ASSET PURCHASE AND SALE AGREEMENT
BY AND BETWEEN
TOWER MEDIA INC,
AS SELLER
XXXX XXXX XXXXX INCORPORATED,
AS GUARANTOR
AND
GARDEN STATE NEWSPAPERS, INC.,
AS PURCHASER
DATED AS OF DECEMBER 2, 1997
ASSET PURCHASE AND SALE AGREEMENT
TABLE OF CONTENTS
Page
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I. DEFINITIONS 1
1.1 "Affiliate" 1
1.2 "Affiliate Assets" 1
1.3 "Affiliate Liabilities" 1
1.4 "Assets" 1
1.5 "Assumed Liabilities" 3
1.6 "Assumption Agreement" 3
1.7 "Business Day(s)" 3
1.8 "Claims" 3
1.9 "Closing" 3
1.10 "Closing Date" 3
1.11 "Closing Date Balance Sheet" 3
1.12 "Collective Bargaining Agreements" 3
1.13 "Consultant" 4
1.14 "December 29, 1996 Balance Sheet" 4
1.15 "December 29 Working Capital" 4
1.16 "Employee Benefit Plan" 4
1.17 "ERISA" 4
1.18 "Escrow Agent" 4
1.19 "Escrow Agreement" 4
1.20 "Excluded Assets" 4
1.21 "Excluded Liabilities" 5
1.22 "Financial Statements" 6
1.23 "1996 Financial Statements" 6
1.24 "GAAP" 6
1.25 "HSR Act" 6
1.26 "Losses" 6
1.27 "Newspaper Business" 6
1.28 "Permitted Encumbrances" 6
1.29 "Pension Plans" 6
1.30 "Person" 6
1.31 "Purchase Price" 7
1.32 "Purchaser Default" 7
1.33 "Purchaser's Group" 7
1.34 "Purchaser's Representatives" 7
1.35 "Retention Agreements" 7
1.36 "Seller Default" 7
1.37 "Seller's Group" 7
1.38 "Seller's Representatives" 7
1.39 "Third Party Consents" 7
1.40 "Title Company" 7
1.41 "Title Policy" 7
1.42 "Working Capital" 8
1.43 "Working Capital Adjustment" 8
II. SALE AND PURCHASE OF ASSETS 8
2.1 Sale and Purchase 8
2.2 Purchase Price; Method of Payment 8
2.3 Assumption of Liabilities 8
2.4 Adjustment to Purchase Price 9
2.5 No Other Adjustments 11
2.6 Letters of Credit, Bonds, Et Cetera 11
III. SELLER'S REPRESENTATIONS AND WARRANTIES 11
3.1 Organization and Qualification 11
3.2 Authority and Enforceability 12
3.3 No Conflicts 12
3.4 Consents 12
3.5 Title to Assets 13
3.6 Financial Statements 13
3.7 No Material Adverse Changes 12
3.8 Scheduled Contracts 13
3.9 Scheduled Real Property - Leases 13
3.10 Employee Benefit Plans; Labor Matters 14
3.11 Insurance 15
3.12 Scheduled Real Property - Owned 15
3.13 Litigation; Compliance with Law 15
3.14 Scheduled Intellectual Property 15
3.15 Scheduled Personal Property Leases 16
3.16 Tangible Personal Property 16
3.17 Scheduled Vehicles 16
3.18 Scheduled Licenses and Permits 16
3.19 Environmental Matters 16
3.20 Taxes 17
3.21 Brokers and Finders 17
3.22 Advertising 17
3.23 Circulation 17
3.24 DISCLAIMER OF REPRESENTATIONS AND WARRANTIES 18
IV. PURCHASER'S REPRESENTATIONS AND WARRANTIES 18
4.1 Organization and Qualification 18
4.2 Authority and Enforceability 18
4.3 No Conflicts 18
4.4 Consents 19
4.5 Litigation; Compliance with Law 19
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4.6 Ability to Fund Purchase Price 19
4.7 Brokers and Finders 19
4.8 Purchaser's Acknowledgment of Seller's and
Guarantor's Limitations Et Cetera 19
V. CERTAIN COVENANTS 20
5.1 Confidentiality; Publicity 20
5.2 Third Party Consents 21
5.3 HSR Act 21
5.4 Seller's Conduct of Newspaper Business 22
5.5 Employees 22
5.6 Books and Records 23
5.7 Reasonable Commercial Efforts 23
VI. CONDITIONS TO PURCHASER'S OBLIGATIONS 23
6.1 Representations and Warranties of Seller 23
6.2 Compliance 23
6.3 Closing Legal Opinion 23
6.4 HSR Act 24
6.5 Corporate Compliance 24
6.6 Injunctions, etc. 24
6.7 Closing Deliveries 24
6.8 Transfer of Real Property 24
6.9 Due Diligence 24
VII. CONDITIONS TO SELLER'S AND GUARANTOR'S OBLIGATIONS 24
7.1 Representations and Warranties of Purchaser 24
7.2 Compliance 25
7.3 Closing Legal Opinion 25
7.4 HSR Act Condition 25
7.5 Compliance by Purchaser 25
7.6 Injunctions, etc. 25
7.7 Payment 25
7.8 Closing Deliveries 25
7.9 Purchaser's Due Diligence 25
VIII. THE CLOSING 25
8.1 Closing; Place of Closing 25
8.2 Deliveries by or on behalf of Seller 26
8.3 Deliveries by or on behalf of Purchaser 27
IX. POST-CLOSING COVENANTS 27
9.1 Further Assurances 27
X. SURVIVAL; INDEMNIFICATION 28
10.1 Survival 28
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10.2 Seller and Guarantor Indemnification 28
10.3 Limitations on Seller Indemnification 28
10.4 Purchaser Indemnification 29
10.5 Indemnification Claim Procedures 29
10.6 Exclusive Remedies 29
XI. TERMINATION 30
11.1 Nonperformance 30
11.2 Other Conditions Permitting Termination 30
11.3 Effect of Termination 30
XII. MISCELLANEOUS 31
12.1 Assignment of Agreement; Binding Effect 31
12.2 Governing Law; Jurisdiction and Venue Et. Cet. 31
12.3 Section and Other Headings 31
12.4 Waivers and Amendments 31
12.5 Expenses 32
12.6 Entire Agreement 32
12.7 Notices 32
12.8 Counterparts 33
12.9 Severability 33
12.10 Waiver of Compliance with Bulk Transfer Laws 33
12.11 Attorneys' Fees 33
12.12 Remedies Cumulative 34
12.13 Time is of the Essence 34
12.14 Incorporation of Disclosures in Different Schedules 34
LIST OF SCHEDULES AND EXHIBITS
SCHEDULES
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1.28 UCC Financing Statements
2.6 Letters of Credit, Bonds, Surety Instruments
3.4 Third Party Consents
3.7 Material Adverse Changes
3.8 Scheduled Contracts
3.9 Scheduled Real Property-Leases
3.10 Employee Benefit Plans, Collective Bargaining
Agreements and Retention Agreements
3.11 Insurance
3.12 Scheduled Real Property-Owned
3.13 Litigation
3.14 Scheduled Intellectual Property
3.15 Scheduled Personal Property Leases
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3.17 Scheduled Vehicles
3.18 Scheduled Licenses and Permits
3.19 Environmental Disclosures
3.22 Advertising Schedule
3.23 Circulation Schedule
EXHIBITS
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1.19 Escrow Agreement
2.3 Assumption Agreement
6.3 DLNI Opinion
7.3 Form of Purchaser's Legal Opinion
8.2(a)(i) Grant Deed-Valencia Property
8.2(a)(ii) Grant Deed-Woodland Hills Property
8.2(b)(ii) Xxxx of Sale and General Assignment
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ASSET PURCHASE AND SALE AGREEMENT
THIS ASSET PURCHASE AND SALE AGREEMENT (this "Agreement") is
by and between TOWER MEDIA INC, a Nevada corporation ("Seller"), XXXX XXXX
XXXXX INCORPORATED, a Nevada corporation ("Guarantor") and GARDEN STATE
NEWSPAPERS, INC., a Delaware corporation ("Purchaser") and is dated as of the
date on which the Seller has signed this Agreement as reflected on the
signature page hereof (the "Agreement Date").
This Agreement sets forth the terms and conditions upon which
Seller will sell to Purchaser, and Purchaser will purchase from Seller, the
"Assets" (as this term is defined herein) which include the property, assets
and goodwill of the newspaper DAILY NEWS of Los Angeles (the "Newspaper").
Purchaser desires to purchase from Seller, and Seller desires to sell to
Purchaser, subject to the terms and provisions hereof, all of the Assets.
NOW THEREFORE, for and in consideration of the mutual covenants,
agreements and conditions contained herein, Purchaser, Seller and Guarantor
agree as follows:
I. DEFINITIONS
In addition to the definitions contained elsewhere in this
Agreement, the following terms shall have the following respective meanings:
1.1 "AFFILIATE" shall mean, with respect to any Person, any other
Person directly or indirectly controlling, controlled by, or under common
control with, such Person. For purposes of this definition, "control" (and
its corollaries) shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of such
Person, whether through the ownership of voting securities or by contract or
otherwise.
1.2 "AFFILIATE ASSETS" shall mean all loans, sums, accounts and
notes receivable due to the Newspaper from Seller or an Affiliate of Seller.
1.3 "AFFILIATE LIABILITIES" shall mean all debts, liabilities and
other obligations due or otherwise payable by the Newspaper to Seller or an
Affiliate of Seller.
1.4 "ASSETS" shall mean all of Seller's right, title and interest
in and to all assets, properties, rights, and interests of every kind,
whether real, personal or mixed, tangible or intangible, known or unknown,
which are owned, leased, held, or used by Seller or the Newspaper as of the
Agreement Date exclusively in connection with the Newspaper Business (but
excluding the Excluded Assets described in Section 1.20 below), plus all
additions thereto and less all dispositions thereof resulting from any
"Permitted Transactions" (as this term is defined in Section 5.4(b) below)
from the Agreement Date to the Closing Date, including, without limitation,
all of Seller's rights, titles and interests in, to and under the following:
(a) the real property, together with all improvements thereon and
appurtenances thereto, owned by Seller and described in Schedule 3.12 annexed
hereto (collectively, the "Scheduled Real Property-Owned");
(b) the patents, copyrights, trademarks, tradenames and service
marks, and the registrations thereof and applications therefor, listed in
Schedule 3.14 annexed hereto (collectively, the "Scheduled Intellectual
Property");
(c) the Newspaper's mailing and subscription lists and all
materials used by Seller for mailing list development and subscription
promotion for the Newspaper;
(d) Seller's records, files and data solely relating to the
Newspaper and the Newspaper Business, subscribers, advertisers and
operations, including, without limitation, customer and trade accounts and
similar operating data whether recorded in writing or in any computer media,
in which case such records shall be deemed to include such media (e.g.,
computer disks, computer tapes) (but excluding account books of original
entry and general ledgers, and financial records);
(e) all orders, contracts, commitments, and other agreements to
which Seller or the Newspaper is a party and which relate solely to the
Newspaper Business, and all unfilled purchase and sales orders and similar
contractual obligations of the Newspaper Business outstanding as of the
Closing Date, but excluding the Pension Plans, the Collective Bargaining
Agreements and the Retention Agreements (all of the foregoing being
collectively referred to herein as the "Contracts");
(f) the real property leases listed in Schedule 3.9 annexed
hereto (collectively, the "Scheduled Real Property-Leases");
(g) the personal property leases listed in Schedule 3.15 annexed
hereto (the "Scheduled Personal Property Leases");
(h) all promotional graphics, original artwork, mats, plates,
negatives and other advertising, marketing or related materials developed by
or for Seller and intended for use solely in connection with the Newspaper;
(i) all office equipment, furniture, data processing equipment,
computers, presses, machinery, tooling, equipment, fixtures, leasehold
improvements, and other tangible personal property (other than vehicles)
owned or leased by Seller and employed exclusively in the Newspaper Business
(collectively, the "Tangible Personal Property");
(j) the vehicles owned by Seller and used exclusively in the
Newspaper Business and listed in Schedule 3.17 annexed hereto (collectively,
the "Scheduled Vehicles");
(k) all licenses, permits and other authorizations which relate
solely to the Newspaper Business, including without limitation, the items
listed in Schedule 3.18 annexed hereto (with said scheduled items being
collectively referred to as the "Scheduled Licenses and Permits");
(l) those certain equity memberships (Nos. 1994 and 1998) in the
Woodland Hills Country Club, which is located in Woodland Hills, California,
subject to all duties, obligations and restrictions relating thereto
("Country Club Memberships");
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(m) all other current assets of the Newspaper and the Newspaper
Business, as determined in accordance with GAAP, as of the Closing Date,
including, without limitation, quantities of inventory of newsprint, ink and
other production supplies, and cash and cash equivalents in the accounts of
Seller at Bank of America, and accounts receivable relating solely to the
Newspaper. (All cash and cash equivalents in accounts other than Seller's
accounts at Bank of America are Excluded Assets);
(n) all of Seller's rights under the Confidentiality Agreements
entered into in connection with the sale of the Newspaper and the
solicitation of bids for the purchase of the Newspaper; and
(o) all goodwill associated with the Newspaper and the Newspaper
Business.
1.5 "ASSUMED LIABILITIES" shall have the meaning ascribed to such
term in Section 2.3 below.
1.6 "ASSUMPTION AGREEMENT" shall mean that certain Assumption
Agreement by and between Seller and Purchaser, substantially in the form of
Exhibit 2.3 annexed hereto.
1.7 "BUSINESS DAY(S)" (whether or not capitalized) shall mean a
calendar day on which banks in Los Angeles, California and the State of
Virginia shall be open for the transaction of business.
1.8 "CLAIMS" shall mean any and all actions, suits, proceedings,
assessments, demands, and claims.
1.9 "CLOSING" shall have the meaning ascribed to such term in
Section 8.1 below.
1.10 "CLOSING DATE" shall mean the later of (a) December 29, 1997,
or (b) the first Monday which is a business day following the fifth (5th)
business day after the waiting period under the HSR Act has expired or
otherwise terminated.
1.11 "CLOSING DATE BALANCE SHEET" shall have the meaning ascribed
to such term in Section 2.4(a) below.
1.12 "COLLECTIVE BARGAINING AGREEMENTS" shall mean those
collective bargaining agreements described in Schedule 3.10 annexed hereto,
copies of which have been previously delivered to Purchaser.
1.13 "CONSULTANT" shall mean Xxxxx, Van Essen & Associates.
1.14 "DECEMBER 29, 1996 BALANCE SHEET" shall mean the audited
balance sheet of Seller as at December 29, 1996, which is included as part of
the 1996 Financial Statements.
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1.15 "DECEMBER 29 WORKING CAPITAL" shall mean the Working Capital
of Seller as reflected in the December 29, 1996 Balance Sheet, which amount
is agreed to be $2,005,000.00.
1.16 "EMPLOYEE BENEFIT PLAN" shall mean any written pension,
retirement, stock option, stock appreciation rights, savings, or
profit-sharing plan (including trust agreements and insurance contracts
embodying such plans), any written deferred compensation, consulting, bonus,
group insurance contract, or any written incentive, welfare or employee
benefit plan or agreement.
1.17 "ERISA" shall mean the Employee Retirement Income Security
Act of 1974, as amended.
1.18 "ESCROW AGENT" shall mean Chicago Title Company.
1.19 "ESCROW AGREEMENT" shall mean that certain Escrow Agreement
among the Escrow Agent, Seller and Purchaser, in the form of the Escrow
Agreement annexed hereto as Exhibit 1.19.
1.20 "EXCLUDED ASSETS" shall mean all of the following:
(a) all Affiliate Assets;
(b) all insurance policies and rights and claims thereunder, and
bonds, letters of credit, surety instruments or other similar items and any
cash surrender value thereunder;
(c) all rights under any contracts or other intangible assets
which may be used or held in connection with the business of Seller or any of
its Affiliates, other than the Newspaper Business;
(d) all right, title and interest in or to any and all names,
logos or symbols or any variant thereof employing the names or words "Xxxxx"
or "Tower" in any respect; provided, however, that Purchaser shall be
entitled to continue to use physical assets bearing any such names, logos or
symbols for a transition period not to exceed thirty (30) days, in
consideration of which Purchaser hereby agrees to defend, indemnify and hold
Seller harmless, from, against and in respect of any obligation or liability
or expense (including attorneys' fees) arising out of Purchaser's use of the
same after the Closing Date;
(e) all claims, rights and interests in and to any refunds for
federal, state or local franchise or income taxes to the extent they relate
to any period prior to the Closing Date;
(f) Such portions, if any, of Seller's account books of original
entry, general ledgers and financial records which do not relate to the
Newspaper; provided, however, that any of Seller's books of account solely
with respect to the Newspaper which are reasonably required by Seller's
independent public accountants to confirm, review or assist in the
preparation of financial statements required by Seller in preparing filings
with or for the Securities and Exchange Commission or state securities law
regulatory authorities, or federal and state tax
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authorities shall be made available to Seller, only for examination and
duplication as may be necessary for such purposes at Purchaser's offices
(which may, in Purchaser's discretion, be located within or outside the State
of California), for a period of seven (7) full calendar years after the
Closing Date, and, if an audit is pending at the expiration of such seven (7)
year period, for an additional period equal to the period during which such
audit is being conducted, but only during regular business hours and on
reasonable advance notice;
(g) subject to the provisions of Section 5.2 below, Seller's
rights under the "Non-Transferable Contracts" (as this term is defined in
Section 5.2);
(h) all cash and cash equivalents other than the cash and cash
equivalents in Seller's accounts at Bank of America; and
(i) to the extent that Seller is the owner of properties and
businesses other than the Newspaper and the Newspaper Business or Assets used
exclusively in the Newspaper Business, all of Seller's rights, titles and
interests in and to such other properties or related businesses, and their
respective assets.
1.21 "EXCLUDED LIABILITIES" shall mean and include only the
liabilities or obligations of Seller with respect to all of the following,
all of which shall be retained by Seller:
(a) legal, accounting or other fees or expenses incurred by
Seller arising out of the negotiation, documentation or consummation of the
transactions contemplated by this Agreement;
(b) all liabilities with respect to any Litigation (as defined in
Section 3.13 of this Agreement) pending on the Closing Date, or any other
legal proceedings pending on the Closing Date, in which Seller, in respect of
the Newspaper, or the Newspaper itself, is a defendant, or any litigation of
such nature commenced after the Closing Date, to the extent attributable to
transactions or states of fact occurring before the Closing Date;
(c) all other liabilities, obligations, costs, expenses and
commitments relating to the Newspaper, the Newspaper Business and the Assets,
and/or attributable to the ownership or operation of the Newspaper, the
Newspaper Business or the Assets, to the extent any of the foregoing arose or
accrued prior to the Closing, excepting, however, any such liabilities,
obligations, costs, expenses and commitments included within or otherwise
constituting Assumed Liabilities; and
(d) all Affiliate Liabilities.
1.22 "FINANCIAL STATEMENTS" shall have the meaning ascribed to
such term in Section 3.6 below.
1.23 "1996 FINANCIAL STATEMENTS" shall mean the audited financial
statements of Seller for the year ended December 29, 1996, copies of which
have been previously delivered to Purchaser.
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1.24 "GAAP" shall mean generally accepted accounting principles
applied on a consistent basis during the period(s) concerned.
1.25 "HSR ACT" shall mean the Xxxx-Xxxxx-Xxxxxx Antitrust
Improvements Act of 1976, as amended.
1.26 "LOSSES" shall mean all judgments, liabilities, losses,
damages, costs and expenses suffered or incurred in connection with any
Claims (including, without limitation, reasonable attorneys' fees and costs
and expenses incurred in the investigation, defense or settlement of any
Claims).
1.27 "NEWSPAPER BUSINESS" shall mean Seller's business of
publishing and distributing the Newspaper (but excluding the Excluded Assets
described in Section 1.20 above).
1.28 "PERMITTED ENCUMBRANCES" shall mean (a) any liens for taxes,
assessments, levies, fees or other governmental charges not yet due and
payable or which are being contested in good faith and by appropriate
proceedings, (b) any carriers', warehousemen's, mechanics', materialmen's,
repairman's and other like liens arising in the ordinary course of business
which are not overdue for a period of more than sixty (60) days or are being
contested in good faith and by appropriate proceedings, (c) easements,
leases, licenses, rights-of-way, minor encroachments, covenants, conditions
and restrictions and other similar encumbrances either (i) of record, or (ii)
which are incurred in the ordinary course of business and do not, in the
aggregate, materially detract from the value of the Assets or interfere with
the ordinary use of the Assets in the ordinary course of business, (d)
exceptions to the Title Policy created by or resulting from the acts or
omissions of Purchaser, (e) all exceptions to title set forth in the
"Woodland Hills PTR" and the "Valencia PTR" (as these terms are defined in
the Escrow Agreement), (f) the standard printed exceptions for a CLTA owner's
standard coverage policy of title insurance, and (g) all security interests
reflected in UCC Financing Statements filed with the California Secretary of
State, including the UCC Financing Statements referred to in Schedule 1.28
annexed hereto.
1.29 "PENSION PLANS" shall mean the Daily News Pension Plan and
the Daily News 401(k) Plan, copies of which have been supplied to Purchaser,
and that are described in Schedule 3.10 annexed hereto.
1.30 "PERSON" shall mean and include an individual, a partnership,
a joint venture, a corporation, a limited liability company, a trust, an
unincorporated association, a government or any agency or department thereof,
and any other entity or organization.
1.31 "PURCHASE PRICE" shall have the meaning ascribed to such term
in Section 2.2(a) below.
1.32 "PURCHASER DEFAULT" shall mean the failure of Purchaser to
perform or comply with one or more of its obligations and agreements required
in this Agreement to be performed or complied with by Purchaser, or the
inaccuracy in a material respect of one or more of the representations or
warranties made by Purchaser in this Agreement and all documents, instruments
or certificates made or delivered by Purchaser pursuant to this Agreement.
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1.33 "PURCHASER'S GROUP" shall mean the Purchaser, each Person
included within the Purchaser's Representatives, and all Affiliates of the
Purchaser and the Purchaser's Representatives.
1.34 "PURCHASER'S REPRESENTATIVES" shall mean all shareholders,
officers, directors, partners, managers, members, employees, agents,
attorneys at law, and other representatives of Purchaser.
1.35 "RETENTION AGREEMENTS" shall mean those agreements with
certain employees of the Newspaper listed in Schedule 3.10 annexed hereto.
1.36 "SELLER DEFAULT" shall mean the failure of Seller to perform
or comply with one or more of its obligations and agreements required in this
Agreement to be performed or complied with by Seller, (b) the inaccuracy in a
material respect of one or more of the representations or warranties made by
Seller or Guarantor in this Agreement and all documents, instruments or
certificates made or delivered by Seller or Guarantor pursuant to this
Agreement, or (c) for purposes of the indemnification provisions in Article
X, the inaccuracy (as of or immediately prior to the Closing) of the
representation and warranty of Seller and Guarantor contained in the last
sentence of Section 3.13 of this Agreement, it being understood that in
determining whether such inaccuracy exists, solely for the purpose of this
clause (c), such representation or covenant shall be read as if it were not
subject to the qualification of material adverse effect.
1.37 "SELLER'S GROUP" shall mean Seller, each Person included
within the Seller's Representatives, and all Affiliates of Seller and the
Seller's Representatives.
1.38 "SELLER'S REPRESENTATIVES" shall mean the Consultant, and all
predecessors, successors, shareholders, officers, directors, partners,
managers, members, employees, agents, attorneys at law, and other
representatives, of Seller and the Consultant.
1.39 "THIRD PARTY CONSENTS" shall have the meaning ascribed to
such term in Section 3.4 below.
1.40 "TITLE COMPANY" shall mean Chicago Title Insurance Company.
1.41 "TITLE POLICY" shall have the meaning ascribed to such term
in Section 3.12 below.
1.42 "WORKING CAPITAL" shall mean the total current assets of
Seller less the total current liabilities of Seller, determined in accordance
with GAAP, except that (a) there shall be excluded from total current assets
and total current liabilities all Affiliate Assets and all Affiliate
Liabilities, and (b) there shall be excluded from total current assets and
total current liabilities in the "Closing Date Balance Sheet" (as this term
is defined in Section 2.4 below) all Excluded Assets and all Excluded
Liabilities, and (c) cash and cash equivalents in the "Closing Date Balance
Sheet" (as this term is defined in Section 2.4 below) shall only include the
cash and cash equivalents in the Bank of America accounts of Seller and shall
not include any cash and cash equivalents in any other accounts of Seller.
Seller reserves the right to transfer cash and
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cash equivalents from its Bank of America accounts to its other accounts from
time to time and at any time prior to the Closing.
1.43 "WORKING CAPITAL ADJUSTMENT" shall mean the adjustment to the
Purchase Price, if any, required to be made pursuant to Section 2.4 below.
II. SALE AND PURCHASE OF ASSETS
2.1 SALE AND PURCHASE.
Upon and subject to the terms and conditions set forth in this
Agreement, Seller agrees to sell, convey, assign, transfer and deliver to
Purchaser, and Purchaser agrees to purchase, acquire and accept from Seller,
all of the Assets.
2.2 PURCHASE PRICE; METHOD OF PAYMENT.
(a) The aggregate purchase price for the Assets shall be the sum
of One Hundred and Thirty Million Dollars ($130,000,000.00) ("Purchase
Price").
(b) The entire Purchase Price shall be paid by Purchaser to
Seller at the Closing by wire transfer of immediately available funds on the
Closing Date to an account or accounts to be designated by Seller in writing
at least two (2) Business Days prior to the Closing Date.
2.3 ASSUMPTION OF LIABILITIES. On the Closing Date, Purchaser
shall, by execution and delivery of the Assumption Agreement, assume and
thereafter pay, perform and discharge each of the following (collectively
referred to herein as the "Assumed Liabilities"):
(a) all of Seller's obligations, liabilities and commitments
under the Contracts and the "Non-Transferable Contracts" (as this term is
defined in Section 5.2 below), attributable to the period subsequent to the
Closing;
(b) all of the total current liabilities of Seller, as reflected
on the Closing Date Balance Sheet;
(c) all state and local sales, use and franchise taxes, or their
equivalents, payable as a consequence of the sale of the Assets under this
Agreement and "Purchaser's Escrow Costs" (as this term is used in the Escrow
Agreement);
(d) sponsorship and adoption of the Pension Plans described in
Schedule 3.10(A), including, without limitation, all obligations and
liabilities of Seller and the Newspaper (whether arising before or after
Closing) under or in respect of the Pension Plans described in Schedule 3.10
annexed hereto, including, without limitation, all liabilities for benefits
for each participant or former participant in the Pension Plans, (i) who was
an employee of the Newspaper on the Closing Date, (ii) who retired or
otherwise terminated his or her employment prior to the
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Closing Date, with a right (whether immediate or deferred) to receive
payments from the Pension Plans, or (iii) who was otherwise receiving
payments from the Pension Plans as of the Closing Date;
(e) all liabilities and obligations associated with the
employment or termination upon or after the Closing of all "Continuing
Employees" (as this term is used in Section 5.5(a) below), including, without
limitation, (i) all such obligations of Seller for salaries, vacation and
holiday benefits, severance payments, bonuses, retirement benefits, welfare
benefits and other forms of compensation, benefits or other payments, (ii)
all obligations of Seller under the Retention Agreements with respect to the
payment of the "Retention Bonuses" and the "Separation Pay" referred to
therein, and (iii) all other obligations of Purchaser referred to in Section
5.5(a);
(f) all liabilities, costs and expenses (including all costs of
defense thereof and judgments rendered therein) relating to all litigation,
proceedings, actions, causes of action, demands, claims and assessments,
administrative or otherwise, involving the Newspaper, the Newspaper Business
or the Assets commenced or asserted after the Closing which derive from
transactions or states of fact occurring after the Closing Date, or which
otherwise accrue after the Closing;
(g) all obligations, liabilities and costs and expenses
(including attorneys fees) arising out of Purchaser's use of any and all
names, logos or symbols or any variant thereof employing the names or words
"Xxxxx" or "Tower" in any respect after the Closing Date, as more
specifically provided in Section 1.20(d) above; and
(h) all other liabilities, obligations, costs, expenses and
commitments relating to the Newspaper, the Newspaper Business and the Assets,
and/or attributable to the ownership or operation of the Newspaper, the
Newspaper Business or the Assets, to the extent any of the foregoing arise or
accrue after the Closing.
It is understood and agreed that Purchaser shall not expressly assume any
duties or obligations under any of the Collective Bargaining Agreements.
2.4 ADJUSTMENT TO PURCHASE PRICE. The Purchase Price shall be
increased by the amount by which the Working Capital on the Closing Date, as
reflected in the Closing Date Balance Sheet, is greater than the December 29
Working Capital. The Purchase Price shall be decreased by the amount by
which the Working Capital on the Closing Date, as reflected in the Closing
Date Balance Sheet, is less than the December 29 Working Capital. The amount
of the increase or decrease in the Purchase Price pursuant to this Section
2.4 is referred to herein as the "Adjustment Amount." The manner in which
the Adjustment Amount is determined and paid shall be as follows:
(a) Within thirty (30) calendar days following the Closing Date,
Purchaser shall have prepared and delivered to Seller an unaudited Balance
Sheet for the Newspaper as at 11:59 p.m. on the day immediately preceding the
Closing Date, together with a statement reflecting the Adjustment Amount and
the party responsible for payment of the Adjustment
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Amount ("Purchaser's Adjustment Amount Statement"). This Balance Sheet is
referred to in this Agreement as the "Closing Date Balance Sheet". The
Closing Date Balance Sheet shall be prepared in accordance with the same
accounting principles and methodology applied by Seller in the preparation of
the Financial Statements and used historically in the Newspaper Business,
except for such adjustments and modifications as may be required under
Section 1.42 above.
(b) After receipt of the Closing Date Balance Sheet, Seller may
make reasonable requests for additional information relating to the Closing
Date Balance Sheet and the information contained therein, and Purchaser shall
provide such information to Seller within five (5) business days after
receipt of such requests. Seller shall review the Closing Date Balance Sheet
and the other information and, if Seller disapproves of any amount or
determination contained therein, Seller shall give Purchaser written notice
stating Seller's objections thereto and identifying the reasons therefor
within fifteen (15) calendar days after the date on which Seller received the
Closing Date Balance Sheet from Seller ("Objection Period"). If for any
reason whatsoever Seller has failed or refused to give Purchaser any such
written objections within said Objection Period, then the Adjustment Amount
shall be the amount set forth in Purchaser's Adjustment Amount Statement and
shall be paid by the responsible party within three (3) business days after
the expiration of said Objection Period.
(c) If Seller makes any objection during the Objection Period,
then during the fifteen (15) days next following the date of Seller's written
notice of objection(s) (the "Discussion Period"), Seller and Purchaser shall
attempt to resolve their disagreements concerning the Closing Date Balance
Sheet or, if they are unable to do so, they shall agree upon the amount, if
any, which is not in dispute. During such Discussion Period each party may,
at its sole cost and expense, utilize its public accountants to assist in
attempting to resolve their differences or in agreeing upon the undisputed
amount, if any. Any undisputed amounts shall be paid by the responsible
party therefor to the other party within three (3) business days after the
date of expiration of the Discussion Period, and the remaining disputed
amounts shall be determined within thirty (30) calendar days after the date
of expiration of the Discussion Period by one partner with substantial
newspaper audit or tax experience (as appropriate) ("Arbiter") selected by
Coopers and Xxxxxxx (pursuant to that firm's internal procedures) which
partner may be from said firm or from another "big six" accounting firm which
has not regularly been engaged by Purchaser or Seller to perform audits,
which determination shall be final and conclusive. The Arbiter shall use its
best efforts to render a decision within thirty (30) calendar days after the
date of expiration of the Discussion Period. Either party hereto may submit
the disputed amounts to the Arbiter. If neither party hereto submits the
disputed amounts to the Arbiter within five (5) calendar days after the date
of expiration of the Discussion Period, then such amounts shall be deemed
conclusively resolved in the manner set forth in the Closing Date Balance
Sheet and Purchaser's Adjustment Amount Statement, subject to any written
agreements made by Seller and Purchaser during the Discussion Period, and the
unpaid portion of the Adjustment Amount, as modified by any such agreement
made by Seller and Purchaser during the Discussion Period, shall be paid
within three (3) business days after expiration of said five (5) day period.
(d) If disputed amounts are submitted to the Arbiter within said
five (5) day period, then the amount determined by the Arbiter to be the
Adjustment Amount shall be paid by the responsible party within three (3)
business days after receipt of the decision of the Arbiter.
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(e) Seller, on the one hand, and Purchaser, on the other, shall
bear equally the fees of and costs incurred by the Arbiter.
2.5 NO OTHER ADJUSTMENTS. Except as expressly set forth in
Section 2.4 above and the Escrow Agreement, no other adjustments to the
Purchase Price shall be made, including without limitation, adjustments for
changes in working capital (or any item or component thereof, including
cash), taxes or prorations of any kind or nature.
2.6 LETTERS OF CREDIT, BONDS, ET CETERA. Schedule 2.6 annexed
hereto describes all of the letters of credit, bonds, surety instruments and
other similar items outstanding as of the Agreement Date which are used by or
otherwise for the benefit of the Newspaper and the Newspaper Business
(collectively, the "Scheduled Surety Instruments"). At the Closing and as a
condition thereof, Purchaser shall (a) obtain, at its sole cost and expense,
its own insurance, bonds, letter of credit, surety instruments or other
similar items to replace the Scheduled Surety Instruments and deliver to
Seller evidence thereof satisfactory to Seller in its sole discretion, and
(b) either provide Seller with a written release as of the Closing Date, in
form and substance satisfactory to Seller in its sole discretion, from all
obligations, expenses or liabilities arising thereafter on or under all such
Scheduled Surety Instruments or provide Seller with written indemnifications,
satisfactory in form and substance to Seller in its sole discretion, against
all such obligations, expenses or liabilities in respect of which Seller has
not been released.
III. SELLER'S REPRESENTATIONS AND WARRANTIES
Seller and Guarantor jointly and severally hereby make the
following representations and warranties to Purchaser, all of which shall be
true and correct in all material respects on the Agreement Date and as of the
Closing, and shall survive the Closing to the extent and subject to the
provisions of Article X below:
3.1 ORGANIZATION AND QUALIFICATION. Seller and Guarantor are
duly organized, validly existing and in good standing under the laws of the
State of Nevada and Seller has the requisite corporate power and authority to
carry on the Newspaper Business as conducted on the Agreement Date. Seller
is duly qualified as a foreign corporation to do business, and is in good
standing, in each jurisdiction where not to be so qualified would have a
material adverse effect on the business and properties of Seller, taken as a
whole.
3.2 AUTHORITY AND ENFORCEABILITY. The execution, delivery and
performance of this Agreement and all documents, instruments and certificates
made or delivered by Seller or Guarantor pursuant to this Agreement, and the
consummation by Seller of the transactions contemplated hereunder and
thereunder, have been duly authorized by all necessary corporate action on
the part of Seller or Guarantor. The terms and provisions of this Agreement
and all documents, instruments and certificates made or delivered from time
to time by Seller or Guarantor hereunder and thereunder constitute valid and
legally binding agreements and obligations of Seller and/or Guarantor,
respectively, enforceable against Seller and/or Guarantor, respectively, in
accordance with the terms hereof and thereof, except as the enforcement
thereof may be limited by bankruptcy, insolvency, reorganization, fraudulent
transfer, moratorium or
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other similar laws affecting the enforcement of creditors' rights generally,
or by general principles of equity.
3.3 NO CONFLICTS. Subject to receipt of the "Consents" referred
to in Section 3.4 below, the execution, delivery and performance of this
Agreement by Seller and Guarantor does not and will not (a) conflict with the
articles of incorporation or by-laws of Seller or Guarantor, respectively, or
conflict with, or result in a material breach or termination of, or
constitute a material default under, any contract, lease, note or other
instrument, or commitment, or any order, judgment or decree, to which Seller,
Guarantor, or any of the Assets, is a party or may be affected or bound, in
each case the enforcement of which would have a material adverse effect on
the Newspaper Business or on Seller's or Guarantor's ability to perform its
obligations under this Agreement; (b) constitute a violation by Seller or
Guarantor of any law, rule or regulation applicable to Seller or Guarantor,
the enforcement of which would have a material adverse effect on the
Newspaper Business or on Seller's or Guarantor's ability to perform its
obligations under this Agreement; or (c) result in the creation of any lien,
charge or encumbrance upon any of the Assets to be sold to Purchaser under
this Agreement, other than the Permitted Encumbrances.
3.4 CONSENTS. No consent, approval or authorization is required
on the part of Seller or Guarantor in connection with Seller's or Guarantor's
execution, delivery or performance of this Agreement except for (a) if the
transactions contemplated hereunder require filings with the United States
Federal Trade Commission ("FTC") and the United States Department of Justice
("DOJ") pursuant to the HSR Act, the expiration or early termination of the
applicable waiting period under the HSR Act, without any action
(administrative or judicial) pending or threatened by the FTC or DOJ
challenging the consummation, in whole or in part, of the transactions
contemplated under this Agreement (the "HSR Act Condition), (b) subject to
the provisions of Section 5.2 below, the consents or approvals from third
parties to the assignment and transfer to Purchaser of the "Scheduled
Contracts" referred to in Section 3.8 below, which are listed on Schedule 3.8
annexed hereto (the "Third Party Consents"), (c) subject to the provisions of
Section 5.2 the "Other Contracts Consents" referred to in Section 5.2, and
(d) the consents and approvals required in order to transfer to Purchaser the
Country Club Memberships ("Country Club Memberships"). The HSR Act
Condition, the Third Party Consents, the Other Contracts Consents and the
Country Club Consents are collectively referred to in this Agreement as the
"Consents."
3.5 TITLE TO ASSETS. Seller has, and on the Closing Date will
have, good and marketable title to, or have valid leasehold interest as to,
all of the Assets, free and clear of any lien, pledge, mortgage, charge or
encumbrance, except for the Permitted Encumbrances. At the Closing, subject
to receipt of the Consents, all of Seller's right, title and interest in and
to the Assets will be transferred to Purchaser.
3.6 FINANCIAL STATEMENTS. There have been delivered to
Purchaser (a) the 1996 Financial Statements, and (b) the unaudited Balance
Sheet of Seller as at October 26, 1997 for the period then ended and the
related statements of income and cash flows (collectively, the "Financial
Statements"). In all material respects, such Financial Statements are in
accordance with the books and records regularly maintained by Seller with
respect to Seller and were
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prepared in accordance with GAAP applied on a consistent basis throughout
the periods covered, and, subject to normal year-end adjustments, fairly
present the financial position of Seller as at the respective dates of the
balance sheets included therein, and the results of operations of Seller for
the respective dates of the income statements included therein.
3.7 NO MATERIAL ADVERSE CHANGES. Except as set forth in Schedule
3.7 annexed hereto, during the period from October 26, 1997 to the Agreement
Date there has been no material adverse change in the financial condition of
Seller or the results of its operations (in each case, as the same relates
solely to the Newspaper Business) and no material adverse change in the Assets
(taken as a whole), except for changes affecting the national, state or local
economies generally and changes applicable to the newspaper or publishing
business generally.
3.8 SCHEDULED CONTRACTS. Schedule 3.8 annexed hereto contains a
list of each written Contract that requires an expenditure by Seller or the
Newspaper after December 1, 1997 of more than $50,000.00 and which (a) cannot
be terminated by Seller upon thirty (30) days or less notice, without liability
and/or (b) although Seller has a right of termination, cannot be terminated by
Seller without incurring such an expenditure between the date of Seller's
notice of termination and the effective date of such termination ("Scheduled
Contracts"). The term Scheduled Contracts does not include any Contract
involving an expenditure of more than $50,000.00 which could be terminated by
Seller in a manner which would involve the incurrence by Seller of $50,000.00
or less under that Contract between the date of Seller's notice of termination
and the effective date of termination. The Scheduled Contracts are in full
force and effect in all material respects and Seller is not in material default
in respect of any of such Scheduled Contracts and to Seller's actual knowledge
no default by the other contracting parties has occurred thereunder and no
event, occurrence or condition exists which, with the lapse or time, the giving
of notice, or both, or the happening of any further event or condition, would
become a default by Seller thereunder. A true and complete copy of each
Scheduled Contract has been delivered by Seller to Purchaser as of the
Agreement Date.
3.9 SCHEDULED REAL PROPERTY - LEASES. The Scheduled Real Property
Leases listed on Schedule 3.9 annexed hereto constitute all of the leases of
real property material to the conduct of the Newspaper Business (taken as a
whole) as it is being conducted by Seller on the Agreement Date. The Scheduled
Real Property Leases are in full force and effect in all material respects and
Seller is not in material default in respect of any such Scheduled Real
Property Leases and to Seller's actual knowledge no default by the other
contracting parties has occurred thereunder and no event, occurrence or
condition exists which, with the lapse or time, the giving of notice, or both,
or the happening of any further event or condition, would become a default by
Seller thereunder. A true and complete copy of each Scheduled Real Property
Lease has been delivered by Seller to Purchaser as of the Agreement Date.
3.10 EMPLOYEE BENEFIT PLANS; LABOR MATTERS. Except as set forth on
Schedule 3.10 annexed hereto and except for matters which do not, taken as a
whole, have a material adverse effect on the Newspaper Business, (a) Seller is
not a party to any Employee Benefit Plan relating to employees of the Newspaper
which Plan will survive the Closing and constitute or create Assumed
Liabilities; (b) neither Seller nor any Affiliate of Seller has in effect or
has any current obligation to establish or contribute to, any plan, fund or
program covered by ERISA, nor
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has any trust under any such plan incurred any "accumulated funding
deficiency" as such term is defined in Section 302 of ERISA, nor has any
trust under any such plan of which Seller or any Affiliate of Seller is a
"sponsor" (as such term in defined in Section 3(16)(B) of ERISA) incurred any
"accumulated funding deficiency" as such term is defined in Section 302 of
ERISA and Section 412 of the Internal Revenue Code of 1954, as amended (the
"Code") (whether or not waived), since the effective date of such Sections
302 and 412; (c) Seller is not a party to any employment agreement or
collective bargaining agreement relating to the Newspaper, Seller is not in
default under any such agreement, to Seller's actual knowledge no default by
the other contracting parties has occurred thereunder and no event,
occurrence or condition exists which, with the lapse or time, the giving of
notice, or both, or the happening of any further event or condition, would
become a default by Seller thereunder, and a true and complete copy of each
such agreement has been delivered by Seller to Purchaser as of the Agreement
Date; (d) each Employee Benefit Plan maintained by Seller or any Affiliate
which provides benefits to employees of the Newspaper complies in all
material respects with and is and has been operated in substantial compliance
with each applicable provision of ERISA, the Code and all other applicable
federal statutes, regulations, and rules promulgated pursuant thereto or in
connection therewith; (e) as of the Agreement Date, neither Seller nor any
Affiliate has incurred any liability with respect to the Pension Benefit
Guaranty Corporation ("PBIC") as a result of the voluntary or involuntary
termination of any employee pension benefit plan pertaining to employees of
the Newspaper which is subject to Title IV of ERISA, nor is there currently
any active filing by Seller or any Affiliate with the PBGC relating to any
such employee benefit plan; (f) neither Seller nor any Affiliate currently
maintains or is obligated to contribute to, nor in the past maintained or
contributed to, any multiemployer plan, as defined in ERISA, pertaining to
employers of the Newspaper, nor has Seller nor any Affiliate suffered a
complete or partial withdrawal, as such terms are defined in ERISA, with
respect to any such plan; and (g) the audited financial statements for the
Daily News Pension Plan attached to Schedule 3.10 to this Agreement fairly
present the net assets available for benefits, the changes in net assets
available for benefits and the accumulated plan benefits, as of the dates and
for the periods reflected therein, in accordance with generally accepted
accounting principles consistently applied and since the date of those
financial statements, to Seller's actual knowledge no event has occurred
which has caused, or with the passage of time is likely to cause, any
material change in (i) the value of the assets or benefits therein reflected
as of such or (ii) the funding or contribution requirements for the Daily
News Pension Plan's plan year commencing January 1, 1997, as reflected in the
Towers Xxxxxx actuarial valuation report for the Daily News Pension Plan for
the plan year commencing January 1, 1997 ("Towers Xxxxxx Report"). True and
complete copies, as currently amended, of all material, operative documents
pertaining to each Employee Benefit Plan described in Schedule 3.10 to this
Agreement (e.g., the plan itself and any related trust, investment/management
agreement, etc.), together with the most recent Form 5500 and the schedules
thereto, the most recent IRS determination letter, the most recent summary
plan description for each such Plan, and the Towers Xxxxxx Report have been
furnished by Seller to Purchaser prior to or concurrently with the execution
of this Agreement.
3.11 INSURANCE. Schedule 3.11 annexed hereto sets forth a summary
listing of insurance policies of Seller which relate to the Assets, the
Newspaper and its operations. None of the Seller's rights under such insurance
policies will be assigned to Purchaser.
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3.12 SCHEDULED REAL PROPERTY - OWNED. Schedule 3.12 annexed hereto
sets forth a legal description of the Scheduled Real Property. Pursuant to the
Escrow Agreement, Seller will cause to be furnished to Purchaser, at Seller's
expense, a CLTA owner's standard coverage policy of title insurance, issued by
Title Company as of the Closing with respect to each parcel of the Scheduled
Real Property, insuring fee simple title to such Real Property vested in the
name of Purchaser in the amount of the assessed valuation of such Real Property
(as shown on the most recent real property tax bills), subject only to the
Permitted Encumbrances (the "Title Policy").
3.13 LITIGATION; COMPLIANCE WITH LAW. Except as set forth on
Schedule 3.13 annexed hereto, as of the Agreement Date there are no
arbitrations, grievances, demands, claims or assessments, judicial or
administrative actions or proceedings or governmental investigations
("Litigation") pending or, to the actual knowledge of Seller, threatened, or
any order, judgment, injunction or decree outstanding, against Seller or
relating to the Newspaper Business, which if determined adversely would have a
material adverse effect upon the Newspaper or the Newspaper Business or would
prevent Seller from performing its obligations under this Agreement. Except
for the matters set forth in Schedule 3.13, to the actual knowledge of Seller,
Seller is not in violation of any applicable law, rule, regulation or
ordinance, judicial or administrative decision, or other requirement of any
governmental body or court relating to the Newspaper Business, which violation
would have a material adverse effect upon the Newspaper or the Newspaper
Business, and no written notice has been received by Seller alleging any such
violation.
3.14 SCHEDULED INTELLECTUAL PROPERTY. Except as otherwise provided
in Schedule 3.13 and/or Schedule 3.14 annexed hereto, Seller owns or possesses
the right to use all of the Scheduled Intellectual Property listed in Schedule
3.14 in the conduct of the Newspaper Business as it is conducted on the
Agreement Date. To the actual knowledge of Seller, it is not, in connection
with the Newspaper Business, infringing in any material respect upon any
trademark, trade name or copyright of any third party and, to the actual
knowledge of Seller, no proceedings have been instituted or are pending or
threatened, and no written claim has been received by Seller, alleging any such
violation.
3.15 SCHEDULED PERSONAL PROPERTY LEASES. The Scheduled Personal
Property Leases listed in Schedule 3.15 annexed hereto constitutes all of the
leases of machinery, equipment and other personal property material to the
conduct of the Newspaper Business (taken as a whole) as it is being conducted
by Seller on the Agreement Date. Seller is not in material default with
respect to any of the Scheduled Personal Property Leases and all such Leases
are in force and effect in all material respects, and to Seller's actual
knowledge no default by the other contracting parties has occurred thereunder
and no event, occurrence or condition exists which, with the lapse or time, the
giving of notice, or both, or the happening of any further event or condition,
would become a default by Seller thereunder. A true and complete copy of each
Scheduled Personal Property Lease has been delivered by Seller to Purchaser as
of the Agreement Date.
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3.16 TANGIBLE PERSONAL PROPERTY. As of the Agreement Date, after
taking into account the age and location of the Tangible Personal Property, all
of the Tangible Personal Property are in good condition, ordinary wear and tear
excepted.
3.17 SCHEDULED VEHICLES. As of the Agreement Date, after taking into
account the age and mileage of the Scheduled Vehicles, all of the Scheduled
Vehicles are in good condition, ordinary wear and tear excepted.
3.18 SCHEDULED LICENSES AND PERMITS. To the actual knowledge of
Seller, all of the Scheduled Licenses and Permits listed on Schedule 3.18
annexed hereto are in force and effect in accordance with their terms and
Seller is not in violation of any material term or condition of any of such
Scheduled Licenses and Permits. Such Scheduled Licenses and Permits constitute
all material licenses and permits which are required relative to Seller's
conduct of the business of the Newspaper as currently conducted.
3.19 ENVIRONMENTAL MATTERS. Except as disclosed in Schedule 3.19
annexed hereto and in the Environmental Assessment Reports referred to therein:
(a) To the actual knowledge of Seller, it has obtained all
environmental permits, licenses, and approvals necessary for the operation of
the business of the Newspaper as currently conducted for which failure to do so
would have a material adverse effect on the Newspaper Business (taken as a
whole) as conducted by Seller on the Agreement Date.
(b) To the actual knowledge of Seller, Seller has not received any
written notice of any pending and unresolved material violations, proceedings,
claims, or lawsuits relating to "hazardous substances" (as this term is defined
below) and arising out of environmental matters with respect to the operation
of the Newspaper.
(c) Seller has no actual knowledge that the Scheduled Real Property
(including, without limitation, the subsurface soil and the ground water
thereunder) contains any "hazardous substances" which are required under
current applicable law to be removed or remediated.
(d) Seller has no actual knowledge of any written communications or
written agreements between Seller, on the one hand, and any governmental
authority or agency (federal, state or local) or any private person or entity,
on the other hand, relating in any way to the presence, release, threat of
release, placement on or in any of the Scheduled Real Property, or the
generation, transportation, storage, treatment, or disposal at any of the
Scheduled Real Property, of any hazardous substance.
The term "hazardous substance" means and includes (i) a "hazardous
substance" as defined in 42 U.S.C. '9601(14), California Health & Safety Code
Section 25316 and/or California Water Code Section 13050(p), and (ii) any other
material or substance known to be toxic or hazardous (including, without
limitation, any radioactive substance, methane, volatile hydrocarbons,
industrial solvents and asbestos).
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3.20 TAXES. To the actual knowledge of Seller, there are no
unsatisfied liens against any of the Assets for any federal, foreign, state or
local taxes, assessments, duties, fees, levies or other governmental charges,
the enforcement of which would have a material adverse effect on the Newspaper
or the Newspaper Business.
3.21 BROKERS AND FINDERS. Other than Consultant, Seller has not
employed or retained any broker, finder, consultant or other intermediary in
connection with the transactions contemplated by this Agreement who would be
entitled to a broker's, finder's or similar fee or other compensation from
Seller in connection therewith or upon the consummation thereof.
3.22 ADVERTISING. Schedule 3.22 annexed hereto sets forth (a) a
complete and correct list of the published rates for advertising lineage for
the Newspaper as of the Agreement Date, and a list of advertising rate changes
which the Newspaper intends as of the Agreement Date to implement after the
Agreement Date, and (b) a complete and correct list of and the amount of
revenues generated by each of the Newspaper's largest (by dollar amount) (i) 10
retail advertisers, (ii) 10 preprint advertisers, and (iii) 10 classified
advertisers for the twelve months ending October 31, 1997.
3.23 CIRCULATION. With respect to circulation, distribution and
subscription:
(a) Schedule 3.23 annexed hereto pertaining to the Newspaper
contains: (i) a true and complete copy of the most recently completed ABC
annual audit report and (ii) a true and complete copy of the most recent
publisher's statement submitted to ABC.
(b) All representations contained in such publisher's
statement are true and correct in all material respects.
(c) Since September 30, 1997, Seller has not made any
material change in its policies for the pricing of circulation for the
Newspaper, except such changes as are set forth in Schedule 3.23. Schedule
3.23 set forth the Newspaper's average paid daily circulation and its average
paid Sunday circulation, as reported in accordance with the ABC guidelines
and rules, for (i) the month of October 1997, (ii) the month of November
1997, (iii) the two-month period ending November 30, 1997, and (iv) the week
ending November 30, 1997.
3.24 DISCLAIMER OF REPRESENTATIONS AND WARRANTIES. EXCEPT AS
OTHERWISE EXPRESSLY SET FORTH ABOVE IN THIS ARTICLE III, NEITHER SELLER,
GUARANTOR NOR ANY OTHER MEMBER OF THE SELLER'S GROUP HAS MADE ANY
REPRESENTATIONS, GUARANTIES, PROMISES, STATEMENTS, ASSURANCES OR WARRANTIES OF
ANY KIND OR NATURE WHATSOEVER, EXPRESS OR IMPLIED.
IV. PURCHASER'S REPRESENTATIONS AND WARRANTIES
Purchaser hereby makes the following representations and warranties
to Seller and Guarantor, all of which shall be true and correct in all material
respects on the Agreement Date and as of the Closing, and shall survive the
Closing to the extent and subject to the provisions of Article X below:
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4.1 ORGANIZATION AND QUALIFICATION. Purchaser is duly organized,
validly existing and in good standing under the laws of the State of its
incorporation (as set forth on the signature page hereof) and has the requisite
power and authority to carry on the Newspaper Business. Purchaser is duly
qualified to do business, and is in good standing, in each jurisdiction where
not to be so qualified would have a material adverse effect on the business and
properties of Purchaser taken as a whole.
4.2 AUTHORITY AND ENFORCEABILITY. The execution, delivery and
performance of this Agreement and all documents, instruments and certificates
made or delivered by Purchaser pursuant to this Agreement, and the consummation
by Purchaser of the transactions contemplated hereunder and thereunder, have
been duly authorized by all necessary action on the part of Purchaser. The
terms and provisions of this Agreement and all documents, instruments and
certificates made or delivered from time to time by Purchaser hereunder and
thereunder constitute valid and legally binding agreements and obligations of
Purchaser, enforceable against Purchaser, in accordance with the terms hereof
and thereof, except as the enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, fraudulent transfer, moratorium or other similar
laws affecting the enforcement of creditors' rights generally, or by general
principles of equity.
4.3 NO CONFLICTS. Subject to the satisfaction of the HSR Condition
and receipt of the Consents, the execution, delivery and performance of this
Agreement by Purchaser does not and will not (a) conflict with any of the
charter documents of Purchaser, or conflict with, or result in a material
breach or termination of, or constitute a material default under, any contract,
lease, note or other instrument, or commitment, or any order, judgment or
decree to which Purchaser is a party or may be affected or bound, the
enforcement of which would have a material adverse effect on the Newspaper
Business as owned by Purchaser or on Purchaser's ability to perform its
obligations under this Agreement, or (b) constitute a violation of any law,
rule or regulation applicable to Purchaser or the Newspaper Business as owned
by the Purchaser, the enforcement of which would have a material adverse effect
on the Newspaper Business as owned by Purchaser or on Purchaser's ability to
perform its obligations under this Agreement.
4.4 CONSENTS. Except as otherwise provided in Section 3.4 above,
no consent, approval or authorization is required on the part of Purchaser in
connection with Purchaser's execution, delivery or performance of its
obligations under this Agreement.
4.5 LITIGATION; COMPLIANCE WITH LAW. There are no judicial or
administrative actions or proceedings or governmental investigations pending or
threatened, and there are no orders, judgments, injunctions or decrees issued
or threatened, against Purchaser or relating to any of Purchaser's businesses
or investments, which if determined adversely would have a material adverse
effect upon the Newspaper Business as owned by the Purchaser or would prevent
Purchaser from performing its obligations under this Agreement. Purchaser is
not in violation of any applicable law, rule, regulation or ordinance, judicial
or administrative decision, or other requirement of any governmental body or
court relating to it or any of its businesses or investments, which violation
would have a material adverse effect upon the Newspaper Business as owned by
the Purchaser, and no written notice has been received by Purchaser alleging
any such violation.
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4.6 ABILITY TO FUND PURCHASE PRICE. Purchaser has sufficient
capital and other financial resources necessary to consummate the purchase of
the Assets and fund the Purchase Price in accordance with the terms and
conditions of this Agreement. Purchaser understands that its ability to secure
financing for the transactions contemplated hereunder is not a condition
precedent to its obligations under this Agreement.
4.7 BROKERS AND FINDERS. Purchaser has not employed or retained
any broker, finder, consultant or other intermediary in connection with the
transactions contemplated by this Agreement who would be entitled to a
broker's, finder's or similar fee or compensation from Purchaser or Seller in
connection therewith or upon the consummation thereof.
4.8 PURCHASER'S ACKNOWLEDGMENT OF SELLER'S AND GUARANTOR'S
LIMITATIONS ON REPRESENTATIONS AND WARRANTIES; WAIVER OF RIGHTS REGARDING
CONFIDENTIAL INFORMATION.
(a) WITHOUT LIMITING THE GENERALITY OF SECTION 3.22 ABOVE,
PURCHASER ACKNOWLEDGES AND AGREES THAT EXCEPT AS OTHERWISE SET FORTH IN ARTICLE
III OF THIS AGREEMENT (i) IT IS PURCHASING THE NEWSPAPER BUSINESS AND THE
ASSETS IN THEIR PRESENT "AS IS/WHERE IS" CONDITION AND WITH ALL DEFECTS AND
FAULTS AS OF THE CLOSING DATE, AND (ii) NEITHER SELLER, GUARANTOR NOR ANY OTHER
MEMBER OF THE SELLER'S GROUP HAS MADE OR WILL MAKE, EITHER EXPRESSLY OR
IMPLIEDLY, ANY REPRESENTATIONS, GUARANTIES, PROMISES, STATEMENTS, ASSURANCES OR
WARRANTIES OF ANY KIND OR NATURE WHATSOEVER CONCERNING ANY OF THE FOLLOWING
MATTERS: (A) THE NEWSPAPER, THE NEWSPAPER BUSINESS, THE ASSETS OR THE ASSUMED
LIABILITIES, (B) THE VALUE, FINANCIAL CONDITION OR FINANCIAL PROSPECTS OR
PROFITABILITY OF THE NEWSPAPER OR THE NEWSPAPER BUSINESS, (C) THE PHYSICAL
(ENVIRONMENTAL OR OTHERWISE) CONDITION OF THE ASSETS, OR (D) THE FITNESS FOR
ANY PARTICULAR PURPOSE OR MERCHANTABILITY OF THE ASSETS; (E) THE COMPLIANCE BY
SELLER OR THE NEWSPAPER WITH LAWS, RULES OR REGULATIONS, OR (F) ANY FINANCIAL
OR OTHER PROJECTIONS RELATING TO THE NEWSPAPER OR THE NEWSPAPER BUSINESS
PROVIDED BY SELLER.
(b) PURCHASER ALSO ACKNOWLEDGES THAT AS OF CLOSING IT HAS BEEN
GIVEN THE FULL OPPORTUNITY TO INSPECT AND INVESTIGATE THE MATTERS REFERRED TO
IN THIS SECTION TO ITS OWN SATISFACTION OR CAUSE SUCH AN INSPECTION AND
INVESTIGATION BY EXPERTS ENGAGED BY PURCHASER. PURCHASER REPRESENTS TO SELLER
THAT IT IS NOT RELYING UPON THE EXPRESS OR IMPLIED REPRESENTATIONS, GUARANTIES,
PROMISES, STATEMENTS, ASSURANCES OR WARRANTIES OF SELLER OR ANY MEMBER OF
SELLER'S GROUP AS TO SUCH MATTERS, EXCEPT AS EXPRESSLY SET FORTH IN THIS
AGREEMENT. PURCHASER ALSO UNDERSTANDS AND AGREES THAT IT IS PURCHASING THE
ASSETS WITHOUT ANY OBLIGATION ON THE PART OF SELLER TO MAKE ANY REPAIRS,
CHANGES OR ALTERATIONS WITH RESPECT TO THE ASSETS.
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(c) PURCHASER UNDERSTANDS THAT IN CONNECTION WITH THE PROCESS
CONDUCTED BY SELLER FOR THE SALE OF THE ASSETS, SELLER FURNISHED A VARIETY OF
INFORMATION, SOME OF WHICH IS CONFIDENTIAL AND PROPRIETARY TO THE NEWSPAPER, TO
MANY PROSPECTIVE PURCHASERS, SOME OF WHOM ARE CURRENTLY COMPETITORS OF THE
NEWSPAPER BUSINESS AND DISTRIBUTE COMPETING NEWSPAPERS IN THE SAME MARKET IN
WHICH THE NEWSPAPER IS DISTRIBUTED. IN PURCHASING THE ASSETS, PURCHASER
ACKNOWLEDGES AND AGREES THAT NEITHER SELLER, GUARANTOR OR ANY OTHER MEMBER OF
SELLER'S GROUP SHALL HAVE ANY LIABILITY OR RESPONSIBILITY WHATSOEVER FOR ANY
LOSSES WHICH PURCHASER OR THE NEWSPAPER BUSINESS MAY SUFFER OR INCUR, EITHER
BEFORE OR AFTER THE CLOSING, AS A RESULT OF THE DISCLOSURE OF SUCH CONFIDENTIAL
OR PROPRIETARY INFORMATION TO COMPETITORS, AND PURCHASER HEREBY WAIVES AND
RELINQUISHES ANY AND ALL CLAIMS WHICH IT MAY NOW HAVE OR HEREAFTER ACQUIRE
AGAINST SELLER, GUARANTOR OR ANY OTHER MEMBER OF THE SELLER'S GROUP WHICH IN
ANY WAY RELATE TO SUCH LOSSES.
V. CERTAIN COVENANTS
5.1 CONFIDENTIALITY; PUBLICITY. Reference is hereby made to that
certain Confidentiality Agreement previously entered into between Seller and
Purchaser (the "Confidentiality Agreement"). The terms and conditions of the
Confidentiality Agreement remain in full force and effect and Seller and
Purchaser agrees to continue to be bound thereby. No announcement, press
release, communication or other disclosure (collectively referred to herein as
a "Disclosure"), whether written or oral, concerning the execution and delivery
of this Agreement, the Exhibits and Schedules hereto or with respect to the
transactions contemplated by this Agreement shall be made or given by either
party to any Person, unless (a) the wording and timing of such Disclosure is
mutually approved by Seller and Purchaser or (b) such Disclosure is required by
any law, court order or governmental authority having jurisdiction over Seller
or Purchaser. Notwithstanding anything to the contrary set forth herein, no
press release or other announcement concerning the execution of this Agreement,
the sale of the Newspaper to Purchaser, or any of the other transactions
contemplated under this Agreement, shall be issued or made until after the
condition referred to in Section 6.9 below has been satisfied.
5.2 THIRD PARTY CONSENTS. As soon as practicable after the
execution hereof, Seller will commence to take all reasonable action required
on its part to obtain all of the Third Party Consents. Purchaser agrees that
it will fully cooperate with Seller, and do all things reasonably necessary to
assist Seller to obtain all of the Third Party Consents, including the
furnishing of all financial and other information reasonably required by the
party whose consent or approval is being sought. However, Purchaser
understands that as of the Closing there may be (a) certain Scheduled Contracts
which require Third Party Consents, but such Third Party Consents have not been
obtained and (b) certain other Contracts ("Other Contracts") which also require
a consent or approval in order to assign those other Contracts to Purchaser
("Other Contracts Consents"), but no such consents or approvals were sought
because they did not constitute Third Party Consents within the meaning of this
Agreement. With respect to all such
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Scheduled Contracts and Other Contracts referred to above (collectively, the
"Non-Transferable Contracts"), although Seller's rights thereunder shall
constitute Excluded Assets pursuant to Section 1.20(g) of this Agreement,
Seller shall, to the extent possible without incurring any liability to any
third party, keep such Non-Transferable Contracts in effect and shall accord
Purchaser the benefit of such Non-Transferable Contracts to the same extent
as if they had not been excluded, and Purchaser shall fully perform all of
Seller's obligations under such Non-Transferable Contracts which arise after
the Closing. Nothing in this Agreement shall be construed as an attempt to
assign any agreement or other instrument that is by its terms nonassignable
without the consent of the other party. Notwithstanding anything which may
be contained in this Agreement to the contrary, the receipt of any of the
Third Party Consents or the Other Contracts Consents or the Country Club
Consents shall not be a condition precedent to Purchaser's obligations
hereunder to purchase the Assets at the Closing, and the failure for any
reason to obtain any Third Party Consents or Other Contracts Consents or
Country Club Consents shall not relieve Purchaser of its obligations to
consummate the transactions contemplated under this Agreement at the times
and in the manner set forth herein.
5.3 HSR ACT. If the transactions contemplated under this Agreement
require filings with the FTC and the DOJ under the HSR Act, then no later than
three (3) business days after the condition referred to in Section 6.9 has been
satisfied, Seller and Purchaser will each prepare and submit to the FTC and DOJ
all such required filings. The parties shall cooperate in the preparation of
such filings (including the exchange of drafts of such portions of the filings
which do not contain confidential information not related to the Newspaper
Business) and shall coordinate filings so as to minimize the length of any
review periods. Each party will keep the other party apprised of the status of
any inquiries made of such party by the FTC, the DOJ or any other governmental
agency or authority or members of their respective staffs with respect to this
Agreement or the transactions contemplated hereby, and each party shall
promptly respond to any such inquiries or requests for additional information.
Purchaser shall pay or reimburse Seller for all filing fees required to be
paid, if any, by Seller in connection with the satisfaction of the HSR
Condition.
5.4 SELLER'S CONDUCT OF NEWSPAPER BUSINESS. Seller agrees that
from and after the Agreement Date to and including the Closing Date:
(a) Seller shall cause the Newspaper Business to be conducted in
the usual and ordinary course of business, including, without limitation,
circulation promotions and telemarketing activities at a level consistent with
past practices; and
(b) None of the Assets shall be sold, transferred, leased, conveyed
or otherwise disposed of, and none of the Assets shall be pledged or otherwise
encumbered, without the prior written consent of Purchaser, except for the
following (collectively referred to herein as the "Permitted Transactions"):
(i) the use of inventory, (ii) the disposition of damaged or defective
equipment or materials, (iii) transactions in the usual and ordinary course of
business, (iv) other transactions which do not involve any Asset which is
material to the Newspaper Business, and (v) transfers of cash and cash
equivalents from Seller's Bank of America accounts to Seller's other accounts.
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Provided, however, that notwithstanding the provisions of this
Section 5.4 or anything else which may be contained in this Agreement to the
contrary, under no circumstances shall Seller be required to make any capital
expenditure with respect to the Newspaper, the Newspaper Business or the
Assets.
5.5 EMPLOYEES.
(a) At the Closing, Purchaser hereby agrees to employ all employees
employed and paid by Seller or the Newspaper immediately prior to the Closing
Date and Xxxxx X. Xxxxxxx, Publisher (the "Continuing Employees") under
substantially the same terms and conditions of employment existing at the
Closing. Purchaser shall be responsible for (i) all obligations and
liabilities of Seller with respect to the Continuing Employees, whether arising
before or after the Closing, including, without limitation, all such
obligations of Seller for salaries, vacation and holiday benefits, severance
payments, bonuses, retirement benefits, welfare benefits and other forms of
compensation, benefits or other payments, and (ii) all obligations of Seller
under the Retention Agreements with respect to the payment of the "Retention
Bonuses" and the "Separation Pay" referred to therein. Purchaser shall be
responsible for and shall pay all obligations and liabilities with respect to
Continuing Employees that accrue or are payable on or after the Closing Date,
including, without limitation, all obligations for salaries, vacation and
holiday benefits, bonuses, retirement benefits, welfare benefits and other
forms of compensation, benefits, or other payments and further including,
without limitation, all obligations and liabilities with respect to life
insurance and medical benefits provided to Continuing Employees who retire on
or after the Closing Date, and all obligations and liabilities with respect to
severance or termination benefits that accrue to Continuing Employees on or
after the Closing Date. In addition, with respect to the Continuing Employees,
Purchaser hereby agrees to comply with the provisions of the Consolidated
Omnibus Budget Reconciliation Act. If any Continuing Employee becomes a
participant in any employee benefit plan, program, policy or arrangement of
Purchaser on or after the Closing Date, such Continuing Employee shall be given
credit under any such plan, program, policy or arrangement for all service with
Seller or any predecessor employer (to the extent such credit was given by
Seller) for purposes of eligibility, vesting and benefit accrual for all
purposes for which such service is either taken into account or recognized.
5.6 BOOKS AND RECORDS. All data, files, records and other
information transferred by Seller to Purchaser pursuant to this Agreement shall
be preserved by Purchaser and shall be available for inspection by Seller on
advance notice during normal business hours for a period of five (5) years
after the Closing Date and Seller may, at its own expense, make such copies and
extracts thereof as it may desire.
5.7 REASONABLE COMMERCIAL EFFORTS. Subject to the terms and
conditions herein provided, Purchaser and Seller each agree to use reasonable
commercial efforts to take, or cause to be taken, all actions, or do, or cause
to be done, all things necessary, proper or advisable under applicable laws and
regulations to consummate and make effective the transactions contemplated by
this Agreement; provided that "reasonable commercial efforts" shall not require
Purchaser or Seller to undertake extraordinary or unreasonable measures to
consummate the transactions contemplated hereby, including without limitation,
the initiation or prosecution of legal proceedings or the payment of fees in
excess of normal and usual filing and processing fees.
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VI. CONDITIONS TO PURCHASER'S OBLIGATIONS
The obligations of Purchaser to consummate the transactions
contemplated under this Agreement on the Closing Date are subject to the
satisfaction at or prior to the Closing of each of the following conditions.
Purchaser may waive any or all of such conditions in whole or in part; provided
that any such waiver shall be in writing and no such waiver of a condition
shall constitute a waiver by Purchaser of any of its other rights or remedies
under this Agreement or otherwise at law or in equity if Seller should be in
default of any of its covenants and agreements under this Agreement.
6.1 REPRESENTATIONS AND WARRANTIES OF SELLER. All representations
and warranties of Seller and Guarantor set forth in Article III shall be true
and correct in all material respects.
6.2 COMPLIANCE. Seller shall have performed and complied in all
material respects with all obligations and agreements required in this
Agreement and the Escrow Agreement to be performed or complied with by Seller
on or prior to the Closing Date.
6.3 CLOSING LEGAL OPINION. Purchaser shall have been furnished an
opinion of Xxxxxxx Leisure Xxxxxx & Irvine, Los Angeles, California ("DLNI
Opinion"), counsel to Seller, dated the Closing Date, to the effect as set
forth in Exhibit 6.3 annexed hereto.
6.4 HSR ACT. If the transactions contemplated under this Agreement
require filings with the FTC and the DOJ under the HSR Act, the HSR Act
Condition shall have been satisfied.
6.5 CORPORATE COMPLIANCE. Purchaser shall have been furnished a
copy, certified by the secretary or an assistant secretary of Seller and
Guarantor ("Seller's and Guarantor's Secretary's Certificate"), of the
resolutions adopted by the board of directors of Seller and Guarantor, and by
the shareholders of Seller and Guarantor, authorizing the execution, delivery
and performance of this Agreement by Seller, and consummation of the
transactions contemplated by this Agreement.
6.6 INJUNCTIONS, ETC. There shall not be in effect any injunction
or restraining order issued by a court of competent jurisdiction in an action
or proceeding against the consummation of the transactions contemplated by this
Agreement.
6.7 CLOSING DELIVERIES. Seller shall have delivered all the sums
and documents described in Section 8.2 below.
6.8 TRANSFER OF REAL PROPERTY. Concurrently upon the Closing, the
Grant Deeds referred to in Sections 8.2(a)(i) and 8.2(a)(ii) below shall have
been recorded and the Title Policy referred to in Section 3.12 shall have been
issued.
6.9 DUE DILIGENCE. Purchaser shall have completed on or prior to
December 5, 1997, its due diligence investigation of the Newspaper and the
Assets to Purchaser's satisfaction. Purchaser shall evidence the satisfaction
of this condition by delivering written
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notice to that effect to Seller prior to 3:00 p.m., local Los Angeles time,
on Friday, December 5, 1997. If for any reason whatsoever, Purchaser fails,
refuses or neglects to deliver such a letter before such date and time, this
condition shall be deemed unsatisfied and not waived, in which event Seller
shall have the right to terminate this Agreement, without liability of any
kind, at any time thereafter by delivering written notice of termination to
the Purchaser.
VII. CONDITIONS TO SELLER'S AND GUARANTOR'S OBLIGATIONS
The obligations of Seller and Guarantor to consummate the
transactions contemplated by this Agreement on the Closing Date are subject to
the satisfaction at or prior to the Closing Date of each of the following
conditions. Seller may waive any or all of such conditions in whole or in
part; provided that any such waiver shall be in writing and no such waiver of a
condition shall constitute a waiver by Seller of any of its other rights or
remedies under this Agreement or otherwise at law or in equity if Purchaser
should be in default of any of its covenants and agreements under this
Agreement.
7.1 REPRESENTATIONS AND WARRANTIES OF PURCHASER. All
representations and warranties of Purchaser set forth in Article IV shall be
true and correct in all material respects.
7.2 COMPLIANCE. Purchaser shall have performed and complied in all
material respects with all obligations and agreements required in this
Agreement and the Escrow Agreement to be performed or complied with by
Purchaser on or prior to the Closing Date.
7.3 CLOSING LEGAL OPINION. Purchaser shall have been furnished an
opinion ("Purchaser's Legal Opinion") of legal counsel to Purchaser, dated the
Closing Date, to the effect as set forth in Exhibit 7.3 annexed hereto.
7.4 HSR ACT CONDITION. If the transactions contemplated under this
Agreement require filings with the FTC and the DOJ under the HSR Act, the HSR
Act Condition shall have been satisfied.
7.5 COMPLIANCE BY PURCHASER. Seller shall have been furnished a
copy, certified by the secretary of Purchaser or, if Purchaser is a
partnership, by the secretary of Purchaser's general partner or managing
general partner ("Purchaser's Secretary's Certificate"), of the resolutions
adopted by the board of directors of Purchaser or of Purchaser's general or
managing partner, as applicable, authorizing the execution, delivery and
performance of this Agreement by Purchaser and consummation of the transactions
contemplated by this Agreement.
7.6 INJUNCTIONS, ETC. There shall not be in effect any injunction
or restraining order issued by a court of competent jurisdiction in an action
or proceeding against the consummation of the transactions contemplated by this
Agreement.
7.7 PAYMENT. Seller shall have received payment of the Purchase
Price in the manner set forth in Section 2.2(b) above.
7.8 CLOSING DELIVERIES. Purchaser shall have delivered all the
sums and documents described in Section 8.3 below.
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7.9 PURCHASER'S DUE DILIGENCE. The receipt by Seller before 3:00
p.m., local Los Angeles time, on Friday, December 5, 1997, of a letter from
Purchaser stating that the condition referred to in Section 6.9 above has
been satisfied.
VIII. THE CLOSING
8.1 CLOSING; PLACE OF CLOSING. The consummation of the
transactions contemplated by this Agreement (the "Closing") shall take place
at the offices of Xxxxxxx Leisure Xxxxxx & Irvine at 000 Xxxxx Xxxxx Xxxxxx,
Xxxxx 0000, Xxx Xxxxxxx, Xxxxxxxxxx 00000 at 8:00 a.m. local time on the
Closing Date, or at such other place and time as the Seller may designate.
At the Closing, all the documents required to be delivered hereunder as a
condition to Closing on the part of either Purchaser or Seller, as set forth
in Articles VI and VII hereof, shall be made and delivered, and all
conditions to Closing hereunder shall be either satisfied in accordance with
the terms of this Agreement or waived in writing by the party entitled to the
satisfaction thereof.
8.2 DELIVERIES BY OR ON BEHALF OF SELLER.
(a) ESCROW AGREEMENT DELIVERIES. At least five (5) business days
prior to the Closing Date, Seller shall execute and deliver the Escrow
Agreement and at least one (1) business day prior to the Closing Date, Seller
shall deposit with the Escrow Holder pursuant to the Escrow Agreement:
(i) The Xxxxxxxx Xxxxx Deed in the form of Exhibit
8.2(a)(i) annexed hereto;
(ii) The Woodland Hills Grant Deed in the form of Exhibit
8.2(a)(ii) annexed hereto;
(iii) Funds sufficient to pay or cause to be paid all costs,
expenses and other sums required to be paid by Seller under the Escrow
Agreement; and
(iv) All other documents and forms required to be deposited in
Escrow by Seller under the Escrow Agreement.
(b) CLOSING DELIVERIES. At the Closing, Seller shall deliver or
cause to be delivered to Purchaser:
(i) Assumption Agreement, duly executed by Seller;
(ii) Xxxx of Sale and General Assignment in the form and
substance of Exhibit 8.2(b)(ii) annexed hereto, duly executed by Seller;
(iii) Copy of Articles of Incorporation of Seller and
Guarantor, certified by the Nevada Secretary of State as of a date no earlier
than thirty (30) calendar days prior to the Closing Date;
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(iv) Certificate of Good Standing of Seller and Guarantor,
issued by the Nevada Secretary of State and dated no earlier than thirty (30)
calendar days prior to the Closing Date;
(v) Certificate of Good Standing of Seller, issued by the
California Secretary of State and dated no earlier than thirty (30) calendar
days prior to the Closing Date;
(vi) Secretary's Certificate;
(vii) DLNI Opinion, duly executed by DLNI;
(viii) Certificates of ownership for all Scheduled Vehicles,
duly endorsed in favor of Purchaser; and
(ix) All such other instruments and documents as may be
necessary or appropriate to permit the Closing.
8.3 DELIVERIES BY OR ON BEHALF OF PURCHASER.
(a) ESCROW AGREEMENT DELIVERIES. At least five (5) business days
prior to the Closing Date, Purchaser shall execute and deliver the Escrow
Agreement and at least one (1) business day prior to the Closing Date,
Purchaser shall deposit with the Escrow Holder pursuant to the Escrow
Agreement:
(i) All documents and forms required to be deposited in
Escrow by Purchaser under the Escrow Agreement; and
(ii) Funds sufficient to pay or cause to be paid all costs,
expenses and other sums required to be paid by Purchaser under the Escrow
Agreement.
(b) CLOSING DELIVERIES. At the Closing, Purchaser shall deliver
or cause to be delivered to Seller:
(i) The Purchase Price in the manner set forth in Section
2.2(b);
(ii) Assumption Agreement, duly executed by Purchaser;
(iii) Xxxx of Sale and General Assignment, duly executed by
Purchaser;
(iv) A copy of Articles or Certificate of Incorporation of
Purchaser, certified by the Secretary of State of the state of Purchaser's
incorporation as of a date no earlier than thirty (30) calendar days prior to
the Closing Date;
(v) Certificate of Good Standing of Purchaser, issued by
the Secretary of State of the state of Purchaser's organization and dated no
earlier than thirty (30) calendar days prior to the Closing Date;
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(vi) Certificate of Good Standing of Purchaser, issued by
the California Secretary of State and dated no earlier than thirty (30)
calendar days prior to the Closing Date;
(vii) Purchaser's Secretary's Certificate;
(viii) Purchaser's Legal Opinion, executed by Purchaser's
legal counsel; and
(ix) all such other instruments and documents as may be
necessary or appropriate to permit the Closing.
IX. POST-CLOSING COVENANTS
9.1 FURTHER ASSURANCES. At any time and from time to time after
the Closing, each party shall, without further consideration, execute and
deliver such other instruments of transfer and assumption or other documents
and shall take such other actions as may be reasonably requested by the other
party in order to carry out the purposes and intent of this Agreement and
consummate the transactions contemplated hereunder. Without limiting the
generality of the foregoing, from time to time after the Closing, Purchaser
shall, without further consideration, cooperate with Seller and Seller's
counsel in connection with Seller's obligations relating to pending and
threatened proceedings, litigation, demands and claims which constitute
Excluded Liabilities. Such cooperation by Purchaser shall include, without
limitation (a) furnishing such documents and making such witnesses available
to Seller and its counsel as Seller or its counsel may reasonably request and
(b) making such retractions in the Newspaper in response to demands for
retractions as are requested by Seller or its counsel, provided such
retractions are reasonable or otherwise consistent with the past practices of
the Newspaper.
X. SURVIVAL; INDEMNIFICATION
10.1 SURVIVAL. Each representation and warranty contained in
Articles III and IV hereof, and each of the covenants set forth in Article V
and Article IX hereof, shall survive the Closing and remain in full force and
effect until such times as the rights of a party for indemnification with
respect to such representation, warranty and covenant under Sections 10.2 and
10.4 hereof shall have expired.
10.2 SELLER AND GUARANTOR INDEMNIFICATION. Subject to the
limitations set forth in Section 10.3 below, Seller and Guarantor shall
jointly and severally indemnify and hold harmless Purchaser and each other
member of the Purchaser's Group from and against any and all Claims and
Losses suffered or incurred by Purchaser or any other member of the
Purchaser's Group to the extent such Claims and Losses are caused by or
constitute (a) a Seller Default or (b) Excluded Liabilities.
10.3 LIMITATIONS ON SELLER INDEMNIFICATION. Notwithstanding
anything contained in this Agreement to the contrary: (a) the rights of
indemnification provided in Section 10.2 shall expire on the first
anniversary of the Closing Date ("Indemnity Expiration Date") and thereafter
all Claims and Losses which might otherwise be the subject of indemnification
under Section 10.2 shall be extinguished, except as to bona fide and valid
Claims and Losses for which
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written notice has been given to Seller in writing prior to the Indemnity
Expiration Date; (b) in no event shall Seller or Guarantor be required to
indemnify the Purchaser or other member of the Purchaser's Group for any
individual Claim or Loss unless the aggregate amount of all such Claims and
Losses exceeds the sum of One Million Dollars ($1,000,000.00) ("Basket"), and
then Seller's and Guarantor's liability for such Claims and Losses shall be
limited only to the amount of such excess; and (c) the maximum amount of
Seller's liability for all Claims and Losses shall be the sum of Seventeen
Million Five Hundred Thousand Dollars ($17,500,000) in the aggregate
("Maximum Liability"); provided, however, that:
(1) There shall be excluded from the Maximum Liability, all Claims and
Losses for (i) breach of the representations and warranties set
forth in Section 3.5 and (ii) taxes, including any interest or
penalties thereon, relating to the Newspaper Business for the
period prior to Closing, and (iii) any breach of any representation
or warranty set forth in Article III of this Agreement which
constitutes intentional fraud; and
(2) Purchaser's rights to indemnification under Section 10.2 with
respect to the Excluded Liabilities shall not be subject to the
temporal or monetary limitations set forth in this Section 10.3.
10.4 PURCHASER INDEMNIFICATION. Purchaser shall indemnify and
hold harmless the Seller and each other member of the Seller's Group from and
against any and all Claims and Losses suffered or incurred by Seller or any
other member of the Seller's Group to the extent such Claims and Losses are
caused by or constitute (a) a Purchaser Default or (b) Assumed Liabilities.
10.5 INDEMNIFICATION CLAIM PROCEDURES. Promptly after either
party hereto has knowledge or receives notice of any Claim or Loss for which
indemnification with respect thereto will be sought against any party
obligated to provide indemnification under Section 10.2 or 10.4 above (the
"Indemnifying Party"), such party (the "Indemnitee") shall give the
Indemnifying Party written notice of such Claim or Loss, setting forth
specifically the facts giving rise to, or alleged as a basis for, such Claim
or Loss, the amount of liability asserted, and accompanied by any
documentation of such Claim or Loss. The Indemnifying Party shall have the
right to compromise or defend, at its own expense and by counsel of its own
choosing reasonably satisfactory to the Indemnitee, any such Claim or Loss.
Such notice and the opportunity to compromise or defend shall be a condition
precedent to any liability of the Indemnifying Party hereunder. If the
Indemnifying Party shall undertake to compromise or defend any such action or
proceeding or asserted liability, it shall promptly notify the Indemnitee,
who shall cooperate with the Indemnifying Party and its counsel in such
defense against any asserted third party liability, including, but not
limited to, furnishing the Indemnifying Party with any books, records or
information reasonably requested, which is in the possession of the
Indemnitee. The Indemnifying Party shall obtain the prior written approval
of the Indemnitee before entering into any settlement of such Claim or
ceasing to defend against such Claim, such approval not to be unreasonably
withheld or delayed, if (i) as a result of such settlement or ceasing to
defend, injunctive or other equitable relief would be imposed against the
Indemnitee or the Assets or (ii) in the case of a settlement, the Indemnitee
would not thereby receive from
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the claimant an unconditional release from all further liability in respect
of such Claim. After the Indemnifying Party has undertaken defense of any
such asserted liability, the Indemnifying Party shall not be liable for any
additional legal expenses incurred by the Indemnitee in connection with such
matter. Any Claim or Loss for indemnification as a consequence of a Seller
Default or a Purchaser Default shall be in writing, accompanied by a summary
description of the basis of the Claim, the asserted amount of damages of the
Indemnitee, and such documentary or other evidence underlying the claim as is
then possessed by the Indemnitee. The parties shall proceed in good faith to
attempt to resolve any question of liability and the amount, if any, of
damages thereby occasioned, as promptly as possible.
10.6 EXCLUSIVE REMEDIES. The provisions of this Article X shall
set forth the exclusive remedies of Purchaser and other members of the
Purchaser's Group against Seller and other members of the Seller's Group for
any breach by Seller of any representations, warranties or covenants under
this Agreement and the Exhibits hereto. The provisions of this Article X
shall set forth the exclusive remedies of Seller and other members of the
Seller's Group against Purchaser and other members of the Purchaser's Group
for any breach by Purchaser of any representations, warranties or covenants
under this Agreement and the Exhibits hereto. Notwithstanding anything to
the contrary which may be contained in this Agreement, no member of Seller's
Group other than Seller shall be liable or otherwise responsible for any
breaches by Seller of any of Seller's representations, warranties and
covenants contained in this Agreement or any Exhibit hereto.
XI. TERMINATION
11.1 NONPERFORMANCE.
(a) At any time on or prior to the Closing Date, either party
shall have the right to terminate this Agreement in the event that (i) in the
case of Seller, there exists or arises a Purchaser Default, or (ii) in the
case of Purchaser, there exists or arises a Seller Default; provided,
however, that no such right of termination shall exist if the party against
whom such termination is sought has remedied or can remedy the alleged
default by the earlier to occur of (A) the Closing Date or (B) within 30 days
after being given written notice thereof by the other party.
(b) In addition to the right of termination under Section 11.1(a)
above and in addition to and not in limitation of any other remedy for breach
of this Agreement, specific performance shall also be available to Seller and
Purchaser to enforce the terms of this Agreement to the extent available
under applicable law.
11.2 OTHER CONDITIONS PERMITTING TERMINATION. Seller or Purchaser
may also terminate this Agreement (provided such party is not then in
material breach of this Agreement), as follows:
(a) Purchaser may terminate this Agreement if any of the
conditions precedent to its obligations set forth in Article VI (other than
Sections 6.1 and 6.2) have not been satisfied or waived as of the Closing
Date (or such earlier date as is expressly set forth in Article VI); or
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(b) Seller may terminate this Agreement if any of the conditions
precedent to its obligations set forth in Article VII (other than Sections
7.1 or 7.2) have not been satisfied or waived as of the Closing Date (or such
earlier date as is expressly set forth in Article VII).
(c) Seller may terminate this Agreement if (i) the condition set
forth in Section 6.9 has not been satisfied prior to the date and time
specified therein or (ii) the Closing has not occurred on or before January
31, 1998.
11.3 EFFECT OF TERMINATION.
(a) No termination of this Agreement pursuant to Sections 11.1 or
11.2 above shall be construed as relieving a party from liability for damages
to the other party for breach of its obligations or representations and
warranties under this Agreement.
(b) In the event of a termination of this Agreement under the
provisions of Section 11.2, a party not then in material breach of this
Agreement shall stand fully released and discharged of any and all
obligations under this Agreement.
XII. MISCELLANEOUS
12.1 ASSIGNMENT OF AGREEMENT; BINDING EFFECT. Neither this
Agreement nor any of the rights or obligations hereunder may be assigned by
Seller without the prior written consent of Purchaser, nor by Purchaser,
except as hereinafter provided, without the prior written consent of Seller.
Purchaser may assign its rights hereunder to a wholly owned subsidiary, but
not such assignment shall operate to relieve Purchaser of any of its
obligations hereunder. Subject to the foregoing, this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns and no other person shall have any right,
benefit or obligation hereunder.
12.2 GOVERNING LAW; JURISDICTION AND VENUE ET. CET. THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF CALIFORNIA, WITHOUT REGARD TO ITS PRINCIPLES OF
CONFLICTS OF LAWS. IN THE EVENT THAT ANY LEGAL ACTION SHOULD BE FILED BY ANY
PARTY AGAINST THE OTHER PARTY, THE VENUE AND FORUM FOR SUCH ACTION SHALL BE
THE COUNTY OF LOS ANGELES, STATE OF CALIFORNIA. EACH PARTY ALSO AGREES THAT
IF IT IS A NON-RESIDENT OF CALIFORNIA AT THE TIME OF SUCH LEGAL ACTION,
SERVICE OF PROCESS MAY BE MADE ON IT BY DELIVERY TO IT VIA UNITED STATES
REGISTERED OR CERTIFIED MAIL. EACH PARTY HEREBY CONSENTS TO THE JURISDICTION
OF ANY FEDERAL OR STATE COURT WITHIN THE COUNTY OF LOS ANGELES, STATE OF
CALIFORNIA, AND ALSO CONSENTS TO SERVICE OF PROCESS BY ANY MEANS AUTHORIZED
BY CALIFORNIA OR FEDERAL LAW.
12.3 SECTION AND OTHER HEADINGS. The paragraph headings,
captions, and the "Table of Contents" contained in this Agreement, are for
reference purposes only and shall not affect the meaning, interpretation or
contents of this Agreement.
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12.4 WAIVERS AND AMENDMENTS.
(a) Purchaser or Seller may by written notice to the other (i)
extend the time for the performance of any of the obligations or other
actions of the other; (ii) waive any inaccuracies in the representations or
warranties of the other contained in this Agreement; (iii) waive compliance
with any of the covenants of the other contained in this Agreement; and (iv)
waive performance of any of the obligations of the other.
(b) No waiver shall be valid unless in writing and signed by the
party to be charged, and then only to the extent therein specified. No
waiver by either party of a right or remedy under this Agreement or under
applicable law shall constitute a waiver, express or implied, of any other
right or remedy of such party, and no failure or delay on the part of either
party to exercise, assert or otherwise insist upon one or more of its rights
or remedies under this Agreement or at law shall constitute a waiver by such
party of any of such rights or remedies either then or in the future, or
otherwise constitute a precedent for any future conduct, actions or inaction.
(c) This Agreement may be amended, modified or supplemented only
by a written instrument executed by each of the parties hereto.
12.5 EXPENSES. Whether or not the transactions contemplated by
this Agreement are consummated, Purchaser and Seller shall each be
responsible for their respective fees and expenses incident to the
negotiation, preparation, execution, and consummation of the transactions
contemplated by this Agreement, including the fees of any brokers or advisors
engaged by either.
12.6 ENTIRE AGREEMENT. This Agreement, including the schedules
and exhibits annexed hereto, and the Confidentiality Agreement, contain the
entire agreement and understanding of the parties with respect to the subject
matter contained herein and therein. There are no restrictions, promises,
representations, warranties, understandings, covenants or undertakings other
than those expressly set forth or referred to herein and in the
Confidentiality Agreement. This Agreement supersedes all prior discussions,
agreements, understandings, negotiations and undertakings, whether written or
oral, between the parties with respect to such subject matter, including
without limitation the Bid Form executed by Purchaser, the Procedures, Terms
and Conditions distributed by Seller and Consultant, and/or any materials
contained therein or supplied to Purchaser in connection therewith.
12.7 NOTICES. Any notice, approval, disapproval, consent, waiver,
or other communication (collectively, "Notices") required or permitted to be
given under this Agreement shall be in writing and shall be delivered
personally or mailed, certified or registered United States mail, postage
prepaid, return receipt requested, or sent by Federal Express or other
reliable overnight carrier for next business day delivery, or by fax. All
Notices shall be deemed delivered (a) if personally served, when delivered,
(b) if sent by Federal Express or other overnight carrier for next business
day delivery, when actually delivered to the address specified below, (c) if
by mail, three (3) days following deposit in the United States mail, or (d)
if by fax, when the transmitting telecopier machine has confirmed that the
Notice has been completed or sent
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without error. All Notices shall be addressed to the party to whom such
Notice is to be given at the party's address set forth below or as such party
shall otherwise direct by Notice sent pursuant to this Section 12.7:
(a) IF TO SELLER, ADDRESSED TO:
Tower Media Inc
x/x Xxxx Xxxxx
Xxxxxxxxxx, XX 00000
Attention: Xxxxxx X Xxxxx, Esq.
Tel: (000) 000-0000
Fax: (000) 000-0000
With a copy (which shall not constitute notice hereunder) addressed
to:
Xxxxxxx Leisure Xxxxxx & Irvine
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxx, Esq.
Tel: (000) 000-0000
Fax: (000) 000-0000
(b) IF TO PURCHASER, ADDRESSED TO:
Garden State Newspapers, Inc.
c/o MediaNews Group, Inc.
0000 Xxxxxxxx, Xxxxx 0000
Xxxxxx, XX 00000
Attention: W. Xxxx Xxxxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
With a copy (which shall not constitute notice hereunder) to:
Verner, Liipfert, Bernhard, XxXxxxxxx and Hand
000 00xx Xxxxxx, X.X., Xxxxx 000
Xxxxxxxxxx, X.X. 00000
Attention: Xxxxxx X. Xxxxx, Xx., Esq.
Tel: (000) 000-0000
Fax: (000) 000-0000
12.8 COUNTERPARTS. This Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an original and all of
which together shall be deemed to be one and the same.
12.9 SEVERABILITY. The covenants and agreements contained herein
are separate and severable and the invalidity or unenforceability of any one
or more of such covenants or
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agreements, if not material to the basis for this Agreement, shall not affect
the validity or enforceability of any other covenant or agreement contained
herein. In addition, if, in any judicial proceeding, a court shall refuse to
enforce one or more of the covenants or agreements contained herein because
the duration thereof is too long, or the scope thereof is too broad, it is
expressly agreed between the parties hereto that such duration or scope shall
be deemed reduced to the extent necessary to permit the enforcement of such
covenants or agreements.
12.10 WAIVER OF COMPLIANCE WITH BULK TRANSFER LAWS. Purchaser
hereby waives compliance by Seller with the provisions of any bulk transfer
or bulk sale laws that may be applicable to the transactions contemplated by
this Agreement.
12.11 ATTORNEYS' FEES. In the event any action, suit or proceeding
is commenced with respect to this Agreement, the prevailing party in any such
action, suit or proceeding shall be entitled to recover, in addition to such
other relief as the court may award, its court costs and attorneys' fees
incurred in connection therewith.
12.12 REMEDIES CUMULATIVE. All of the rights and remedies
permitted or available to either party under this Agreement or at law or
equity shall be cumulative and not alternative, and invocation of any such
right or remedy shall not constitute a waiver or election of remedies with
respect to any other permitted or available right or remedy.
12.13 TIME IS OF THE ESSENCE. Time is of the essence of this
Agreement, it being understood that the time for performance of each
obligation, including without limitation, the Closing Date, has been the
subject of negotiation by the parties.
12.14 INCORPORATION OF DISCLOSURES IN DIFFERENT SCHEDULES. Any
item referred to in a specific Schedule to this Agreement shall also
constitute an item of disclosure in every other Schedule of this Agreement
where the context would make such disclosure necessary or appropriate.
IN WITNESS WHEREOF, the parties hereto have duly executed and
delivered this Agreement effective as of the Agreement Date.
SELLER: TOWER MEDIA INC,
a Nevada corporation
By:
-----------------------------------------
Its:
----------------------------------------
Date of Execution: December 2, 1997
GUARANTOR: XXXX XXXX XXXXX INCORPORATED,
a Nevada corporation
By:
-----------------------------------------
Its:
----------------------------------------
Date of Execution: December 2, 1997
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PURCHASER: GARDEN STATE NEWSPAPERS, INC.,
a Delaware corporation
By:
-----------------------------------------
Its:
----------------------------------------
Date of Execution: December 2, 1997
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FIRST AMENDMENT
TO
ASSET PURCHASE AND SALE AGREEMENT
THIS FIRST AMENDMENT TO ASSET PURCHASE AND SALE AGREEMENT (this
"First Amendment") is entered into as of December 19, 1997, by TOWER MEDIA
INC, a Nevada corporation ("Seller"), XXXX XXXX XXXXX INCORPORATED, a Nevada
corporation ("Guarantor") and GARDEN STATE NEWSPAPERS, INC., a Delaware
corporation ("Purchaser"), with reference to the following:
A. Seller, Guarantor and Purchaser have entered into that certain
Asset Purchase and Sale Agreement dated as of December 2, 1997 (the
"Agreement"). Unless otherwise defined herein, all capitalized terms used
herein shall have the meanings ascribed to them in the Agreement.
B. It appears that unless changed by this First Amendment, the
Closing Date under the Agreement will occur on a legal holiday. The parties
hereto wish to amend the Agreement so that the Closing Date will not occur on
a legal holiday.
NOW, THEREFORE, in consideration of the mutual covenants set forth
herein, the parties hereto hereby agree as follows:
1. Section 1.10 of the Agreement is hereby amended in its
entirety to read in full as follows:
"1.10 "CLOSING DATE" shall mean the seventh (7th) business day
after the waiting period under the HSR Act has expired or
otherwise terminated."
2. Except as set forth herein, the Agreement shall remain
unmodified and in full force and effect.
SELLER: TOWER MEDIA INC,
a Nevada corporation
By:
----------------------------
Its:
----------------------------
GUARANTOR: XXXX XXXX XXXXX INCORPORATED,
a Nevada corporation
By:
----------------------------
Its:
----------------------------
PURCHASER: GARDEN STATE NEWSPAPERS, INC.,
a Delaware corporation
By:
----------------------------
Its:
----------------------------
SECOND AMENDMENT
TO
ASSET PURCHASE AND SALE AGREEMENT
THIS SECOND AMENDMENT TO ASSET PURCHASE AND SALE AGREEMENT (this
"Second Amendment") is entered into as of January 13, 1998, by and among
TOWER MEDIA INC, a Nevada corporation ("Seller"), XXXX XXXX XXXXX
INCORPORATED, a Nevada corporation ("Guarantor") and GARDEN STATE NEWSPAPERS,
INC., a Delaware corporation ("Purchaser"), with reference to the following:
A. Seller, Guarantor and Purchaser have entered into that certain
Asset Purchase and Sale Agreement dated as of December 2, 1997, as amended by
the First Amendment to Asset Purchase and Sale Agreement dated as of December
19, 1997 (collectively, the "Agreement"). Unless otherwise defined herein,
all capitalized terms used herein shall have the meanings ascribed to them in
the Agreement.
B. Seller, Guarantor and Purchaser desire to amend the Agreement
as set forth in this Second Amendment.
NOW, THEREFORE, in consideration of the mutual covenants set forth
herein, the parties hereto hereby agree as follows:
1. Section 1.10 of the Agreement is hereby amended in its
entirety to read in full as follows:
"1.10 "CLOSING DATE" shall mean January 30, 1998."
2. AMENDMENT OF SECTION 1.18 OF THE AGREEMENT. Section 1.18 of
the Agreement is hereby amended in its entirety to read in full as follows:
"1.18 "ESCROW AGENT" shall mean First American Title
Insurance Company."
3. AMENDMENT OF SECTION 1.40 OF THE AGREEMENT. Section 1.40 of the
Agreement is hereby amended in its entirety to read in full as follows:
"1.40 "TITLE COMPANY" shall mean First American Title Insurance
Company."
4. AMENDMENT OF SCHEDULE 3.14 OF THE AGREEMENT. Schedule 3.14 of
the
Agreement is hereby deleted in its entirety and is replaced with a new
Schedule 3.14 in the form of Exhibit A to this Second Amendment, which is
annexed hereto and incorporated herein by this reference.
5. AMENDMENT OF EXHIBIT 1.19 OF THE AGREEMENT. Exhibit 1.19 of
the Agreement is hereby deleted in its entirety and is replaced with a new
Exhibit 1.19 in the form of Exhibit B to this Second Amendment, which is
annexed hereto and incorporated herein by this reference.
6. OTHER PROVISIONS. Except where inconsistent with the express
terms or manifest intent of this Second Amendment, all provisions of the
Agreement as in effect prior to this Second Amendment shall remain in full
force and effect. No party to this Second Amendment shall be deemed to waive
any of the rights or remedies available to it under the Agreement, all of
which are expressly reserved.
7. FURTHER ASSURANCES. The parties to this Second Amendment
agree to take any actions and execute and deliver any documents that may be
necessary to ensure, complete and effect the implementation and consummation
of this Second Amendment.
8. EXECUTION IN COUNTERPARTS. This Second Amendment may be
executed in any number of counterparts, each of which when so executed and
delivered shall be deemed to be an original and all of which taken together
shall constitute one and the same agreement.
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IN WITNESS WHEREOF, the parties have caused their duly authorized
representatives to execute this Second Amendment as of the date first written
above.
SELLER: TOWER MEDIA INC,
a Nevada corporation
By:
-------------------------------
Its:
-------------------------------
GUARANTOR: XXXX XXXX XXXXX INCORPORATED,
a Nevada corporation
By:
-------------------------------
Its:
-------------------------------
PURCHASER: GARDEN STATE NEWSPAPERS, INC.,
a Delaware corporation
By:
-------------------------------
Its:
-------------------------------
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