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EXHIBIT 10.162
EXECUTION COPY
ASSIGNMENT AND ACCEPTANCE AGREEMENT
This ASSIGNMENT AND ACCEPTANCE AGREEMENT ("Agreement") is made as
of this 18th day of April, 1997, by and between WQED Pittsburgh ("QED"), a
Pennsylvania nonprofit corporation, and Xxxxxx Communications of Pittsburgh-40,
Inc. ("Buyer"), a Florida corporation. All capitalized terms not otherwise
defined herein shall have the meanings ascribed to them in the Asset Exchange
Agreement dated May 23, 1996, by and between QED and Cornerstone TeleVision,
Inc. ("Cornerstone"), as amended by the Amendment to Asset Exchange Agreement
executed contemporaneously herewith by QED and Cornerstone (together, the
"Exchange Agreement"), which is attached hereto as Exhibit A to this Agreement.
RECITALS
WHEREAS, pursuant to the Exchange Agreement, QED has the right to
exchange the WQEX Assets for the Channel 40 Assets, and contemporaneous with
the exchange, pursuant to an assignment of certain of QED's rights under the
Exchange Agreement, to cause the transfer and assignment of the Channel 40
Assets to a Third Party Buyer directly from Cornerstone, such transaction
constituting the Third Party Sale;
THEREFORE, the foregoing premises considered, the parties, intending
to be legally bound, for good and valuable consideration including the mutual
promises contained herein, the receipt and sufficiency of which are hereby
acknowledged, do hereby agree to proceed with the Third Party Sale as follows:
ARTICLE 1
ASSIGNMENT
QED hereby selects Buyer as the Third Party Buyer for the Channel 40
Assets in accordance with Article 5 of the Exchange Agreement. Subject to
fulfillment of Buyer's obligations and undertakings hereunder, QED hereby
assigns, transfers and conveys to Buyer all of its rights, interests, and
remedies relating to the acquisition of the Channel 40 Assets under the
Exchange Agreement, including the benefit of all representations, warranties,
covenants, deliveries, indemnities and other obligations of Cornerstone
thereunder relating
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to the purchase and sale of the Channel 40 Assets. Cornerstone's consent
thereto shall be evidenced by the Consent and Assignment Agreement in the form
attached hereto as Exhibit B, executed copies of which have been delivered to
QED and Buyer on the date hereof (the "Consent and Assignment Agreement").
ARTICLE 2
ASSETS
2.1. CLOSING. Subject to the terms, conditions and limitations in
the Exchange Agreement, the consummation of the transactions contemplated by
this Agreement (the "Closing") shall occur simultaneously with, and contingent
on, the closing of the sale of the WQEX Assets from QED to Cornerstone on such
date and at such place as QED, Cornerstone and Buyer mutually agree pursuant to
Section 1.1 of the Exchange Agreement, provided that the QED Closing Conditions
and the Buyer Closing Conditions, as hereinafter defined, shall have been
fulfilled or waived by the party entitled to waive such condition.
2.2. CHANNEL 40 ASSETS. Subject to the terms, conditions and
limitations in the Exchange Agreement, at the Closing, simultaneous with and
contingent on the assignment of the WQEX Assets from QED to Cornerstone,
Cornerstone shall assign, transfer and convey to Buyer, and Buyer shall acquire
from Cornerstone, the Channel 40 Assets, and no others.
In addition, simultaneously herewith Buyer and Cornerstone are
entering into the Development Agreement substantially in the form of Exhibit C
to this Agreement.
In accordance with the Exchange Agreement, the Channel 40 Assets shall
be transferred by Cornerstone to Buyer in "as is, where is" condition free and
clear of all debts, liens, security interests, pledges, mortgages, trusts,
claims, liabilities and encumbrances of any nature whatsoever.
ARTICLE 3
CONSIDERATION
3.1. PURCHASE PRICE. The aggregate purchase price for the Channel
40 Assets shall be $35,000,000 (the "Purchase Price"), which shall be the total
consideration for the Channel 40 Assets. Simultaneous with the execution of
this Agreement, the parties hereto shall enter into an escrow agreement (the
"WQED Escrow Agreement"), attached hereto as Exhibit D-1, pursuant to which,
subject to satisfaction of the condition set forth in Section 18.1(a) hereof
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and in the manner provided in Section 18.1(b) hereof, Buyer shall place the sum
of $1,750,000 (the "WQED Escrow Deposit") in escrow with First Union National
Bank of Florida as escrow agent (the "Escrow Agent"), and Buyer and Cornerstone
shall enter into an escrow agreement (the "Cornerstone Escrow Agreement"),
attached hereto as Exhibit D-2, pursuant to which, subject to satisfaction of
the condition set forth in Section 18.1(a) hereof and in the manner provided in
Section 18.1(b) hereof, Buyer shall place the sum of $1,750,000 (the
"Cornerstone Escrow Deposit") in escrow with the Escrow Agent. At the Closing,
Buyer shall deliver $35,000,000 by wire transfer in immediately available
funds, to be allocated between QED and Cornerstone in the manner set forth at
Section 2.2(b) of the Exchange Agreement pursuant to joint instructions
executed by QED and Cornerstone and delivered to Buyer at least two business
days prior to the Closing Date. At Buyer's election, QED and Buyer shall
jointly instruct the Escrow Agent to deliver the WQED Escrow Deposit to QED or
Cornerstone at the Closing as a credit toward the payment of the Purchase
Price, and to deliver all interest earned thereon to Buyer, and Cornerstone and
Buyer shall jointly instruct the Escrow Agent to deliver the Cornerstone Escrow
Deposit to QED or Cornerstone at the Closing as a credit toward the payment of
the Purchase Price, and to deliver all interest earned thereon to Buyer.
3.2. TRANSFER TAXES. Any sales, transfer or other taxes and fees
arising by reason of Buyer's acquisition of the Channel 40 Assets as
contemplated hereby shall be borne exclusively by Buyer. Buyer shall have no
liability for any past due or delinquent taxes owing by either QED or
Cornerstone.
3.3. PURCHASE PRICE ALLOCATION. Buyer and QED agree, and Buyer and
QED agree to use their commercially reasonable efforts to obtain Cornerstone's
agreement, to allocate the Purchase Price for tax and recording purposes in
accordance with an appraisal to be conducted by Broadcast Investments Analysts,
Inc. ("BIA"). Buyer shall be responsible for all fees payable to BIA in
connection with such appraisal.
ARTICLE 4
ACCEPTANCE OF RIGHTS AND ASSUMPTION OF OBLIGATIONS
Subject to fulfillment of QED's obligations and undertakings
hereunder, Buyer accepts the assignment described in this Agreement and shall
assume all obligations, and be entitled to exercise all rights, of QED under
the Exchange Agreement relating to the acquisition of the Channel 40 Assets.
Except as provided in the preceding sentence, as otherwise explicitly
contemplated by this Agreement, as required by the FCC, or as otherwise
required by law, Buyer shall not be required to assume any liabilities of QED
or
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Cornerstone of any nature in connection with the transactions contemplated
hereunder. Nothing contained in this Agreement or in the Consent and Assignment
Agreement shall relieve QED of its obligations and liabilities under the
Exchange Agreement.
ARTICLE 5
REQUIRED CONSENTS
5.1. FCC APPLICATIONS. The assignment of the Channel 40 Licenses
listed in Schedule 1.3(a) of the Exchange Agreement as contemplated by this
Agreement and by the Exchange Agreement is subject to, among other things, the
consent and approval of the FCC. Within fifteen (15) days following the
execution of this Agreement, QED and Buyer shall cooperate to cause the filing
of their respective FCC Exchange Applications contemplated by Section 4.1 of
the Exchange Agreement (collectively, the "FCC Applications"). QED and Buyer
thereafter shall prosecute and cooperate fully with each other in the
prosecution of their respective FCC Applications in accordance with the
provisions set forth in Section 4.1 of the Exchange Agreement as the same are
applicable to QED and Buyer.
5.2. OTHER GOVERNMENTAL CONSENTS. Within 15 days following the
execution of this Agreement, QED and Buyer shall prepare and file with the
appropriate governmental authorities any other requests for approval or waiver
that are required from such governmental authorities in connection with this
Agreement and the Exchange Agreement, including such consents listed on
Schedule 4.2 to the Exchange Agreement, and shall diligently and expeditiously
prosecute, and shall cooperate fully with each other in the prosecution of,
such requests for approval or waiver and all proceedings necessary to secure
such approvals and waivers.
ARTICLE 6
REPRESENTATIONS AND WARRANTIES OF QED
QED represents and warrants to Buyer as follows:
6.1. ORGANIZATION AND STANDING. QED is a corporation duly
organized, validly existing and in good standing under the Nonprofit
Corporation Law of the Commonwealth of Pennsylvania.
6.2. AUTHORIZATION AND BINDING OBLIGATION. QED has all necessary
power and authority to enter into and perform this Agreement and the Exchange
Agreement and the transactions contemplated by this Agreement and the Exchange
Agreement. Except as
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provided in Section 18.1(a) hereof, QED's execution, delivery and performance
of this Agreement and the Exchange Agreement have been duly and validly
authorized by all necessary corporate action on its part. Subject to
satisfaction of the condition set forth at Section 18.1(a) hereof, this
Agreement and the Exchange Agreement have been duly executed and delivered by
QED and constitute its valid and binding obligation, enforceable in accordance
with their respective terms, except as limited by laws affecting creditors'
rights or equitable principles generally.
6.3. ABSENCE OF CONFLICTING AGREEMENTS OR REQUIRED CONSENTS. Except
as set forth in Article 5 with respect to FCC and other governmental consents,
and except for receipt of the consent of QED's Board of Trustees as
contemplated by Section 18.1(a) hereof, the execution, delivery and performance
of this Agreement and the Exchange Agreement and the consummation of the
transactions contemplated hereby and thereby by QED: (a) do not and will not
require the consent, approval, authorization or other action by, or filing with
or notification to, any third party or governmental authority other than QED's
senior lender Mellon Bank, N.A.; (b) do not and will not violate any provisions
of QED's articles of incorporation or bylaws; (c) do not and will not violate
any applicable law, judgment, order, injunction, decree, rule, regulation or
ruling of any governmental authority to which QED is a party, or by which it or
the WQEX Assets are bound; and (d) do not and will not, either alone or with
the giving of notice or the passage of time, or both, conflict with, constitute
grounds for termination of or result in a breach of the terms, conditions or
provisions of, or constitute a default under any contract, agreement,
instrument, license or permit to which QED or the WQEX Assets are subject. QED
has (i) obtained the consent of its senior lender Mellon Bank, N.A. to the
execution, delivery and performance of this Agreement and the Exchange
Agreement and the consummation of the transactions contemplated hereby and
thereby, and delivered a copy of such consent to Buyer and Cornerstone; (ii)
obtained all consents from Cornerstone required by the terms of the Exchange
Agreement as a result of the transactions contemplated by this Agreement,
evidenced by the Consent and Assignment Agreement; and (iii) provided Buyer
with written evidence that Cornerstone's Board of Directors has approved the
delivery of the Consent and Assignment Agreement.
6.4. ABSENCE OF LITIGATION. Except as set forth in Schedule 6.4
hereto, there is no claim, litigation, proceeding or investigation pending or,
to the best of QED's knowledge, threatened against QED which seeks to enjoin or
prohibit, or which otherwise questions the validity of, any action taken or to
be taken in connection with this Agreement.
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6.5. EXCHANGE AGREEMENT. QED has furnished a true and correct copy
of the Exchange Agreement to Buyer and all amendments, modifications and
waivers relating thereto.
6.6. DISCLAIMER. Except as set forth in this Article 6, QED makes
no representations or warranties to Buyer.
ARTICLE 7
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to QED as follows:
7.1. ORGANIZATION AND STANDING. Buyer is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Florida, and has all necessary corporate power and authority to own, lease and
operate the Channel 40 Assets.
7.2. AUTHORIZATION AND BINDING OBLIGATION. Buyer has all necessary
power and authority to enter into and perform this Agreement and the
transactions contemplated by this Agreement, and Buyer's execution, delivery
and performance of this Agreement has been duly and validly authorized by all
necessary corporate action on its part. This Agreement has been duly executed
and delivered by Buyer and, subject to satisfaction of the condition set forth
at Section 18.1(a) hereof, constitutes its valid and binding obligation,
enforceable in accordance with its terms, except as limited by laws affecting
creditors' rights or equitable principles generally.
7.3. FCC QUALIFICATIONS. To the best of Buyer's knowledge after
reasonable inquiry, there are no facts which, under the Communications Laws,
could reasonably be expected to disqualify Buyer as assignee of the Channel 40
Licenses, and Buyer is able to and will certify on FCC Form 314 to its
financial qualifications.
7.4. ABSENCE OF CONFLICTING AGREEMENTS OR REQUIRED CONSENTS. Except
as set forth in Article 5 with respect to FCC and other governmental consents,
the execution, delivery and performance of this Agreement and the consummation
of the transactions contemplated hereby by Buyer: (a) do not and will not
require the consent, approval, authorization or other action by, or filing with
or notification to, any third party or governmental authority; (b) do not and
will not violate any provisions of Buyer's articles of incorporation or bylaws;
(c) do not and will not violate any applicable law, judgment, order,
injunction, decree, rule, regulation or ruling of any governmental authority to
which Buyer
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is a party, or by which it is bound; and (d) do not and will not, either alone
or with the giving of notice or the passage of time, or both, conflict with,
constitute grounds for termination of or result in a breach of the terms,
conditions or provisions of, or constitute a default under any contract,
agreement, instrument, license or permit to which it is now subject.
7.5. ABSENCE OF LITIGATION. Except as set forth in Schedule 6.4
hereto, there is no claim, litigation, proceeding or investigation pending or,
to the best of Buyer's knowledge, threatened against Buyer which seeks to
enjoin or prohibit, or which otherwise questions the validity of, any action
taken or to be taken in connection with this Agreement.
7.6. FINANCIAL QUALIFICATION. Buyer is and shall be at the Closing
financially qualified to meet all terms, conditions and undertakings
contemplated by this Agreement.
7.7. DISCLAIMER. Except as set forth in this Article 7, Buyer makes
no representations or warranties to any party.
ARTICLE 8
REPRESENTATIONS AND WARRANTIES WITH RESPECT TO CHANNEL 40 ASSETS
QED makes no representations or warranties with respect to the Channel
40 Assets, except as expressly set forth in this Agreement.
ARTICLE 9
JOINT COVENANTS
9.1. NO INCONSISTENT ACTION. Neither Buyer nor QED shall take any
action inconsistent with its obligations under this Agreement, or inconsistent
with the terms and conditions of this Agreement, including any such action that
would hinder, delay or interfere with the consummation of the transactions
contemplated by this Agreement.
9.2. NOTIFICATION. Buyer and QED shall each notify the other and
Cornerstone of any material litigation, arbitration or administrative
proceeding pending or, to its knowledge, threatened which challenges the
transactions contemplated by this Agreement and the Exchange Agreement or
adversely affects the Channel 40 Assets, including any challenges to any FCC
application contemplated hereby or thereby, and shall take such steps as may
reasonably be necessary to remove any such impediment to the transactions
contemplated by this Agreement.
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ARTICLE 10
ADDITIONAL COVENANT OF BUYER
Buyer shall cooperate with QED in the formulation and implementation
of an engineering plan of transition that will protect the broadcast operations
of Cornerstone from interruption for a period of no longer than six (6) hours
as a consequence of the transition contemplated by the Exchange Agreement,
which interruptions shall occur at times of minimum viewership.
ARTICLE 11
ADDITIONAL COVENANT OF QED
QED shall perform such of its obligations under the Exchange Agreement
as are not assigned herein to Buyer in accordance with the terms thereof,
including the obligations set forth in Section 2.2 of the Exchange Agreement.
Except with the prior written consent of Buyer (which consent shall not be
unreasonably withheld), QED will not (a) amend or modify in any manner any term
or condition of the Exchange Agreement or give any consent, waiver or approval
thereunder or waive any default under any term or condition of the Exchange
Agreement, or (b) take any other action in connection with the Exchange
Agreement that would impair in any material respect, in the case of (a) or (b)
above, the value of the interests or rights of Buyer under the Exchange
Agreement or this Agreement.
ARTICLE 12
CONDITIONS PRECEDENT TO QED'S OBLIGATION TO CLOSE
The obligations of QED hereunder are, at its option, subject to
satisfaction, at or prior to the Closing Date, of each of the following
conditions (the "QED Closing Conditions"):
12.1. REPRESENTATIONS, WARRANTIES AND COVENANTS.
(a) All representations and warranties of Buyer made in this
Agreement shall be true and complete in all material respects on and as of the
Closing Date as if made on and as of that date.
(b) All of the terms, covenants and conditions to be complied
with and performed by Buyer under this Agreement and the Exchange Agreement on
or prior to the Closing Date shall have been complied with or performed in all
material respects.
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12.2. GOVERNMENTAL CONSENTS. The FCC consents to the FCC
Applications shall each have become a Final Order as defined at Section 11.2 of
the Exchange Agreement without conditions materially adverse to QED, and all
other governmental consents referred to in Section 5.2 hereof shall have been
obtained.
12.3. CLOSING DELIVERIES OF BUYER. Buyer shall have made or stand
willing to make the following deliveries, in form and substance reasonably
satisfactory to QED:
(a) the Purchase Price, in the amount and manner provided in
Section 3.1 hereof;
(b) a certificate of an officer of Buyer, dated the Closing
Date, in form and substance reasonably satisfactory to QED, certifying to the
fulfillment of the conditions set forth in Section 12.1(a) and (b) hereof;
(c) resolutions of the board of directors of Buyer authorizing
the execution, delivery and performance of this Agreement and the Exchange
Agreement, certified by the secretary of Buyer; and
(d) such other documents as may reasonably be requested by
QED's counsel, including documents to enable QED to fulfill its obligations
under Section 12.6 of the Exchange Agreement.
ARTICLE 13
CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE
The obligations of Buyer hereunder and under the Exchange Agreement
are, at its option, subject to satisfaction, at or prior to the Closing Date,
of each of the following conditions (the "Buyer Closing Conditions"):
13.1. REPRESENTATIONS, WARRANTIES AND COVENANTS.
(a) All representations and warranties of QED made in this
Agreement shall be true and complete in all material respects on and as of the
Closing Date as if made on and as of that date.
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(b) All of the terms, covenants and conditions to be complied
with and performed by QED under this Agreement and the Exchange Agreement on or
prior to the Closing Date shall have been complied with or performed in all
material respects.
13.2. GOVERNMENTAL CONSENTS. The FCC consents to the FCC
Applications shall each have become a Final Order as defined at Section 11.2 of
the Exchange Agreement without conditions materially adverse to Buyer, and all
other governmental consents referred to in Section 5.2 hereof shall have been
obtained.
13.3. TOWER LEASE. Cornerstone and Buyer shall have entered into a
Lease Agreement substantially in the form of either Exhibit B to the Exchange
Agreement, as amended, or Annex 1 to the Development Agreement, whichever is
appropriate.
13.4. DELIVERIES.
(a) Cornerstone shall have made or stand willing to make
all the deliveries required under Section 13.1 of the Exchange Agreement
directly to Buyer, and such deliveries are in form and substance reasonably
satisfactory to Buyer.
(b) QED shall have made or stand willing to make the
following deliveries:
(i) a certificate of an officer of QED, dated the
Closing Date, in form and substance reasonably satisfactory to Buyer,
certifying to the fulfillment of the conditions set forth in Sections 13.1 and
13.2 hereof;
(ii) resolutions of the board of trustees of QED,
authorizing the execution, delivery and performance of this Agreement and the
Exchange Agreement, certified by the secretary of QED; and
(iii) such other documents as may reasonably be
requested by Buyer's counsel.
13.5. OTHER AGREEMENTS. QED shall stand ready to enter into the
following additional agreements, which agreements, and the consideration
payable to QED thereunder, shall be separate and apart from, and not constitute
consideration for, this Agreement or the acquisition of the Channel 40 Assets:
(a) a lease agreement between QED and Buyer providing Buyer
with the lease of approximately 4,000 square feet of office and studio space at
QED's office and studio
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facilities at 0000 Xxxxx Xxxxxx, Xxxxxxxxxx, and appropriate space on the
premises for a microwave dish and a satellite receive dish of such weight and
size as can be accommodated on the existing roof or site without modification
thereof (together with shared use of QED's standby generator), for a 25-year
term at prevailing market rates (all such payments shall be considered separate
and distinct from, and not included within, either Gross Proceeds or Net
Proceeds as defined in Section 2.2 of the Exchange Agreement), which lease
agreement shall be in the form of Exhibit E hereto; and
(b) a three-year agreement between QED and Buyer whereby QED
will provide Buyer, and Buyer agrees to broadcast, up to five hours per week of
public affairs and children's core programming as defined by the FCC and
meeting FCC requirements (any payments made by Buyer to QED as may be agreed
upon by QED and Buyer in connection with the provision of such programming
shall be considered separate and distinct from, and not included within, either
Gross Proceeds or Net Proceeds as defined in Section 2.2 of the Exchange
Agreement), which agreement shall be in the form of Exhibit F hereto; provided,
however, that QED shall have the option to terminate the obligation to enter
into the agreement described in this Section 13.5(b) by providing written
notice of such termination to Buyer at least thirty (30) days prior to the
Closing Date.
ARTICLE 14
BROKER'S COMMISSION OR FINDER'S FEE
The parties hereto represent and warrant to each other that neither of
them, nor any person or entity acting on their behalf, has agreed to pay a
commission, finder's fee or similar payment in connection with this Agreement
or any matter related hereto to any person or entity other than the fee payable
to Xxxxxxx X. Xxxxxxx Associates, Inc., which was engaged by QED, nor have they
or any person or entity acting on their behalf taken any other action on which
a claim for any such payment could be based. The parties hereto further agree
to indemnify and hold each other harmless from and against any and all claims,
losses, liabilities and expenses (including reasonable attorneys' fees) arising
out of a claim by any person or entity based on any such arrangement or
agreement made or alleged to have been made by either QED or Buyer. QED is and
shall be solely responsible for any fees of Xxxxxxx X. Xxxxxxx Associates, Inc.
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ARTICLE 15
TERMINATION RIGHTS
15.1. TERMINATION.
This Agreement may be terminated by QED or Buyer so long as the party
seeking to terminate is not in material default or breach of this Agreement,
upon written notice to the other upon the occurrence of any of the following:
(a) if, on or before the Closing Date, the other party
defaults in any material respect in the observance or in the due and timely
performance of any of its covenants, agreements or obligations contained herein
and fails to cure such default within ten (10) business days following receipt
of written notice thereof by the non- defaulting party;
(b) if the FCC denies one or both of the FCC Applications or
designates one or both of them for an evidentiary hearing;
(c) if there shall be in effect any final judgment, decree or
order that would prevent or make unlawful the Closing;
(d) if the Closing has not occurred by December 31, 1998; or
(e) if the Board of Trustees of QED shall have failed to
duly authorize the execution, delivery and performance by QED of this Agreement
and the Exchange Agreement (the "QED Consent") within thirty (30) days of the
date hereof.
15.2. BY BUYER. In addition to its rights set forth in Section 15.1,
this Agreement may be terminated by Buyer so long as Buyer is not in material
default or breach of this Agreement, upon written notice to QED, (a) if QED
shall have failed to deliver to Buyer, within thirty (30) days of the date
hereof, evidence of the QED Consent duly certified by the Secretary of QED in
form and substance reasonably satisfactory to Buyer (the "Certified Consent"),
and (b) upon any termination of the Exchange Agreement in accordance with its
terms. If Buyer terminates this Agreement pursuant to Section 15.1 or 15.2
hereof, Buyer shall have no further obligation or liability hereunder or under
the Exchange Agreement, except as provided in Section 15.3 hereof.
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15.3. LIABILITY. The termination of this Agreement under Sections
15.1 or 15.2 hereof shall not relieve any party of any liability for material
breach of this Agreement or the Exchange Agreement prior to the date of
termination.
15.4. ESCROW DEPOSITS. If this Agreement is terminated by either
party pursuant to this Article 15 and Buyer is not in material breach of this
Agreement, all amounts held by the Escrow Agent pursuant to the WQED Escrow
Agreement and the Cornerstone Escrow Agreement, including any interest or other
proceeds from the investment of funds held by the Escrow Agent, shall be
disbursed to or at the direction of Buyer.
ARTICLE 16
INDEMNIFICATION
16.1. INDEMNIFICATION BY MISPERFORMING OR NONPERFORMING PARTY.
Notwithstanding the Closing, QED and Buyer hereby agree to indemnify, defend
and hold the other harmless against and with respect to, and shall reimburse
the other for:
(a) Any and all losses, liabilities, or damages resulting from
any untrue representation, breach of warranty, or nonfulfillment of any
covenant or obligation by such misperforming or nonperforming party contained
herein or in the Exchange Agreement or in any certificate, document or
instrument delivered to the other party hereunder or thereunder;
(b) Any and all actions, suits, proceedings, claims, demands,
assessments, judgments, costs and expenses, including reasonable legal fees and
expenses, incident to the foregoing or incurred in investigating or attempting
to avoid the same or to oppose the imposition thereof, or in enforcing this
indemnity; and
(c) Interest at the Prime Rate on any reimbursable expense or
loss incurred by the indemnified party from the date of payment until the date
of reimbursement by the indemnifying party.
16.2. PROCEDURE FOR INDEMNIFICATION. The procedure for
indemnification shall be as follows:
(a) The party seeking indemnification under this Article 16
(the "Indemnified Party") shall give notice to the party from whom
indemnification is sought (the "Indemnitor") of any claim, whether solely
between the parties or brought by a third party,
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specifying (i) the factual basis for the claim, and (ii) the amount of the
claim or the Indemnified Party's reasonable estimate thereof, as set forth in a
certificate executed by an officer of the Indemnified Party. If the claim
relates to an action, suit or proceeding filed by a third party against the
Indemnified Party, notice shall be given by the Indemnified Party within
fifteen (15) business days after written notice of the action, suit or
proceeding was given to the Indemnified Party. In all other circumstances,
notice shall be given by the Indemnified Party within thirty (30) business days
after the Indemnified Party becomes, or should have become, aware of the facts
giving rise to the claim. Notwithstanding the foregoing, the Indemnified
Party's failure to give Indemnitor timely notice shall not preclude the
Indemnified Party from seeking indemnification from Indemnitor except to the
extent that the Indemnified Party's failure has materially prejudiced
Indemnitor's ability to defend the claim or litigation.
(b) With respect to any claim by a third party as to which the
Indemnified Party is entitled to indemnification hereunder, the Indemnitor
shall have the right at its own expense to participate in or assume control of
the defense of the claim, and the Indemnified Party shall cooperate fully with
the Indemnitor. If the Indemnitor elects to assume control of the defense of
any third-party claim, the Indemnified Party shall have the right to
participate in the defense of the claim at its own expense. The Indemnitor
shall not settle or compromise any third-party claim for which the Indemnified
Party seeks indemnification in respect of an indemnifiable claim hereunder, or
consent to entry of any judgment in litigation arising from such a claim,
without obtaining from the third party claimant a release of the Indemnified
Party from all liability in respect of such claim or litigation.
(c) If the Indemnitor does not elect to assume control or
otherwise participate in the defense of any third party claim or does not
assume control promptly upon notice thereof, the Indemnified Party may, but
shall have no obligation to, defend or settle such claim or litigation in such
manner as it deems appropriate, and in any event Indemnitor shall be bound by
the results obtained by the Indemnified Party with respect to the claim (by
default or otherwise) and shall promptly reimburse the Indemnified Party for
the amount of all losses, liabilities, claims and expenses (including the
amount of any judgment rendered), legal or otherwise, incurred in connection
with such claim or litigation. The Indemnitor shall be subrogated to all
rights of the Indemnified Party against any third party with respect to any
claim for which indemnity was paid.
16.3. LIMITATIONS. Neither party shall be required to indemnify the
other party under this Article 16 for any breach of any representation or
warranty contained in this Agreement
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unless written notice of a claim under this Article 16 was received by the
party within the pertinent survival period specified in Article 17 of this
Agreement.
ARTICLE 17
REMEDIES; SURVIVAL
17.1. REMEDIES.
(a) In the event of material breach of this Agreement, the
non-defaulting party shall be entitled to obtain specific performance of the
terms of this Agreement, subject, however, to the termination rights specified
in Article 15 hereof. In any action to specifically enforce the provisions of
this Agreement, the defaulting party shall waive the defense that there is an
adequate remedy at law or equity and shall agree that the non-defaulting party
shall have the right to obtain specific performance of the terms of this
Agreement without being required to prove actual damages, post bond or furnish
other security. In addition, the non-defaulting party shall be entitled to
obtain from the defaulting party court costs and reasonable attorneys' fees
incurred by it in enforcing its rights hereunder if it substantially prevails
in its claim.
(b) If the transactions contemplated by this Agreement are not
consummated as a result of Buyer's material breach and QED is not also in
material breach hereunder, QED, at its option, in lieu of obtaining specific
performance under Section 17.1(a) hereof, shall be entitled to payment of the
WQED Escrow Deposit in the amount of One Million Seven Hundred Fifty Thousand
Dollars ($1,750,000) and all interest earned thereon, as liquidated damages and
as QED's exclusive remedy in settlement of any damages of any nature or kind
that QED may suffer or allege to suffer as a result thereof. It is understood
and agreed that the amount of liquidated damages represents Buyer's and QED's
reasonable estimate of actual damages and does not constitute a penalty.
17.2. SURVIVAL. Survival of the representations, warranties,
covenants, indemnities and agreements contained in this Agreement or in any
certificate, document or instrument delivered pursuant to this Agreement shall
be governed at all times by the provisions set forth in Article 17 of the
Exchange Agreement. Any investigation by or on behalf of any party hereto
shall not constitute a waiver as to enforcement of any representation,
warranty, covenant or agreement contained herein.
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ARTICLE 18
OTHER PROVISIONS
18.1. CONDITION TO THE OBLIGATIONS OF QED AND BUYER.
(a) The parties have executed this Agreement subject to the
subsequent approval by QED's Board of Trustees of the execution, delivery and
performance hereof and of the Exchange Agreement, and to the delivery by QED to
Buyer and Cornerstone of the Certified Consent. If QED determines that it is
necessary or advisable to hold a public meeting in connection with the approval
by the QED Board of Trustees of such execution, delivery and performance, such
public meeting shall be held as soon as practicable following the date hereof.
Subject to the parties' rights under Article 15 hereof, QED shall seek to
obtain such consent and deliver to Buyer and Cornerstone the Certified Consent
as soon as practicable following the public meeting. Upon the delivery to
Buyer of the Certified Consent, the condition to the obligations of QED and
Buyer set forth in this Section 18.1(a) shall be deemed satisfied for all
purposes under this Agreement, and QED shall not be permitted to rescind or
revoke the QED Consent or deny or repudiate the satisfaction of such condition
for any reason whatsoever.
(b) Buyer shall not be required to place the WQED Escrow
Deposit or the Cornerstone Escrow Deposit in escrow with the Escrow Agent until
the second business day following delivery to Buyer of the Certified Consent.
(c) From the date hereof until termination of this Agreement
in accordance with the terms of Article 15 hereof, neither QED, any affiliate
of QED nor any principal, officer, trustee, employee, representative or agent
of QED or of any affiliate of QED shall directly or indirectly (a) solicit,
initiate, encourage or respond in any substantive manner to any proposal or
offer from any person relating to any acquisition or purchase of all or any
substantial amount of the WQEX Assets, or any equity interest in station WQEX,
or any other transaction that is materially inconsistent with the terms of this
Agreement or the Exchange Agreement, or (b) participate in any discussions or
negotiations regarding, or furnish to any person any information with respect
to, or otherwise cooperate in any way with, or assist or participate in,
facilitate or encourage, any effort or attempt by any person to do or seek any
of the foregoing.
18.2. BENEFIT AND ASSIGNMENT. Subject to satisfaction of the
condition set forth in Section 18.1 hereof, this Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors and permitted assigns. Neither party may assign this Agreement, in
whole or in part, without the prior written consent of Cornerstone and the
other party hereto, except that either party may assign its rights hereunder or
under
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the Exchange Agreement without such consent to any person or entity that is
controlling, controlled by or under common control with the named person or
entity so long as such assignment does not impose any delay or loss of file
number with respect to any of the FCC Applications.
18.3. ACCESS TO CHANNEL 40. Between the date of this Agreement and
the Closing Date, QED shall use its best efforts to insure that Cornerstone
provides Buyer with the rights of access to the Channel 40 Assets set forth in
Section 8.8 of the Exchange Agreement.
18.4. CONFIDENTIALITY. Except for QED's notification obligation to
Cornerstone pursuant to Section 9.2 of the Exchange Agreement, Buyer and QED
shall each keep confidential all information obtained by it with respect to the
other in connection with this Agreement, and if the transactions contemplated
hereby are not consummated for any reason, neither shall at any time utilize,
directly or indirectly, or disclose to any person any such information, and
each shall return to the other, without retaining a copy thereof, any
schedules, documents or other written information, including all financial
information, obtained from the other in connection with this Agreement and the
transactions contemplated hereby, except where such information is known or
available through other lawful sources or where such party is advised by
counsel that its disclosure is required in accordance with applicable law.
Except as required by the FCC in connection with the filing of the FCC
Applications, or by any other agency, court, or other authority with
jurisdiction over the transactions proposed herein, or by any statute, law,
rule or regulation applicable to the parties or the transactions proposed
herein, including disclosure requirements under securities laws and regulations
and rules of securities markets, there shall be no public announcement relating
to this Agreement or the transactions proposed herein without the prior consent
of Buyer, QED and Cornerstone.
18.5. ENTIRE AGREEMENT; NO IMPLIED WAIVER. This Agreement and the
Exchange Agreement and the exhibits hereto and thereto embody the entire
agreement and understanding of the parties hereto and supersede any and all
prior agreements, arrangements and understandings relating to the matters
provided for herein. No amendment, waiver of compliance with any provision or
condition hereof, or consent pursuant to this Agreement shall be effective
unless evidenced by an instrument in writing signed by the party against whom
enforcement of any waiver, amendment, change, extension or discharge is sought.
No waiver of compliance with any provision or condition hereof shall constitute
a waiver of any other provision or condition, or create an obligation to
continue any prior waiver in effect.
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18.6. HEADINGS. The headings set forth in this Agreement are for
convenience only and will not control or affect the meaning or construction of
the provisions of this Agreement.
18.7. GOVERNING LAW. The construction and performance of this
Agreement shall be governed by the laws of the Commonwealth of Pennsylvania
without regard to its principles of conflict of law.
18.8. NOTICES. Any notice, demand or request required or permitted
to be given under the provisions of this Agreement shall be in writing,
addressed to the following addresses, or to such other address as any party may
request in writing, with a required copy to Cornerstone at the addresses set
forth in the Exchange Agreement.
If to QED:
Xxxxxx X. Xxxxx, Xx.
Chief Executive Officer
WQED Pittsburgh
0000 Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
With a copy, which shall not constitute notice, to:
Xxxxxxxxx, Xxxxxx & Xxxxxx
0000 X Xxxxxx, X.X.
Xxxxx 000
Xxxxxxxxxx, X.X. 00000
Attention: Xxxxxx X. Xxxxxx, Esq.
If to Buyer:
Xxxxxx X. Xxxxxx
Xxxxxx Communications Corporation
000 Xxxxxxxxxx Xxxx Xxxx
Xxxx Xxxx Xxxxx, XX 00000
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With a copy, which shall not constitute notice, to:
Xxxx X. Xxxxx, Xx., Esq.
Dow, Xxxxxx & Xxxxxxxxx, PLLC
Suite 800
0000 Xxx Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx, XX 00000
Any such notice, demand or request shall be deemed to have been duly delivered
and received (i) on the date of personal delivery, or (ii) on the date of
receipt, if mailed by registered or certified mail, postage prepaid and return
receipt requested, or (iii) on the date of a signed receipt, if sent by an
overnight delivery service, but only if sent in the same manner to all persons
entitled to receive notice or a copy.
18.9. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which will be deemed an original and all of which
together will constitute one and the same instrument.
18.10. FURTHER ASSURANCES. The parties shall take any actions and
execute any other documents that may be reasonably necessary or desirable to
the implementation and consummation of this Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the date first written above.
ATTEST WQED PITTSBURGH
/s/ /s/ Xxxxxx X. Xxxxx, Xx.
By: ____________________________ By: _______________________________
Name: Xxxxxx X. Xxxxx, Xx.
Title: President and Chief
Executive Officer
ATTEST XXXXXX COMMUNICATIONS OF
PITTSBURGH-40, INC.
/s/ /s/ Xxxxxx X. Xxxxxx
By: ____________________________ By: _______________________________
Name: Xxxxxx X. Xxxxxx
Title: Chairman
