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Exhibit 10.9
ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement ("Agreement") is entered into as of
September 4, 1998, by and between TRI- STATE OUTDOOR MEDIA GROUP, INC., a Kansas
corporation ("Buyer"), and WESTERN OUTDOOR ADVERTISING CO., a Nebraska
corporation ("Seller") (Buyer and Seller are sometimes herein referred to
individually as a "Party" and collectively as the "Parties").
RECITALS
Among other business endeavors, Seller is engaged in the business of
owning and operating outdoor signs and billboards and otherwise providing
outdoor advertising services (the "Business") in those areas described on
Schedule A (the "Territory"). Seller desires to sell and assign certain outdoor
advertising assets to Buyer, and Buyer desires to purchase such assets and to
assume certain liabilities associated with such assets, pursuant to the terms,
conditions, limitations and exclusions contained in this Agreement.
AGREEMENT
The Parties, intending to be legally bound, agree as follows:
1. DEFINITIONS
For purposes of this Agreement, the terms listed on Exhibit A attached
hereto have the meanings specified or referred to in Exhibit A .
2. PURCHASE AND SALE OF THE ASSETS; CLOSING
2.1 AGREEMENT TO PURCHASE AND SELL. Subject to the terms and
conditions of this Agreement, Seller hereby agrees to grant, sell, assign,
transfer, convey and deliver (or cause to be granted, sold, assigned,
transferred, conveyed and delivered) all right, title and interest in and to the
Purchased Assets, free and clear of any Encumbrances or Security Interests, and
Buyer hereby agrees to buy and acquire the Purchased Assets from Seller, and to
assume the Assumed Liabilities upon the terms and conditions set forth in this
Agreement.
2.2 PURCHASED ASSETS. The Purchased Assets are those assets of
Seller used in the Business listed below:
(a) all of the billboard displays and other out-of-home
advertising structures, together with all components, fixtures, parts,
appurtenances, and equipment attached to or made a part thereof that are
existing, under construction or for which Seller has any rights (including at
least 1,900 structures and 2,400 sign faces) (collectively, the "Structures"),
including, without limitation, all of the Structures listed on Schedule 2.2(a);
(b) all leases, licenses, easements, other rights of ingress
or egress, and all other grants of the right to place, construct, own, operate
or maintain billboard displays and other out-of-home advertising structures
(including, without limitation, the Structures) on land, buildings and
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other real property owned by third parties, and all rights therein
(collectively, the "Site Leases"), including, without limitation, those Site
Leases listed on Schedule 2.2(b):
(c) all of the rights under existing and pending sales and
advertising contracts associated with the Business, all rights to the
advertising copy displayed on the Structures as of the Closing Date, all other
rights to collect and receive income from the use of the Structures and security
deposits, if any, with respect thereto (collectively, the "Advertising
Contracts"), including, without limitation, all of the Advertising Contracts
listed on Schedule 2.2(c);
(d) all state and local licenses or permits/tags which Seller
has or has an interest in with respect to the Business and all other
Governmental Authorizations that are required for the operation of the Business
(collectively, the "Permits"), including, without limitation, all of the Permits
listed on Schedule 2.2(d);
(e) all accounts receivable, prepaid items and other assets of
Seller as of the Closing Date used in the Business that would be reflected as
current assets on a balance sheet of Seller as of the Closing Date prepared in a
manner consistent with Section 3. 10(a) (but excluding cash);
(f) the Books and Records;
(g) the Intangible Property;
(h) all real property owned in fee by Seller (or, in the case
of the real property commonly known as 0000 Xxxxx Xxxxxx, Xxxxx, Xxxxxxxx [the
"Omaha Property"], owned by L.K. Company, L.L.C., a Nebraska limited liability
company [the "LLC"]) and used in the Business and any rights therein, and all
buildings, fixtures, structures and other improvements located thereon, listed
on Schedule 2.2(h) (the "Real Property") (but excluding the real property
commonly referred to as the Century 21 Apartments located at 10025 "S" Plaza,
Omaha, Nebraska);
(i) all tangible personal property owned by Seller and used in
the operation of the Business, including, without limitation, the property
listed on Schedule 2.2(i) (collectively, the "Tangible Personal Property");
(j) all supplies used in connection with the Business,
including, without limitation, panels, moldings, steel components, sections,
parts, paint supplies, and appurtenances, equipment, electrical connections,
wiring and lighting components, as set forth on Schedule 2.2(j); and
(k) all rights (including any benefits arising therefrom),
causes of action, claims and demands of whatever nature (whether or not
liquidated) of Seller relating to the Purchased Assets, including, without
limitation, condemnation rights and proceeds, and all rights against suppliers
under warranties covering any of the Purchased Assets.
2.3 AGREEMENT TO ASSUME CERTAIN LIABILITIES. At the Closing, Buyer
shall assume and agree to discharge and perform only those liabilities and
obligations that arise or are attributable to
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events occurring on or after the Closing Date pursuant to the Site Leases and
the Advertising Contracts (the "Assumed Liabilities"), but to the extent and
only to the extent that:
(a) Such obligations are performable on or after the Closing
Date; and
(b) Such obligations are attributable to periods arising on or
after the Closing Date.
The assumption by Buyer of any Assumed Liabilities shall not
be deemed to modify or amend Seller's representations and warranties contained
herein or in any way impair Buyer's right to rely upon such representations and
warranties or to obtain indemnification pursuant to Article 10 hereof for any
breach of such representations and warranties.
2.4 EXCLUDED LIABILITIES. All claims against and liabilities and
obligations of Seller not specifically assumed by Buyer pursuant to Section 2.3,
including, without limitation, the following claims against and liabilities of
Seller (the "Excluded Liabilities"), are excluded, and shall not be assumed or
discharged by Buyer, and shall be discharged in full when due by Seller:
(a) Any liabilities to the extent not attributable to the
Purchased Assets;
(b) Any liability for Taxes arising prior to or as a result of
the sale of the Purchased Assets under this Agreement;
(c) Any liabilities for or related to indebtedness of Seller
to banks, financial institutions, or other Persons;
(d) Any liabilities of Seller for or with respect to any
employees of Seller, including, without limitation, any liabilities pursuant to
any compensation, collective bargaining, pension, retirement, severance,
termination, or other benefit plan, agreement or arrangement; and
(e) Any other liabilities of Seller, whether absolute or
contingent, that are attributable to or arise from facts, events, or conditions
that occurred or came into existence prior to the Closing whether or not such
liabilities are asserted or claimed prior to the Closing or thereafter, except
to the extent that such liabilities would otherwise constitute, in whole or in
part, an Assumed Liability.
2.5 CLOSING. The purchase and sale of the Purchased Assets (the
"Closing") provided for in this Agreement will take place at the offices of
Buyer or Buyer's attorneys or Buyer's lender on or about November 30, 1998; or
such earlier or later time and place as the Parties may agree in writing. Buyer,
at its option, may (a) designate a Closing Date prior to November 30, 1998
provided Buyer shall give to Seller at least seven (7) days notice thereof and
further provided that such optional Closing Date shall not fall between the
dates of October 15, 1998 and November 1, 1998, or (b) extend the Closing Date
until a date not later than December 15, 1998, provided Buyer shall give Seller
notice thereof on or before November 30, 1998. The effective time of the Closing
shall be 12: 01 a.m., Eastern Standard Time, on the Closing Date.
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2.6 PURCHASE PRICE. In consideration for the Purchased Assets, Buyer
shall assume the Assumed Liabilities, and pay an amount (the "Purchase Price")
equal to Twenty Six Million Seven Hundred Fifty Thousand Dollars
($26,750,000.00). The Parties agree to cooperate with each other in determining
and reaching an agreement in writing on the allocation of the Purchase Price
among the Purchased Assets on or prior to Closing (however, there shall be
allocated to the covenants described in Section 11 not more than $10,000.00).
2.7 TRANSACTIONS AT THE CLOSING. The following transactions shall take
place at the Closing:
(a) Seller shall enter into (as applicable) and/or deliver to
Buyer: (i) the Xxxx of Sale; (ii) the Deeds and all applicable documentary
stamps or real estate transfer taxes payable in connection with the conveyance
of the Real Property (except that in the case of the Omaha Property Seller shall
cause the LLC to deliver such items) (provided, however, that Buyer, by written
notice to Seller, may elect not to acquire any one (1) or more parcels
constituting the Real Property but no reduction in purchase price shall arise as
the result of any such election); (iii) Required Consents; (iv) satisfactory
evidence of the release of any Encumbrances or Security Interests on the
Purchased Assets; (v) all applicable Tax Clearances; and (vi) other instruments
of transfer, and all other related documents as may be necessary to effect the
sale and assignment of the Purchased Assets in accordance with the terms hereof
(and in the case of the Omaha Property shall cause the LLC to comply with this
provision). Seller shall also deliver to Buyer all Books and Records with
respect to the Purchased Assets, including the originals of the Advertising
Contracts, Site Leases and Permits.
(b) Buyer shall deliver the Purchase Price at the Closing, as
follows:
(i) $25,500,000.00 (subject to any required
adjustments) shall be delivered to an account or accounts designated by Seller
by wire transfer of immediately available funds;
(ii) $1,000,000.00 (the "Escrow Amount") (as
described in Section 13.1) shall be delivered to the Escrow Agent by wire
transfer of immediately available funds to be held in accordance with the
provisions of Section 13 of this Agreement; and
(iii) $250,00.00 (the "Lease Escrow Amount") (as
described in Section 15.1) shall be delivered to the Escrow Agent by wire
transfer of immediately available funds to be held in escrow in accordance with
the provisions of Section 15 of this Agreement.
(c) Buyer shall enter into (as applicable) and deliver to
Seller: (i) the Xxxx of Sale, and (ii) other assumption agreements, instruments
and other documents as may be reasonably necessary to evidence the assumption by
Buyer of the Assumed Liabilities.
(d) The Parties shall also deliver to each other the
agreements, instruments, opinions, certificates, and other documents referred to
in this Agreement.
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2.8 THIRD PARTY CONSENTS. To the extent that Seller's rights under any
Advertising Contract, Site Lease, Permit or other interest in the Purchased
Assets may not be assigned without the consent of a third party and such consent
has not been obtained, this Agreement shall not constitute an agreement to
assign the same if an attempted assignment would constitute a breach thereof or
be unlawful, and Seller and Buyer, to the maximum extent permitted by law and
any terms of or limitations relating to such asset, shall use their Best Efforts
to obtain for Buyer the benefits thereunder, and shall cooperate to the maximum
extent permitted by law and any terms of or limitations relating to such asset
in any reasonable arrangement designed to provide such benefits to Buyer,
including any sublease or subcontract or similar arrangement, and if Buyer has
obtained such benefits, Buyer shall discharge Seller's obligations thereunder
arising from and after the Closing Date, except for those obligations arising
because of Seller's breach.
3. REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to Buyer as follows (which
representations and warranties shall be joined in by the Indemnifying
Stockholders):
3.1 ORGANIZATION AND GOOD STANDING. Seller is a corporation duly
organized, validly existing and in good standing under the laws of Nebraska,
with full power and authority to conduct the Business as it is now being
conducted, to own or use the Purchased Assets, and to perform all its
obligations. Seller has delivered to Buyer true and complete copies of its
Organizational Documents, as currently in effect. Seller is duly qualified to do
business and in good standing in each jurisdiction comprising the Territory. The
Business is operating only in the Territory. Seller has no subsidiaries. The LLC
is a limited liability company duly organized, validly existing and in good
standing under the laws of the State of Nebraska.
3.2 AUTHORITY: NO CONFLICT.
(a) This Agreement constitutes the legal, valid, and binding obligation
of Seller, enforceable against it in accordance with its terms. Upon the
execution and delivery by Seller of any documents to be executed at Closing
pursuant to this Agreement (collectively, the "Closing Documents"), such Closing
Documents will constitute the legal, valid, and binding obligations of Seller,
as applicable, enforceable against it in accordance with its terms. Seller has
the absolute and unrestricted right, power and authority to execute and deliver
this Agreement and the Closing Documents to which it is a party and to perform
its obligations thereunder. The Indemnifying Stockholders are all the
shareholders, beneficially and of record, of Seller. The execution, delivery and
performance of this Agreement has been specifically authorized by all the
shareholders and directors of Seller.
(b) Except as set forth in Part 3.2(b) of the Disclosure Schedule,
neither the execution and delivery by Seller of this Agreement nor the
consummation or performance by Seller of any of the Contemplated Transactions
will:
(i) conflict with, violate or result in a breach of
(A) any provision of the Organizational Documents of Seller; (B) any
Order or Legal Requirement to which Seller, the Business or any of the
Purchased Assets may be subject; or (C) any Governmental
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Authorization held by Seller or that otherwise relates to the Business
or the Purchased Assets; or
(ii) (A) contravene, conflict with, or result in a
violation or breach of any provision of, or give any Person the right
to declare a default or exercise any remedy under, or to accelerate the
maturity or performance of, or to cancel, terminate, or modify, any
Contract to which Seller is a party or any material interest or rights
of Seller in or to the Purchased Assets; or (B) result in the
imposition or creation of any Encumbrance upon or with respect to any
of the Purchased Assets.
(c) Except as set forth in Part 3.2(c) of the Disclosure
Schedule, Seller and the LLC are not and will not be required to give any notice
to or obtain any Consent from any Person in connection with the execution and
delivery of this Agreement or the consummation or performance of any of the
Contemplated Transactions (any such Consents set forth on Part 3.2(c) of the
Disclosure Schedule are referred to as "Required Consents").
3.3 SOLVENCY. By consummating the transactions contemplated hereby,
Seller does not intend to hinder, delay or defraud any of Seller's present or
future creditors. Before giving effect to the transactions contemplated hereby,
Seller has been paying its debts as they become due in the Ordinary Course of
Business and, after giving effect to the transactions contemplated hereby,
Seller will have paid or discharged all of its debts (or made adequate provision
for the payment thereof) with respect to the Purchased Assets.
3.4 BOOKS AND RECORDS. The books of account, and other Books and
Records of Seller maintained in connection with the Purchased Assets, are
complete and correct in all material respects and have been maintained in
accordance with sound business practices. Buyer shall have full access to the
Books and Records (and the right to make copies of same) prior to, at and after
the Closing, and this provision shall survive the Closing.
3.5 STRUCTURES. Seller owns all of the Structures. Except as set forth
in Part 3.5 of the Disclosure Schedule, each Structure (a) has a written Site
Lease and is located entirely on property covered by a Site Lease or is located
entirely on the Real Property, (b) complies in all material respects with the
terms of the Permits and applicable Legal Requirements pertaining to it, (c) is
in condition to accept faces and in adequate condition and repair for its
current use, and (d) is not currently the subject of any dispute with any
lessor, any lessee or owner of adjacent property or any other Person.
3.6 PERMITS. Except as set forth in Part 3.6 of the Disclosure
Schedule, (a) the Permits constitute all necessary licenses, permits,
registrations and approvals necessary pursuant to all applicable Legal
Requirements to install, operate and maintain the Structures for off-premises
advertising, (b) Seller is in material compliance with the terms of the Permits;
(c) each Permit is in full force and effect and Seller is not aware of any fact
or event which constitutes a violation of any Permit, and (d) Seller has not
received notice that any Governmental Body issuing any Permit intends to cancel,
terminate, modify or amend any Permit.
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3.7 SITE LEASES AND ADVERTISING CONTRACTS. Seller has delivered to
Buyer true and complete copies of all Advertising Contracts and the Site Leases
to which Seller is a party or by which Seller or any of the Purchased Assets is
bound, and all Site Leases and Advertising Contracts are listed on Schedules
2.2(b) and 2.2(c), respectively. Except as set forth on Part 3.7 of the
Disclosure Schedule, all sales made to advertisers in connection with the
Structures have been made pursuant to Advertising Contracts. The Site Leases and
the Advertising Contracts are in full force and effect, valid, enforceable in
accordance with their respective terms, and are binding upon the parties
thereto. Except as set forth in Part 3.7 of the Disclosure Schedule, (x) no
default by Seller or, to the Knowledge of Seller, any other Person has occurred
under the Site Leases or Advertising Contracts and (y) to the Knowledge of
Seller, no event, occurrence or condition exists which (with or without notice
or lapse of time or the happening of any future event or condition) would become
a default by Seller thereunder or would entitle any other party to terminate a
Site Lease or Advertising Contract to make a claim or set-off against Seller or
otherwise to amend such Site Lease or Advertising Contract or prevent such Site
Lease or Advertising Contract from being renewed in accordance with its terms.
Except as set forth in Part 3.7 of the Disclosure Schedule, Seller has not
received any notice of default, termination or non-renewal under any Site Lease
or Advertising Contract. On the Closing Date, all Site Lease rents and other
charges and all liabilities with respect to the Purchased Assets obligations
shall be paid in full through the day of Closing.
3.8 REAL PROPERTY. Seller or the LLC, as the case may be, has good and
marketable record title to the Real Property, such title being a fee interest to
the Real Property. Seller and the LLC have not granted or agreed to grant to any
Person any option, agreement or other right to purchase, sell, lease or occupy
any of the Real Property.
3.9 TITLE, ENCUMBRANCES.
(a) Seller (and the LLC with respect to the Omaha Property)
has good and marketable title to all of the Purchased Assets. There are no
existing agreements, options, commitments or rights with, of or to any Person to
acquire any of the Purchased Assets or any interest therein.
(b) Except as set forth in Part 3.9(b) of the Disclosure
Schedule, none of the Structures, Site Leases or Real Property are subject to
zoning, use, or building code restrictions or, to Seller's Knowledge, any
Encumbrances that will prohibit the continued effective ownership, leasing or
other use of such assets as currently owned and used by Seller. Seller has not
received any notice of pending or Threatened claims, Proceedings, planned public
improvements, annexations, special assessments or other adverse claims affecting
the structures or Site Leases.
3.10 FINANCIAL STATEMENTS.
(a) Seller has delivered to Buyer certain financial statements
the ("Financial Statements") with respect to the Business, copies of which are
annexed hereto as Schedule 3. 10. The Financial Statements have been prepared
consistently during the periods covered thereby and accurately present in all
material respects the gross revenues and expenses of the Business at the dates
of said statements and the results of the operations of the Business and cash
flows for the
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periods covered thereby. There has been no Material Adverse Change in the
financial condition of the Business or Purchased Assets since the date of the
most recent Financial Statement.
(b) As of the date hereof and as of the Closing Date, Seller
had and will have no liabilities with respect to the Business or the Purchased
Assets (which liabilities, when taken individually or in the aggregate are
material) of any nature, whether accrued, absolute, contingent or otherwise,
asserted or unasserted, known or unknown (including, without limitation,
liabilities as guarantor or otherwise with respect to obligations of others, or
liabilities for Taxes due or then accrued or to become due or contingent or
potential liabilities relating to activities of Seller with respect to the
Business prior to the date hereof or the Closing, as the case may be, regardless
of whether claims in respect thereof had been asserted as of such date), except
(i) liabilities reflected in the Financial Statements or the notes thereto, or
(ii) liabilities incurred in the Ordinary Course of Business since the date of
the most recent Financial Statement.
(c) At the Closing Seller shall deliver to Buyer an unaudited
balance sheet as at the date immediately preceding the Closing Date and an
income statement for the partial fiscal year then ended, certified by Seller.
3.11 TAXES. With respect to the Purchased Assets and the Business:
(a) Seller has filed or caused to be filed all Tax Returns
that are or were required to be filed by Seller (or the LLC with respect to the
Omaha Property), pursuant to applicable Legal Requirements. Seller has paid, or
made provision for the payment of, all Taxes that have or may have become due
pursuant to those Tax Returns or otherwise, or pursuant to any assessment
received by Seller;
(b) No unpaid Taxes create an Encumbrance on the Purchased
Assets; and
(c) Buyer shall not be liable for any Taxes of Seller or the
LLC as a result of the Contemplated Transactions.
3.12 COMPLIANCE WITH LEGAL REQUIREMENTS. Except as set forth in Part
3.12 of the Disclosure Schedule, (a) Seller (and the LLC with respect to the
Omaha Property) has complied with all Legal Requirements applicable to Seller's
or the LLC's ownership or use of the Purchased Assets and operation of the
Business, and (b) Seller and the LLC have not received any notice (written or
oral) of any violation or failure to comply with any Legal Requirements relating
to the Business, the Purchased Assets or their use or operation which violation
or failure has not been cured.
3.13 LEGAL PROCEEDINGS; ORDERS. Except as set forth in Part 3.13 of the
Disclosure Schedule, there is no Proceeding pending or, to the Knowledge of
Seller, Threatened against Seller or affecting any of the Purchased Assets and
there is no Order to which Seller or the Purchased Assets is subject (the
foregoing representation and warranty being deemed made by the LLC with respect
to the Omaha Property).
3.14 OTHER CONTRACTS. Seller is not a party to or bound by any Other
Contract, except as disclosed in Part 3.14 of the Disclosure Schedule.
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3.15 INSURANCE. Seller maintains (and shall through and including the
Closing Date maintain) in full force and effect policies of fire and other
casualty, liability, title and other forms of insurance covering the Purchased
Assets and the Business, and the operation thereof, of the types and with the
amounts of coverage as are consistent with industry standards for outdoor
advertising businesses.
3.16 ENVIRONMENTAL MATTERS. Except as set forth in Part 3.16 of the
Disclosure Schedule with respect to the Purchased Assets (including the Real
Property and the use or operation thereof): (a) Seller is, and has been, in
compliance with all Environmental Laws; (b) Seller has timely filed all reports,
obtained all required approvals and permits relating to the Business, and
generated and maintained all data, documentation and records under any
applicable Environmental Laws; (c) to the Knowledge of Seller, there has not
been any Release of Hazardous Materials at or in the vicinity of the Business
(including the Real Property and any real property covered by a Site Lease or on
which a Structure is located) or in areas for which Seller would have
responsibility under Environmental Laws; (d) Seller has not received any written
notice from any Person entity advising it that it is or may be responsible for
response costs with respect to a Release, a threatened Release or clean up of
Hazardous Materials produced by, or resulting from, its Business, operations or
processes; and (e) Seller has delivered to Buyer true and complete copies and
results of any reports, studies, analyses, tests, or monitoring possessed or
accessible by Seller pertaining to Hazardous Materials in, on, or under the
properties included in the Purchased Assets. The foregoing representations and
warranties are deemed also to be made by the LLC with respect to the Omaha
Property.
3.17 INTANGIBLE PROPERTY. Seller uses no intangible property in
connection with the operation of the Purchased Assets, except for the Permits,
the Books and Records and the Intangible Property.
3.18 RELATIONSHIPS WITH AFFILIATES. Except as set forth on Part 3.18 of
the Disclosure Schedule, Seller is not a party to any contract with a Related
Person of Seller relating to the Purchased Assets or the Business associated
therewith. Neither Seller nor any Related Persons of Seller is the owner (of
record or as a beneficial owner) of an equity interest or any other financial or
profit interest in, a Person (other than Seller) that has business dealings or a
material financial interest in any transaction with Seller involving the
Purchased Assets or the Business associated therewith.
3.19 BROKERS OR FINDERS. The Seller, its shareholders, directors, and
officers have not incurred any obligation or liability, contingent or otherwise,
for brokerage or finders' fees or agents' commissions or other similar payment
in connection with this Agreement.
3.20 EMPLOYEE BENEFITS MATTERS. Except as disclosed on Part 3.20 of the
Disclosure Schedule, with respect to Seller:
(a) Seller does not maintain and has never maintained an
"employee benefit pension plan" within the meaning of ERISA Section 3(2), that
is or was subject to Title IV of ERISA.
(b) Seller does not have and has not ever had, any past,
present or future obligation or liability to contribute any "multi-employer
plan," as defined in ERISA Section 3(37).
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(c) Seller does not have any written or oral employee benefit
plans, contracts, agreements, incentives or arrangements, including without
limitation, pension and profit sharing plans, savings plans, incentive
compensation, medical, life, dental or disability plans or severance agreements.
Buyer does not, however, assume any liabilities with respect to any of the plans
or other matters disclosed on Part 3.20 of the Disclosure Schedule, all of which
shall constitute Excluded Liabilities.
For purposes of this Section 3.20, the term "Seller" shall be deemed to include
any other corporation, trade, business or other entity, other than Seller, which
would, together with Seller, now or in the past constitute a single employer
within the meaning of Section 414 of the IRC.
3.21 OMITTED.
3.22 EMPLOYEES: LABOR MATTERS. All employees of Seller are employees at
will. Except as disclosed on Part 3.22 of the Disclosure Schedule, no employee,
agent or consultant of Seller is a party to any agreement governing such
employee's agent's or consultant's employment or engagement, as the case may be,
with Seller. As of the date hereof Seller employs (and as of the Closing Date
Seller shall employ) less than fifty (50) employees. Seller has made no
warranty, representation or agreement, either in writing or orally, to any
employee of Seller that Buyer intends to employ such employee on or after the
Closing Date. Seller consents to Buyer communicating with the employees,
consultants and independent contractors of Seller on or prior to the Closing
Date, and Seller shall cooperate in connection therewith. Seller is not a party
to any collective bargaining agreement with respect to any of its employees nor
are any employees of Seller covered by any collective bargaining agreement. No
labor organization or group of employees has made a demand for recognition, has
filed a petition seeking a representation proceeding or given Seller notice of
any intention to hold an election of a collective bargaining organization. There
are no known writs, actions, claims or legal, administrative, arbitration or
other proceedings or governmental investigations pending or Threatened or
involving or alleging civil rights violations, unfair labor investigations
practice claims, back pay orders or other similar claims or proceedings. Seller
is in material compliance with all federal, state and local laws respecting
employment and employment practices, terms and conditions of employment and
wages and hours, and is not engaged in any unfair labor practice; there is no
unfair labor practice complaint against Seller pending before the National Labor
Relations Board; there is no labor strike, dispute, slowdown, or stoppage
pending or threatened against or involving the employees of Seller; and no
grievance or any arbitration proceeding is pending or threatened against Seller
and no claim therefor exists.
3.23 INDEBTEDNESS, ENCUMBRANCES AND SECURITY INTERESTS. All of the
Purchased Assets will be, at Closing, owned by Seller (or the LLC with respect
to the Omaha Property) free and clear of all Encumbrances and Security
Interests.
3.24 BILLBOARD INCOME. The net cash receipts on advertising contracts
through July 31, 1998 are $3,314,042 and that amount compares with a similar
amount of $3,238,300, through the period July 31, 1997. As of July 31, 1998 the
average advertising contract held by the Seller has a term of fourteen (14)
months remaining. As of the Closing Date, the cash receipts from advertising
revenues shall not be less than a similar amount received through the equivalent
date one year prior;
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and, further, should closing occur after October 31, 1998, cash receipts from
advertising revenues for the year ended October 31, 1998 shall not be less than
for the fiscal year ended October 31, 1997.
3.25 HSR ACT. Seller does not, as of the date hereof, and shall not as
of the Closing Date, have total assets or net sales (as defined in the HSR Act)
of $10,000,000.00 or more.
3.26 DISCLOSURE. No representation or warranty of Seller in this
Agreement and no statement in the Disclosure Schedule contains an untrue
statement of material fact or omits to state a material fact necessary to make
the statements herein or therein, in light of the circumstances in which they
were made, not misleading.
4. REPRESENTATIONS AND WARRANTIES OF BUYER Buyer represents and warrants
to Seller as follows:
4.1 ORGANIZATION AND GOOD STANDING. Buyer is a corporation duly
organized, validly existing, and in good standing under the laws of the State of
Kansas.
4.2 AUTHORITY, NO CONFLICT.
(a) This Agreement constitutes the legal, valid, and binding
obligation of Buyer, enforceable against Buyer in accordance with its terms.
Upon the execution and delivery by Buyer of the Closing Documents to which Buyer
is a party, such Closing Documents will constitute the legal, valid, and binding
obligations of Buyer, enforceable against Buyer in accordance with their
respective terms. Buyer has the absolute and unrestricted right, power, and
authority to execute and deliver this Agreement and the Closing Documents and to
perform its obligations under this Agreement and the Closing Documents to which
Buyer is a party.
(b) Neither the execution and delivery of this Agreement by
Buyer nor the consummation or performance of any of the Contemplated
Transactions by Buyer will give any Person the right to prevent, delay, or
otherwise interfere with any of the Contemplated Transactions pursuant to (i)
any provision of Buyer's Organizational Documents; (ii) any resolution adopted
by the board of directors or the stockholders of Buyer; (iii) any Legal
Requirement or Order to which Buyer may be subject; or (iv) any material
Contract to which Buyer is a party or by which Buyer may be bound.
4.3 CERTAIN PROCEEDINGS. There is no pending Proceeding that has been
commenced against Buyer and that challenges, or may have the effect of
preventing, making illegal, or otherwise interfering with, any of the
Contemplated Transactions. No such Proceeding has been Threatened and no event
has occurred or circumstance exists that may give rise to or serve as a basis
for the commencement of any Proceeding.
4.4 BROKERS OR FINDERS. Buyer has not incurred any obligation or
liability, contingent or otherwise, for brokerage or finders' fees or agents'
commissions or other similar payment in connection with this Agreement.
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5. COVENANTS OF SELLER
5.1 ACCESS AND INVESTIGATION. Between the date of this Agreement and
the Closing Date, Seller will, and will cause its Representatives to, afford
Buyer and its Representatives reasonable access during normal business hours to
Seller's personnel, properties, Books and Records, and other documents and data
relating to the Purchased Assets and the Business, and furnish Buyer and its
Representatives with copies of the same. In addition to the foregoing, Seller
shall, at all reasonable times before the Closing if called upon by Buyer, use
reasonable efforts to cooperate with and assist Buyer in the preparation of
financial statements by Buyer which may include the operation of the Business
prior to the Closing Date.
5.2 DUE DILIGENCE. Buyer shall have the right, and Seller shall afford
access to Buyer and its Representatives, at all reasonable times upon advance
notice, to perform due diligence on the Purchased Assets.
5.3 OPERATION OF THE PURCHASED ASSETS. Between the date of this
Agreement and the Closing Date, Seller will:
(a) operate the Business only in the Ordinary Course of
Business;
(b) use its Best Efforts to maintain the Purchased Assets, and
maintain the relations and good will with advertisers, landlords and others
associated with the operation of the associated Business;
(c) not enter into any new Advertising Contract or Site Lease
not in the Ordinary Course of Business; and
(d) prorate any receipts from any party under any advertising
contract for any period after the Closing Date between the parties through the
date of Closing.
5.4 BEST EFFORTS. Between the date of this Agreement and the Closing
Date, Seller will use its Best Efforts to cause the conditions in Section 7
(except Section 7.11) to be satisfied.
5.5 NEGATIVE COVENANT. Except as otherwise expressly permitted by this
Agreement, between the date of this Agreement and the Closing Date, Seller will
operate the Business consistent in all material respects with past practice,
except as otherwise provided in this Agreement.
5.6 REQUIRED APPROVALS AND CONSENTS. As promptly as practicable after
the date of this Agreement, Seller will make all filings required by Legal
Requirements to be made by it in order to consummate the Contemplated
Transactions and use its Best Efforts to obtain the Required Consents.
5.7 NOTIFICATION. Between the date of this Agreement and the Closing
Date, Seller will promptly notify Buyer in writing if Seller become aware of any
fact or condition that causes or constitutes a breach of any of Seller's
representations and warranties as of the date of this Agreement, or if Seller
becomes aware of the occurrence after the date of this Agreement of any fact or
condition
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that would (except as expressly contemplated by this Agreement) cause or
constitute a breach of any such representation or warranty had such
representation or warranty been made as of the time of occurrence or discovery
of such fact or condition. During the same period, Seller will promptly notify
Buyer of the occurrence of any breach of any covenant of Seller in this Section
5 or of the occurrence of any event that may make the satisfaction of the
conditions in Section 7 impossible or unlikely.
5.8 NO NEGOTIATION. Until such time, if any, as this Agreement is
terminated pursuant to Section 9, neither Seller nor any Affiliate will, nor
will it permit its Representatives to, directly or indirectly solicit, initiate,
or encourage any inquiries or proposals from, discuss or negotiate with, provide
any non-public information to, or consider the merits of any unsolicited
inquiries or proposals from, any Person (other than Buyer or its
Representatives) relating to or affecting any transaction involving the sale of
the Purchased Assets or any interest in Seller.
6. COVENANTS OF BUYER
6.1 REQUIRED APPROVALS. As promptly as practicable after the date of
this Agreement, Buyer will make all filings required by Legal Requirements to be
made by it to consummate the Contemplated Transactions.
6.2 BEST EFFORTS. Between the date of this Agreement and the Closing
Date, Buyer will use its Best Efforts to cause the conditions in Section 8 to be
satisfied, provided that this Agreement will not require Buyer to dispose of or
make any change in any portion of its business or to incur any other burden to
obtain a Governmental Authorization.
6.3 NOTIFICATION. Between the date of this Agreement and the Closing
Date, Buyer will promptly notify Seller in writing if Buyer becomes aware of any
fact or condition that causes or constitutes a breach of any of Buyer's
representations and warranties as of the date of this Agreement, or if Buyer
becomes aware of the occurrence after the date of this Agreement of any fact or
condition that would (except as expressly contemplated by this Agreement) cause
or constitute a breach of any such representation or warranty had such
representation or warranty been made as of the time of occurrence or discovery
of such fact or condition. During the same period, Buyer will promptly notify
Seller of the occurrence of any breach of any covenant of Buyer in this Section
6 or of the occurrence of any event that may make the satisfaction of the
conditions in Section 8 impossible or unlikely.
7. CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE
Buyer's obligation to purchase the Purchased Assets and to take the
other actions required to be taken by Buyer at the Closing is subject to the
satisfaction, at or prior to the Closing, of each of the following conditions
(any of which may be waived by Buyer, in whole or in part):
7.1 ACCURACY OF REPRESENTATIONS. Seller's and the LLC's representations
and warranties in this Agreement must have been accurate in all material
respects as of the date of this Agreement, and must be accurate in all material
respects as of the Closing Date as if made on the Closing Date,
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and Buyer shall have received a certificate of an executive officer of Seller
and the LLC in the form of Exhibit C annexed hereto, dated as of the Closing
Date, as to such accuracy.
7.2 SELLER'S PERFORMANCE. The covenants and obligations that Seller is
required to perform or to comply with pursuant to this Agreement at or prior to
the Closing must have been performed and complied with in all material respects,
and Buyer shall have received a certificate of an executive officer of Seller in
the form of Exhibit C annexed hereto, dated as of the Closing Date, as to such
compliance.
7.3 CONSENTS. Each of the Required Consents shall have been obtained
and shall be in full force and effect.
7.4 ADDITIONAL DOCUMENTS. Each of the following documents must have
been delivered to Buyer:
(a) an opinion of Xxxxxxxx, Xxxxxx & Xxxxxxx, counsel to
Seller, in the form of Exhibit D annexed hereto,
(b) the deliveries required from Seller in Section 2.7;
(c) resolutions of all the shareholders and directors of
Seller confirming the authorization of the execution and delivery of this
Agreement and the Contemplated Transactions;
(d) such other documents as Buyer may reasonably request for
the purpose of (i) evidencing the satisfaction of any condition referred to in
this Section 7, or (ii) otherwise facilitating the consummation or performance
of any of the Contemplated Transactions.
7.5 NO PROCEEDINGS. Since the date of this Agreement, there must not
have been commenced and pending or Threatened by any Person any Proceeding (i)
involving any challenge to, or seeking damages or other relief in connection
with, any of the Contemplated Transactions, (ii) that prevents, makes illegal,
or otherwise materially interferes with any of the Contemplated Transactions or
seeks to do any of the foregoing, or (iii) that involves any material claim
against Seller.
7.6 NO PROHIBITION. There must not be in effect any Legal Requirement
or any injunction or other Order that prohibits or restricts the consummation of
the Contemplated Transactions.
7.7 NO MATERIAL ADVERSE CHANGE. There shall not have been a Material
Adverse Change since the date hereof.
7.8 DUE DILIGENCE. On or before November 30, 1998, Buyer's due
diligence investigation and review of the Purchased Assets and the Assumed
Liabilities shall not reveal any fact or circumstance not acceptable to Buyer in
Buyer's sole and absolute discretion.
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7.9 SATISFACTION OF INDEBTEDNESS. At or prior to the Closing, Seller
shall have repaid in full all outstanding indebtedness of Seller to the extent
affecting the Purchased Assets and shall cause all Security Interests affecting
the Purchased Assets to be extinguished.
7.10 AUDITED FINANCIAL STATEMENTS. At or prior to the Closing, Buyer
shall have received, from an independent accounting firm reasonably acceptable
to Buyer, audited financial statements of Seller for (a) each of Seller's fiscal
years ending October 31, 1996 and October 31, 1997, and (b) the nine (9) month
period ended July 31, 1998, which financial statements shall be prepared in
accordance with generally accepted accounting principles and Regulation S-X of
the Securities Exchange Act of 1934. Seller shall provide all necessary
cooperation in the preparation of such financial statements. The cost of
preparation of such financial statements shall be borne by Buyer.
7.11 TAX CLEARANCE. Buyer shall obtain certificates of clearances for
Taxes ("Tax Clearances") from the states listed on Schedule 5.9 annexed hereto,
certifying as to the payment by or on behalf of Seller of all Taxes due on or
prior to the Closing Date (including, without limitation, in connection with the
Contemplated Transactions). Seller shall provide reasonable cooperation to Buyer
in obtaining such Tax Clearances.
8. CONDITIONS PRECEDENT TO SELLER'S OBLIGATION TO CLOSE
Seller's obligation to sell the Purchased Assets and Seller's
obligation to take the other actions required to be taken by Seller at the
Closing is subject to the satisfaction, at or prior to the Closing, of each of
the following conditions (any of which may be waived by Seller, in whole or in
part):
8.1 ACCURACY OF REPRESENTATIONS. Buyer's representations and warranties
in this Agreement must have been accurate in all material respects as of the
date of this Agreement and must be accurate in all material respects in all
respects as of the Closing Date as if made on the Closing Date, and Seller shall
have received a certificate of an executive officer of Buyer in the form of
Exhibit E annexed hereto, dated as of the Closing Date, as to such accuracy.
8.2 BUYER'S PERFORMANCE. The covenants and obligations that Buyer is
required to perform or to comply with pursuant to this Agreement at or prior to
the Closing must have been performed and complied with in all material respects,
and Seller shall have received a certificate of an executive officer of Buyer in
the form of Exhibit E annexed hereto, dated as of the Closing Date, as to such
compliance.
8.3 ADDITIONAL DOCUMENTS. Buyer must have caused the following
documents to be delivered to Seller:
(a) an opinion of St. Xxxx & Xxxxx, L.L.C., counsel to Buyer,
dated as of the Closing Date in the form of Exhibit F annexed hereto;
(b) the deliveries required from Buyer in Section 2.7;
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(c) resolutions of all the directors of Buyer confirming the
authorization of the execution and delivery of this Agreement and the
Contemplated Transactions; and
(d) such other documents as Seller may reasonably request for
the purpose of (i) evidencing the satisfaction of any condition referred to in
this Section 8, or (ii) otherwise facilitating the consummation of any of the
Contemplated Transactions.
8.4 NO PROCEEDINGS. Since the date of this Agreement, there must not
have been commenced and pending or Threatened any Proceeding (i) involving any
challenge to, or seeking damages or other relief in connection with, any of the
Contemplated Transactions, or (ii) that prevents, makes illegal, or otherwise
materially interferes with any of the Contemplated Transactions or seeks to do
any of the foregoing.
8.5 NO PROHIBITION. There must not be in effect any Legal Requirement
or any injunction or other Order that prohibits or restricts the consummation of
the Contemplated Transactions.
9. TERMINATION
9.1 TERMINATION EVENTS. This Agreement may, by notice given prior to or
at the Closing, be terminated:
(a) by mutual written consent of Buyer and Seller;
(b) (i) by Buyer if any of the conditions in Section 7 has not
been satisfied as of the Closing Date (or the date of delivery by Buyer of a
notice under Section 7.8) or if satisfaction of such a condition is or becomes
impossible (other than through the failure of Buyer to comply with its
obligations under this Agreement) and Buyer has not waived in writing such
condition on or before the Closing Date; or (ii) by Seller if any of the
conditions in Section 8 has not been satisfied as of the Closing Date or if
satisfaction of such a condition is or becomes impossible (other than through
the failure of Seller to comply with its obligations under this Agreement) and
Seller has not waived in writing such condition on or before the Closing Date;
or
(c) by Buyer, on the one hand, or Seller on the other hand, if
the Closing has not occurred (other than through the failure of the other Party
seeking to terminate this Agreement to comply fully with its obligations under
this Agreement) on or before December 15, 1998, or such later date as the
Parties may agree upon.
9.2 EFFECT OF TERMINATION. Each Party's right of termination under
Section 9.1 is in addition to any other rights it may have under this Agreement.
If this Agreement is terminated pursuant to Section 9.1, all further obligations
of the Parties under this Agreement will terminate, except that the obligations
in Sections 12.1 and 12.3 will survive; provided, however:
(a) If Buyer shall default in its obligations under this
Agreement to consummate the Contemplated Transactions (other than as a result of
Seller's default under this Agreement), and
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Buyer shall fail to cure such default within ten (10) days after receipt of
written notice of default from Seller, then Seller shall have the right to
pursue any or all legal and equitable remedies, separately or simultaneously
(including specific performance), which will survive the termination unimpaired.
(b) If Seller shall default in its obligations under this
Agreement to consummate the Contemplated Transactions (other than as a result of
Buyer's default under this Agreement), and Seller shall fail to cure such
default within ten (10) days after receipt of written notice of default from
Buyer, then Buyer shall have the right to pursue any or all legal and equitable
remedies, separately or simultaneously (including specific performance), which
will survive the termination unimpaired.
(c) The remedies set forth in this Section 9.2 apply only to
the failure of Buyer or Seller to consummate the Contemplated Transactions, and
not with respect to any obligations specified herein that survive the Closing or
termination of this Agreement.
10. INDEMNIFICATION; REMEDIES
10.1 INDEMNIFICATION AND PAYMENT OF DAMAGES BY SELLER AND THE
INDEMNIFYING STOCKHOLDERS. Seller and the Indemnifying Stockholders will,
jointly and severally, indemnify and hold harmless Buyer and its stockholders,
controlling Persons and Affiliates (collectively, the "Seller Indemnified
Persons") for, and will pay to the Seller Indemnified Persons the amount of, any
loss, liability (whether absolute or contingent), claim, damage or expense
(including reasonable costs of investigation and defense and reasonable
attorneys' fees), whether or not involving a third-party claim (collectively,
"Damages"), arising, directly or indirectly, from or in connection with:
(a) any breach of any representation or warranty made by
Seller and/or the LLC in this Agreement, the Disclosure Schedule, or any other
certificate or document delivered by Seller pursuant to this Agreement;
(b) any breach by Seller of any covenant or obligation of
Seller in this Agreement or in any certificate or document delivered by Seller
pursuant to this Agreement;
(c) the failure of Seller to satisfy and discharge any
Excluded Liabilities;
(d) any default by Seller under any Site Lease, Advertising
Contract or Permit which occurred or accrued prior to the Closing;
(e) facts, events or conditions that occurred or came into
existence prior to the Closing, whether or not such Damages are asserted or
claimed prior to the Closing or thereafter; and
(f) the occurrence of any Lease Termination Event on or before
the two (2) year anniversary of the Closing Date for which a Determination is
not obtained as provided in Section 15.2(a).
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10.2 INDEMNIFICATION AND PAYMENT OF DAMAGES BY BUYER. Buyer will
indemnify and hold harmless Seller and its stockholders, controlling Persons and
Affiliates (collectively, the "Buyer Indemnified Persons") for, and will pay to
the Buyer Indemnified Persons the amount of, any Damages arising, directly or
indirectly, from or in connection with:
(a) any breach of any representation or warranty made by Buyer
in this Agreement or in any certificate or document delivered by Buyer pursuant
to this Agreement; and
(b) the failure to pay Assumed Liabilities after the Closing.
10.3 PROCEDURE FOR INDEMNIFICATION -- THIRD PARTY CLAIMS.
(a) Promptly after receipt by an Indemnified Person under
Section 10.1 or 10.2 of notice of any claim against it, such Indemnified Person
will, if a claim is to be made against an Indemnifying Party under such Section,
give notice to the Indemnifying Party of the commencement of such claim, but the
failure to notify the Indemnifying Party will not relieve the Indemnifying Party
of any liability that it may have to any Indemnified Person, except to the
extent that the Indemnifying Party demonstrates that the defense of such action
is prejudiced by the Indemnifying Party's failure to give such notice.
(b) If any claim referred to in Section 10.3(a) is brought
against an Indemnified Person and it gives written notice to the Indemnifying
Party of such claim, the Indemnifying Party may, at its option, assume the
defense of such claim with counsel satisfactory to the Indemnified Person and,
after written notice from the Indemnifying Party to the Indemnified Person of
its election to assume the defense of such claim, the Indemnifying Party will
not, as long as it diligently conducts such defense, be liable to the
Indemnified Person under this Article 10 for any fees of other counsel or any
other expenses with respect to the defense of such claim subsequently incurred
by the Indemnified Person in connection with the defense of such claim, other
than reasonable costs of investigation. If the Indemnifying Party assumes the
defense of a claim, (i) no compromise or settlement of such claim may be
effected by the Indemnifying Party without the Indemnified Person's written
consent unless (A) there is no finding or admission of any violation of Legal
Requirements or any violation of the rights of any Person, and (B) the sole
relief provided is monetary damages that are paid in full by the Indemnifying
Party; and (ii) the Indemnified Person will have no liability with respect to
any compromise or settlement of such claims effected without its written
consent. Subject to Section 10.3(c), if notice is given to an Indemnifying Party
of any claim and the Indemnifying Party does not, within ten (10) days after the
Indemnified Person's notice is given, give notice to the Indemnified Person of
its election to assume the defense of such claim, the Indemnifying Party will be
bound by any determination made in such Proceeding or any compromise or
settlement effected by the Indemnified Person.
(c) Notwithstanding the foregoing, if an Indemnified Person
determines in good faith that there is a reasonable probability that a claim may
adversely affect it or its Affiliates other than as a result of monetary damages
for which it would be entitled to indemnification under this Agreement, the
Indemnified Person may, by notice to the Indemnifying Party, assume the
exclusive right to defend, compromise, or settle such claim, but the
Indemnifying Party will not be bound by
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any determination of a claim so defended or any compromise or settlement
effected without its written consent (which may not be unreasonably withheld or
delayed).
10.4 PROCEDURE FOR INDEMNIFICATION -- OTHER CLAIM. A claim for
indemnification for any matter not involving a third-party claim shall be
asserted by written notice to the Indemnifying Party from whom indemnification
is sought.
10.5 SURVIVAL/LIMITATIONS. (a) The parties hereto agree that (i) the
covenants and agreements contained in the Agreement (including, without
limitation, Section 10.1(c) and any document delivered pursuant hereto and the
representations and warranties contained in Sections 3.1, 3.2, 3.3, 3.5, 3.9(a),
3.11, 3.12, 3.13, 3.14, 3.16, 3.18, 3.19, 3.20, 3.22, 3.23, 3.25, 3.26, 4.1,
4.2, 4.3 and 4.4 shall survive until ninety (90) days after the expiration of
all applicable statutes of limitation with respect to the subject matter
thereof, (ii) all other representations and warranties shall survive until one
(1) year following the Closing Date, and (iii) any indemnification claim for a
breach of the foregoing must be made in writing in accordance with the provision
of this Article 10 within the applicable survival period for the underlying
representation, warranty or covenant. The expiration of the applicable survival
period will not extinguish an indemnification claim properly made prior to such
expiration in accordance with this Article 10.
(b) Seller and the Indemnifying Stockholders shall not be
required to make any payments to the Seller Indemnified Persons pursuant to
Sections 10.1(a) with respect to a breach of any of the representations and
warranties contained in Article 3 (other than the representations and warranties
listed in Section 10.5(a)(i)) until the Damages, in the aggregate, exceed
$100,000.00, and then only to the extent of Damages in excess of such amount.
(c) In no event shall Seller's or the Indemnifying
Stockholders' obligation to indemnify the Seller Indemnified Persons for Damages
pursuant to a breach of any of the warranties and representations set forth in
Article 3 (other than those warranties and representations listed in Section
10.5(a)(i) above, for which there shall be no limitation) collectively exceed
the One Million Dollars ($1,000,000.00) Escrow Fund.
(d) In no event shall Seller's or the Indemnifying
Stockholders' obligation to indemnify the Seller Indemnified Persons for Damages
as a result of a Lease Termination Event collectively exceed the Two Hundred
Fifty Thousand Dollar ($250,000.00) Lease Escrow Fund.
(e) Notwithstanding the foregoing, any claims for Damages
arising from fraud by Seller or the Indemnifying Stockholders hereunder shall be
without limitation of any kind.
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11. NON-COMPETITION AND NON-SOLICITATION.
11.1 NON-COMPETITION. Seller and the Obligors each hereby agree that
for a period of seven (7) years after the Closing Date, such Person will not,
without the prior written consent of Buyer, directly or indirectly, engage or
participate in, be employed by or assist in any manner or in \any capacity, or
have any interest in or make any loan to any person, firm, corporation or
business which engages in outdoor advertising activities (including the
ownership and/or operation of outdoor signs and billboards) in those areas
described on Schedule 11 annexed hereto; provided, however, the foregoing shall
not prevent (a) any such entity or person from owning beneficially or of record
up to one percent (1%) of the outstanding securities of a publicly-held
corporation which engages in competitive activities, and (b) Xxxxxxxx X. Xxxxxxx
from engaging in a sign manufacturing business in the manner currently conducted
by him.
11.2 NON-SOLICITATION. For a period of seven (7) years after the
Closing Date, Seller and the Obligors each agree that he, she or it will (i) not
solicit, recruit or hire, or attempt to solicit, recruit or hire, directly or
indirectly, any of the current employees of Buyer or its Affiliates; (ii)
refrain from soliciting, or attempting to solicit, directly or indirectly, any
business from any customer of Buyer, or actively pursue prospective customers,
with whom Buyer had material contact at any time during the previous seven (7)
years for purposes of providing outdoor (including, without limitation,
out-of-home advertising) products or services of the type offered or provided by
Buyer (Buyer's customers to include customers of Seller); and (iii) refrain from
soliciting, or attempting to solicit, directly or indirectly, any real estate
location used by Buyer from any land owner (or its successor or assigns) who
leases to Buyer (including without limitation land owners under the Site
Leases), or actively pursue prospective land owners with whom Buyer or Seller
had material contact during the previous seven (7) years.
11.3 ENFORCEMENT. Seller and the Obligors acknowledge that a breach of
the covenants in this Section 11 would cause irreparable harm to Buyer and its
Affiliates for which there is not adequate remedy at law. Seller and the
Obligors consent to the issuance of an injunction in favor of Buyer and its
Affiliates enjoining the breach of this provision. Notwithstanding the
foregoing, in addition to any equitable remedies available to Buyer, Buyer shall
be entitled to any and all remedies at law or equity, including, without
limitation, injunctive relief, monetary damages, an accounting for profits
and/or the imposition of a constructive trust. In the event that any court of
competent jurisdiction should construe any geographical limitation, the scope,
or the time period contained in this restrictive covenant to be too broad, so as
to be unenforceable, it is the intention of the parties that the court should
modify the covenant(s) to provide that the restrictions as herein contained
shall apply and be enforceable to the maximum extent permitted by law for such
restrictions, and further upon such determination, to enforce the covenant as so
modified.
11.4 SURVIVAL. The provisions of this Section 11 shall survive the
Closing.
11.5 LIMITATION OF INDIVIDUAL OBLIGOR. The obligation of Xxxxx Xxxxxx,
one of the Obligors shall be limited strictly to his personal actions in
violation of Sections 11.1 or 11.2 above. No obligation of Xxxxx Xxxxxx shall be
deemed joint and several with those of the actions of other Obligors unless and
until Xxxxx Xxxxxx has materially participated in such prohibited act or acts.
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12. GENERAL PROVISIONS
12.1 EXPENSES. Except as otherwise expressly provided in this
Agreement, each Party to this Agreement will bear its respective expenses
incurred in connection with the preparation, execution, and performance of this
Agreement and the Contemplated Transactions, including all fees and expenses of
agents, representatives, brokers or finders, counsel, and accountants. In the
event of termination of this Agreement, the obligation of each Party to pay its
own expenses will be subject to any rights of such Party arising from a breach
of this Agreement by another Party. Each Party hereto shall indemnify the other
for its failure to pay any brokerage or finders' fees or agents' commission or
similar payment incurred by such Party or its Representatives in connection with
this Agreement.
12.2 HEADINGS; CONSTRUCTION. The headings of Sections in this Agreement
are provided for convenience only and will not affect its construction or
interpretation. All words used in this Agreement will be construed to be of such
gender or number as the circumstances require. Unless otherwise expressly
provided, the word "including" does not limit the preceding words or terms.
12.3 PUBLIC ANNOUNCEMENTS, CONFIDENTIALITY. Any public announcement or
similar publicity with respect to this Agreement or the Contemplated
Transactions will be issued, if at all, at such time and in such manner as Buyer
and Seller agree in writing, provided that the parties shall reasonably
cooperate in such announcements, and provided further that nothing contained
herein shall prevent any party from at any time furnishing information required
by a Governmental Body. Unless consented to by Buyer and Seller in advance or
required by Legal Requirements, prior to the Closing, each Party shall, and
shall cause their respective Representatives to, keep this Agreement strictly
confidential and may not make any disclosure of this Agreement to any Person.
All confidential information and documents made available to Buyer by Seller or
its Representatives with respect to the Business shall be kept in strict
confidence, and not made available to any third party other than absolutely
necessary for the purposes of concluding the Contemplated Transactions. In the
event the Contemplated Transactions for any reason are not concluded, all
documents or documents compiled from information supplied or obtained hereunder,
and copies thereof, shall be returned to Seller and the Confidential Information
obtained shall in no way be used by the Buyer or communicated to any third
party, except as required by law or court order. This representation shall
survive the termination of this Agreement.
12.4 AVAILABILITY OF EQUITABLE REMEDIES. The Parties acknowledge and
agree that (i) a breach of the provisions of this Agreement could not adequately
be compensated by money damages, and (ii) any Party shall (except as otherwise
expressly provided in this Agreement) be entitled, either before or after the
Closing, in addition to any other right or remedy available to it, to an
injunction restraining such breach and to specific performance of this
Agreement, and no bond or other security shall be required in connection
therewith.
12.5 NOTICES. All notices, consents, waivers, and other communications
under this Agreement must be in writing and will be deemed to have been duly
given when (a) delivered by hand (with written confirmation of receipt), (b)
sent by telecopier (with written confirmation of receipt), provided that a copy
is mailed by certified mail, return receipt requested, or (c) when
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received by the addressee, if sent by a nationally recognized overnight delivery
service (receipt requested), in each case to the appropriate addresses and
telecopier numbers set forth below (or to such other addresses and telecopier
numbers as a Party may designate by notice to the other Parties):
If to Seller:
Western Outdoor Advertising Co.
c/o L.K. Company, Inc.
0000 X. 00xx Xxxxx
Xxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxx
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
With a copy to:
Xxxxxxxx, Xxxxxx & Xxxxxxx
0000 Xxxx Xxxxx Xxxx, Xxxxx 000
Xxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx, Esq.
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
If to Buyer, to:
Tri-State Outdoor Media Group, Inc.
X.X. Xxx 0000
0000 Xxxxxxx 00 Xxxxx
Xxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx, President
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
With a copy to:
St. Xxxx & Xxxxx, L.L.C.
Xxx Xxxx Xxxxx Xxxx
Xxxxxx, Xxx Xxxxxx 00000
Attention: Xxxxx X. Xxxxxxxxx, Esq.
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
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If to Escrow Agent:
Norwest Bank
0000 Xxxxxxx Xxxxxx
Xxxxx, Xxxxxxxx 00000
Attention: Xxxxx Xxxxx
Telephone No.: 000-0000
Facsimile No.: 536-2075
Notices given by an attorney for a Party shall be deemed to be a notice given by
such Party.
12.6 FURTHER ASSURANCES. The Parties agree (i) to furnish upon request
to each other such further information, (ii) to execute and deliver to each
other such other documents, and (iii) to do such other acts and things, all as
the other Party may reasonably request for the purpose of carrying out the
intent of this Agreement and the documents referred to in this Agreement.
12.7 WAIVER. Neither the failure nor any delay by any Party in
exercising any right, power, or privilege under this Agreement or the documents
referred to in this Agreement will operate as a waiver of such right, power, or
privilege, and no single or partial exercise of any such right, power, or
privilege will preclude any other or further exercise of such right, power, or
privilege or the exercise of any other right, power, or privilege.
12.8 ENTIRE AGREEMENT AND MODIFICATION. This Agreement supersedes all
prior agreements between the Parties with respect to its subject matter
(including, without limitation, a certain letter dated June 9, 1998 and signed
by Seller on June 26, 1998 as amended) and constitutes (along with the documents
referred to in this Agreement) a complete and exclusive statement of the terms
of the agreement between the Parties with respect to its subject matter. This
Agreement may not be amended except by a written agreement executed by the Party
to be charged with the amendment.
12.9 ASSIGNMENTS, SUCCESSORS, AND NO THIRD-PARTY RIGHTS. No Party may
assign any of its rights under this Agreement without the prior consent of the
other Parties, except that Buyer may assign any of its rights under this
Agreement to any Affiliate of Buyer (provided that Buyer shall remain liable for
the obligations of such assignee under this Agreement). This Agreement will
apply to, be binding in all respects upon, and inure to the benefit of the
Parties, and their successors, by liquidation or otherwise, and their permitted
assigns. Nothing expressed or referred to in this Agreement will be construed to
give any Person other than the Parties to this Agreement any legal or equitable
right, remedy, or claim under or with respect to this Agreement or any provision
of this Agreement.
12.10 SEVERABILITY. If any provision of this Agreement is held invalid
or unenforceable by any court of competent jurisdiction, the other provisions of
this Agreement will remain in full force and effect. Any provision of this
Agreement held invalid or unenforceable only in part or degree will remain in
full force and effect to the extent not held invalid or unenforceable.
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12.11 RISK OF LOSS. Except as otherwise expressly provided in this
Agreement, material risk of loss or damage to the Purchased Assets from any
cause whatsoever prior to the Closing shall be borne by Seller, and after the
Closing shall be borne by Buyer.
12.12 POST-CLOSING ACCESS. Buyer agrees that all Books and Records
delivered to Buyer by Seller pursuant to this Agreement shall be maintained open
for inspection by Seller at any time during regular business hours upon
reasonable notice for a period of six (6) years (or for such longer period as
may be required by applicable Legal Requirements) following the Closing and
that, during such period, Seller, at its expense, may make such copies thereof
as it may reasonably desire. Seller agrees that all books and records relating
to the Purchased Assets and retained by Seller shall be maintained open for
inspection by Buyer at any time during regular business hours for a period of
six (6) years (or for such longer period as may be required by applicable Legal
Requirements) following the Closing and that, during such period, Buyer, at its
expense, may make such copies thereof as it may reasonably desire. In addition
to the foregoing, Seller shall, at all reasonable times after the Closing if
called upon by Buyer, use reasonable efforts to cooperate with and assist Buyer
in the preparation of financial statements by Buyer which may include the
operation of the Business prior to the Closing Date. This provision shall
survive the Closing.
12.13 APPLICABLE LAW AND VENUE. This Agreement is made in and shall be
governed by and construed and enforced in accordance with the laws of the State
of Nebraska. Seller and Buyer hereby consent to the personal jurisdiction of the
courts of Nebraska in Xxxxxxx County for all matters relating to or arising from
this Agreement.
12.14 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which will be deemed to be an original copy of this
Agreement and all of which, when taken together, will be deemed to constitute
one and the same agreement.
13. POST-CLOSING ESCROW FUND.
13.1 ESCROW AMOUNT. At the Closing hereof, the sum of One Million
Dollars ($1,000,000.00) (the "Escrow Amount") shall be deposited in an interest
bearing escrow account reasonably acceptable to Buyer and Seller (the "Escrow
Fund") with Norwest Bank (the "Escrow Agent"). The Escrow Fund shall be held by
the Escrow Agent for a period not to exceed one (1) year from the Closing Date
(the "Escrow Period"), subject to the terms hereof.
13.2 CLAIMS. In the event that, at any time during the Escrow Period,
Buyer shall claim that Seller has breached any of its representations,
warranties or covenants hereunder, or any claim is made against Buyer by a
creditor of Seller with respect to a liability of Seller or the Business
accruing or performable prior to the Closing Date or if Buyer shall incur any
Damages, it shall provide notice thereof to Seller, with a copy to the Escrow
Agent, such notice to set forth with particularity the specifics of any such
claim. In the event that Seller does not dispute or contest any such claim or
fails to cure same within thirty (30) days after receipt of Buyer's notice (or
such longer period not to exceed ninety (90) days in the case of a Damage which
cannot with due diligence be cured within thirty (30) days and the continuance
of which for the period required for cure will not subject any of the Seller
Indemnified Persons to the risk of civil or criminal liability or the imposition
of any Encumbrance on the Purchased Assets, provided Seller commences the cure
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within such initial thirty (30) day period and thereafter diligently prosecutes
the cure), Buyer may thereafter furnish to the Escrow Agent a duly executed and
notarized affidavit setting forth the specifics of any such claim, including,
without limitation, the amount thereof and basis therefor, the date of the
notice thereof to Seller and a certification that Seller has not disputed or
contested same or has failed to cure same within the time provided for herein.
Unless Seller has paid to Buyer the amount of such claim within ten (10) days
after receipt by Escrow Agent of the affidavit of Buyer, the Escrow Agent shall
on the tenth (10th) day after receipt promptly deliver to Buyer from the Escrow
Fund, a check in the amount of any such claim. In the event, however, that
Seller shall elect to dispute or contest any such claim, it shall be required,
within thirty (30) days of Buyer's initial notice hereunder, to provide notice
thereof to Buyer, with a copy to the Escrow Agent, which notice shall set forth
with particularity the specifics of any such dispute or contest as between the
parties hereto or their successors or representatives. In the event of any such
dispute or contest, Buyer and Seller hereby agree that any such dispute or
contest shall be settled by arbitration in accordance with the provisions of
Article 14 of this Agreement. The Escrow Agent shall retain the portion of the
Escrow Fund covered by any such dispute until its receipt of a certified copy of
any such arbitration decision or award in favor of Buyer, at which time it shall
promptly deliver to Buyer from the Escrow Fund a check in the amount of any such
judgment or award.
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13.3 PAYMENT DATE. On the date which is one (1) year after the Closing
Date, the Escrow Agent shall pay to Seller the balance of the Escrow Fund (plus
accrued interest), reduced by any amounts due to Buyer pursuant to the terms of
this Agreement and any amounts which are the subject of an Unresolved Claim. The
term "Unresolved Claim" shall mean any claim which may be made against the
Escrow Fund in accordance with this Section 13, until such time as such claim
has been paid in full or otherwise fully settled, compromised or adjusted by the
parties and the Escrow Agent and the amount of such Unresolved Claims shall
remain with the Escrow Agent until so settled or adjusted and then paid to the
party to whom such funds are to be paid pursuant to such agreement, settlement,
compromise or adjustment.
13.4 ESCROW AGENT HELD HARMLESS. The parties to this Agreement
acknowledge and agree that the Escrow Agent shall not be liable for any error or
judgment or for any mistake of fact, law or for anything which it may do or
refrain from doing in connection herewith, except its own gross negligence or
willful misconduct. Seller and Buyer agree to indemnify, hold harmless and
defend the Escrow Agent from any loss, damage, claim, liability, judgment,
expense (including attorneys' fees and disbursements) or other charge incurred
or sustained by it by reason of any act or omission performed or omitted
hereunder, but this indemnity shall not be applicable to any loss, liability,
damage, claim, judgment, expense or other charge resulting from the gross
negligence or willful misconduct of the Escrow Agent.
13.5 RELIANCE ON NOTICES. The Escrow Agent shall have the right to rely
conclusively upon the notices delivered hereunder, and shall be under no
obligation to ascertain the authenticity of such notices, nor to determine the
factual accuracy thereof.
13.6 DISPUTES. The Escrow Agent is acting as a stakeholder only with
respect to the Escrow Fund. If there is any dispute as to whether the Escrow
Agent is obligated to deliver the Escrow Fund (or any portion thereof) and/or to
whom it should be delivered, the Escrow Agent shall not make any delivery, but
in such event the Escrow Agent shall hold the Escrow Fund until receipt by the
Escrow Agent of an authorization in writing signed by all parties having an
interest in such dispute, directing the disposition of same, or in the absence
of such authorization the Escrow Agent shall hold the Escrow Fund until the
final determination of the rights of the parties in an appropriate proceeding.
If such written authorization is not given, or proceedings for such
determination are not begun within a reasonable period of time and diligently
continued, the Escrow Agent shall have the right, at any time thereafter, to
commence an action or proceeding, at the sole cost and expense of Seller and
Buyer, in the nature of interpleader in any court having jurisdiction thereof,
and to deposit the Escrow Fund with such court, and thereupon, be discharged
from any and all further liability hereunder.
13.7 OMITTED.
13.8 NO LIMITATION OF RIGHTS OR OBLIGATIONS. The provisions of this
Section 13 (including the amount of the Escrow Fund) shall not limit Buyer's
rights nor Seller's obligations under this Agreement (including, without
limitation, Section 10) (except as set forth to the contrary in Section
10.5(c)).
13.9 SURVIVAL. The provisions of this Section 13 shall survive the
Closing.
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14. ARBITRATION
14.1 APPOINTMENT. In the event that any contest or dispute set forth in
Articles 13 or 15 of this Agreement is to be settled by arbitration, the Party
invoking the arbitration procedure (the "First Party") shall give a notice
("Arbitration Notice") to the other Party, and shall in such Arbitration Notice
appoint an arbitrator on its behalf. Within fifteen (15) days after its receipt
of such Arbitration Notice, the other Party by notice to the First Party shall
appoint an arbitrator on its behalf; and if the second arbitrator shall not be
so appointed within such fifteen (15) days, the First Party shall appoint the
second arbitrator. The two arbitrators appointed pursuant to the above shall try
to appoint the third independent arbitrator. If, within twenty (20) days after
the appointment of the second arbitrator, they have not agreed upon the
appointment of a third independent arbitrator, then either Party may apply to
AAA for the appointment of such third arbitrator and the other Party shall not
raise any question as to the AAA's full power and jurisdiction to entertain the
application and make the appointment. Each arbitrator shall have at least ten
(10) years' experience in a calling pertaining to the matter in dispute. The
third arbitrator is herein called the "Umpire", and the date on which the Umpire
is appointed is referred to as the "Appointment Date".
14.2 ARBITRATION PROCEDURE. As soon as practicable after the
Appointment Date, the matter in dispute shall be arbitrated by the Parties in
accordance with the commercial rules then in force of the American Arbitration
Association ("AAA"); provided, however, that each party shall be entitled to
discovery proceedings in accordance with the rules of the District Court of
Xxxxxxx County, Nebraska and the failure of any party to so submit to such
discovery upon the request of the other shall provide the basis for termination
of arbitration procedure and the filing of a lawsuit in the District Court of
Xxxxxxx County, Nebraska. The resolution of the dispute shall be determined by
the decision of majority of the three (3) arbitrators, shall constitute an
"award" within the meaning of the applicable rules of the AAA and applicable
law, and judgment may be entered thereon in any court of competent jurisdiction.
14.3 JURISDICTION. Buyer and Seller hereby submit to the in personam
jurisdiction of the AAA in the State of Nebraska and agree that any process in
any arbitration proceeding hereunder may be personally served upon Buyer or
Seller within or outside of the State of Nebraska. The arbitration shall be
conducted at a location in Omaha mutually acceptable to Buyer and Seller.
14.4 EXPENSES. Each Party shall pay its own fees and expenses relating
to the arbitration (including, without limitation, the fees and expense of its
counsel, its arbitrator and any experts or witnesses retained by it). Each Party
shall pay one-half (1/2) of the fees and expenses of the Umpire and of the AAA.
14.5 REFERENCE. For purposes of this Section 14, all references to
Seller shall be deemed to include, collectively, Seller and the Indemnifying
Stockholders.
14.6 SURVIVAL. The provisions of this Section 14 shall survive the
Closing.
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15. LEASE ESCROW FUND.
15.1 ESCROW AMOUNT. At the Closing hereof, the sum of Two Hundred Fifty
Thousand Dollars ($250,000.00) (the "Lease Escrow Amount") shall be deposited in
an interest bearing escrow account reasonably acceptable to Buyer and Seller
(the "Lease Escrow Fund") with the Escrow Agent. The Lease Escrow Fund shall be
held by the Escrow Agent for a period not to exceed two (2) years from the
Closing Date (the "Lease Escrow Period"), subject to the terms hereof.
15.2 CLAIMS. (a) A "Lease Termination Event" shall mean receipt by
Buyer after the Closing of notice from a lessor under a Site Lease (a) seeking
to terminate a Site Lease, (b) claiming that such lessor is the owner of the
Structure(s) covered by such Site Leases, and (c) where the use of such location
for outdoor advertising purposes is a non-conforming use under applicable Legal
Requirements. Upon the occurrence of a Lease Termination Event, Buyer shall
provide notice thereof to Seller, with a copy to the Escrow Agent. For a period
of two hundred seventh (270) days after the occurrence of a Lease Termination
Event, Buyer shall use its Best Efforts to challenge such Lease Termination
Event in order to seek a determination (by consensual agreement or judicial
determination) that Buyer is the owner of the subject Structure(s) (a
"Determination"). If Buyer has not obtained a Determination within two hundred
seventy (270) days after the occurrence of the Lease Termination Event, Seller
shall be entitled to seek to obtain a Determination, provided that such
Determination shall be reasonably acceptable to Buyer as evidenced by Buyer's
written consent thereto. If, however, Seller has not so obtained a Determination
within one hundred eighty (180) days after the expiration of the initial two
hundred seventy (270) day period, then, in that event, Buyer may thereafter
furnish to the Escrow Agent a duly executed and notarized affidavit stating that
(i) a Lease Termination Event has occurred, (ii) a Determination has not been
obtained as required by this Section 15.2(a), and (iii) the Escrow Agent shall
pay to Buyer from the Lease Escrow Fund the amount specified in Section 15.2(b)
below.
(b) If Buyer shall be entitled to payment of any amounts from
the Lease Escrow Fund as provided in Section 15.2(a) above, the Escrow Agent
shall pay to Buyer an amount equal to the product of (i) and (ii), where (i) is
the product of (A) the monthly xxxxxxxx as of the date of the Lease Termination
Event on Advertising Contracts in effect with respect to the Structures covered
by the Site Leases which are the subject of the Lease Termination Event, and (B)
72, and (ii) is a fraction, the numerator of which the number of months (full
and partial) remaining between the Lease Termination Date and the Lease Payment
Date, and the denominator of which is 72.
If an advertising display face on a Structure covered by a Site Lease which is
the subject of a Lease Termination Event shall not be covered by an Advertising
Contract as of the date of the Lease Termination Event, then the monthly
xxxxxxxx with respect to such advertising display face shall be deemed to be the
monthly billing rate in effect for an Advertising Contract on an advertising
display face that would most closely approximate the characteristics of the
advertising display face in question (and if the Parties cannot agree on such
assumed monthly billing rate on or before the date which is ten (10) days after
receipt by Seller of Buyer's affidavit described in the third sentence of
Section 15.2(a), such dispute shall be settled by arbitration in accordance with
the provisions of Article 14 of this Agreement). Unless Seller has paid to Buyer
the amount of any claim under this Article 15 within ten (10) days after receipt
by the Escrow Agent of the affidavit of Buyer, the Escrow Agent shall on the
tenth (10th) day after receipt (but in any event not prior to the one (1) year
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anniversary of the Closing Date) promptly deliver to Buyer from the Lease Escrow
Fund a check in the amount of any such claim.
15.3 PAYMENT DATE. On the two (2) year anniversary of the Closing Date
(the "Lease Payment Date"), the Escrow Agent shall pay to Seller the balance of
the Lease Escrow Fund (plus accrued interest), reduced by any amounts due to
Buyer pursuant to the terms of this Agreement and any amounts which are the
subject of an Unresolved Lease Claim. The term "Unresolved Lease Claim" shall
mean any claim which may be made against the Lease Escrow Fund in accordance
with this Section 15, until such time as such claim has been paid in full or
otherwise fully settled, compromised or adjusted by the parties and the Escrow
Agent and the amount of such Unresolved Claims shall remain with the Escrow
Agent until so settled or adjusted and then paid to the party to whom such funds
are to be paid pursuant to such agreement, settlement, compromise or adjustment
15.4 ESCROW AGENT HELD HARMLESS. The parties to this Agreement
acknowledge and agree that the Escrow Agent shall not be liable for any error or
judgment or for any mistake of fact, law or for anything which it may do or
refrain from doing in connection herewith, except its own gross negligence or
willful misconduct. Seller and Buyer agree to indemnify, hold harmless and
defend the Escrow Agent from any loss, damage, claim, liability, judgment,
expense (including attorneys' fees and disbursements) or other charge incurred
or sustained by it by reason of any act or omission performed or omitted
hereunder, but this indemnity shall not be applicable to any loss, liability,
damage, claim, judgment, expense or other charge resulting from the gross
negligence or willful misconduct of the Escrow Agent.
15.5 RELIANCE ON NOTICES. The Escrow Agent shall have the right to rely
conclusively upon the notices delivered hereunder, and shall be under no
obligation to ascertain the authenticity of such notices, nor to determine the
factual accuracy thereof.
15.6 DISPUTES. The Escrow Agent is acting as a stakeholder only with
respect to the Lease Escrow Fund. If there is any dispute as to whether the
Escrow Agent is obligated to deliver the Lease Escrow Fund (or any portion
thereof) and/or to whom it should be delivered, the Escrow Agent shall not make
any delivery, but in such event the Escrow Agent shall hold the Lease Escrow
Fund until receipt by the Escrow Agent of an authorization in writing signed by
all parties having an interest in such dispute, directing the disposition of
same, or in the absence of such authorization the Escrow Agent shall hold the
Lease Escrow Fund until the final determination of the rights of the parties in
an appropriate proceeding. If such written authorization is not given, or
proceedings for such determination are not begun within a reasonable period of
time and diligently continued, the Escrow Agent shall have the right, at any
time thereafter, to commence an action or proceeding, at the sole cost and
expense of Seller and Buyer, in the nature of interpleader in any court having
jurisdiction thereof, and to deposit the Lease Escrow Fund with such court, and
thereupon, be discharged from any and all further liability hereunder.
15.7 OMITTED.
15.8 NO LIMITATION OF RIGHTS OR OBLIGATIONS. The provisions of this
Section 15 (including the amount of the Lease Escrow Fund) shall not limit
Buyer's rights nor Seller's
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obligations under this Agreement (including, without limitation, Section 10)
(except as set forth to the contrary in Section 10.5(d)).
15.9 SURVIVAL. The provisions of this Section 15 shall survive the
Closing.
[The remainder of this page intentionally left blank.]
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IN WITNESS WHEREOF, the Parties have executed this Asset Purchase
Agreement as of the date first written above.
BUYER:
TRI-STATE OUTDOOR MEDIA GROUP, INC.
By: /s/ Xxxxxxx X. Xxxxx
--------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: President
SELLER:
WESTERN OUTDOOR ADVERTISING CO.
By: /s/ Xxxxxx Xxxxxxx
--------------------------------------
Name: Xxxxxx Xxxxxxx
Title: President
/s/ Xxxxxxx X. Xxxxxxx
-----------------------------------------
Xxxxxxx X. Xxxxxxx
/s/ Xxxxx X. Xxxxxxx
-----------------------------------------
Xxxxx X. Xxxxxxx
XXXXXXXX X. XXXXXXX TRUST
/s/ Xxxxxxx X. Xxxxxxx,
-----------------------------------------
Xxxxxxx X. Xxxxxxx, Trustee
/s/ Xxxxx X. Xxxxxxx
-----------------------------------------
Xxxxx X. Xxxxxxx, Trustee
/s/ Xxxxx Xxxxxx
----------------------------------------
Xxxxx Xxxxxx
/s/ Xxxxxxxx X. Xxxxxxx
----------------------------------------
Xxxxxxxx X. Xxxxxxx
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ESCROW AGENT
NORWEST BANK
By: /s/ Xxxxx Xxxxx, Xx.
-------------------------------
Name: Xxxxx Xxxxx, Xx.
Title: VP
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EXHIBIT A
DEFINITIONS
"AAA" -- as defined in Section 14.2.
"Advertising Contracts" -- as defined in Section 2.2(c).
"Affiliates" -- when used with reference to a specified Person, any
other Person that directly, or indirectly through one or more intermediaries,
controls or is controlled by or is under common control with the specified
Person. For purposes of this definition of Affiliate, "control" means the
possession, directly or indirectly, of the power to direct or to cause the
direction of management and policies of the Person in question, whether through
the ownership of voting securities or by contract or otherwise.
"Appointment Date" -- as defined in Section 14. 1.
"Arbitration Notice" -- as defined in Section 14. 1.
"Assumed Liabilities" -- as defined in Section 2.3.
"Best Efforts" -- the efforts that a prudent Person desirous of
achieving a result would use in similar circumstances.
"Xxxx of Sale" -- the Xxxx of Sale, Assignment and Assumption Agreement
in the form of Exhibit B attached hereto.
"Books and Records" -- all of Seller's books and records relating to
the Purchased Assets, including, without limitation, all accounting records,
Site Lease files, Advertising Contract files, Permit files, maintenance and
other records for the Structures, logs, advertiser, customer and supplier lists;
provided, however, that the term "Books and Records" and the reference to
accounting records set forth herein shall not refer to the general ledger, cash
receipt journal or cash receipts or disbursements journals, income tax returns
for the business operations as a whole, nor any original records with respect
thereto and which are used in computation of net income or taxable income
(provided, however, that Buyer shall be entitled to copies of any depreciation
records relating to Purchase Assets).
"Business" -- as defined in the Recitals of this Agreement.
"Buyer" -- as defined in the first paragraph of this Agreement.
"Closing" -- as defined in Section 2.5.
"Closing Date" -- the date and time as of which the Closing actually
takes place.
"Closing Documents" -- as defined in Section 3.2(a).
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"Confidential Information" -- any information concerning the businesses
and affairs of Seller that is not generally available to the public, however,
information even if generally available to the public which has been provided to
Buyer during the course of its investigations shall be included within this
term.
"Consent" -- any approval, consent, ratification, waiver, or other
authorization (including any Governmental Authorization).
"Contemplated Transactions" -- all of the transactions contemplated by
this Agreement, including: (a) the purchase of the Purchased Assets by Buyer
from Seller and assignment to and assumption by Buyer of the Assumed
Liabilities, and (b) the performance by Buyer and Seller of their respective
covenants and obligations under this Agreement.
"Contract" -- any agreement, contract, obligation, promise, or
undertaking (whether written or oral and whether express or implied) that is
legally binding.
"Court" -- as defined in Section 14. 1.
"Damages" -- as defined in Section 10.1.
"Deeds" -- warranty deeds (or statutory equivalent thereof), in
recordable form, with respect to the Real Property.
"Determination" -- as defined in Section 15.2(a).
"Disclosure Schedule" -- the disclosure schedule, delivered by Seller
to Buyer concurrently with the execution and delivery of this Agreement.
"Encumbrance" -- any charge, claim, condition, equitable interest,
lien, option, pledge, security interest, right of first refusal, or restriction
of any kind, including any restriction on use, transfer, receipt of income, or
exercise of any other attribute of ownership affecting the Purchased Assets.
"Environment" -- soil, land surface or subsurface strata, surface
waters, groundwaters, drinking water supply, stream sediments, ambient air
(including indoor air), plant and animal life, and any other environmental
medium or natural resource.
"Environmental Law" -- any Legal Requirement pertaining to
environmental discharges, Releases, emissions or spills or the manufacture,
sale, processing, handling, transportation, storage or disposal of Hazardous
Materials, or relating to any environmental processes or condition, including,
without limitation, the Comprehensive Environmental Response, Compensation and
Liability Act ("CERCLA"), the Clean Air Act, the Clean Water Act, the Resource
Conservation and Recovery Act ("RCRA"), the Endangered Species Act, the Federal
Insecticide, Fungicide and Rodenticide Act, the Hazardous Materials
Transportation Act, the Surface Mining Control and Reclamation Act, The
Emergency Planning and Community Right to Know Act, the Safe Drinking
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Water Act, the Toxic Substances Control Act, the Coastal Zone Management Act,
the National Environmental Policy Act, the Noise Control Act. As used in this
Agreement, Environmental Laws shall mean any of such laws or regulations as the
same exist now or at the Closing Date.
"ERISA" -- the Employee Retirement Income Security Act of 1974 or any
successor law, and regulations and rules issued pursuant to that Act or any
successor law.
"Escrow Agent" -- as defined in Section 13. 1.
"Escrow Amount" -- as defined in Section 13. 1.
"Escrow Fund" -- as defined in Section 13. 1.
"Escrow Period" -- as defined in Section 13. 1.
"Excluded Liabilities" -- as defined in Section 2.4.
"Financial Statements" -- those financial statements of Seller
described in Section 3.10.
"First Party" -- as defined in Section 15.1.
"Governmental Authorization" -- any approval, consent, license, permit,
waiver, or other authorization issued, granted, given, or otherwise made
available by or under the authority of any Governmental Body, or pursuant to any
Legal Requirement.
"Governmental Body" -- any federal, state, local, municipal, foreign,
or other government; or governmental or quasi-governmental authority of any
nature (including any governmental agency, branch, department, official, or
entity and any court or other tribunal).
"Hazardous Materials" -- any waste or other substance that is listed,
defined, designated, or classified as, or otherwise determined to be, hazardous,
radioactive, or toxic or a pollutant or a contaminant under or pursuant to any
Environmental Law, and specifically including petroleum and all derivatives
thereof or synthetic substitutes therefor and asbestos or asbestos-containing
materials.
"HSR Act" -- the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976,
as amended, and any regulations and rules promulgated thereunder.
"Indemnified Person" -- any of the Seller Indemnified Persons or the
Buyer Indemnified Persons, as the context requires.
"Indemnifying Party" -- the Buyer, or the Seller and the Indemnifying
Stockholders, as the context requires.
"Indemnifying Stockholders" -- Xxxxxxx X. Xxxxxxx, Xxxxx X. Xxxxxxx,
Xxxxxxxx X. Xxxxxxx Trust and Xxxxx Xxxxxx.
A-3
36
"Intangible Property" -- All right, title and interest in and to the
goodwill and other intangible property (including Seller's trade names, but not
Seller's corporate name) used in connection with the Purchased Assets, all
licenses, permits and authorizations pertaining to the Purchased Assets or the
right to own and operate the Purchased Assets and all right, title and interest
in and to any intellectual property used in connection with the Purchased
Assets.
"IRC" -- the Internal Revenue Code of 1986, as amended from time to
time, or any successor law, and regulations issued by the IRS pursuant to the
Internal Revenue Code or any successor law.
"IRS" -- the United States Internal Revenue Service and, to the extent
relevant, the United States Department of the Treasury.
"Knowledge" -- a Person will be deemed to have "Knowledge" of a
particular fact or other matter if such Person is actually aware of such fact or
other matter. A Person (other than an individual) will be deemed to have
"Knowledge" of a particular fact or other matter if any individual who is
serving as a director, officer, partner, member, executor, or trustee of such
Person (or in any similar capacity) has Knowledge of such fact or other matter.
"Lease Escrow Fund" -- as defined in Section 15.1.
"Lease Escrow Period" -- as defined in Section 15.1.
"Lease Payment Date" -- as defined in Section 15.3.
"Lease Termination Date" -- the latest date of (a) the date of
termination specified, if any, as set forth in the notice from Lessor referred
to in Section 15.2, (b) the date of the notice from the Lessor as referred to in
Section 15.2, or (c) if neither (a) nor (b) specifies or indicates a date, then
thirty (30) days from the date of receipt by the Buyer of the notice referred to
in Section 15.2.
"Lease Termination Event" -- as defined in Section 15.2.
"Legal Requirement" -- any federal, state, local, municipal, foreign,
international, multinational, or other administrative Order, constitution, law,
ordinance, principle of common law, regulation, statute, or treaty.
"LLC" -- as defined in Section 2.2(h).
"Material Adverse Change" -- a change that will cause a Material
Adverse Effect.
"Material Adverse Effect" -- a material adverse effect on the Purchased
Assets, the associated Business or operations or conditions (financial or
otherwise) relating thereto, taken as a whole.
"Members" -- Xxxxxxx X. Xxxxxxx, Xxxxx X. Xxxxxxx and Xxxxxxxx X.
Xxxxxxx Trust.
"Obligors" -- Xxxxxxx X. Xxxxxxx, Xxxxx X. Xxxxxxx, Xxxxxxxx X. Xxxxxxx
and Xxxxx Xxxxxx.
A-4
37
"Omaha Property' -- as defined in Section 2.2(h).
"Order" -- any award, decision, injunction, judgment, order, ruling,
subpoena, or verdict entered, issued, made, or rendered by any court,
administrative agency, or other Governmental Body or by any arbitrator.
"Ordinary Course of Business" -- an action taken by a Person will be
deemed to have been taken in the "Ordinary Course of Business" if such action is
consistent with the past custom and practices of such Person and is taken in the
ordinary course of the normal day-to-day operations of such Person (including
with respect to quantity and frequency).
"Organizational Documents" -- the articles or certificate of
incorporation and the bylaws of a corporation.
"Other Contract" -- any Contract (other than a Site Lease or
Advertising Contract) relating to or affecting the Purchased Assets, the
Business or the operation thereof (I) under which Seller has or may acquire, any
rights, (ii) under which Seller has or may become subject to any obligation or
liability, or (iii) by which Seller or any of the Purchased Assets is or may
become bound.
"Party" -- as defined in the first paragraph of this Agreement.
"Permits" -- as defined in Section 2.2(d).
"Person" -- any individual, corporation (including any non-profit
corporation), general or limited partnership, limited liability company, limited
liability partnership, joint venture, estate, trust, association, organization,
labor union, or other entity or Governmental Body.
"Proceeding" -- any action, arbitration, audit, hearing, investigation,
litigation, or suit (whether civil, criminal, administrative, investigative, or
informal) commenced, brought, conducted, or heard, by or before, or otherwise
involving, any Governmental Body or arbitrator.
"Purchase Price" -- as defined in Section 2.6.
"Purchased Assets" -- as defined in Section 2.2.
"Real Property" -- as defined in Section 2.2(h).
"Related Person" -- with respect to a particular individual:
(a) each other member of such individual's Family;
(b) any Person that is directly or indirectly controlled by such
individual or one or more members of such individual's Family.
A-5
38
(c) any Person in which such individual or members of such
individual's Family hold (individually or in the aggregate) a
Material Interest; and
(d) any Person with respect to which such individual or one or
more members of such individual's Family serves as a director,
officer, partner, executor. or trustee (or in a similar
capacity).
With respect to a specified Person other than an individual:
(a) any Person that directly or indirectly controls, is directly
or indirectly controlled by, or is directly or indirectly
under common control with such specified Person;
(b) any Person that holds a Material Interest in such specified
Person;
(c) each Person that serves as a director, officer, partner,
manager, executor, or trustee of such specified Person (or in
a similar capacity);
(d) any Person in which such specified Person holds a Material
Interest;
(e) any Person with respect to which such specified Person serves
as a general partner or a trustee (or in a similar capacity);
and
any Related Person of any individual described in clause (b) or (c).
For purposes of this definition, (a) the "Family" of an individual includes (I)
the individual, (ii) the individual's spouse, (iii) any other natural person who
is related to the individual or the individual's spouse within the second
degree, and (iv) any other natural person who resides with such individual, and
(b) "Material Interest" means direct or indirect beneficial ownership (as
defined in Rule 13d-3 under the Securities Exchange Act of 1934) of voting
securities or other voting interests representing at least 5 % of the
outstanding voting power of a Person or equity securities or other equity
interests representing at least 5 % of the outstanding equity securities or
equity interests in a Person.
"Release" -- any spilling, leaking, emitting, discharging, depositing,
escaping, leaching, dumping, or other releasing into the Environment, whether
intentional or unintentional.
"Representative" -- with respect to a particular Person, any director,
officer, partner, employee, agent, consultant, advisor, or other representative
of such Person, including legal counsel, accountants, and financial advisors
(including, in the case of Buyer, its investors and lenders).
"Required Consents" -- as defined in Section 3.2(c).
"Security Interest" -- any mortgage, pledge, lien, encumbrance, charge
or other security interest or option or right of any third party with respect
thereto.
"Seller" -- as defined in the first paragraph of this Agreement.
"Seller Indemnified Persons" -- as defined in Section 10.1.
A-6
39
"Site Leases" -- as defined in Section 2.2(b).
"Structures" -- as defined in Section 2.2(a).
"Tangible Personal Property" -- as defined in Section 2.2(i).
"Tax" -- shall mean any tax (including, without limitation, income tax,
capital gains tax, value added tax, sales tax, use tax, property tax, deed tax,
transfer tax, real property transfer tax or intangibles tax), levy, assessment,
tariff, duty, deficiency or other fee and any related charge or amount
(including fine, penalty and interest) imposed, assessed or collected by or
under the authority of any Governmental Body.
"Tax Clearances" -- as defined in Section 7.11.
"Tax Return" -- any return (including any information return), report,
statement, schedule, notice, form or other document or information filed with or
submitted to, or required to be filed with or submitted to, any Governmental
Body in connection with the determination, assessment, collection, or payment of
any Tax or in connection with the administration, implementation, or enforcement
of or compliance with any Legal Requirement relating to any Tax.
"Territory" -- as defined in the Recitals.
"Threatened" -- a claim, Proceeding or dispute will be deemed to have
been "Threatened" if any demand or statement has been made or any notice has
been given that would lead a prudent Person to conclude that such a claim,
Proceeding or dispute is likely to be asserted, commenced, taken, or otherwise
pursued in the future.
"Umpire" -- as defined in Section 14.1.
"Unresolved Claim" -- as defined in Section 13.3.
"Unresolved Lease Claim" -- as defined in Section 15.3.
A-7
40
EXHIBIT B
XXXX OF SALE, ASSIGNMENT AND ASSUMPTION AGREEMENT
This Xxxx of Sale (this "Agreement") is executed and delivered
effective as of ______________, 1998, by WESTERN OUTDOOR ADVERTISING CO., a
__________________ corporation, and TRI-STATE OUTDOOR MEDIA GROUP, INC., a
Kansas corporation ("Buyer").
WITNESSETH:
WHEREAS, pursuant to that certain Asset Purchase Agreement dated
________________, 1998 by and among Seller, Buyer and the other parties named
therein (the "Purchase Agreement"), Seller desires to sell to Buyer and Buyer
wishes to purchase from Seller, for the consideration and upon the terms and
conditions set forth in the Purchase Agreement, the Purchased Assets (as defined
in the Purchase Agreement), subject to the assumption by Buyer of the Assumed
Liabilities (as defined in the Purchase Agreement);
NOW, THEREFORE, in consideration of the premises, and for good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, it is hereby agreed that:
1. Conveyance of Assets. Seller does hereby sell, grant, convey,
assign, transfer and deliver to Buyer all right, title and interest of Seller in
and to all of the Purchased Assets, subject to the Assumed Liabilities.
2. Assumption of Liabilities. Buyer does hereby assume and agree to
pay, discharge and perform, as appropriate, the Assumed Liabilities in
accordance with and to the extent required by the terms of the Purchase
Agreement.
3. Power of Attorney. Seller hereby constitutes and appoints Buyer its
true and lawful attorney-in-fact, with full power of substitution of Buyer in
the name or stead of Seller (a) to demand, collect, and receive for the account
of Seller or Buyer any or all of the Purchased Assets hereby sold, granted,
conveyed, transferred, assigned, and delivered to Buyer or intended so to be;
(b) from time to time to institute or prosecute, in the name of Seller or
otherwise, all proceedings that Buyer, in its sole discretion, may deem
necessary or convenient in order to realize upon, affirm, or obtain title to or
possession of, or to collect, assert, or enforce any claim, right or title of
any kind in or to the Purchased Assets; (c) to endorse the name of Seller on any
and all checks, notes, drafts or other instruments of commercial paper that may
be payable or endorsed to the order or orders of Seller and that constitute or
represent all or any part of the Purchased Assets; (d) to defend and compromise
any and all actions, suits or proceedings in respect of any of the Purchased
Assets; and (e) to do all such other acts and things in relation to the
Purchased Assets as Buyer, in its sole discretion, deems desirable. Seller
agrees that the foregoing powers are coupled with an interest and shall not be
revocable by Seller for any reason whatsoever.
4. Execution and Delivery of Instruments. Seller shall duly execute and
deliver or cause to be executed and delivered all instruments of sale,
conveyance, transfer and assignment, and all notices, releases, acquittances and
other documents that may be necessary more fully to grant,
B-1
41
convey, transfer, assign, and deliver to and vest in Buyer the Purchased Assets
hereby granted, conveyed, transferred, assigned, and delivered or intended so to
be.
5. Conflict. Nothing in this Agreement supersedes or extinguishes any
of the obligations, agreements, covenants or warranties of Seller or Buyer
contained in the Purchase Agreement. If any conflict exists between this
Agreement and the Purchase Agreement, then the terms of the Purchase Agreement
shall govern and control.
IN WITNESS WHEREOF, Seller and Buyer have caused this Agreement to be
executed and delivered as of the date first above written.
SELLER:
WESTERN OUTDOOR ADVERTISING CO.
By:________________________________
Name:
Title:
BUYER:
TRI-STATE OUTDOOR MEDIA GROUP, INC.
By:_________________________________
Xxxxxxx X. Xxxxx, President
B-2
42
WESTERN OUTDOOR ADVERTISING CO.
COMPLIANCE CERTIFICATE
The undersigned hereby certifies as follows:
1. He is the President of Western Outdoor Advertising Co., a
corporation duly organized, validly existing and in good standing under the laws
of the State of Nebraska (the "Seller").
2. The representations and warranties of the Seller contained in
Section 3 of the Asset Purchase Agreement dated as of September 4, 1998 (the
"Purchase Agreement") by and among Tri-State Outdoor Media Group, Inc., Seller,
and the other parties identified therein, are true and correct in all material
respects at and as of the date hereof with the same effect as though all such
representations and warranties were made at and as of the date hereof.
3. The Seller has performed or complied, in all material respects, with
all of the covenants and obligations required by the Purchase Agreement to be
performed or complied with by the Seller at or prior to the date hereof.
IN WITNESS WHEREOF, the undersigned has executed this Certificate as of
this _____day of September, 1998.
_______________________________________
Name:
C-1
43
The undersigned, constituting all the members of L.K. Company, L.L.C.,
a Nebraska limited liability company, hereby join in the foregoing
certifications to the extent the same pertain to the Omaha Property (as defined
in the Purchase Agreement).
----------------------------------
Xxxxxxxx X. Xxxxxxx
----------------------------------
Xxxxx X. Xxxxxxx
XXXXXXXX X. XXXXXXX TRUST
By:
-------------------------------
Xxxxxxx X. Xxxxxxx, Trustee
By:
-------------------------------
Xxxxx X. Xxxxxxx, Trustee
[This Exhibit Deleted]
C-2
44
EXHIBIT D
OPINION OF SELLER'S COUNSEL
_________, 1998
Tri-State Outdoor Media Group, Inc.
X.X. Xxx 0000
0000 Xxxxxxx 00 Xxxxx
Xxxxxx, Xxxxxxx 00000
Ladies and Gentlemen:
We have acted as counsel to Western Outdoor Advertising Co., a Nebraska
corporation (the "Company"), certain of the Indemnifying Stockholders and
certain of the Obligors (as such terms are defined in the Purchase Agreement
[hereinafter defined])in connection with the sale of certain assets of the
Company to Tri-State Outdoor Media Group, Inc., a Kansas corporation ("TSOMG")
and related transactions contemplated by the Asset Purchase Agreement (the
"Purchase Agreement") dated as of __________, 1998 among TSOMG, the Company, and
the other parties named therein. Capitalized terms used herein and not otherwise
defined shall have the respective meanings ascribed to such terms in the
Purchase Agreement. The Purchase Agreement, together with the Xxxx of Sale and
the other Closing Documents, are sometimes collectively referred to herein as
the "Agreements". This opinion is being delivered to you pursuant to Section
7.4(a) of the Purchase Agreement.
We have acted as counsel to the Company, certain of the Indemnifying
Stockholders and certain of the Obligors in connection with the Agreements and
the transactions contemplated thereby. As such counsel, we have made such
examinations of laws and have examined all such records, agreements and other
instruments, certificates and orders of public officials, and other documents,
originals or copies, certified or otherwise authenticated to our satisfaction,
that we have deemed necessary to render the opinions hereinafter set forth.
As used in this opinion letter, the phrase "to our knowledge" means the
actual knowledge (that is, the conscious, awareness of facts or other
information) of lawyers in the firm who have given substantive legal attention
to representing the Company, the LLC, the Indemnifying Stockholders and the
Obligors in connection with the transactions contemplated by the Agreements.
Based and relying upon the foregoing and subject to all of the
qualifications contained in this letter, we are of the opinion that as of the
date hereof:
(i) The Company is a corporation duly organized, validly existing and
in good standing under the laws of the State of Nebraska with full power and
authority to conduct its respective
45
businesses as currently conducted, to own or use the Purchased Assets, and to
perform the obligations under the Agreements.
(ii) The Company is duly qualified or licensed to conduct its business
and is in good standing in each jurisdiction in which the property owned, leased
or operated by the Company or the nature of the business conducted by the
Company makes such qualification or licensing necessary.
(iii) The Company, and the Indemnifying Stockholders and Obligors have
the absolute and unrestricted right, power and authority to execute and deliver
each of the Agreements to which they are a party and to perform each of their
obligations thereunder. Each of the Agreements has been duly authorized,
executed and delivered by the Company. Each of the Agreements has been executed
by the Indemnifying Shareholders and/or the Obligors as the case may be. Each of
the Agreements is a valid, legal and binding agreement of the parties thereto,
enforceable in accordance with its terms, subject to the qualification that the
enforceability thereunder may be limited by bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium, and other laws relating to or affecting
creditors' rights generally and by general equitable principles.
(iv) Neither the execution nor delivery of the Agreements by the
Company, nor the consummation or performance by the Company, the Indemnifying
Stockholders or the Obligors of any of the transactions contemplated thereby
does or will:
(A) conflict with, violate or result in a breach of:
(I) any provision of the Organizational Documents of
the Company;
(II) to our knowledge, any Legal Requirement or any
Order to which the Company, the Purchased
Assets, or the Indemnifying Stockholders or the
Obligors may be subject;
(III) to our knowledge, any Governmental
Authorization held by the Company or that
otherwise relates to the Purchased Assets; or
(IV) the resolutions adopted by the shareholders and
board of directors of the Company.
(B) contravene, conflict with or result in a violation or
breach of any provision of, or give any Person the right to declare a default or
exercise any remedy under, or to accelerate the maturity or performance of, or
to cancel, terminate, or modify any Contract relating to the Purchased Assets of
which we are aware, after due inquiry, to which the Company, certain of the
Indemnifying Stockholders and certain the Obligors are parties or by which such
party or any interest or rights of the Company in or to the Purchased Assets may
be bound; or result in the imposition or creation of any Encumbrance upon or
with respect to any of the Purchased Assets.
(v) To the best of our knowledge, after due inquiry, there is no
Proceeding pending or Threatened by or against the Company, the Indemnifying
Stockholders or the Obligors or affecting
46
any of the Purchased Assets, and there is no Order to which the Company or the
Purchased Assets are subject.
(vi) To the best of our knowledge, after due inquiry, the Company, and
the Indemnifying Stockholders and the Obligors are not and will not be required
to give any notice or to obtain any Consent from any Person in connection with
the execution and delivery of the Purchase Agreement or the consummation or
performance of the Contemplated Transactions.
This opinion is being furnished solely to TSOMG and is solely for the
benefit of TSOMG (and its affiliates, lenders, successors and assigns) and may
not be relied upon for any other purpose, or furnished to, quoted to or relied
upon by any other person for any purpose without our prior written consent.
We are qualified to practice law within the State of Nebraska and our
opinions expressed herein are solely limited to the effect of Nebraska law on
the Contemplated Transaction and we express no opinion herein with respect to
the laws of other states or jurisdictions within which the Company may conduct
business or operations.
Very truly yours,
D-3
47
EXHIBIT E
TRI-STATE OUTDOOR MEDIA GROUP, INC.
COMPLIANCE CERTIFICATE
The undersigned hereby certifies as follows:
1. He is President of Tri-State Outdoor Media Group, Inc., a
corporation duly organized, validly existing and in good standing under the laws
of the State of Kansas (the "Buyer").
2. The representations and warranties of Buyer contained in Section 4
of the Asset Purchase Agreement dated as of ______________, 1998 (the "Purchase
Agreement") by and among the Buyer, Western Outdoor Advertising Co. and the
other parties identified therein, are true and correct in all material respects
at and as of the date hereof with the same effect as though all such
representations and warranties were made at and as of the date hereof.
3. Buyer has performed or complied, in all material respects, with all
of the covenants and obligations required by the Purchase Agreement to be
performed or complied with by Buyer at or prior to the date hereof.
IN WITNESS WHEREOF, the undersigned has executed this Certificate as of
this _____ day of ______________, 1998.
________________________________
Xxxxxxx X. Xxxxx
President
48
EXHIBIT F
OPINION OF BUYER'S COUNSEL
____________________, 1998
Western Outdoor Advertising Co.
0000 Xxxxx Xxxxxx
Xxxxx, Xxxxxxxx 00000
Ladies and Gentlemen:
We have acted as counsel to Tri-State Outdoor Media Group, Inc., a
Kansas corporation (the "Company"), in connection with the Company's purchase of
certain assets of Western Outdoor Advertising Co., a ________________corporation
("Seller"), and related transactions contemplated by the Asset Purchase
Agreement (the "Purchase Agreement") dated as of __________________, 1998 among
the Company, Seller and the other parties named therein. Capitalized terms used
herein and not otherwise defined shall have the respective meanings ascribed to
such terms in the Purchase Agreement. The Purchase Agreement, together with the
Xxxx of Sale and the other Closing Documents, are sometimes collectively
referred to herein as the "Agreements". This opinion is being delivered to you
pursuant to Section 8.3(a) of the Purchase Agreement.
We have acted as counsel to the Company in connection with the
Agreements and the transactions contemplated thereby. As such counsel, we have
made such examinations of laws and have examined certificates of officers and
representatives of the Company, originals or copies, certified or otherwise
authenticated to our satisfaction, of all such records, agreements and other
instruments, certificates and orders of public officials, and other documents
that we have deemed necessary to render the opinions hereinafter set forth
including, but not limited to:
(a) the certificate of incorporation and by-laws of the Company;
(b) resolutions of the directors of the Company authorizing, among
other things, the Agreements and the transactions contemplated thereby; and
(c) executed copies of the Agreements.
In such examination, we have assumed the genuineness of all signatures,
the authenticity of all documents submitted to us as originals, the conformity
to the originals thereof of all documents submitted to us as certified or
photostatic copies, and the authenticity of the originals of such latter
documents. As to any fact relevant to any such opinion, we have relied, to the
extent that relevant facts are not independently established by us, and to the
extent we deem reliance proper, on
49
Western Outdoor Advertising Co.
Page -2-
___________________, 1998
certificates of public officials and certificates, oaths and declarations of
officers and other representatives of the Company on which we believe that we
and you are justified in relying. We have not, except as specifically identified
herein, been retained or engaged for, nor have we performed, any independent
review or investigation of any statutes, orders, rules or regulations of any
court or governmental agency having jurisdiction over the Company. This letter
and the opinions set forth herein are given, and all statements herein "to our
knowledge" are made, in the context of the foregoing.
As used in this opinion letter, the phrase "to our knowledge" means the
actual knowledge (that is, the conscious awareness of facts or other
information) of lawyers in the firm who have given substantive legal attention
to representing the Company in connection with the transactions contemplated by
the Agreements.
We are qualified to practice law only in the States of New York and New
Jersey and we do not purport to be experts on any laws other than the laws of
the States of New York and New Jersey and the Federal laws of the United States.
We express no opinion as to the laws of any jurisdiction other than the Federal
laws of the United States, and the laws of the State of New Jersey. For purposes
of this opinion we assume that Nebraska law in all relevant respects is
substantively identical to New Jersey law.
Based and relying upon the foregoing and subject to all of the
qualifications contained in this letter, we are of the opinion that as of the
date hereof:
(i) The Company is a corporation duly incorporated and validly existing
in good standing under the laws of the State of Kansas with full corporate power
and authority to conduct its business as it is currently conducted, to own or
use the Purchased Assets, and to perform its obligations under the Agreements.
(ii) The Company has the absolute and unrestricted right, power and
authority to execute and deliver each of the Agreements to which it is a party
and to perform each of its obligations thereunder. Each of the Agreements has
been duly authorized, executed and delivered by the Company. Each of the
Agreements is a valid, legal and binding agreement of the Company, enforceable
in accordance with its terms, subject to the qualification that the
enforceability thereunder may be limited by bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium, and other laws relating to or affecting
creditors' rights generally and by general equitable principles.
(iii) Neither the execution and delivery of the Agreements by the
Company nor the consummation or performance by the Company of any of the
transactions contemplated thereby does or will conflict with, violate or result
in a breach of:
X-0
00
Xxxxxxx Xxxxxxx Advertising Co.
Page -3-
___________________, 1998
(A) any provision of the Organizational Documents of the
Company; and
(B) the resolutions adopted by the board of directors of the
Company authorizing the Contemplated Transactions.
This opinion is being furnished solely to Seller and is solely
for the benefit of Seller and may not be relied upon for any other purpose, or
furnished to, quoted to or relied upon by any other person for any purpose
without our prior written consent.
Very truly yours,
St. Xxxx & Xxxxx, L.L.C.
F-3
51
SCHEDULE A
TERRITORY
Arkansas
Colorado
Illinois
Indiana
Iowa
Kansas
Kentucky
Minnesota
Missouri
Nebraska
New Mexico
North Dakota
Ohio
Oklahoma
South Dakota
Tennessee
Texas
Wisconsin
Wyoming
52
SCHEDULE 2.2(a)
STRUCTURES
53
SCHEDULE 2.2(b)
SITE LEASES
54
SCHEDULE 2.2(c)
ADVERTISING CONTRACTS
55
SCHEDULE 2.2(d)
PERMITS
56
SCHEDULE 2.2(h)
REAL PROPERTY
57
SCHEDULE 2.2(i)
TANGIBLE PERSONAL PROPERTY
58
SCHEDULE 2.2(j)
SUPPLIES
59
SCHEDULE 3.10
FINANCIAL STATEMENTS
60
SCHEDULE 5.9
TAX CLEARANCE CERTIFICATES
Illinois
Iowa
Kansas
Missouri
Nebraska
Oklahoma
Texas
61
SCHEDULE 11
AREAS OF NON-COMPETITION
The Territory
62
DISCLOSURE SCHEDULE
xv
63
EXHIBITS
Exhibit A - Definitions
Exhibit B - Xxxx of Sale, Assignment and Assumption Agreement
Exhibit C - Seller's Compliance Certificate
Exhibit D - Opinion of Seller's Counsel
Exhibit E - Buyer's Compliance Certificate
Exhibit F - Opinion of Buyer's Counsel
SCHEDULES
Schedule A - Territory
Schedule 2.2(a) - Structures
Schedule 2.2(b) - Site Leases
Schedule 2.2(c) - Advertising Contracts
Schedule 2.2(d) - Permits
Schedule 2.2(h) - Real Property
Schedule 2.2(i) - Tangible Personal Property
Schedule 2.2(j) - Supplies
Schedule 3.10 - Financial Statements
Schedule 5.9 - Tax Clearance Certificates
Schedule 11 - Areas of Non-Competition
DISCLOSURE SCHEDULE
Part 3.2(b) Part 3.9(b) Part 3.18
Part 3.2(c) Part 3.12 Part 3.20
Part 3.5 Part 3.13 Part 3.22
Part 3.6 Part 3.14 Part 3.23
Part 3.7 Part 3.16
64
SCHEDULE 5.9
Tax Clearance Certificates
Deleted.
65
PART 3.7
66
PART 3.12
67
PART 3.14
68
PART 3.16
69
PART 3.20
70
PART 3.23
