buyer may assign its
right under this Agreement to one or more affiliates or subsidiary of Buyer,
provided such affiliate or subsidiary is controlled by or under common control
with Buyer, and so long as Buyer unconditionally guarantees all of such
affiliate's or subsidiary's obligations under the Agreement and other Documents,
29
and provided that such assignment occurs prior to the termination of the 30-day
period provided for in Section 73.3584 of the FCC's rules, and (ii) any party's
rights to indemnification under Article XII hereof will inure to the benefit of
and be enforceable by any successor-in-interest by merger or consolidation or by
any lender secured by a security interest in such rights to indemnification.
This Agreement shall inure to the benefit of and be binding upon the parties
hereto and their respective successors or permitted assigns.
16.6 Governing Law. This Agreement shall in all respects be governed by and
construed in accordance with the internal laws of the State of South Carolina,
including all matters of construction, validity and performance, without regard
to its principles of conflicts of laws.
16.7 Amendments and Waivers. No term or provision of this Agreement may be
amended, waived, modified, discharged or terminated orally but rather only by an
instrument in writing signed by both parties. Any written waiver shall be
effective only in accordance with its express terms and conditions.
16.8 Severability. Any provision of this Agreement which is held by any
court of competent jurisdiction or as a result of further legislative or
administrative action, unenforceable shall, as to such jurisdiction, be
ineffective to the extent of such unenforceability without affecting the
validity or enforceability of any other provision hereof.
16.9 Headings. The captions in this Agreement are for convenience of
reference only and shall not define or limit any of the terms or provisions
hereof.
16.10 Counterparts. This Agreement may be executed in any number of
counterparts, and by either party on separate counterparts, each of which shall
be deemed an original, but all of which together shall constitute one and the
same instrument.
16.11 References. All references in this Agreement to Schedules and Exhibits
are to Schedules and Exhibits contained in this Agreement unless a different
document is expressly specified.
16.12 Attorneys' Fees. If either Seller or Buyer brings suit against the
other in connection with this Agreement, the prevailing party shall be entitled
to receive from the other party reasonable attorneys' fees and other costs and
expenses incurred by such party in connection with such suit regardless of
whether such suit is prosecuted to judgment. As used herein, "prevailing party"
shall mean, in the case of a claimant, one who is successful in obtaining
substantially all of the relief sought, and in the case of a defendant or
respondent, one who is successful in denying substantially all of the relief
sought by the claimant.
30
16.13 Construction. The language used in this Agreement will be deemed to be
the language chosen by the Seller and Buyer to express their mutual intent, and
no rule of strict construction shall be applied against any party. Any reference
to any federal, state, local or foreign statute or law shall be deemed to refer
to all rules and regulations promulgated thereunder, unless the context requires
otherwise.
16.14 Confidentiality. Buyer and Seller shall keep confidential all
information obtained by it with respect to the other in connection with this
Agreement and the negotiations preceding this Agreement, and will use such
information solely in connection with the transactions contemplated by this
Agreement. If the transactions contemplated hereby are not consummated for any
reason, each party shall return to the other, without retaining a copy thereof,
any schedules, documents or other written information obtained from the other in
connection with this Agreement and the transactions contemplated hereby.
Notwithstanding the foregoing, neither party shall be required to keep
confidential or return any information which (a) is known or available through
other lawful sources, not bound by a confidentiality agreement with the
disclosing party, or (b) is or becomes publicly available or known through no
fault of the receiving party or its agents, (c) is required to be disclosed
pursuant to an order or request of a judicial or governmental authority or under
applicable law (provided the disclosing party is given reasonable prior notice),
or (d) is developed by the receiving party independently of the disclosure by
the disclosing party.
16.15 Press Releases. In the event either party wishes to issue a news
release or other announcement regarding this Agreement (other than public
notices required by Section 73.3580 of the FCC's rules), such party shall
coordinate with the other party in advance with respect to the information to be
disclosed and the timing of such disclosure.
[INTENTIONALLY LEFT BLANK]
31
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be executed as of the date first written above.
WSEA, INC.
By:
----------------------------
(printed)
----------------------------
Title:
-------------------------
CUMULUS BROADCASTING, INC.
By:
----------------------------
(printed)
----------------------------
Title:
-------------------------
CUMULUS LICENSING CORPORATION
By:
----------------------------
(printed)
----------------------------
Title:
-------------------------
32
TABLE OF EXHIBITS AND SCHEDULES
EXHIBIT 1 Escrow Agreement
SCHEDULE 2.1.3 Station Agreements, Contracts and Leases
SCHEDULE 2.1.3-A Advertising Contracts
SCHEDULE 2.1.5 Intangible Assets
SCHEDULE 2.4 Purchase Price
SCHEDULE 3.3 FCC Authorizations
SCHEDULE 3.4 Tangible Personal Property
SCHEDULE 3.5 Litigation
SCHEDULE 3.11 Leased Real Property
SCHEDULE 3.13 Environmental Exceptions
SCHEDULE 3.17 Employees
SCHEDULE 3.19 Financial Statements
Schedule 2.4
Buyer agrees to pay Seller, as consideration for the purchase contemplated
hereunder a total Purchase Price of One Million Three Hundred Thousand Dollars
($1,300,000.00) to be paid as follows:
Escrow Deposit. Simultaneously with the execution of this Agreement, Buyer
shall deposit Sixty-Five Thousand Dollars ($65,000.00) (the "Deposit") with
Xxxxx X. Xxxxx and X. Xxxxxxxx Xxxxxxx ("Joint Escrow Agents") in the form of a
letter of irrevocable letter of credit from Xxxxxx Commercial Paper Inc. The
Deposit shall be held by the Escrow Agent in accordance with the terms of the
Escrow Agreement attached hereto as Exhibit 1.
Cash Payment of Balance. Buyer shall pay to Seller at Closing the Purchase
Price: One Million Three Hundred Thousand Dollars ($1,300,000.00). Payment shall
be made by wire transfer of immediately available funds pursuant to wire
instructions to be provided by Seller in advance of the Closing.
