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EXHIBIT 2.2
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (this "AGREEMENT") is made as of January
31, 2001, among XXXXX ACQUISITION COMPANY, a Delaware corporation ("SAC"), XXXXX
ACQUISITION LICENSE COMPANY, a Delaware corporation ("SAC LICENSEE", together
with SAC, "XXXXX"), STC BROADCASTING, INC., a Delaware corporation ("STCB"), and
STC LICENSE COMPANY, a Delaware corporation ("STC LICENSEE", together with STCB,
"STC"), and LIN TELEVISION CORPORATION, a Delaware corporation ("BUYER").
RECITALS
X. Xxxxx owns television broadcast station WNAC-TV, Providence, Rhode
Island (the "STATION"), pursuant to certain authorizations issued by the Federal
Communications Commission (the "FCC").
B. Pending approval by the FCC, SAC shall be merged with and into STCB
and SAC Licensee shall be merged with and into STC Licensee (collectively, the
"MERGERS"). The term "SELLER" as used in this Agreement shall refer to Xxxxx
prior to the consummation of the Mergers and to STC from and after the
consummation of the Mergers.
C. STC has entered into an Asset Purchase Agreement (the "WPRI PURCHASE
AGREEMENT") dated as of November 3, 2000, with Clear Channel Broadcasting, Inc.
and Clear Channel Broadcasting, Licenses, Inc. (together, "CLEAR CHANNEL"),
pursuant to which Clear Channel has agreed to sell to STC, and STC has agreed to
acquire from Clear Channel, the assets of WPRI-TV, Providence, Rhode Island
("WPRI").
D. The WPRI Purchase Agreement contemplates that STC will assign the
FCC license for the Station and certain related assets to an FCC qualified
assignee in order to permit STC to acquire WPRI in compliance with FCC rules and
regulations.
E. Subject to the terms and conditions set forth herein, Buyer, an FCC
qualified assignee, desires to acquire from Seller the FCC license for the
Station and certain related assets described herein.
AGREEMENT
NOW, THEREFORE, taking the foregoing into account, and in consideration
of the mutual covenants and agreements set forth herein, the parties, intending
to be legally bound, hereby agree as follows:
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ARTICLE 1: PURCHASE OF ASSETS
1.1. CONVEYED ASSETS. On the terms and subject to the conditions
hereof, on the Closing Date (defined below), Seller shall sell, assign,
transfer, convey and deliver to Buyer, and Buyer shall purchase and acquire from
Seller, all right, title and interest of Seller in and to the assets,
properties, interests and rights of Seller with respect to the Station to the
extent set forth below and excluding the Excluded Assets as hereafter defined
(the "CONVEYED ASSETS"):
(a) the license issued to Seller by the FCC with respect to
the Station described on SCHEDULE 1.1(a), including any renewals or
modifications thereof between the date hereof and Closing (the "FCC LICENSE");
(b) the tangible personal property specifically set forth on
SCHEDULE 1.1(B) (the "TANGIBLE PERSONAL PROPERTY"); and
(c) Seller's rights as the owner of the Station under the
Joint Marketing and Promotion Agreement (the "LMA") dated June 10, 1996, by and
between Seller (as assignee of WNAC Argyle Television, Inc. and Providence
Argyle Television, Inc.) and Clear Channel Television, Inc.; PROVIDED, that the
Conveyed Assets shall not include the rights acquired by Seller under the LMA
from Clear Channel upon the consummation of the WPRI Purchase Agreement.
The Conveyed Assets shall be transferred to Buyer free and
clear of liens, claims and encumbrances ("LIENS") except for (i) Assumed
Obligations (defined in SECTION 1.3), (ii) liens for taxes not yet due and
payable, and (iii) any Liens released on or prior to the Closing Date
(collectively, "PERMITTED LIENS").
1.2. EXCLUDED ASSETS. Except for those assets specifically identified
in SECTION 1.1, the Conveyed Assets shall not include any other assets,
property, interests or rights of any kind or description which are used or held
for use (in whole or in part) in the operation of the Station or any other
station of Seller (the "EXCLUDED ASSETS"). The Excluded Assets shall remain the
property of Seller.
1.3. ASSUMPTION OF OBLIGATIONS. On the Closing Date, Buyer shall assume
the obligations of Seller set forth on SCHEDULE 1.3 (the "ASSUMED OBLIGATIONS")
arising after Closing with respect to the Conveyed Assets. Buyer does not assume
or agree to discharge or perform, and will not be deemed by reason of the
execution and delivery of this Agreement or the consummation of the transactions
contemplated hereby, to have assumed or to have agreed to discharge or perform,
and Seller shall remain liable for, any liabilities, obligations or commitments
of Seller arising from the business or operation of the Station before Closing,
or any other obligations or liabilities other than the Assumed Obligations.
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1.4. PURCHASE PRICE. In consideration for the sale of the Conveyed
Assets to Buyer, in addition to the assumption of the Assumed Obligations, Buyer
shall at Closing (defined below) deliver to Seller by wire transfer of
immediately available funds, the sum of Two Million, Five Hundred Thousand
Dollars ($2,500,000) (the "PURCHASE Price").
1.5. ALLOCATION. Buyer and Seller will allocate the Purchase Price in
accordance with the respective fair market values of the Conveyed Assets and the
goodwill being purchased and sold in accordance with the requirements of Section
1060 of the Internal Revenue Code of 1986, as amended (the "CODE"). The
allocation shall be determined by mutual agreement of the parties. Buyer and
Seller agree to file their federal income tax returns and their other tax
returns reflecting such allocation and to use such allocation for accounting and
financial reporting purposes.
1.6. CLOSING. The consummation of the sale and purchase of the Conveyed
Assets provided for in this Agreement (the "CLOSING") shall take place on the
same day as the closing date under the WPRI Purchase Agreement, subject to the
satisfaction or waiver of the last of the conditions required to be satisfied or
waived pursuant to ARTICLES 6 and 7 below (other than those requiring a delivery
of a certificate or other document, or the taking of other action, at the
Closing). Alternatively, the Closing may take place at such other place, time or
date as the parties may mutually agree upon in writing. The date on which the
Closing is to occur is referred to herein as the "CLOSING DATE."
1.7. LMA. As of the Closing, the LMA shall remain in full force and
effect, with Seller as the owner of WPRI and Buyer as the owner of the Station;
PROVIDED, that, effective as of the Closing Date, certain revenue rights and
expense obligations pursuant to the LMA shall be adjusted as provided in EXHIBIT
A to this Agreement. If for any reason (other than for a willful breach of the
LMA by Buyer) the LMA is terminated while Buyer is the owner of the Station,
Seller shall be responsible for all costs, expenses and reimbursements due to
Buyer under this Agreement including, but not limited to such costs, expenses
and reimbursements provided for in EXHIBIT A to this Agreement as if the LMA was
still in effect.
1.8. SELLER'S CALL RIGHT. At any time after the Closing, Seller shall
be entitled to provide written notice to Buyer (the "CALL NOTICE") of its
election to repurchase the Conveyed Assets from Buyer in consideration for Two
Million Five Hundred Thousand Dollars ($2,500,000) (the "PUT/CALL AMOUNT"). The
Call Notice shall constitute an irrevocable offer to purchase the Conveyed
Assets from Buyer, and upon receipt of the Call Notice, Buyer shall be
irrevocably obligated to sell the Conveyed Assets to Seller (or Seller's
designee identified in the Call Notice) in consideration for the Put/Call
Amount, subject to receipt of all required regulatory approvals, including the
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consent of the FCC to transfer the FCC License from Buyer to Seller (or Seller's
designee). The closing of the purchase and sale of the Conveyed Assets to Seller
(or Seller's designee) pursuant to this SECTION 1.8 shall occur within a
reasonable time following the date upon which all such required regulatory
approvals have been obtained and Buyer shall assist Seller in obtaining such
required regulatory approvals.
1.9. BUYER'S PUT RIGHT. If at any time after the Closing (a) Buyer
shall determine in its sole reasonable discretion that the ownership of the
Conveyed Assets or the operation of the Station proves detrimental for
regulatory reasons (including, without limitation, a rule, regulation, or order
of the FCC requiring Buyer to divest or transfer the Conveyed Assets) or
business reasons and (b) the ownership/operation of the Station by Seller (or
one of its affiliates) would not be prohibited by FCC rules or regulations,
Buyer shall be entitled to provide written notice (the "PUT NOTICE") of its
election to sell the Conveyed Assets to Seller (or Seller's designee) in
consideration for the Put/Call Amount. The Put Notice shall constitute an
irrevocable offer to sell the Conveyed Assets to Seller (or Seller's designee),
and upon receipt of the Put Notice, Seller shall be irrevocably obligated to
purchase (or have Seller's designee purchase) the Conveyed Assets from Buyer in
consideration for the Put/Call Amount, subject to receipt of all required
regulatory approvals, including the consent of the FCC to transfer the FCC
License from Buyer to Seller (or Seller's designee). The closing of the sale of
the Conveyed Assets pursuant to this SECTION 1.9 shall occur within a reasonable
time following the date upon which all such required regulatory approvals are
obtained and Seller shall assist Buyer in obtaining such required regulatory
approvals.
1.10. SALE BY BUYER. If at any time after the Closing (a) Buyer shall
determine in its sole reasonable discretion that the ownership of the Conveyed
Assets or the operation of the Station proves detrimental for regulatory reasons
(including, without limitation, a rule, regulation, or order of the FCC
requiring Buyer to divest or transfer the Conveyed Assets) or business reasons
and (b) Buyer's put right set forth in SECTION 1.9 is not available to Buyer
because the condition set forth in SECTION 1.9(B) is not satisfied at such time,
then Buyer shall have the right to sell, transfer or otherwise dispose of the
Conveyed Assets subject to and in accordance with the terms and conditions of
this SECTION 1.10. Buyer shall provide Seller written notice (the "SALE NOTICE")
of its intent to exercise the rights granted to it in this SECTION 1.10. Seller
shall have thirty (30) days after receiving the Sale Notice to identify a
purchaser of the Conveyed Assets or to provide an alternative business
transaction to address (to the satisfaction of Buyer) all of Buyer's regulatory
or business concerns (the "PROPOSED TRANSACTION"). If (x) Seller shall not have
provided the Proposed Transaction within thirty (30) days after receiving the
Sale Notice or (y) the Proposed Transaction shall not have been consummated
within one hundred fifty (150) days after Seller's receipt of the Sale Notice,
then if Buyer's regulatory or business concerns still exist and Buyer's put
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right set forth in SECTION 1.9 is not available to Buyer because the condition
set forth in SECTION 1.9(B) is not satisfied at such time, then Buyer shall have
the right to sell, transfer or otherwise dispose of the Conveyed Assets to an
unrelated third party and Seller shall pay to Buyer the amount by which the
Put/Call Amount exceeds the amount received by Buyer in connection with such
sale, transfer or disposition (the "DEFICIENCY Amount"). Seller's call right set
forth in SECTION 1.8 and Buyer's put right set forth in SECTION 1.9 shall
terminate upon the sale, transfer, or other disposition of the Conveyed Assets
pursuant to this SECTION 1.10.
ARTICLE 2: SELLER REPRESENTATIONS AND WARRANTIES
Seller makes the following representations and warranties to Buyer as
of the date hereof and again as of the Closing Date:
2.1. ORGANIZATION AND STANDING. Seller is duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization (as first set forth above), and is qualified to do business in each
jurisdiction in which the Conveyed Assets are located. Seller has the requisite
power and authority to execute and deliver this Agreement and all of the other
agreements and instruments to be executed and delivered by Seller pursuant
hereto (collectively, the "SELLER ANCILLARY AGREEMENTS"), to consummate the
transactions contemplated hereby and thereby and to comply with the terms,
conditions and provisions hereof and thereof.
2.2. AUTHORIZATION. The execution, delivery and performance of this
Agreement and the Seller Ancillary Agreements by Seller have been duly
authorized and approved by all necessary action of Seller and do not require any
further authorization or consent of Seller. This Agreement is, and each Seller
Ancillary Agreement when executed and delivered by Seller and the other parties
thereto will be, a legal, valid and binding agreement of Seller enforceable in
accordance with its respective terms, except in each case as such enforceability
may be limited by bankruptcy, moratorium, insolvency, reorganization or other
similar laws affecting or limiting the enforcement of creditors' rights
generally and except as such enforceability is subject to general principles of
equity.
2.3. NO CONFLICTS. Neither the execution and delivery by Seller of this
Agreement and the Seller Ancillary Agreements nor the consummation by Seller of
any of the transactions contemplated hereby or thereby nor compliance by Seller
with or fulfillment by Seller of the terms, conditions and provisions hereof or
thereof will conflict with any organizational documents of Seller or any law,
judgment, order, or decree to which Seller is subject or require the approval,
consent, authorization or act of, or the making by Seller of any declaration,
filing or registration with, any third party or any foreign, federal, state or
local court, governmental or regulatory authority or body, except the FCC
Consent.
2.4. FCC LICENSE. Seller is the holder of the FCC License described on
SCHEDULE 1.1(a). The FCC License is in full force and effect and has not been
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revoked, suspended, canceled, rescinded or terminated and has not expired. There
is not pending any action by or before the FCC to revoke, suspend, cancel,
rescind or materially adversely modify the FCC License (other than proceedings
to amend FCC rules of general applicability), and there is not now issued or
outstanding, by or before the FCC, any order to show cause, notice of violation,
notice of apparent liability, complaint or notice of forfeiture against Seller
with respect to the Station. The Station is operating in compliance in all
material respects with the FCC License, the Communications Act of 1934, as
amended (the "COMMUNICATIONS ACT"), and the rules, regulations and policies of
the FCC.
2.5. TAXES. Seller has, in respect of the Station's business, filed all
foreign, federal, state, county and local income, excise, property, sales, use,
franchise and other tax returns and reports which are required to have been
filed by it under applicable law and has paid all taxes which have become due
pursuant to such returns or pursuant to any assessments which have become
payable.
2.6. PERSONAL PROPERTY. Seller has good and marketable title to the
Tangible Personal Property free and clear of Liens other than Permitted Liens.
All items of Tangible Personal Property are in good operating condition and
adequate repair (ordinary wear and tear excepted).
2.7. EMPLOYEES. Seller has complied in all material respects with all
labor and employment laws, rules and regulations applicable to the Station's
business, including without limitation those which relate to prices, wages,
hours, discrimination in employment and collective bargaining. There is no (a)
unfair labor practice charge or complaint against Seller in respect of the
Station's business pending or threatened before the National Labor Relations
Board, any state labor relations board or any court or tribunal, or (b) strike,
dispute, request for representation, slowdown or stoppage pending or threatened
in respect of the Station's business. Seller has withheld and paid, when and as
required, all payroll, social security, and related taxes and obligations that
it is required to withhold and pay in connection with its employment of all of
the Transferred Employees (as defined in SECTION 5.6 hereof).
2.8. INSURANCE. Seller maintains insurance policies with respect to the
Station and the Conveyed Assets consistent with its practices for other
stations, and will maintain such policies until Closing. All premiums for such
policies have been paid as billed to date and Seller is in compliance in all
material respects with the terms of such policies.
2.9. COMPLIANCE WITH LAW. Seller has complied in all material respects
with all laws, regulations, rules, writs, injunctions, ordinances, franchises,
decrees or orders of any court or of any foreign, federal, state, municipal or
other governmental authority which are applicable to the operation of the
Station including filing all returns, reports, and statements that Seller is
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required to file with the FCC and the Federal Aviation Administration. There is
no action, suit or proceeding pending or threatened against Seller in respect of
the Station that will subject Buyer to liability or which questions the legality
or propriety of the transactions contemplated by this Agreement. To Seller's
knowledge, there are no governmental claims or investigations pending or
threatened against Seller in respect of the Station (except those affecting the
broadcasting industry generally).
2.10. NO FINDER. No broker, finder or other person is entitled to a
commission, brokerage fee or other similar payment in connection with this
Agreement or the transactions contemplated hereby as a result of any agreement
or action of Seller or any party acting on Seller's behalf.
ARTICLE 3: BUYER REPRESENTATIONS AND WARRANTIES
Buyer hereby makes the following representations and warranties to
Seller as of the date hereof and again as of the Closing Date:
3.1. ORGANIZATION AND STANDING. Buyer is duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization (as first set forth above), and is qualified to do business in each
jurisdiction in which the Conveyed Assets are located. Buyer has the requisite
power and authority to execute and deliver this Agreement and all of the other
agreements and instruments to be executed and delivered by Buyer pursuant hereto
(collectively, the "BUYER ANCILLARY AGREEMENTS"), to consummate the transactions
contemplated hereby and thereby and to comply with the terms, conditions and
provisions hereof and thereof.
3.2. AUTHORIZATION. The execution, delivery and performance of this
Agreement and the Buyer Ancillary Agreements by Buyer have been duly authorized
and approved by all necessary action of Buyer and do not require any further
authorization or consent of Buyer. This Agreement is, and each Buyer Ancillary
Agreement when executed and delivered by Buyer and the other parties thereto
will be, a legal, valid and binding agreement of Buyer enforceable in accordance
with its respective terms, except in each case as such enforceability may be
limited by bankruptcy, moratorium, insolvency, reorganization or other similar
laws affecting or limiting the enforcement of creditors' rights generally and
except as such enforceability is subject to general principles of equity.
3.3. NO CONFLICTS. Neither the execution and delivery by Buyer of this
Agreement and the Buyer Ancillary Agreements or the consummation by Buyer of any
of the transactions contemplated hereby or thereby nor compliance by Buyer with
or fulfillment by Buyer of the terms, conditions and provisions hereof or
thereof will conflict with any organizational documents of Buyer or any law,
judgment, order or decree to which Buyer is subject, or require the approval,
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consent, authorization or act of, or the making by Buyer of any declaration,
filing or registration with, any third party or any foreign, federal, state or
local court, governmental or regulatory authority or body, except the FCC
Consent.
3.4. QUALIFICATION. (a) Buyer is legally, financially and otherwise
qualified to be the licensee of, acquire, own and operate the Station under the
Communications Act and the rules, regulations and policies of the FCC, (b) under
existing law and the existing rules, regulations, policies and procedures of the
FCC, Buyer is not disqualified from being an assignee of the FCC License or as
the owner and operator of the Station, (c) no waiver of any FCC rule or policy
is necessary for the FCC Consent to be obtained, and (d) there is no action,
suit or proceeding pending or, to the knowledge of Buyer, threatened against
Buyer which questions the legality or propriety of the transactions contemplated
by this Agreement or could materially adversely affect the ability of Buyer to
perform its obligations hereunder.
3.5. NO FINDER. No broker, finder or other person is entitled to a
commission, brokerage fee or other similar payment in connection with this
Agreement or the transactions contemplated hereby as a result of any agreement
or action of Buyer or any party acting on Buyer's behalf.
ARTICLE 4: SELLER COVENANTS
4.1. SELLER'S COVENANTS. Seller covenants and agrees with respect to
the Station that, between the date hereof and the Closing Date, except as
permitted by this Agreement or with the prior written consent of Buyer, which
shall not be unreasonably withheld, Seller shall:
(a) operate the Station in the ordinary course of business
consistent with past practice and in all material respects in accordance with
FCC rules and regulations and with all other applicable laws, regulations, rules
and orders and the LMA;
(b) not, sell, lease or dispose of or agree to sell, lease or
dispose of any of the Conveyed Assets, or create, assume or permit to exist any
Liens upon the Conveyed Assets, except for Permitted Liens;
(c) not, enter into any employment agreement with or amend or
modify the compensation and benefits payable to any employee of Seller with
respect to the Station;
(d) maintain the existing insurance policies on the Conveyed
Assets or other policies providing substantially similar coverages until the
Closing Date;
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(e) upon reasonable notice, give Buyer reasonable access
during normal business hours to the Conveyed Assets, and furnish Buyer with
information relating to the Conveyed Assets that Buyer may reasonably request;
PROVIDED that such rights of Buyer under this SECTION 4.1(E) shall not be
exercised in such a manner as to interfere unreasonably with the business of the
Station; and
(f) not breach in any material respect its representations and
warranties set forth in ARTICLE 2.
ARTICLE 5: JOINT COVENANTS
Buyer and Seller hereby covenant and agree that between the date hereof
and Closing:
5.1. CONFIDENTIALITY.
(a) Subject to the requirements of applicable law and except
as provided in SECTION 5.1(B), Buyer and Seller shall each keep confidential all
information obtained by it with respect to the other parties hereto in
connection with this Agreement and the negotiations preceding this Agreement
("CONFIDENTIAL INFORMATION"); PROVIDED that, the parties hereto may furnish such
Confidential Information to their employees, agents and representatives who
reasonably need to know such Confidential Information (including their financial
and legal advisers, their banks and other lenders) (collectively,
"REPRESENTATIVES"); PROVIDED, HOWEVER, the disclosing party shall be responsible
for all actions or omissions of such Representatives with regard to
Representatives' breach of this SECTION 5.1. Each party hereto shall, and shall
cause each of such party's Representatives to, use the Confidential Information
solely in connection with the transactions contemplated by this Agreement, and
not for any competitive purpose or advantage detrimental to the other party
hereto or any of its affiliates. If the transactions contemplated hereby are not
consummated for any reason, each party shall (i) return to such other party
hereto, without retaining a copy thereof, any schedules, documents or other
written information (and any derivative work product) obtained from such other
party in connection with this Agreement and the transactions contemplated
hereby, and (ii) provide, upon request, a written confirmation that all
Confidential Information (and derivative work product) has been returned to the
other party, and that the Confidential Information was used solely in connection
with the transactions contemplated by this Agreement.
(b) No party shall be required to keep confidential or return
any Confidential Information which: (i) is known or available through other
lawful sources, not bound by a confidentiality agreement with the disclosing
party; (ii) is or becomes publicly known through no fault of the receiving party
or its agents; (iii) is required to be disclosed pursuant to an order or request
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of a judicial or governmental authority (provided the disclosing party is given
reasonable prior notice of the order or request and the purpose of the
disclosure); or (iv) is developed by the receiving party independently of the
disclosure by the disclosing party. Seller and its affiliates may, in accordance
with their respective legal obligations (including but not limited to filings
permitted or required by the applicable securities laws or any securities
market) make such filings and public statements and announcements as necessary
or appropriate in connection with this Agreement and the transactions
contemplated hereby.
5.2. COOPERATION. Subject to express limitations contained elsewhere
herein, each party (a) shall cooperate fully with one another in taking any
reasonable actions (including without limitation, reasonable actions to obtain
the required consent of any governmental instrumentality or any third party)
necessary or helpful to accomplish the transactions contemplated by this
Agreement, including but not limited to the prompt satisfaction of any condition
to Closing set forth herein, (b) shall not take any action that conflicts with
its obligations hereunder or that causes its representations and warranties to
become untrue in any material respect, and (c) shall not take any action that
would materially hinder or otherwise materially delay the consummation of the
transactions contemplated in SECTIONS 1.8, 1.9, and 1.10.
5.3. CONTROL OF STATION. Buyer shall not, directly or indirectly,
control, supervise or direct the operations of the Station prior to the Closing
Date. Consistent with FCC rules, control, supervision and direction of all
Station operations prior to the Closing Date shall remain the responsibility of
Seller as the holder of the FCC License.
5.4. FCC APPLICATION. As soon as reasonably practicable (but in no
event later than five (5) business days after the date of this Agreement) Seller
and Buyer shall file an application with the FCC requesting the FCC's written
consent to the assignment of the FCC License from Seller to Buyer pursuant to
this Agreement. Seller and Buyer shall thereafter prosecute such application
with commercially reasonable diligence and otherwise use their commercially
reasonable efforts to obtain a favorable conclusion with regard to such
application. Each party shall promptly provide the other with a copy of any
pleading, order or other document served on it relating to such applications,
shall furnish all information required by the FCC, and shall be represented at
all meetings or hearings scheduled to consider such applications. The FCC's
written consent to the assignment of the FCC License contemplated hereby is
referred to herein as the "FCC CONSENT." Seller and Buyer each agree to comply
with any condition imposed on them by any FCC Consent, except that neither shall
be required to comply with a condition if such condition requires such party to
divest any of its direct or indirect assets. Buyer and Seller shall oppose any
petitions to deny or other objections filed with respect to the application for
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any FCC Consent and any requests for reconsideration or review of any FCC
Consent. If the Closing shall not have occurred for any reason within the
original effective period of any FCC Consent, and neither party shall have
terminated this Agreement pursuant to its right under SECTION 10.1 hereof, the
parties shall jointly request an extension of the effective period of such FCC
Consent. No extension of the effective period of any FCC Consent shall limit the
exercise by either party of its right to terminate the Agreement under SECTION
10.1 hereof.
5.5. UPDATED SCHEDULES. Seller shall promptly disclose in writing to
Buyer, and Buyer shall promptly disclose in writing to Seller, any information
contained in their respective representations and warranties or any of the
Schedules hereto which, because of an event occurring after the date of this
Agreement, is incomplete or is no longer correct such that the respective
conditions set forth in SECTION 7.1 or SECTION 6.1, as the case may be, would
not be satisfied.
5.6. EMPLOYEES.
(a) At Closing, Buyer shall hire the two (2) employees at the
Station to be designated in writing by Seller prior to the Closing Date (the
"TRANSFERRED EMPLOYEES") at their current salaries. With respect to the
Transferred Employees, to the extent permitted by law, Seller shall provide
Buyer access to its personnel records and such other information as Buyer may
reasonably request prior to Closing. With respect to the Transferred Employees,
Seller shall be responsible for the payment of all compensation and accrued
employee benefits payable by it until Closing and thereafter Buyer shall be
responsible for all compensation obligations payable by it. To the extent
permitted by law and in accordance with Buyer's business practice, Buyer shall
cause Transferred Employees to be eligible to participate in its "employee
welfare benefit plans" and "employee pension benefit plans" (as defined in
Sections 3(1) and 3(2) of ERISA, respectively) in which similarly situated
employees are generally eligible to participate; PROVIDED, HOWEVER, that the
Transferred Employees and their spouses and dependents shall be eligible for
coverage under Buyer's welfare benefit plans immediately after Closing (and
shall not be excluded from coverage on account of any pre-existing condition).
To the extent applicable, for purposes of any length of service requirements,
waiting periods, vesting periods or differential benefits based on length of
service in any such plan for which the Transferred Employees may be eligible
after Closing, Buyer shall treat that service with Seller or any prior owner of
the Station or WPRI as equivalent to service with Buyer. In addition and to the
extent permitted by law, Buyer shall ensure that each Transferred Employee
receives credit under any welfare benefit plan of Buyer for any deductibles or
co-payments paid by such Transferred Employee and dependents for the current
plan year under a plan maintained by Seller. Buyer shall grant credit to each
Transferred Employee for all unused sick leave accrued as of Closing as an
employee of Seller. Buyer shall discharge Seller's obligations for the payment
of all unused vacation leave accrued by the Transferred Employees as of Closing;
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PROVIDED that Seller shall reimburse Buyer for such payments in accordance with
EXHIBIT A.
(b) As of the Closing Date and to the extent permitted by law,
Buyer shall cause its 401(k) plan to permit Transferred Employees who
participate in the Seller's 401(k) plan to elect to make direct rollovers of
their account balances in Seller's 401(k) plan into the Buyer's 401(k) plan,
including the direct rollover of any outstanding loan balances such that they
will continue to make payments under the terms of such loans under the Buyer's
401(k) plan; PROVIDED, that, such action is in full compliance with the terms of
Buyer's 401(k) plan and all applicable law and regulations, including the Code,
as of the date of the proposed rollover.
ARTICLE 6: SELLER CLOSING CONDITIONS
The obligations of Seller hereunder are, at its option, subject to
satisfaction, at or prior to Closing, of each of the following conditions:
6.1. REPRESENTATIONS, WARRANTIES AND COVENANTS. The representations and
warranties of Buyer made in this Agreement, shall be true and correct in all
material respects at and as of the Closing Date except for changes permitted or
contemplated by the terms of this Agreement, and the covenants and agreements to
be complied with and performed by Buyer at or prior to Closing shall have been
complied with or performed in all material respects. Seller shall have received
a certificate dated as of the Closing Date from Buyer executed by an authorized
officer of Buyer, to the effect that the conditions set forth in this Section
have been satisfied.
6.2. FCC CONSENT. The FCC Consent shall have been obtained, and no
court or governmental order prohibiting Closing shall be in effect.
6.3. WPRI ACQUISITION. The Closing (as defined in the WPRI Purchase
Agreement) shall have occurred or shall be occurring simultaneously with the
Closing under this Agreement.
6.4. NO PROHIBITIONS. No injunction, restraining order or decree of any
nature of any governmental authority of competent jurisdiction shall be in
effect that restrains or prohibits Seller or Buyer from consummating the
transactions contemplated by this Agreement.
ARTICLE 7: BUYER CLOSING CONDITIONS
The obligations of Buyer hereunder are, at its option, subject to
satisfaction, at or prior to Closing, of each of the following conditions:
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7.1. REPRESENTATIONS, WARRANTIES AND COVENANTS. The representations and
warranties of Seller made in this Agreement shall be true and correct in all
material respects at and as of the Closing Date except for changes permitted or
contemplated by the terms of this Agreement, and the covenants and agreements to
be complied with and performed by Seller at or prior to Closing shall have been
complied with or performed in all material respects. Buyer shall have received a
certificate dated as of the Closing Date from Seller, executed by an authorized
officer of Seller to the effect that the conditions set forth in this Section
have been satisfied.
7.2. FCC CONSENT. The FCC Consent shall have been obtained, and no
court or governmental order prohibiting Closing shall be in effect.
7.3. RELATED TRANSACTIONS. The "Closing" as defined in the WPRI
Purchase Agreement and the "Closing" as defined in the Loan Agreement between
STCB and Buyer of even date herewith shall have occurred or shall be occurring
simultaneously with the Closing under this Agreement.
7.4. NO PROHIBITIONS. No injunction, restraining order or decree of any
nature of any governmental authority of competent jurisdiction shall be in
effect that restrains or prohibits Seller or Buyer from consummating the
transactions contemplated by this Agreement.
ARTICLE 8: CLOSING DELIVERIES
8.1. SELLER DOCUMENTS. At Closing, Seller shall deliver or cause to be
delivered to Buyer:
(a) certified copies of resolutions authorizing its execution,
delivery and performance of this Agreement, including the consummation of the
transactions contemplated hereby;
(b) the certificate described in SECTION 7.1;
(c) one hundred thousand dollars ($100,000) by wire transfer
of immediately available funds to an account designated by Buyer in payment of
the first annual installment of the LMA Fee provided for in EXHIBIT A which
payment shall be nonrefundable; and
(d) such bills of sale, assignments and other instruments of
conveyance, assignment and transfer as may be necessary to convey, transfer and
assign the Conveyed Assets to Buyer, free and clear of Liens, except for
Permitted Liens.
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8.2. BUYER DOCUMENTS. At Closing, Buyer shall deliver or cause to be
delivered to Seller:
(a) the certified copies of resolutions authorizing its
execution, delivery and performance of this Agreement, including the
consummation of the transactions contemplated hereby;
(b) the certificate described in SECTION 6.1;
(c) such documents and instruments of assumption as may be
necessary to assume the Assumed Obligations; and
(d) the Purchase Price in accordance with SECTION 1.4 hereof.
ARTICLE 9: SURVIVAL; INDEMNIFICATION
9.1. SURVIVAL. The covenants, agreements, representations and
warranties in this Agreement shall survive Closing for a period of two (2) years
from the Closing Date or the period during which the LMA remains in effect,
whichever is greater, whereupon they shall expire and be of no further force or
effect, except those under (a) this SECTION 9.1 that relate to Damages (defined
below) for which written notice is given by the indemnified party to the
indemnifying party prior to the expiration, which shall survive until resolved
and (b) SECTIONS 1.3 (Assumed Obligations), 1.5 (Allocation), 1.7 (LMA), 1.8
(Seller's Call Right), 1.9 (Buyer's Put Right), 1.10 (Sale by Buyer) and 10.3
(Expenses), and indemnification obligations with respect to such provisions,
which shall survive until performed.
9.2. INDEMNIFICATION.
(a) From and after Closing, Seller shall defend, indemnify
and hold harmless Buyer from and against any and all losses, costs, damages,
claims, suits, actions, judgments, liabilities and expenses, including
reasonable attorneys' fees and expenses ("DAMAGES") incurred by Buyer arising
out of or resulting from: (i) any inaccuracy in or breach or nonfulfillment of
any of the representations, warranties, covenants, or agreements made by Seller
in this Agreement or default by Seller under this Agreement; (ii) the business
or operation of the Station or ownership of the Station before the Closing Date;
or (iii) any taxes owed by Seller for any period prior to the Closing Date.
(b) From and after Closing, Buyer shall defend, indemnify and
hold harmless Seller from and against any and all Damages incurred by Seller
arising out of or resulting from: (i) any inaccuracy in or breach or
nonfulfillment of any of the representations, warranties, covenants, or
agreements made by Buyer in this Agreement or default by Buyer under this
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Agreement; (ii) the Assumed Obligations or the business or operation of the
Station after the Closing Date or (iii) any taxes owed by Buyer for any period
following the Closing Date.
9.3. PROCEDURES. The indemnified party shall give prompt written notice
to the indemnifying party of any demand, suit, claim or assertion of liability
by third parties or other circumstances that could give rise to an
indemnification obligation hereunder against the indemnifying party (a "CLAIM"),
but a failure to give such notice or delaying such notice shall not affect the
indemnified party's right to indemnification and the indemnifying party's
obligation to indemnify as set forth in this Agreement, except to the extent the
indemnifying party's ability to remedy, contest, defend or settle with respect
to such Claim is thereby prejudiced. The obligations and liabilities of the
parties with respect to any Claim shall be subject to the following additional
terms and conditions:
(a) The indemnifying party shall have the right to undertake,
by counsel or other representatives of its own choosing, the defense or
opposition to such Claim.
(b) In the event that the indemnifying party shall elect not
to undertake such defense or opposition, or, within twenty (20) days after
written notice (which shall include sufficient description of background
information explaining the basis for such Claim) of any such Claim from the
indemnified party, the indemnifying party shall fail to undertake to defend or
oppose, the indemnified party (upon further written notice to the indemnifying
party) shall have the right to undertake the defense, opposition, compromise or
settlement of such Claim, by counsel or other representatives of its own
choosing, on behalf of and for the account and risk of the indemnifying party
(subject to the right of the indemnifying party to assume defense of or
opposition to such Claim at any time prior to settlement, compromise or final
determination thereof).
(c) Anything herein to the contrary notwithstanding: (i) the
indemnified party shall have the right, at its own cost and expense, to
participate in the defense, opposition, compromise or settlement of the Claim;
(ii) the indemnifying party shall not, without the indemnified party's written
consent, settle or compromise any Claim or consent to entry of any judgment
which does not include the giving by the claimant to the indemnified party of a
release from all liability in respect of such Claim; and (iii) in the event that
the indemnifying party undertakes defense of or opposition to any Claim, the
indemnified party, by counsel or other representative of its own choosing and at
its sole cost and expense, shall have the right to consult with the indemnifying
party and its counsel or other representatives concerning such Claim and the
indemnifying party and the indemnified party and their respective counsel or
other representatives shall cooperate in good faith with respect to such Claim.
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(d) All claims not disputed shall be paid by the indemnifying
party within thirty (30) days after receiving notice of the Claim. "DISPUTED
CLAIMS" shall mean claims for Damages by an indemnified party which the
indemnifying party objects to in writing within thirty (30) days after receiving
notice of the Claim. In the event there is a Disputed Claim with respect to any
Damages, the indemnifying party shall be required to pay the indemnified party
the amount of such Damages for which the indemnifying party has, pursuant to a
final determination, been found liable within ten (10) days after there is a
final determination with respect to such Disputed Claim. A final determination
of a Disputed Claim shall be (i) a judgment of any court with proper
jurisdiction determining the validity of a Disputed Claim, if no appeal is
pending from such judgment and if the time to appeal therefrom has elapsed; (ii)
an award of any legally binding arbitration proceeding determining the validity
of such disputed claim, if there is not pending any motion to set aside such
award and if the time within which to move to set aside such award has elapsed;
(iii) a written termination of the dispute with respect to such claim signed by
the parties thereto; (iv) a written acknowledgment of the indemnifying party
that it no longer disputes the validity of such claim; or (v) such other
evidence of final determination of a disputed claim as shall be acceptable to
the parties. No undertaking of defense or opposition to a Claim shall be
construed as an acknowledgment by such party that it is liable to the party
claiming indemnification with respect to the Claim at issue or other similar
Claims.
ARTICLE 10: MISCELLANEOUS PROVISIONS
10.1. TERMINATION. This Agreement may be terminated as follows:
(a) by mutual written consent of Buyer and Seller;
(b) at any time prior to Closing, by written notice of Buyer
to Seller if Seller (i) does not satisfy the conditions or perform the
obligations to be satisfied or performed by it on the Closing Date; or (ii)
otherwise breaches in any material respect any of its representations or
warranties or defaults in any material respect in the performance of any of its
covenants or agreements herein contained and such breach or default is not cured
within the Cure Period (defined below);
(c) at any time prior to Closing, by written notice of Seller
to Buyer if Buyer (i) does not satisfy the conditions or perform the obligations
to be satisfied or performed by it on the Closing Date; or (ii) otherwise
breaches in any material respect any of its representations or warranties or
defaults in any material respect in the performance of any of its covenants or
agreements herein contained and such breach or default is not cured within the
Cure Period (defined below); or
(d) automatically upon termination of the WPRI Purchase
Agreement.
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The term "CURE PERIOD" as used herein means a period commencing the
date Buyer or Seller receives from the other written notice of breach or default
hereunder and continuing until the earlier of (i) thirty (30) days thereafter or
(ii) the Closing Date; PROVIDED, HOWEVER, that if the breach or default cannot
reasonably be cured within such period but can be cured before the Closing Date,
and if diligent efforts to cure promptly commence, then the Cure Period shall
continue as long as such diligent efforts to cure continue, but not beyond the
Closing Date. Except as set forth below, the termination of this Agreement shall
not relieve any party of any liability for breach or default under this
Agreement prior to the date of termination. Notwithstanding anything contained
herein to the contrary, SECTION 10.3 shall survive any termination of this
Agreement.
10.2. REMEDIES. The parties recognize that if either party refuses to
consummate the Closing pursuant to the provisions of this Agreement or either
party otherwise breaches or defaults such that the Closing has not occurred
("BREACHING PARTY"), monetary damages alone will not be adequate to compensate
the non-breaching party ("NON-BREACHING PARTY") for its injury. Such
Non-Breaching Party shall therefore be entitled to obtain specific performance
of the terms of this Agreement in lieu of, and not in addition to, any other
remedies, including but not limited to monetary damages, that may be available
to it. If any action is brought by the Non-Breaching Party to enforce this
Agreement, the Breaching Party shall waive the defense that there is an adequate
remedy at law. In the event of a default by the Breaching Party which results in
the filing of a lawsuit for damages, specific performance, or other remedy, the
Non-Breaching Party shall be entitled to reimbursement by the Breaching Party of
reasonable legal fees and expenses incurred by the Non-Breaching Party, provided
that the Non-Breaching Party is successful in such lawsuit.
10.3. EXPENSES. Seller shall pay all reasonably necessary or
appropriate costs and expenses actually incurred by Buyer and Seller in
connection with the negotiation, preparation and consummation of the
transactions contemplated by this Agreement including, but not limited to, all
costs and expenses (a) to obtain FCC approval of the proposed transaction and
any governmental filings, including filings required under the Communications
Act and (b) incurred in connection with the consummation of the transactions
contemplated in SECTIONS 1.8, 1.9 and 1.10. Buyer shall submit statements
regarding such costs and expenses to Seller and Seller shall remit payment to
Buyer or as directed by Buyer within thirty (30) days of receiving such
statement from Buyer.
10.4. FURTHER ASSURANCES. After Closing, Seller shall from time to
time, at the request of and without further cost or expense to Buyer, execute
and deliver such other instruments of conveyance and transfer and take such
other actions as may reasonably be requested in order to more effectively
consummate the transactions contemplated hereby to vest in Buyer good title to
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the Conveyed Assets, and Buyer shall from time to time, at the request of and
without further cost or expense to Seller, execute and deliver such other
instruments and take such other actions as may reasonably be requested in order
more effectively to relieve Seller of any obligations being assumed by Buyer
hereunder.
ARTICLE 11: GENERAL PROVISIONS
11.1. ASSIGNMENT. Neither party may assign this Agreement without the
prior written consent of the other party hereto. This Agreement shall bind and
inure to the benefit of the parties hereto and the respective successors and
permitted assigns of the parties hereto.
11.2. AMENDMENTS. 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.
11.3. 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.
11.4. GOVERNING LAW. The construction and performance of this Agreement
shall be governed by the laws of the State of Delaware without giving effect to
the choice of law provisions thereof.
11.5. NOTICES. Any notice, demand or request required or permitted to
be given under the provisions of this Agreement shall be in writing, including
by facsimile, and shall be deemed to have been received on the date of personal
delivery, on the third day after deposit in the U.S. mail if mailed by
registered or certified mail, postage prepaid and return receipt requested, on
the day after delivery to a nationally recognized overnight courier service if
sent by an overnight delivery service for next morning delivery or when
delivered by facsimile transmission, and shall be addressed as set forth below
(or to such other address as any party may request by written notice):
Notices to Seller: STC Broadcasting, Inc.
000 Xxxxxx Xxxxxx Xxxxx
Xx. Xxxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxx
Facsimile: (000) 000-0000
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with a copy (which shall not Xxxxx & Xxxxxxx L.L.P.
constitute notice) to: 0000 Xxxxxxxxxx Xxxxx
Xxxxx 0000
XxXxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx, Xx.
Facsimile: (000) 000-0000
Notices to Buyer: LIN Television Corporation
0 Xxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxx Xxxxxx 00000
Attention: Xxxxxxx Xxxxxxxx
Facsimile: (000) 000-0000
with a copy (which shall not Xxxxxxxxx & Xxxxxxx
constitute notice) to: 0000 Xxxxxxxxxxxx Xxxxxx, XX
Xxxxxxxxxx, XX 00000-0000
Attention: Xxxxx X. Xxxxxxx, Xx.
Facsimile: (000) 000-0000
11.6. 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.
11.7. NO THIRD PARTY BENEFICIARIES. Nothing herein expressed or implied
is intended or shall be construed to confer upon or give to any person or entity
other than the parties hereto and their successors or permitted assigns, any
rights or remedies under or by reason of this Agreement.
11.8. SEVERABILITY. The parties agree that if one or more provisions
contained in this Agreement shall be deemed or held to be invalid, illegal or
unenforceable in any respect under any applicable law, this Agreement shall be
construed with the invalid, illegal or unenforceable provision deleted, and the
validity, legality and enforceability of the remaining provisions contained
herein shall not be affected or impaired thereby.
11.9. BULK TRANSFER LAWS. Buyer hereby waives compliance with the
provisions of any applicable bulk transfer laws. Seller shall indemnify Buyer
for any and all costs or expenses that Buyer incurs as a result of this waiver.
11.10. ENTIRE AGREEMENT. This Agreement embodies the entire agreement
and understanding of the parties hereto and supersedes any and all prior
agreements, arrangements and understandings relating to the matters provided for
herein.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties have executed this Asset Purchase
Agreement as of the date first set forth above.
SELLER:
XXXXX ACQUISITION COMPANY
By: /s/ XXXXX X. XXXX
-----------------------------------------
Xxxxx X. Xxxx
Chief Financial Officer and Secretary
XXXXX ACQUISITION LICENSE
COMPANY
By: /s/ XXXXX X. XXXX
-----------------------------------------
Xxxxx X. Xxxx
Chief Financial Officer and Secretary
STC BROADCASTING, INC.
By: /s/ XXXXX X. XXXX
-----------------------------------------
Xxxxx X. Xxxx
Chief Financial Officer and Secretary
STC LICENSE COMPANY
By: /s/ XXXXX X. XXXX
-----------------------------------------
Xxxxx X. Xxxx
Chief Financial Officer and Secretary
BUYER:
LIN TELEVISION CORPORATION
By: /s/ XXXXXXX X. XXXXXXXX
-----------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Vice President
Corporate Development & Treasurer
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