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EXHIBIT 2.3
ASSET PURCHASE AGREEMENT
BY AND AMONG
XXXXXXX XX ACQUISITION CORP.
BUYER
AND
HMS BROADCASTING, INC.,
SMH BROADCASTING, INC.,
HHH BROADCASTING, INC.
SELLERS
DATED AS OF DECEMBER 30, 1999
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TABLE OF CONTENTS
PAGE
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ASSET PURCHASE AGREEMENT......................................................................................................1
ARTICLE I. ASSETS TO BE CONVEYED..............................................................................................1
1.1 Licenses and Authorizations...........................................................................1
1.2 Station Equipment.....................................................................................1
1.3 Contracts.............................................................................................2
1.4 Real Property.........................................................................................2
1.5 Call Signs, Promotional Materials and Intangibles.....................................................2
1.6 Records...............................................................................................2
1.7 Accounts Receivable...................................................................................2
1.8 Non-Compete Agreement.................................................................................3
1.9 Excluded Assets.......................................................................................3
ARTICLE II. ASSUMPTION OF LIABILITIES.........................................................................................4
ARTICLE III. PURCHASE PRICE AND PAYMENT.......................................................................................5
3.1 Purchase Price........................................................................................5
3.2 Allocation............................................................................................5
ARTICLE IV. PRORATIONS AND ADJUSTMENTS........................................................................................5
ARTICLE V. [RESERVED].........................................................................................................6
ARTICLE VI. REPRESENTATIONS AND WARRANTIES OF SELLER..........................................................................6
6.1 Organization..........................................................................................6
6.2 Authorization.........................................................................................6
6.3 No Breach.............................................................................................7
6.4 Station Licenses......................................................................................7
6.5 Station Applications..................................................................................7
6.6 Title to Assets.......................................................................................7
6.7 Condition of Equipment................................................................................8
6.8 Condition of Real Property............................................................................8
6.9 Contracts.............................................................................................9
6.10 Employees............................................................................................10
6.11 Employee Benefit Plans...............................................................................10
6.12 Litigation...........................................................................................11
6.13 Payment of Taxes.....................................................................................11
6.14 Compliance With Laws.................................................................................11
6.15 Insolvency Proceedings...............................................................................12
6.16 Citizenship..........................................................................................13
6.17 Patents, Trademarks, Copyrights......................................................................13
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6.18 Financial Statements.................................................................................13
6.19 Sufficiency of Assets................................................................................14
6.20 No Misleading Statements.............................................................................14
6.21 Year 2000 Compliance.................................................................................14
6.22 Limitation...........................................................................................14
ARTICLE VII. REPRESENTATIONS AND WARRANTIES OF BUYER.........................................................................14
7.1 Organization.........................................................................................14
7.2 Authorization........................................................................................14
7.3 No Breach............................................................................................14
7.4 Litigation...........................................................................................15
7.5 No Misleading Statements.............................................................................15
7.6 Qualification as Broadcast Licensee..................................................................15
ARTICLE VIII. ENVIRONMENTAL MATTERS..........................................................................................15
8.1 Compliance with Law..................................................................................15
8.2 Site Contamination...................................................................................15
8.3 Additional Provisions Regarding Hazardous or Toxic Materials.........................................16
8.4 No Notice of Lack of Compliance with Environmental Statutes..........................................16
ARTICLE IX. PRE-CLOSING OBLIGATIONS..........................................................................................16
9.1 Application for Commission Consent...................................................................16
9.2 Xxxx-Xxxxx-Xxxxxx Act................................................................................16
9.3 Other Governmental Consents..........................................................................17
9.4 Financial Information................................................................................17
9.5 Third Party Consents.................................................................................17
9.6 Environmental Site Assessment........................................................................17
9.7 Title Insurance......................................................................................18
9.8 Surveys..............................................................................................18
9.9 Confidentiality......................................................................................18
9.10 Access...............................................................................................18
9.11 Employee Matters.....................................................................................18
9.12 Operations Prior to Closing..........................................................................19
9.13 Adverse Developments.................................................................................20
9.14 Administrative Violations............................................................................20
9.15 Bulk Sales Act.......................................................................................20
9.16 Control of Stations..................................................................................20
9.17 Buyer's Financing: Other Documents and Acts.........................................................21
9.18 Construction Permit Application......................................................................21
9.19 Additional Covenant..................................................................................21
ARTICLE X. CONDITIONS PRECEDENT..............................................................................................21
10.1 Mutual Conditions....................................................................................21
10.1.1 Governmental Consents.................................................................21
10.1.2 Absence of Litigation.................................................................22
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10.2 Conditions to Buyer's Obligation.....................................................................22
10.2.1 Representations and Warranties........................................................22
10.2.2 Compliance with Conditions............................................................22
10.2.3 No Material Adverse Development.......................................................22
10.2.4 Surveys...............................................................................22
10.2.5 Validity of Station Licenses..........................................................22
10.2.6 Closing Documents.....................................................................22
10.2.7 Third Party Consents..................................................................22
10.2.8 Finality..............................................................................23
10.2.9 Satisfactory Environmental Assessment.................................................23
10.2.10 Office Building Contract..............................................................23
10.3 Conditions to Seller's Obligation....................................................................23
10.3.1 Representations and Warranties........................................................23
10.3.2 Compliance with Conditions............................................................23
10.3.3 Payment...............................................................................23
10.3.4 Closing Documents.....................................................................23
10.3.5 Office Building Contract..............................................................24
ARTICLE XI. CLOSING..........................................................................................................24
11.1 Closing Date.........................................................................................24
11.2 Performance at Closing...............................................................................24
11.2.1 Seller shall deliver to Buyer:........................................................24
11.2.2 Buyer shall deliver to Seller:........................................................25
11.2.3 Other Documents and Acts..............................................................26
ARTICLE XII. POST-CLOSING OBLIGATIONS........................................................................................26
12.1 Indemnification......................................................................................26
12.1.1 Buyer's Right to Indemnification......................................................26
12.1.2 Seller's Right to Indemnification.....................................................26
12.1.3 Conduct of Proceedings................................................................27
12.1.4 Indemnification Sole Remedy...........................................................27
12.1.5 Limits on and Conditions of Indemnification; Threshold and Cap........................27
12.2 Post-Closing Access..................................................................................27
ARTICLE XIII. DEFAULT AND REMEDIES...........................................................................................28
13.1 Termination by Seller Upon Buyer's Default...........................................................28
13.2 Termination by Buyer Upon Seller's Default...........................................................28
13.3 Letter of Credit.....................................................................................29
13.4 Seller's Remedies....................................................................................29
13.5 Buyer's Remedies.....................................................................................29
ARTICLE XIV. TERMINATION.....................................................................................................30
14.1 Designation for Hearing..............................................................................30
14.2 Damage...............................................................................................30
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14.2.1 Risk of Loss..........................................................................30
14.2.2 Failure of Broadcast Transmission.....................................................30
14.2.3 Resolution of Disagreements...........................................................31
14.3 Legal Actions........................................................................................31
ARTICLE XV. POST-CLOSING OBLIGATIONS OF SELLER...............................................................................31
15.1 Future Financings....................................................................................31
15.2 Removal of Liens.....................................................................................32
ARTICLE XVI. GENERAL PROVISIONS..............................................................................................32
16.1 Brokerage............................................................................................32
16.2 Expenses.............................................................................................32
16.3 Notices..............................................................................................33
16.4 Attorneys' Fees......................................................................................34
16.5 Survival of Representations, Warranties and Indemnification Rights...................................34
16.6 Exclusive Dealings...................................................................................34
16.7 Waiver...............................................................................................34
16.8 Assignment...........................................................................................34
16.9 Entire Agreement.....................................................................................35
16.10 Counterparts.........................................................................................35
16.11 Construction.........................................................................................35
16.12 Schedules and Exhibits...............................................................................35
16.13 Severability.........................................................................................35
16.14 Choice of Law........................................................................................35
16.15 Counsel..............................................................................................35
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DEFINED TERMS
As used herein, the following terms shall have the meanings defined in
the introduction, background or section indicated below:
Adjustment Time Article IV
Administrative Violation Section 9.14
Agreement Introduction
Assets Article I
Assignment Applications Section 9.1
Barter Agreements Section 1.3
BFT Section 10.2.10
Buyer Introduction
Buyer Indemnitees Section 12.1.1
Closing Article II
Closing Date Section 11.1
Code Section 6.11
Commission Background
Contract Date Introduction
Contracts Section 1.3
Covenant Section 1.8
Credit Agreement Section 7.3
Employee Plan Section 6.11
Environmental Assessment Section 9.6
Environmental Statutes Section 8.2
ERISA Section 6.11
Escrow Agent Section 13.3
Escrow Agreement Section 13.3
EST Article 4
FAA Section 6.14(e)
FCC Background
FCC Consent Section 10.1.1
Final Order Section 10.2.8
Financial Statements Section 6.18
GAAP Section 6.18
Hazardous Substance Section 8.2
HHH Introduction
HMS Introduction
HSR Act Section 9.2
Hired Employees Section 9.11(b)
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Indemnified Party Section 12.1.3
Indemnitor Section 12.1.3
Intangible Property Section 1.5
Lease Agreements Section 6.8(c)
Letter of Credit Section 13.3
Licensee Introduction
License Sub Section 16.8
Liens Section 6.6
Losses Section 12.1.1
Material Contracts Section 9.5.1
Operating Contracts Section 1.3
Panamedia Section 10.2.10
Payment Date Article IV
Permitted Liens Section 6.6
Promotional Rights Section 6.17
Public Filings Article XV
Purchase Price Section 3.1
Real Property Section 1.4
Real Property-Leased Section 6.8(a)
Real Property-Owned Section 6.8(a)
Receivables Section 1.7
Required Consent Section 10.2.7
Sales Agreements Section 1.3
Seller Introduction
Seller Indemnitees Section 12.1.2
Senior Lenders Section 7.3
SMH Introduction
Specified Event Section 14.3.2
Stations Background
Station Applications Section 1.1
Station Equipment Section 1.2
Station Licenses Section 1.1
Station Records Section 1.6
Title Commitment Section 9.7
Trade Agreements Section 1.3
Transaction Background
Upset Date Section 9.18
WHSR Application Section 11.1
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TABLE OF SCHEDULES AND EXHIBITS
SCHEDULE TITLE
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1.1 Licenses and Authorizations
1.2 Station Equipment
1.3(a) Operating Contracts
1.3(c) Sales Agreements
1.3(d) Trade Agreements
1.3(e) Barter Agreements
1.4 Real Property
1.5 Call Signs, Promotional Materials and Intangibles
6.1 Organization
6.6(a) Title to Assets
6.8(c) Liens on Leases; Assignment Restrictions on Lease Agreements
6.9 Contracts
6.10 Employees
6.11 Employee Benefits Plans
6.12 Litigation
6.18 Financial Statements
8.1 Compliance with Law
8.2 Site Contamination
8.3 Hazardous and Toxic Materials
8.4 Lack of Compliance with Environmental Statutes
EXHIBIT TITLE
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A Covenant
B Opinion of Seller's Counsel
C Escrow Agreement
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ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (the "Agreement") is made and entered on
December 30th, 1999 (the "Contract Date"), by and among XXXXXXX XX ACQUISITION
CORP., a Delaware corporation ("Buyer") and HMS BROADCASTING, INC., a Florida
corporation ("HMS"), SMH BROADCASTING, INC., a Florida corporation ("SMH" ) and
HHH BROADCASTING, INC., a Florida corporation ("HHH" and, together with HMS and
SMH, "Seller," and each individually, a "Licensee").
BACKGROUND:
HHH is the licensee, owner and operator of Broadcast Station WWNN (AM),
1470 Khz, Pompano Beach, Florida; HMS is the licensee, owner and operator of
Broadcast Station WHSR (AM), 000 Xxx, Xxxxxxx Xxxxx, Xxxxxxx; and SMH is the
licensee, owner and operator of Broadcast Station WSBR (AM), 740 Khz, Boca
Raton, Florida (together, the "Stations"), pursuant to certain authorizations
issued by the Federal Communications Commission (the "Commission" or "FCC"), and
the Licensees each own certain assets used or held for use solely in connection
with the operation of the Stations. Seller desires to sell and assign and Buyer
desires to purchase and acquire substantially all of the property and assets
used or held for use in the operation of the Stations upon the terms set forth
in this Agreement (the "Transaction"). The parties acknowledge that the licenses
issued by the Commission for the operation of the Stations may not be assigned
without the prior written consent of the Commission. Accordingly, in
consideration of the foregoing and of the mutual promises, covenants, and
conditions set forth below, the parties agree as follows:
ARTICLE I.
ASSETS TO BE CONVEYED
On the Closing Date (as defined below), subject to and in reliance upon
the covenants, representations, warranties and agreements set forth herein, and
subject to the terms and conditions contained herein, Seller shall sell, assign,
transfer and deliver to Buyer and Buyer shall purchase from Seller, all of the
assets used or held for use in the operation of the Stations, other than
Excluded Assets (as defined below), including without limitation, the following
(collectively, the "Assets"):
1.1 Licenses and Authorizations. All licenses, permits, permissions and
other authorizations issued to Seller for the operation of the Stations by the
Commission or any other governmental agencies, including, but not limited to,
those listed on Schedule 1.1 and the right to use the Stations' call letters
(the "Station Licenses"), and all applications for modification, extension or
renewal thereof, and any pending applications for any new licenses, permits,
permissions or authorizations pending on the Closing Date, including, but not
limited to, those listed on Schedule 1.1 (the "Station Applications").
1.2 Station Equipment. All the fixed and tangible personal property used
or held for use in the operation of each of the Stations including, but not
limited to, the transmitters, towers, ground system and studio equipment listed
on Schedule 1.2 together with
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any replacements, improvements, or additions thereto made between the Contract
Date and the Closing Date (the "Station Equipment").
1.3 Contracts. All rights of Seller under (a) all agreements, contracts
or leases described on Schedule 1.3(a); (b) such other contracts, agreements or
leases entered into (i) with the written consent of Buyer, or (ii) in the
ordinary course of business and consistent with past practice, between December
30, 1999 and the Closing Date, that do not, in the aggregate, impose obligations
in excess of Twenty Thousand Dollars ($20,000) on Buyer (the contracts,
agreements and leases described in clauses (a) and (b) are collectively referred
to as the "Operating Contracts"); (c) all contracts for the sale of time on the
Stations for cash (i) at rates substantially in accordance with Stations' past
practices with a remaining term at Closing of six (6) months or less, (ii) set
forth on Schedule 1.3(c), or (iii) entered into with the written consent of
Buyer ("Sales Agreements"); (d) contracts for the sale of time on the Stations
in exchange for merchandise or services set forth on Schedule 1.3(d) or entered
into after the date hereof with the written consent of Buyer ("Trade
Agreements"); and (e) contracts for the sale of time on the Stations in exchange
for programming set forth on Schedule 1.3(e) or entered into after the Contract
Date with the written consent of Buyer ("Barter Agreements"). (The Operating
Contracts, Sales Agreements, Trade Agreements, and Barter Agreements are
referred to collectively as the "Contracts.")
1.4 Real Property. All right, title and interest in the real property
used or held for use in the operation of the Stations and owned, leased, or
licensed by Seller or its affiliates, as described in Schedule 1.4, (the "Real
Property").
1.5 Call Signs, Promotional Materials and Intangibles. All of Seller's
rights in the Stations' call signs, copyrights, patents, trademarks, trade
names, slogans, logos, service marks, computer software, magnetic media, data
processing files, systems and programs, business lists, trade secrets, sales and
operating plans, all goodwill of the Stations and other similar intangible
property rights used or held for use in the operation of the Stations, including
but not limited to the intangible property identified on Schedule 1.5 (the
"Intangible Property").
1.6 Records. All records, including but not limited to all books of
account, customer lists, supplier lists, computer programs and software,
employee personnel files, local public inspection file materials, engineering
data, logs, programming records, consultants' reports, ratings reports, budgets,
marketing and demographic data, financial reports and projections, lists of
advertisers, promotional materials, and sales, operating and business plans,
relating to or used in the operation of the Stations or necessary or desirable
to show compliance with any law or regulation applicable to the Stations or the
operation of the Stations and not pertaining solely to Seller's internal
corporate affairs or its other stations or interests (the "Station Records").
1.7 Accounts Receivable. At the consummation of the transaction
contemplated by this Agreement on the Closing Date, Seller shall assign to
Buyer, for purpose of collection only, all of Seller's accounts receivable
outstanding as of the Closing Date arising from the operation of the Stations
before the Closing Date (the "Receivables"). For a period of
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one hundred twenty days (120) after the Closing Date, Buyer will collect in the
normal course of business the Receivables for Seller's benefit. Seller will
furnish Buyer with a complete list of the Receivables at or as soon as is
reasonably possible after the Closing. Buyer will not adjust, compromise or
settle any dispute concerning the Receivables without prior written consent of
Seller. Sixty-five (65), ninety-five (95) and one hundred twenty five (125) days
after the Closing Date, Buyer shall pay to Seller all amounts collected on
account of the Receivables during the first sixty (60), ninety (90) and one
hundred twenty (120) days following the Closing Date, respectively, provided,
however, that any payment received by Buyer during the one hundred thirty (130)
day period (described below) from any customer which continues to be serviced by
Buyer shall be applied to the invoice (if any) specified by the customer and,
failing specification by the customer, to the oldest accounts receivable
outstanding. The obligation of Buyer hereunder will be to collect such accounts
receivable in the ordinary and normal course of business and does not extend to
the institution of litigation, employment of counsel or a collection agency, or
any other extraordinary means of collection. Within one hundred thirty (130)
days of the Closing Date, Buyer will deliver to Seller the balance of amounts
collected on account of the Receivables. Buyer shall then reassign to Seller the
Receivables that remain uncollected. If Buyer receives following the termination
of the collection period any payments with respect to the Receivables, Buyer
shall promptly remit to Seller such payments. All payments of Receivables to
Seller hereunder shall be made free of any offsets or deductions.
1.8 Non-Compete Agreement. At Closing, Seller and Buyer shall enter into
a Non-Compete and Consulting Agreement in the form set forth in Exhibit A (the
"Covenant").
1.9 Excluded Assets. It is understood and agreed that the following
assets shall not be among the Assets purchased pursuant to this Agreement:
(a) Seller's cash on hand as of the Closing and any of Seller's
interests in its bank accounts and all of Seller's other cash, cash equivalents,
security funds, securities, investments, deposits, prepayments (including
prepaid taxes and insurance), tax refunds and overpayments;
(b) Any insurance policies and proceeds thereof, promissory
notes, amounts due from employees, bonds, letters of credit, certificates of
deposits or other similar items and cash surrender value in regard thereto;
(c) Any pension, profit-sharing, or employee benefit plans,
including all of Seller's interest in any Employee Plan (as defined in Section
6.11), and any collective bargaining agreements;
(d) Any accounts receivable outstanding on the Closing Date,
subject to Section 1.7 hereof;
(e) Any agreements not included among the Contracts;
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(f) All tax returns and supporting materials, all original
financial statements and supporting materials, all books and records that Seller
is required by law to retain, all corporate minutes and records, and all records
of Seller relating to the sale of the Assets;
(g) Any interest in and to any refunds of federal, state, or
local franchise, income or other taxes for periods prior to the Closing Date;
and
(h) All Contracts that have been terminated or expired prior to
the Closing Date in the ordinary course of business and in accordance with such
Contracts' respective terms.
(i) The Lease Agreement with CTI Group/Equipment Financing,
Inc.
ARTICLE II.
ASSUMPTION OF LIABILITIES
On the Closing Date, Buyer shall assume the liabilities which accrue
under the Contracts and Station Licenses on and after the Closing Date (the
closing of the transactions contemplated herein, the "Closing"). Buyer shall not
assume or undertake to pay, satisfy or discharge any other liabilities,
obligations, commitments or responsibilities of Seller, including, without
limitation, (i) any obligations or liabilities under any contract, agreement or
lease not included in the Contracts, (ii) any obligations or liabilities under
the Contracts relating to the period prior to the Closing except for those
obligations or liabilities arising out of the Trade Agreements or Barter
Agreements assumed by Buyer and subject to adjustment pursuant to Article IV,
(iii) any obligations or liabilities of Seller relating to or arising out of any
claims or pending litigation proceedings, (iv) any obligations or liabilities of
Seller under any agreement or arrangement, written or oral, with salaried or
non-salaried employees of the Stations, other than those obligations or
liabilities of Seller under agreements or arrangements with employees of the
Stations that Buyer has identified pursuant to Section 9.11(b) as agreements or
arrangements that Buyer will assume from Seller and provided, further, that
Buyer actually hires such employees pursuant to such agreements or arrangements
(as opposed to entering into new employee agreements with such employees), (v)
any Employee Plan and (vi) any obligations or liabilities to any employee of the
Stations for accrued commissions, vacation time or sick leave, and all such
obligations and liabilities shall remain and be the obligations and liabilities
of Seller. If any Contract requires the consent of third parties for assignment,
but (i) such consent has not been obtained as of the Closing Date, as required
by Section 10.2.7, and (ii) in the case of Material Contracts, Buyer waives such
condition precedent to the Closing in its sole discretion, then Buyer shall
assume Seller's obligations under such Contract only for the period after
Closing during which Buyer receives the benefits to which Seller is currently
entitled under such Contract (unless consent is subsequently obtained and such
delay has not prejudiced Buyer, and unless the failure of Buyer to receive
benefits under such Contract is due to Buyer's failure to perform Seller's
obligations thereunder after Closing).
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ARTICLE III.
PURCHASE PRICE AND PAYMENT
3.1 Purchase Price. The purchase price for the Assets and the Covenant
shall be Eighteen Million Dollars ($18,000,000) (the "Purchase Price"). At
Closing, Buyer will pay to Seller by wire transfer of federal funds (pursuant to
wire instructions that Seller shall deliver to Buyer at least three (3) days
prior to Closing) the Purchase Price minus Ten Thousand Dollars ($10,000) which
shall constitute Seller's contribution toward construction expenses to be
incurred by Buyer in connection with the relocation of the WHSR night time
transmitter pursuant to the WHSR Application, and plus or minus any adjustments,
as set forth in Article IV and Section 9.6 hereof.
3.2 Allocation. Fifty Thousand Dollars ($50,000) of the Purchase Price
shall be allocated to the Covenant, and Seventeen Million Nine Hundred Fifty
Thousand Dollars ($17,950,000) shall be allocated among the Assets in accordance
with an appraisal performed by an appraiser selected by Buyer and paid for by
Buyer. Each of Seller and Buyer agree (i) to jointly complete and separately
file Form 8594 with its federal income tax return for the tax year in which the
Closing occurs and (ii) that neither Seller nor Buyer will take a position on
any income, transfer or gains tax return consistent with the values set forth in
the appraisal and the requirements of section 1060 of the Internal Revenue Code
that is in any manner inconsistent with the terms of any such allocation without
the written consent of the other.
ARTICLE IV.
PRORATIONS AND ADJUSTMENTS
Current real estate taxes, rent, utilities and all other normal income
and expense items related to the Assets shall be apportioned between the parties
to reflect the principle that all expenses and income arising from the operation
of the Assets up through 11:59 p.m. Eastern Standard Time ("EST") of the day
prior to the Closing Date (the "Adjustment Time") shall be for the account of
Seller, and all expenses and income arising from the operation of the Assets
after the Adjustment Time shall be for the account of Buyer. All special
assessments and similar charges or liens, imposed against the Assets in respect
of any period of time up until the Adjustment Time, whether payable in
installments or otherwise, shall be the responsibility of Seller, and amounts
payable with respect to such special assessments, charges or liens imposed in
respect of any period of time after the Adjustment Time shall be the
responsibility of Buyer, and such charges shall be adjusted as required
hereunder. Three (3) days prior to the Closing Date Seller shall estimate all
apportionments pursuant to this Article IV and shall deliver a statement of its
estimates to Buyer (which statement shall set forth in reasonable detail the
basis for those estimates). To the extent that, as of the Closing Date, the
aggregate value of the unfulfilled obligations under Trade Agreements or Barter
Agreements exceeds the aggregate value of consideration to be received by the
Stations under such Trade Agreements or Barter Agreements (determined as of the
Closing Date) by Fifteen Thousand Dollars ($15,000), Buyer shall be entitled to
a positive cash adjustment in an amount equal to the excess, if any, over such
Fifteen Thousand Dollar ($15,000) amount. At the Closing, Buyer shall pay to
Seller, or Seller shall pay to Buyer, as the case may be, the net amount due as
a result of the estimated apportionments
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(excluding any item that is in good faith in dispute). Within sixty (60) days
after the Closing, Buyer shall deliver to Seller a statement (the "Buyer
Statement") of any adjustments to Seller's estimate of the apportionments, and
within twenty (20) days of the delivery to Seller of the Buyer Statement
("Payment Date"), Buyer shall pay to Seller, or Seller shall pay to Buyer, as
the case may be, any amount due as a result of the adjustment (or, if there is
any dispute, the undisputed amount). Except with respect to items that Seller
notifies Buyer that it objects to within such twenty (20) day period, the
adjustments set forth in the Buyer Statement shall be final and binding on the
parties effective on the expiration of such twenty (20) day period. If Seller
disputes Buyer's determinations, the parties shall confer with regard to the
matter and an appropriate adjustment and payment shall be made as agreed upon by
the parties (or, if they are unable to resolve the matter, they shall select a
firm of independent certified public accountants to resolve the matter, whose
decision on the matter shall be binding and whose fees and expenses shall be
borne equally by the parties). All amounts due pursuant to this subsection that
are not paid on the Payment Date or such later date when any disputed amounts
are finally determined, as applicable, shall bear interest from such date until
paid at a rate per annum equal to the generally prevailing prime interest rate
(as reported by The Wall Street Journal) plus five percent (5%).
ARTICLE V.
[RESERVED]
ARTICLE VI.
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller makes the following representations and warranties, all of which
have been relied upon by Buyer in entering into this Agreement and, except as
otherwise specifically provided, all of which shall be true and correct at
Closing.
6.1 Organization. Each Licensee is a corporation duly organized, validly
existing and in good standing under the laws of, and is duly qualified to do
business in the State of Florida. Each Licensee has full corporate power and
authority to own, lease and operate its Assets and to conduct the business and
operations of the Stations as currently conducted and to enter into and perform
this Agreement. The address of each Licensee's chief executive offices, and the
locations of all tangible personal property included in the Assets are listed in
Schedule 6.1. Except as set forth in Schedule 6.1, during the past five (5)
years, the Licensees have not been known by or used any corporate, partnership,
fictitious or other name in the conduct of the Stations' business or in
connection with the use or operation of the Assets.
6.2 Authorization. The execution, delivery and performance of this
Agreement (and each agreement, document or instrument required to be executed,
delivered and performed by Seller pursuant to this Agreement) by each of the
Licensees has been duly authorized by all necessary corporate action on each of
their parts. Each of the Licensees shall deliver evidence of such authorization
at Closing. This Agreement has been duly executed by Seller and delivered to
Buyer and constitutes the legal, valid and binding obligation of Seller,
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enforceable against Seller in accordance with its terms, except as limited by
laws affecting the enforcement of creditors' rights generally or equitable
principles.
6.3 No Breach. None of (i) the execution, delivery and performance of
this Agreement by Seller, (ii) the consummation by Seller of this Agreement and
all other documents or instruments related thereto or executed in connection
therewith or in contemplation of the Transaction, or (iii) Seller's compliance
with the terms and conditions hereof will, with or without the giving of notice
or the lapse of time or both, conflict with, breach the terms and conditions of,
constitute a default under, or violate any of the Licensees' articles of
incorporation or bylaws, any judgment, decree, order, injunction, agreement,
lease or other instrument to which Seller is a party or by which Seller is
legally bound, or any law, rule, or regulation applicable to Seller or the
operation of the Stations.
6.4 Station Licenses. The Station Licenses are all of the licenses,
permits, and other authorizations used or necessary to lawfully operate the
Stations in the manner and to the full extent as they are now operated, and the
Station Licenses are validly issued in the name of Seller. Seller has delivered
to Buyer true and complete copies of the Station Licenses, including any and all
amendments and other modifications thereto. The Station Licenses are in full
force and effect, are valid on the date hereof and as of the Closing Date for
the balance of the current license term applicable generally to radio stations
licensed to communities in the state where each of the Stations are located, are
unimpaired by any acts or omissions of Seller or any of its affiliates, or the
employees, agents, officers, directors, or shareholders of Seller or any of its
affiliates, and are free and clear of any restrictions which might limit the
full operation of the Stations in the manner and to the full extent as it is now
operated (other than restrictions under the terms of the licenses themselves or
generally applicable under the rules and regulations of the FCC). There are no
applications, proceedings, or complaints pending or, to the knowledge of Seller,
threatened which may have an adverse effect on the business or operation of the
Stations (other than rulemaking proceedings that apply to the radio broadcasting
industry generally). Seller is not aware of any reason why those of the Station
Licenses subject to expiration might not be renewed in the ordinary course for a
full term without material qualifications or of any reason why any of the
Station Licenses might be revoked. Each of the Stations is in compliance with
the Commission's policy on exposure to radio frequency radiation. There are no
facts which, under the Communications Act of 1934, as amended, or the existing
rules of the Commission, would disqualify Seller from assigning the Station
Licenses or from consummating the transactions contemplated herein within the
times contemplated herein. Seller maintains an appropriate public inspection
file at each Station's studio in accordance with Commission rules. Access to the
Stations' transmission facilities are restricted in accordance with the policies
of the Commission.
6.5 Station Applications. All information contained in any Station
Application (as described on Schedule 1.1 hereto) pending with the Commission is
true, complete and accurate in all material respects.
6.6 Title to Assets. Except as set forth on Schedule 6.6(a), Seller has
good and marketable title to the Assets, in the case of owned Assets, and a
valid leasehold interest, in
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the case of leased Assets, in each case free and clear of all debts, liens,
charges, security interests, mortgages, deeds of trust, pledges, judgments,
trusts, adverse claims, liabilities, collateral assignments, leases, easements,
covenants, encumbrances and other impairments of title ("Liens"), other than (i)
the Liens set forth on Schedule 6.6(a) and (ii) liens for taxes not yet due and
payable, mechanics' liens and similar statutory liens not in default and
recorded easements, rights of way and other similar liens which do not adversely
affect the value of any Real Property or the use of any Real Property as it is
currently used in the operation of the Assets (the "Permitted Liens"). At
Closing, Seller shall convey to Buyer good and marketable title to the Assets
owned by Seller and a valid leasehold interest in the Assets leased by Seller,
free and clear of all Liens other than Permitted Liens.
6.7 Condition of Equipment. The Station Equipment listed on Schedule 1.2
constitutes all of the personal property that is used, held by the Seller or
others for use by the Stations, or necessary to operate the Stations as it is
now operated. The Station Equipment is in good operating condition and repair
(reasonable wear and tear excepted), is maintained in compliance with good
engineering practice, is performing satisfactorily, is not in need of repair,
has been properly maintained in all material respects in accordance with the
manufacturers' recommendations and industry practices, is available for
immediate use and is otherwise sufficient to permit the Stations to operate in
accordance with the Station Licenses and the rules and regulations of the
Commission.
6.8 Condition of Real Property.
(a) The Real Property listed on Schedule 1.4 constitutes all
the real property owned ("Real Property-Owned") or leased ("Real
Property-Leased") by Seller in connection with the operation of the Stations as
it is now operated. Seller has marketable fee simple title (free and clear of
any liens other than Permitted Liens) to the Real Property-Owned.
(b) There are no encroachments upon the Real Property by any
buildings, structures, or improvements located on adjoining real estate. None of
the buildings, structures, or improvements of Seller (including without
limitation any ground radials, guy wires or guy anchors) constructed on the Real
Property encroach upon adjoining real estate, and all such buildings,
structures, and improvements are constructed in conformity with or are
"grandfathered" with respect to all "setback" lines, easements, and other
restrictions, or rights of record, or that have been established by any
applicable building or safety code or zoning ordinance. Such "grandfathered"
approvals shall survive indefinitely the transfer of the Real Property to Buyer.
There are no pending or, to the best of Seller's knowledge, threatened or
contemplated condemnation or eminent domain proceedings that may affect the Real
Property. There exists no writ, injunction, decree, order or judgment, nor any
litigation, pending, or to the best of Seller's knowledge, threatened, relating
to the ownership, use, lease, occupancy or operation of any of the Real
Property. Seller's use and occupancy of the Real Property complies in all
material respects with all regulations, codes, ordinances, and statutes of all
applicable governmental authorities, including without limitation all
environmental protection and
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sanitary laws and regulations, occupational safety and health regulations, and
electrical codes. There are no material structural defects in the buildings,
structures, and improvements located on the Real Property. Roofs are in good
condition and repair, and all plumbing equipment, heating, ventilating and air
conditioning equipment, electrical wiring, and water and sewage systems are
operating properly and are free of any material defects. Seller's
representations in this Section 6.8(b), as they apply to Real Property-Leased,
shall be to the best of Seller's knowledge.
(c) The leased premises are leased at the rates and for terms
ending on the dates shown on Schedule 1.4 pursuant to the agreements described
in Schedule 1.4 (the "Lease Agreements"), which are the sole and complete
agreements concerning Seller's use of the leased premises. Each Lease Agreement
is legal, valid, binding, enforceable and in full force and effect. Neither
Seller nor any other party is in default, violation or breach in any respect
under any Lease Agreement, and no event has occurred and is continuing that
constitutes or, with notice or the passage of time or both, would constitute a
default, violation or breach thereunder. No amount payable under any Lease
Agreement is past due. Seller has not received any written notice of a default,
offset or counterclaim under any Lease Agreement or any other written
communication asserting non-compliance with any Lease Agreement. Seller has the
exclusive right to use and occupy the premises leased under each Lease Agreement
as they are now currently being used and occupied and for the purposes necessary
to operate the Stations. Seller enjoys peaceful and undisturbed possession of
the premises leased by Seller under the Lease Agreement. Except as set forth on
Schedule 6.8(c), the Lease Agreements are free and clear of all Liens, except
Permitted Liens and except for lessors' interests in the leases. Seller has
delivered to Buyer, true and complete copies of the Lease Agreements, together,
in the case of any subleases or similar occupancy agreements, with copies of all
overleases. Except as disclosed in Schedule 6.8(c), Seller has full legal power
and authority to assign its rights under the Lease Agreements to Buyer in
accordance with this Agreement on terms and conditions no less favorable than
those in effect on the date hereof, and such assignment will not affect the
validity, enforceability and continuity of any such lease.
(d) All utilities that are required for the full and complete
occupancy and use of the Real Property for the purposes for which such
properties are presently being used by Seller, including without limitation
electric, water, sewer, telephone (if any) and similar services, have been
connected and are in good working order. By the Closing Date, Seller will have
paid all charges for such utilities, including without limitation any "tie-in"
charges or connection fees, except for those charges that will not become due
until after the Closing Date and that are to be prorated between Seller and
Buyer pursuant to Article IV.
6.9 Contracts. Except as set forth on Schedule 6.9, the Contracts are
assignable to Buyer on terms and conditions no less favorable than those in
effect on the date hereof without consent. Each Contract is in full force and
effect and is unimpaired by any acts or omissions of Seller, Seller's employees,
agents, officers, directors or shareholders. Seller has
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complied in all material respects will all Contracts to be assigned to Buyer
hereunder, and there has not occurred as to any Contract any default by Seller
or any event that, with notice or the lapse of time or otherwise, could become a
default by Seller. Seller has not granted or been granted any waiver or
forbearance with respect to any of the Contracts. To the best knowledge of
Seller, there has not occurred as to any Contract any default by any other party
thereto or any event that, with notice or the lapse of time or at the election
of any person other than Seller, could become a default by such party. Those
Contracts whose stated duration extends beyond the Closing Date will, at
Closing, be in full force and effect. Seller has provided to Buyer true and
correct copies of all written Contracts, as modified to date, or true and
complete memoranda describing the terms of all oral Contracts, and all
liabilities and obligations under such Contracts can be ascertained from such
copies or memoranda. The Contracts as amended through the date of this Agreement
will not be modified without Buyer's written consent, which consent shall not be
unreasonably withheld.
6.10 Employees.
(a) Schedule 6.10 contains a true and complete list as of the
date hereof of all persons employed at the Stations and each such person's
compensation and bonus arrangements. Seller is not a party to any agreement or
arrangement, written or oral, with salaried or non-salaried employees except as
described in Schedules 6.10 and 6.11 or included among the Operating Contracts.
(b) Except as disclosed in Schedule 6.10, Seller is not a party
to or subject to any contract with any labor organization, nor has Seller agreed
to recognize any union or other collective bargaining unit, nor has any union or
other collective bargaining unit been certified as representing any of Seller's
employees at the Stations. Seller has no knowledge of any organizational effort
currently being made or threatened by or on behalf of any labor union with
respect to employees of Seller at the Stations. There are no unfair labor
practice charges pending or, to the best of Seller's knowledge, threatened
against Seller; there are no pending or threatened strikes, arbitration
proceedings involving labor matters or other material labor disputes affecting
Seller or the Stations; and Seller has not experienced any strikes, work
stoppages or other significant labor difficulties of any nature at the Stations
in the past two (2) years.
6.11 Employee Benefit Plans. Schedule 6.11 sets forth a true and
complete list of each employee or retiree benefit or compensation plan within
the meaning of Section 3(3) of the Employee Retirement Income Security Act of
1974, as amended ("ERISA"), or compensation, bonus, incentive, deferral, equity
based, severance, termination, retention, change in control, employment or other
similar program, agreement, arrangement, trust or other funding arrangement,
whether or not subject to the provisions of ERISA, to which Seller is bound or
that is or has been established or maintained or in respect of which Seller has
ever had any obligation to contribute (each, an "Employee Plan"). Except
pursuant to an Employee Plan or as disclosed on Schedule 6.10, Seller has no
fixed or contingent liability or obligation to or in respect of any person now
or formerly employed at the Stations or any beneficiary or dependent of any such
person, including, without limitation, in respect of pension or thrift benefits
or
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payments, individual or supplemental pension benefits or payments or
compensation arrangements, contributions to hospitalization or other health,
life or other welfare benefits, incentive benefits or payments, bonus benefits
or payments or vacation, sick leave, disability and termination benefits or
payments, including workers' compensation. No trade or business (whether or not
incorporated) is or has been as of any date within the preceding six (6) years
treated as a single employer together with Seller pursuant to Section 414 of the
Internal Revenue Code of 1986, as amended, and the regulations thereunder (the
"Code"). Seller has not incurred or does not reasonably expect to incur (either
directly or indirectly, including as a result of any indemnification obligation)
any liability that could become a liability of Buyer or, following the Closing,
remain a liability of the Stations under or pursuant to Title I or IV of ERISA
or the penalty, excise tax or joint and several liability provisions of the Code
relating to employee benefit plans and, to the best knowledge of Seller, no
event, transaction or condition has occurred or exists which could result in any
such liability. Each of the Employee Plans has been operated and administered in
all respects in accordance with all applicable laws, including but not limited
to ERISA and the Code. It is expressly understood that Buyer is not assuming any
obligation of Seller under or with respect to any Employee Plan.
6.12 Litigation. Except as set forth on Schedule 6.12 and proceedings
affecting the broadcast industry generally, there is no unsatisfied judgment
outstanding and no litigation, proceeding, claim or investigation of any nature
pending or, to Seller's best knowledge, threatened against Seller or any of the
Assets which might adversely affect the continued operation of the Stations or
impair the value of the Assets or which might adversely affect Seller's ability
to perform in accordance with the terms of this Agreement. Seller has no
knowledge of any facts that could reasonably result in any such proceedings.
With respect to each matter set forth therein, Schedule 6.12 sets forth a
description of the forum for the matter, the parties thereto and the type and
amount of relief sought.
6.13 Payment of Taxes. Seller has, or by the Closing Date will have,
duly filed all tax returns and forms required to be filed in respect of the
Stations and paid in full or discharged all taxes, assessments, excises,
interest, penalties, deficiencies and other levies relating to the Assets or
that could give rise to a lien or other encumbrances on the Assets in the hands
of the Buyer, excepting such taxes, assessments, and other levies as will not be
due until after the Closing Date or that are to be prorated between Seller and
Buyer pursuant to Article IV. No event has occurred that could impose on Buyer
any liability for any taxes, penalties, or interest due or to become due from
Seller from any taxing authority.
6.14 Compliance With Laws. Seller has complied in all material respects
with, and is not in violation of any federal, state or local laws, regulations
or orders (including any applicable statutes, ordinances or codes relating to
zoning and land use, health and sanitation, environmental protection,
occupational safety, and the use of electrical power) affecting the Assets,
Seller's business, or the operation of the Stations. Without limiting the
generality of the foregoing:
(a) The Stations' transmitting and studio equipment is
operating in all material respects in accordance with the terms and conditions
of the
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Station Licenses, and the rules, regulations and policies of the Commission,
including without limitation all regulations concerning equipment authorization
and human exposure to radio frequency radiation. To the best of Seller's
knowledge, (i) the Stations are not causing interference in violation of
Commission rules to the transmission of any other broadcast station or
communications facility and has not received any complaints with respect thereto
and (ii) no other broadcast station or communications facility is causing
interference in violation of Commission rules to the Stations' transmissions or
the public's reception of such transmissions. Seller has no outstanding
construction permits with respect to the Stations.
(b) Seller has, in the conduct of the Stations' business,
complied in all material respects with all applicable laws, rules and
regulations relating to the employment of labor, including those concerning
wages, hours, equal employment opportunity, collective bargaining, pension and
welfare benefit plans, and the payment of Social Security and similar taxes, and
Seller is not liable for any arrearages of wages or any tax penalties due to any
failure to comply with any of the foregoing.
(c) Seller has received no notification from the Commission
that Seller's employment practices fail to comply with Commission rules and
policies.
(d) All ownership reports, employment reports, tax returns and
other documents required to be filed by Seller with the Commission or other
governmental authorities have been filed. All proofs of performance and
measurements that are required to be made by Seller with respect to each
Station's transmission facilities have been completed and filed at the Stations.
All information contained in the foregoing documents is true, complete and
accurate in all material respects.
(e) The towers used in the operation of the Stations are
painted, obstruction marked and lighted to the extent required by, and in
accordance with the rules and regulations of the Federal Aviation Administration
(the "FAA"), the Commission and any other applicable requirements of law.
Appropriate notifications to the FAA have been filed for such towers where
required by the Commission's rules and regulations.
6.15 Insolvency Proceedings. Neither Seller nor the Assets are the
subject of any pending or threatened insolvency proceedings of any character,
including without limitation bankruptcy, receivership, reorganization,
composition or arrangement with creditors, voluntary or involuntary. Seller has
not made an assignment for the benefit of creditors or taken any action in
contemplation of or which would constitute a valid basis for the institution of
any such insolvency proceedings. After giving effect to the Transaction, Seller
(i) will have sufficient capital to carry on its business and transactions, (ii)
will be able to pay its debts as they mature or become due, and (iii) will own
assets the fair value of which will be greater than the sum of all liabilities
(including contingent liabilities) of Seller not specifically assumed by Buyer
pursuant to the terms of this Agreement. Seller is not insolvent nor will it
become insolvent as a result of entering into this Transaction.
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6.16 Citizenship. None of the Licensees is a "foreign person" as
defined in Section 1445(f)(3) of the Code. On the Closing Date, each Licensee
will deliver to Buyer an affidavit to that effect, verified as true and sworn to
under penalty of perjury by a duly-authorized officer of such Licensee. Each
Licensee's affidavit shall also set forth the Licensee's name, address, taxpayer
identification number, and such additional information as may be required to
exempt the Transaction from the withholding provisions of Section 1445 of the
Code. Buyer shall have the right to furnish copies of the affidavit to the
Internal Revenue Service.
6.17 Patents, Trademarks, Copyrights. The call signs and all slogans,
logos, copyrights, patents, trademarks, trade names, service marks, and other
similar intangible property rights, including registrations and applications to
register or renew the registrations of any of the foregoing, currently used to
promote or identify the Stations, or otherwise used in connection with each
Station's business, are listed or described on Schedule 1.5 (the "Promotional
Rights"). The Promotional Rights are either owned or validly licensed by Seller,
and Schedule 1.5 identifies which Promotional Rights are so owned and which are
licensed, and if licensed, the royalties paid thereon and the parties paid
thereunder. Seller does not have any knowledge, nor has Seller received any
written notice to the effect that its use of any of the Promotional Rights may
be or are claimed to infringe on the right of another. Seller has no knowledge
of any infringement or unlawful or unauthorized use of such Promotional Rights.
The operations of the Stations do not infringe any copyright, patent, trademark,
trade name, service xxxx, or other similar right of any third party. Seller has
not sold, licensed or otherwise disposed of any Promotional Rights to any person
or entity and Seller has not agreed to indemnify any person or entity for any
patent, trademark or copyright infringement. Schedule 1.5 lists all of the
Promotional Rights which have been duly registered with, filed in or issued by,
as the case may be, the United States Patent and Trademark Office and United
States Copyright Office or other filing offices, domestic or foreign.
6.18 Financial Statements. Seller has furnished Buyer with the
financial statements listed or described on Schedule 6.18 (the "Financial
Statements"). The Financial Statements include (i) consolidated balance sheets
as of December 31, 1996, 1997 and 1998 and the related consolidated statements
of income and cash flows for such fiscal years of Seller, (ii) an unaudited
balance sheet as of November 30, 1999 of the Stations, (iii) unaudited
statements of income of the Stations for the nine (9) month period ended
November 30, 1999 and (iv) unaudited monthly financial statements covering the
period beginning January 1, 1998 and ending November 30, 1999. The year-end
Financial Statements: (i) have been prepared on a consistent basis throughout
the periods involved and as compared with prior periods and (ii) fairly and
accurately reflect the financial condition and the results of operations and
cash flows of the Stations as of the dates and for the periods indicated. The
monthly and other interim Financial Statements: (i) have been prepared on a
consistent basis throughout the periods involved (except to the extent noted
thereon) and on a basis consistent with the year-end Financial Statements, and
(ii) fairly and accurately reflect the financial condition and the results of
operations and cash flows of the Stations as of the dates and for the periods
indicated in all material respects. Except as reflected in the Financial
Statements or otherwise disclosed to Buyer in writing, no event has occurred
since the preparation of the most recent Financial Statements that would make
such Financial Statements misleading in any material respect.
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6.19 Sufficiency of Assets. Except for the office building owned by
Xxxxxx Xxxxxxxxx, the Assets are sufficient to operate the Stations as they are
now operated.
6.20 No Misleading Statements. No statement made by Seller to Buyer in
this Agreement and no information to be provided by Seller to Buyer pursuant to
this Agreement contains or will contain any untrue statement of a material fact
or omits or will omit a material fact necessary in order to make such statements
or information not misleading.
6.21 Year 2000 Compliance. The Assets used by Seller in the conduct of
its business as currently conducted, whether owned by Seller or licensed from
others, will perform its intended functions without regard to any references to
or computations based on calendar dates or periods of elapsed time, including,
but not limited to, any thereof with respect to any date or dates in 1999 or
2000.
6.22 Limitation. Other than as set forth in this Agreement, Seller
makes no express or implied warranties or representations relating to the Assets
or the Stations.
ARTICLE VII.
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer makes the following representations and warranties, all of which
have been relied upon by Seller in entering into this Agreement and, except as
otherwise specifically provided, all of which shall be true and correct as of
Closing.
7.1 Organization. Buyer is a corporation duly organized, validly
existing, and in good standing, under the laws of the State of Delaware. Buyer
is duly qualified to do business in and is in good standing under the laws of
the State of Florida.
7.2 Authorization. The execution, delivery and performance of this
Agreement (and each agreement, document or instrument required to be executed
and delivered by Buyer pursuant to this Agreement) by Buyer has been duly
authorized by all necessary corporate action on its part. Buyer shall deliver
evidence of such authorization at Closing. This Agreement has been duly executed
by Buyer and delivered to Seller and constitutes the legal, valid and binding
obligation of Buyer, enforceable against Buyer in accordance with its terms,
except as limited by laws affecting the enforcement of creditors' rights
generally or equitable principles.
7.3 No Breach. Except for Buyer's obligations to comply with certain
requirements of that certain Credit Agreement, as amended, (the "Credit
Agreement") dated as of August 11, 1999 among Buyer, certain affiliates of
Buyer, the lenders named therein (the "Senior Lenders") and the Bank of
Montreal, Chicago Branch, as agent, including obtaining the consent of the
Senior Lenders, none of (i) the execution, delivery and performance of this
Agreement by Buyer, (ii) the consummation of this Agreement and all other
documents or instruments related thereto or executed in connection therewith if
in contemplation of the Transaction, or (iii) Buyer's compliance with the terms
and conditions hereof will, with or without the giving of notice or the lapse of
time or both, conflict with, breach the terms and
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conditions of, constitute a default under, or violate Buyer's articles of
incorporation, bylaws, any judgment, decree, order, agreement, lease or other
instrument to which Buyer is a party or by which Buyer is legally bound, or any
law, rule or regulation applicable to Buyer.
7.4 Litigation. There is no action, suit, investigation or other
proceedings pending or, to Buyer's best knowledge, threatened which may
adversely affect Buyer's ability to perform in accordance with the terms of this
Agreement, and Buyer is unaware of any facts which could reasonably result in
any such proceeding.
7.5 No Misleading Statements. No statement made by Buyer to Seller in
this Agreement and no information to be provided by Buyer to Seller pursuant to
this Agreement contains or will contain any untrue statement of a material fact
or omits or will omit a material fact necessary in order to make such statements
or information not misleading.
7.6 Qualification as Broadcast Licensee. Buyer knows of no fact that
would, under the Communications Act of 1934, as amended, or the rules,
regulations and policies of the FCC, disqualify Buyer or a License Sub from
becoming the licensee of the Stations. There are no proceedings, complaints,
notices of forfeiture, claims, investigations pending or, to the knowledge of
Buyer, threatened against any or in respect of any of the broadcast stations
licensed to Buyer or its affiliates that would materially impair the
qualifications of either Buyer or a License Sub to become a licensee of the
Stations. At Closing Buyer will have sufficient net liquid assets available from
committed sources to consummate the transactions contemplated by this Agreement
and to otherwise financially qualify under the Communications Act of 1934, as
amended, and the rules and regulations of the FCC.
ARTICLE VIII.
ENVIRONMENTAL MATTERS
8.1 Compliance with Law. Except as listed and described on Schedule 8.1
to this Agreement, all activities of Seller at or on the Real Property and all
operations of the Stations by the Seller (whether or not conducted at the Real
Property), have been and are being conducted in compliance with all applicable
federal, state and local statutes, ordinances, rules, regulations, permits,
orders and policies concerning (i) manufacturing, processing, handling, storage,
treatment and/or disposal of any hazardous or toxic materials or of any wastes,
(ii) discharges or releases into the air, ground, surface water or groundwater,
and (iii) employee health and safety.
8.2 Site Contamination. Except as listed and described in Schedule 8.2,
Seller has no knowledge that any Hazardous Substance is present at, on or under
the Real Property or has been disposed of by Seller in such a manner as may
require remediation under any Environmental Statute. No claims have been
asserted or threatened against Seller relating to the presence or disposal of
such Hazardous Substances. "Hazardous Substance" means any substance regulated
under any federal, state, or local statute, regulation, ordinance, order,
permit, or policy relating to environmental protection, environmental pollution,
liability for environmental contamination, or protection of worker health and
safety ("Environmental Statutes").
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8.3 Additional Provisions Regarding Hazardous or Toxic Materials. Except
as listed and described on Schedule 8.3, Seller has no knowledge that (i) any
polychlorinated biphenyls or substances containing polychlorinated biphenyls are
present at, on or under the Real Property; (ii) any asbestos or materials
containing asbestos exist at, on or under the Real Property; and (iii) any
underground storage tanks exist or existed at, on or under the Real Property.
8.4 No Notice of Lack of Compliance with Environmental Statutes. Seller
has not been notified by any governmental authority of any violation of any
Environmental Statute in connection with the operation of the Stations or the
conduct of any activities on or at the Real Property. Seller has no knowledge of
notices of violation of Environmental Statutes, notices of noncompliance with
Environmental Statutes or environmental enforcement, response, removal or
remediation actions issued for or undertaken at the Real Property. Further,
Seller has no knowledge of investigations or inspections by governmental
authorities into Seller's compliance with Environmental Statutes. Schedule 8.4
includes a correct and complete list of Seller's registrations with, licenses
from, or permits issued by governmental agencies or authorities pursuant to
Environmental Statutes. All such registrations, licenses or permits are in full
force and effect.
ARTICLE IX.
PRE-CLOSING OBLIGATIONS
The parties covenant and agree as follows with respect to the period
prior to the Closing Date:
9.1 Application for Commission Consent. Within fifteen (15) business days
after the date of this Agreement, Seller and Buyer shall join in and file an
application or applications requesting the Commission's written consent to the
assignment of the Station Licenses from Seller to Buyer (the "Assignment
Applications"), and they will diligently take all steps necessary or desirable
and proper to prosecute expeditiously the Assignment Applications and to obtain
the Commission's determination that approval of the Assignment Applications will
serve the public interest, convenience, and necessity, including, without
limitation, compliance with the public notice requirements of the Communications
Act of 1934, as amended. The failure by either party to timely file or
diligently prosecute its portion of the Assignment Applications shall be deemed
a material breach of this Agreement. Each party shall bear its own expenses in
connection with the preparation, filing and prosecution of the Assignment
Applications.
9.2 Xxxx-Xxxxx-Xxxxxx Act. Within twenty (20) business days after the
date of this Agreement, each party shall submit to the United States Department
of Justice and the United States Federal Trade Commission all forms and
information applicable to the transaction required under the Xxxx-Xxxxx-Xxxxxx
Antitrust Improvements Act of 1976, as amended, and the rules promulgated
thereunder (the "HSR Act"), and shall furnish to the other party all information
that the other reasonably requests in connection with such filings.
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9.3 Other Governmental Consents. Promptly following the execution of this
Agreement, Seller and Buyer shall proceed to prepare and file with the
appropriate governmental authorities (other than the Commission) such requests,
if any, for approval or waiver as may be required from such governmental
authorities in connection with the Transaction, and shall jointly, diligently
and expeditiously prosecute, and shall cooperate fully with each other in the
prosecution of, such requests for approval or waiver and all proceedings
necessary to secure such approvals and waivers.
9.4 Financial Information. Between the date hereof and the Closing Date,
Seller shall furnish Buyer with monthly financial statements within fifteen (15)
days after the end of each calendar month, and with such additional data
concerning the Stations' financial condition as are prepared by Seller in the
ordinary course of business, in the same form as the Financial Statements
contained in Schedule 6.18. Such financial statements and additional data shall
be accompanied by a certificate executed by the president of Seller certifying
that such financial statements and data: (i) have been prepared on a consistent
basis throughout the periods involved (except to the extent noted thereon) and
on a basis consistent with the year-end Financial Statements, and (ii) fairly
and accurately reflect the financial condition and the results of operations and
cash flows of the Stations as of the dates and for the periods indicated in all
material respects. Between the date hereof and the Closing Date, the president
of Seller shall make himself available to Buyer, upon prior notice, and at
reasonable times, to discuss and explain the compilation and preparation of the
Financial Statements and the monthly financial statements and such other
additional data provided pursuant to this Section 9.4, and each of the
constituent elements reflected thereon.
9.5 Third Party Consents. Seller shall use commercially reasonable
efforts to obtain the consents of the other contracting parties to the
assignment from Seller to Buyer of the Contracts requiring such consent. The
delivery of such consents to the assignment of Contracts that are identified on
Schedules 1.3(a), 1.3(c), 1.3(d) and 1.3(e) to be material to the operation of
the Stations ("Material Contracts") shall be a condition to Buyer's obligation
to close under Section 10.2.7.
9.6 Environmental Site Assessment. Within fifty (50) days of the
execution of this Agreement, Buyer may obtain a Phase I Environmental Assessment
for each of the parcels of the Real Property (the "Environmental Assessment").
In the event the Environmental Assessment discloses any recognized environmental
conditions or any potential that such conditions may exist, then Buyer may
conduct or have conducted at its expense additional testing to confirm or negate
the existence of any such conditions. If any such Environmental Assessment or
additional testing reflects the existence of any such conditions, Seller shall
cause the conditions to be remedied as quickly as possible (and in all events
prior to Closing) such that no recognized environmental conditions exist;
provided, however, that Seller shall not be obligated to expend in the aggregate
in excess of Seventy-Five Thousand Dollars ($75,000) to effect such remediation.
In the event that such remedial action(s) does cost in the aggregate in excess
of Seventy-Five Thousand Dollars ($75,000), Seller may elect not to take such
remedial action. In such event, Buyer may require Seller to proceed to Closing
and Buyer shall receive a proration at Closing, in the amount of Seventy-Five
Thousand Dollars ($75,000).
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Alternatively, Buyer may terminate this Agreement and Seller shall have no
liability to Buyer as a result of such termination. Such Environmental
Assessment shall not relieve Seller of any obligation with respect to any
representation, warranty or covenant of Seller in this Agreement or waive any
condition to Buyer's obligations under this Agreement. The cost of completing
the Environmental Assessment shall be paid by Buyer.
9.7 Title Insurance. Promptly following the execution of this Agreement,
Seller shall deliver to Buyer its existing title insurance policies. Seller
shall cooperate with Buyer to the extent necessary for Buyer to obtain a
commitment of a title insurance company to issue to Buyer, at standard rates,
ALTA 1992 Form extended coverage title insurance policies, insuring Buyer's
interest in the Real Property (the "Title Commitment"). The costs of the Title
Commitment and the policy to be issued pursuant to the Title Commitment shall be
paid by Buyer.
9.8 Surveys. Seller shall cooperate with Buyer to the extent necessary
for Buyer to obtain surveys of the Real Property sufficient to remove any
"survey exception" from the title insurance policies to be issued pursuant to
the Title Commitments. The cost of such surveys shall be paid by Buyer.
9.9 Confidentiality. Each party agrees that any and all information
learned or obtained by it from the other (and that is not otherwise public or
known in the radio broadcast industry) shall be confidential and agrees not to
disclose any such information to any person whatsoever other than as is
necessary for the purpose of effecting the Transaction or as otherwise required
by law.
9.10 Access. Between the date hereof and the Closing Date, Seller shall
give, upon prior notice, Buyer or representatives of Buyer (including lenders,
consultants and accountants) reasonable access to the Assets and to the books
and records of Seller relating to the business and operation of the Stations. It
is expressly understood that, pursuant to this Section, Buyer, at its sole
expense, shall be entitled to make such engineering inspections of the Stations,
and such audits of the Stations' financial records as Buyer may desire, so long
as the same do not unreasonably interfere with Seller's operation of the
Stations.
9.11 Employee Matters.
(a) As set forth on Schedule 6.10, Seller has provided to Buyer
an accurate list as of the date hereof of all current employees of the Stations
together with a description of the terms and conditions of their respective
employment and their duties as of the date of this Agreement. Seller shall
promptly notify Buyer of any changes that occur prior to Closing with respect to
such information.
(b) Buyer may extend offers of employment to those employees of
Seller whom it desires to hire (such employees are hereinafter referred to as
the "Hired Employees"), which offers shall be on terms and conditions that Buyer
shall determine in its sole discretion. Buyer shall provide notice to Seller at
least twenty (20) days prior to Closing identifying those employees to whom
Buyer intends to extend
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offers of employment and indicating whether Buyer intends to either assume the
employment agreements under which such employees are employed by Seller or enter
into new employment contracts with such employees. Nothing contained in this
Agreement shall obligate Buyer to hire any employee of Seller. Except to the
extent of any breaches or defaults under the terms of this Agreement, Seller
waives any claims against Buyer or any of the Hired Employees arising from such
employment, including without limitation any claims arising from any employment
agreement or non-compete agreement. On or prior to Closing, Seller shall
compensate each Station's employees for all accrued commissions, accrued
vacations, sick leave and other accrued benefits, or if Buyer assumes such
obligations, such liabilities shall be prorated between Seller and Buyer
pursuant to Article IV. Seller shall terminate the employment of all employees
effective on the Closing Date to whom Buyer has extended offers of employment.
(c) Nothing contained in this Agreement shall confer upon any
employee of Seller any right with respect to continued employment by Buyer, nor
shall anything herein interfere with the right of Buyer to terminate the
employment of any of the Hired Employees at any time, with or without cause.
9.12 Operations Prior to Closing. Between the date of this Agreement
and the Closing Date:
(a) Seller shall operate the Stations in the normal and usual
manner, consistent with Seller's past practice and the rules, regulations, and
policies of the Commission, and shall conduct the Stations' business only in the
ordinary course. To the extent consistent with such operations, Seller shall use
its commercially reasonable efforts to: (i) maintain the present character and
entertainment format of the Stations and the quality of its programs; (ii) keep
available for Buyer the services and number of each Station's present employees
reasonably necessary for the operation of the Stations; (iii) preserve each
Station's present customers and business relations; and (iv) continue to make
expenditures and engage in activities designed to promote the Stations; all
consistent with past practices of the Stations, provided that Seller shall not
be required to expend any funds or take any action outside the ordinary course
of business to comply with this covenant.
(b) Seller shall: (i) subject to Section 14.3, maintain the
Assets in their present condition (reasonable wear and tear in normal use
excepted); and (ii) maintain all inventories of supplies, tubes, and spare parts
at levels consistent with each Station's prior practices.
(c) Seller shall maintain its books and records in the usual
and ordinary manner, on a basis consistent with prior periods.
(d) Seller shall comply with all laws, rules, ordinances and
regulations applicable to it, to the Assets and to the business and operation of
the Stations.
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(e) Seller shall perform all Contracts without default and
shall pay all of Seller's trade accounts payable in a timely manner in
accordance with past practices of the Stations; provided, however, that Seller
may dispute, in good faith, any alleged obligation of Seller.
(f) Seller shall not, without the express written consent of
Buyer which shall not be unreasonably withheld, and which shall be deemed given
in the event Buyer has not responded to a written request therefor within ten
(10) days: (i) sell or agree to sell or otherwise dispose of any of the Assets
(A) other than in the ordinary course of business, and (B) unless such Assets
are replaced prior to Closing by assets of equal or greater worth, quality and
utility; (ii) acquiesce in any infringement, unauthorized use or impairment of
the Intangible Property or change the Stations' call signs; (iii) enter into any
employment contract on behalf of the Stations unless the same is terminable at
will and without penalty; or (iv) enter into any other contract, lease or
agreement that will be binding on Buyer after Closing unless Seller has entered
into such contract, lease or agreement in the ordinary course of business and
consistent with past practice and such contract, lease or agreement does not, in
the aggregate, impose obligations in excess of Twenty Thousand Dollars ($20,000)
provided, however, that the limitation in this clause (iv) shall not apply to
time sales agreements entered into by Seller in the ordinary course of business,
consistent with past practice and in exchange for cash but only if such time
sales agreements provide for termination upon sixty (60) days notice by Seller
(or by any party to which Seller assigns such agreement) without financial
penalty.
9.13 Adverse Developments. Seller shall promptly notify Buyer of any
unusual or materially adverse developments that occur prior to Closing with
respect to the Assets or the operation of the Stations; provided, however, that
Seller's compliance with the disclosure requirements of this Section 9.13 shall
not relieve Seller of any obligation with respect to any representation,
warranty or covenant of Seller in this Agreement or waive any condition to
Buyer's obligations under this Agreement.
9.14 Administrative Violations. If Seller receives any written finding,
order, complaint, citation or notice prior to the Closing Date which states that
any aspect of the Stations' operations violates any rule or regulation of the
Commission or of any other governmental authority (an "Administrative
Violation"), including without limitation any rule or regulation concerning
environmental protection, the employment of labor, or equal employment
opportunity, Seller shall promptly notify Buyer of the Administrative Violation.
9.15 Bulk Sales Act. Seller agrees to jointly and severally indemnify,
defend, and hold Buyer harmless against any claims, liabilities, costs, or
expenses, including reasonable attorneys' fees, that Buyer may incur as a result
of the failure to comply with the bulk sales provisions of the Uniform
Commercial Code or similar laws.
9.16 Control of Stations. This Agreement shall not be consummated until
after the Commission has given its written consent thereto, and notwithstanding
anything
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herein to the contrary, between the date of this Agreement and the Closing Date,
Buyer shall not directly or indirectly control, supervise or direct, or attempt
to control, supervise or direct the operation of the Stations. Such operations
shall be the sole responsibility of Seller.
9.17 Buyer's Financing: Other Documents and Acts. Seller shall, at
Buyer's expense, execute such other documents and perform such other acts as may
be reasonably necessary with respect to Buyer's financing of this Transaction
provided that Seller shall not be obligated to execute any document that imposes
additional or increased obligations on Seller.
9.18 Construction Permit Application. Within forty five (45) days of
the date of this Agreement, Seller shall file with the Commission a construction
permit application to move the night time transmitter of WHSR (AM) to the site
where the transmitters of WSBR (AM) are located (the "WHSR Application"). Seller
will diligently take all steps necessary or desirable and proper to prosecute
expeditiously the WHSR Application and to obtain the Commission's determination
that approval of the WHSR Application will serve the public interest,
convenience, and necessity, including, without limitation, compliance with the
public notice requirements of the Communications Act of 1934, as amended. The
failure by Seller to timely file or diligently prosecute the WHSR Application
shall be deemed a material breach of this Agreement. Seller shall bear its own
expenses in connection with the preparation, filing and prosecution of the WHSR
Application.
9.19 Additional Covenant. Buyer and Seller shall take all commercially
reasonable efforts to cause the consummation of the transactions contemplated by
this Agreement. Buyer and Seller shall not take any action that would conflict
with this Agreement, and each party shall notify the other if any of its
representations and warranties are no longer true and correct.
ARTICLE X.
CONDITIONS PRECEDENT
10.1 Mutual Conditions. The obligation of both Seller and Buyer to
consummate this Agreement is subject to the satisfaction of each of the
following conditions:
10.1.1 Governmental Consents. The Commission shall have granted
its consent to the Assignment Applications (the "FCC Consent"). Any applicable
waiting period under the HSR Act shall have expired or been earlier terminated
without receipt of any second or subsequent request for information from the
Department of Justice or Federal Trade Commission, or the time period for
further action by such agencies following any such second or subsequent request
for information shall have passed, and there shall have been neither any
commencement of any litigation by any governmental authority of competent
jurisdiction to restrain the consummation of the Transaction, nor any written
notice from such governmental authority of a decision to commence such
litigation, which has not been withdrawn or otherwise resolved.
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10.1.2 Absence of Litigation. As of the Closing Date, no action,
claim, suit or proceeding seeking to enjoin, restrain, or prohibit the
consummation of the Transaction shall be pending before any court, the
Commission, or any other governmental authority; provided, however, that this
condition may not be invoked by a party if any such action, suit, or proceeding
was solicited or encouraged by, or instituted as a result of any act or omission
of, such party.
10.2 Conditions to Buyer's Obligation. In addition to satisfaction of
the mutual conditions contained in Section 10.1, the obligation of Buyer to
consummate this Agreement is subject to the satisfaction of each of the
following conditions:
10.2.1 Representations and Warranties. The representations and
warranties of Seller to Buyer shall be true, complete, and correct in all
material respects as of the Closing Date with the same force and effect as if
then made, except to the extent expressly made as of an earlier date and except
for changes expressly permitted or contemplated by this Agreement.
10.2.2 Compliance with Conditions. All of the terms, conditions
and covenants to be complied with or performed by Seller on or before the
Closing Date shall have been complied with and performed in all material
respects.
10.2.3 No Material Adverse Development. No material adverse
development shall have occurred with respect to the Stations that results in a
significant impairment to the ability of the Stations to operate as they are
currently operated or represents a substantial impairment of the aggregate value
of the Stations or Assets being conveyed.
10.2.4 Surveys. The surveys specified in Section 9.8 shall reveal
nothing inconsistent with Seller's representations and warranties hereunder.
10.2.5 Validity of Station Licenses. On the Closing Date, Seller
shall be the owner and holder of the Station Licenses to the extent that such
authorizations can be owned or held by Seller under the Communications Act of
1934, as amended; the Station Licenses shall be in unconditional full force and
effect, valid for the balance of the current license term applicable generally
to radio stations licensed to communities in the state where the Stations are
located; and the Station Licenses shall be unimpaired by any acts or omissions
of Seller or Seller's employees, agents, officers, directors or shareholders.
10.2.6 Closing Documents. Seller shall deliver to Buyer all of the
closing documents specified in Section 11.2.1, all of which documents shall be
dated as of the Closing Date, duly executed, and in a form customary in
transactions of this type and reasonably acceptable to Buyer.
10.2.7 Third Party Consents. Seller shall have obtained all
consents to the assignment of Material Contracts (a "Required Consent"), such
that Buyer will enjoy all of the rights and privileges of Seller under the
Contracts subject only to the same obligations as are binding on Seller
thereunder, pursuant to the present terms thereof. In the event Seller fails to
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obtain any consent necessary to validly assign a Contract (other than a Required
Consent), such Contract shall not be assigned to Buyer at Closing; provided,
however, that Buyer may elect to require that Seller provide Buyer the benefits
under such Contract until such necessary consent is obtained and such Contract
is then assigned to Buyer; provided further, that Buyer shall reimburse Seller
for amounts paid by Seller pursuant to the terms of such Contracts to the extent
Buyer receives benefits thereunder.
10.2.8 Finality. The FCC Consent shall have become a Final Order.
"Final Order" means an order or action of the Commission that, by reason of
expiration of time or exhaustion of remedies, is no longer subject to
administrative or judicial reconsideration or review.
10.2.9 Satisfactory Environmental Assessment. To the extent that
the Environmental Assessment or additional testing conducted pursuant to Section
9.6 hereof reflects the existence of conditions contrary to any representation
or warranty in this Agreement, either (i) Seller shall have completed the
remediation of such conditions in accordance with Section 9.6 hereof or (ii)
Buyer shall have provided notice to Seller of Buyer's election to proceed to
Closing with the proration to the Purchase Price specified in Section 9.6
hereof.
10.2.10 Office Building Contract. All of the conditions precedent
to Xxxxxxx Family Towers, Inc.'s ("BFT") obligation to consummate the
transactions contemplated by that Purchase and Sale Agreement, dated as of
December 30, 1999, between Panamedia Square Realty, Inc. ("Panamedia") and BFT
shall have been satisfied.
10.3 Conditions to Seller's Obligation. In addition to satisfaction of
the mutual conditions contained in Section 10.1, the obligation of Seller to
consummate this Agreement is subject to satisfaction of each of the following
conditions:
10.3.1 Representations and Warranties. The representations and
warranties of Buyer to Seller shall be true, complete and correct in all
material respects as of the Closing Date with the same force and effect as if
then made, except to the extent expressly made as of an earlier date and except
for changes expressly permitted or contemplated by this Agreement.
10.3.2 Compliance with Conditions. All of the terms, conditions
and covenants to be complied with or performed by Buyer on or before the Closing
Date shall have been timely complied with and performed in all material
respects.
10.3.3 Payment. Buyer shall have paid Seller the Purchase Price as
adjusted in accordance with Article IV and Section 9.6 hereof.
10.3.4 Closing Documents. Buyer shall deliver to Seller all the
closing documents specified in Section 11.2.2, all of which documents shall be
dated as of the Closing Date, duly executed, and in a form customary in
transactions of this type and reasonably satisfactory to Seller.
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10.3.5 Office Building Contract. All of the conditions precedent
to Panamedia's obligation to consummate the transactions contemplated by that
Purchase and Sale Agreement, dated as of December 30, 1999, between Panamedia
and BFT shall have been satisfied.
ARTICLE XI.
CLOSING
11.1 Closing Date. The Closing hereunder shall occur on a date mutually
agreeable to Buyer and Seller within fifteen (15) business days after the later
of (i) the date that the Commission's action granting its consent to the
Assignment Applications has become a Final Order, or, at the election of the
Buyer, the date of the Commission's action granting its consent and (ii) the
date on which the applicable waiting period under the HSR Act has expired or
been earlier terminated without receipt of any second or subsequent request for
information from the Department of Justice or Federal Trade Commission, or the
time period for further action by such agencies following any such second or
subsequent request for information shall have passed, and there shall have been
neither any commencement of any litigation by any governmental authority of
competent jurisdiction to restrain the consummation of the Transaction, nor any
written notice from such governmental authority of a decision to commence such
litigation, which has not been withdrawn or otherwise resolved (the "Closing
Date"); provided, however, that the Closing shall occur no later than September
30, 2000 (the "Upset Date"). The Closing shall be effective as of 12:00 a.m. EST
on the Closing Date. The Closing shall take place on the Closing Date at (i) the
offices of Buyer's counsel in Washington, D.C., commencing at 10:00 a.m. EST or
(ii) such other mutually acceptable time or place. If, as of the Closing Date,
any condition precedent described in Article X has not been satisfied, the party
that is entitled to require that such condition be satisfied may (in its sole
discretion) notify the other party of the absence of such condition precedent at
or before the Closing and simultaneously therewith postpone the Closing until a
date ten (10) days after all such conditions have been (or are able to be)
performed, and such postponed date shall constitute the new Closing Date for all
purposes hereunder except that such postponed closing date shall occur no later
than the Upset Date. Each of the parties shall use its reasonable best efforts
to obtain any FCC authority necessary to schedule the Closing Date as
contemplated in this Section.
11.2 Performance at Closing. The following documents shall be executed
and delivered at Closing:
11.2.1 Seller shall deliver to Buyer:
(a) A certificate executed by the Seller attesting to the
Seller's compliance with the matters set forth in Sections 10.2.1, 10.2.2 and
10.2.3 together with certified copies of (i) the Certificates of Incorporation
of the Seller and (ii) appropriate evidence of the Seller's authorization to
enter into and consummate this Agreement.
(b) One or more assignments transferring to Buyer all of the
interests of Seller in and to the Station Licenses, the Station Applications,
and all other
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licenses, permits, and authorizations issued by any other governmental
authorities that are used in or necessary for the lawful operation of the
Stations.
(c) One or more bills of sale conveying to Buyer the Station
Equipment.
(d) One or more assignments, together with all Required
Consents assigning to Buyer all of the Contracts, the Station Records and the
Intangible Property.
(e) One or more assignments, limited warranty deeds or other
appropriate instruments conveying to Buyer all rights of Seller in the Real
Property and all Required Consents to such assignments.
(f) The Covenant.
(g) An opinion of Seller's corporate and FCC Counsel, dated the
Closing Date, substantially in the form set forth in Exhibit B, subject to
customary qualifications and to be for the benefit of and to be relied upon by
Buyer and the Senior Lenders.
(h) The affidavit described in Section 6.16.
(i) UCC-3 termination statements executed by Admiralty Bank
along with such other documents and instruments as may be necessary in order to
evidence the termination, discharge and release of all Liens that Admiralty Bank
maintains on the Assets, including without limitation, a letter executed by
Admiralty Bank stating that as of Closing, Admiralty Bank has terminated,
discharged and released all Liens described on Schedule 6.6(a) as being in favor
of Admiralty Bank and all other Liens that Admiralty Bank maintains on the
Assets.
11.2.2 Buyer shall deliver to Seller:
(a) A certificate executed by Buyer attesting to Buyer's
compliance with the matters set forth in Sections 10.3.1 and 10.3.2, together
with certified copies of (i) the Certificate of Incorporation of Buyer and (ii)
appropriate evidence of Buyer's authorization to enter into and consummate this
Agreement.
(b) The Purchase Price as adjusted in accordance with Article
IV and Section 9.6 hereof.
(c) Such assumption agreements and other instruments and
documents as are required to make, confirm, and evidence Buyer's assumption of
and obligation to pay, perform, or discharge Seller's obligations under the
Contracts and the Station Licenses to the extent the same are to be assumed by
Buyer pursuant to the terms of this Agreement.
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11.2.3 Other Documents and Acts. The parties will also execute
such other documents and perform such other acts, before and after the Closing
Date, as may be reasonably necessary for the complete implementation and
consummation of this Agreement.
ARTICLE XII.
POST-CLOSING OBLIGATIONS
The parties covenant and agree as follows with respect to the period
subsequent to the Closing Date:
12.1 Indemnification.
12.1.1 Buyer's Right to Indemnification. Seller undertakes and
agrees to jointly and severally indemnify, defend by counsel reasonably
acceptable to Buyer, and hold harmless Buyer, its parent, subsidiaries,
affiliates, successors and assigns and their respective directors, officers,
employees, shareholders, representatives and agents (hereinafter referred to
collectively as "Buyer Indemnitees") from and against and in respect of any and
all losses, costs, liabilities, claims, obligations, diminution in value and
expenses, including reasonable attorneys' fees, incurred or suffered by a Buyer
Indemnitee ("Losses") arising from (i) the claims of third parties with respect
to operation of the Stations or ownership of the Assets prior to Closing not
expressly assumed by Buyer pursuant to this Agreement or otherwise consented to
by Buyer in writing; (ii) a breach, misrepresentation, or other violation of any
of Seller's covenants, warranties or representations contained in this
Agreement; (iii) all liabilities of Seller or the Stations related to the period
prior to the Closing and not expressly assumed by Buyer pursuant to this
Agreement or otherwise consented to by Buyer in writing; (iv) all liens,
charges, or encumbrances on any of the Assets which are not expressly permitted
by this Agreement or otherwise consented to by Buyer in writing; (v) all
Administrative Violations and alleged Administrative Violations occurring prior
to Closing; and (vi) any breach or default by Seller under any Contract prior to
Closing. The foregoing indemnity is intended by Seller to cover all acts, suits,
proceedings, claims, demands, assessments, adjustments, diminution in value,
costs, and expenses with respect to any and all of the specific matters in this
indemnity set forth.
12.1.2 Seller's Right to Indemnification. Buyer undertakes and
agrees to indemnify, defend by counsel reasonably acceptable to Seller, and hold
harmless Seller, its parent, subsidiaries, affiliates, successors and assigns
and their respective directors, officers, employees, shareholders,
representatives and agents (hereinafter referred to collectively as "Seller
Indemnitees") against any and all Losses incurred or suffered by a Seller
Indemnitee arising from (i) the claims of third parties with respect to the
operation of the Stations or ownership of the Assets after Closing; (ii) a
breach, misrepresentation, or other violation of any of Buyer's covenants,
warranties or representations contained in this Agreement; (iii) all liabilities
under the Contracts and the Station Licenses to the extent specifically assumed
by Buyer pursuant to this Agreement; and (iv) any breach or default by Buyer
under any Contract after Closing. The foregoing indemnity is intended by Buyer
to cover all acts, suits, proceedings, claims, demands, assessments,
adjustments, costs, and expenses with respect to any and all of the specific
matters in this indemnity set forth.
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12.1.3 Conduct of Proceedings. If any claim or proceeding covered
by the foregoing agreements to indemnify and hold harmless shall arise, the
party who seeks indemnification (the "Indemnified Party") shall give written
notice thereof to the other party (the "Indemnitor") promptly after the
Indemnified Party learns of the existence of such claim or proceeding; provided,
however, that the Indemnified Party's failure to give the Indemnitor prompt
notice shall not bar the Indemnified Party's right to indemnification unless
such failure has materially prejudiced the Indemnitor's ability to defend the
claim or proceeding. The Indemnitor shall have the right to employ counsel
reasonably acceptable to the Indemnified Party to defend against any such claim
or proceeding, or to compromise, settle or otherwise dispose of the same, if the
Indemnitor deems it advisable to do so, all at the expense of the Indemnitor;
provided that the Indemnitor shall not have the right to control the defense of
any such claim or proceeding unless it has acknowledged in writing its
obligation to indemnify the Indemnified Party fully from all liabilities
incurred as a result of such claim or proceeding and then and periodically
thereafter provides the Indemnified Party with reasonably sufficient evidence of
the ability of the Indemnitor to satisfy any such liabilities. The parties will
fully cooperate in any such action, and shall make available to each other any
books or records useful for the defense of any such claim or proceeding. If the
Indemnitor fails to acknowledge in writing its obligation to defend against or
settle such claim or proceeding within twenty (20) days after receiving notice
thereof from the Indemnified Party (or such shorter time specified in the notice
as the circumstances of the matter may dictate), the Indemnified Party shall be
free to dispose of the matter, at the expense of the Indemnitor, in any way in
which the Indemnified Party deems to be in its best interest.
12.1.4 Indemnification Sole Remedy. The right to indemnification
hereunder shall be the exclusive remedy of any party in connection with any
breach by another party of its representations, warranties, or covenants, under
this Agreement, provided, however, that nothing in this Section 12.1.4 shall act
to limit Buyer's rights, relief or remedies under the Covenant.
12.1.5 Limits on and Conditions of Indemnification; Threshold and
Cap. Notwithstanding any other provision (other than Section 15.2 hereof) of
this Agreement, no Indemnified Party shall be entitled to make a claim against
an Indemnitor in respect of any breach of this Agreement except to the extent
that the aggregate amount of such damages exceeds the amount of Fifty Thousand
Dollars ($50,000); provided, however, that once such aggregate amount has been
exceeded, such Indemnitor shall be liable for the full amount of such damages.
Notwithstanding any other provision of the Agreement, neither the indemnity
obligation of Seller nor the indemnity obligation of Buyer shall exceed One
Million Five Hundred Thousand Dollars ($1,500,000).
12.2 Post-Closing Access. Each party agrees that it will cooperate with
and make available to the other party, during normal business hours and upon
reasonable notice, all books and records which are necessary or useful in
connection with any tax inquiry, audit, investigation or dispute, any litigation
or investigation or any other matter requiring any such books and records,
information or employees for any reasonable business purpose. The party
requesting any such books and records, information or employees shall bear all
of the
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out-of-pocket costs and expenses reasonably incurred in connection with
providing such books and records, information or employees. All information
received pursuant to this Section 12.2 shall be kept confidential by the party
receiving it. If Buyer or Seller is required by legal process or operation of
law to disclose any confidential information, it shall provide the other party
with prompt written notice of such request so that such other party may seek an
appropriate protective order.
ARTICLE XIII.
DEFAULT AND REMEDIES
13.1 Termination by Seller Upon Buyer's Default. This Agreement may be
terminated by Seller and the purchase and sale of the Stations abandoned, if
Seller is not then in material default, upon written notice to Buyer, upon the
occurrence of any of the following:
(a) If on the date that would otherwise be the Closing Date any
of the conditions precedent to the obligations of Seller set forth in this
Agreement have not been satisfied in all material respects or waived in writing
by Seller and Buyer shall not have cured such failure to satisfy such conditions
within ten (10) days thereafter.
(b) If there shall be in effect on the date that would
otherwise be the Closing Date any judgment, decree or order that would prevent
or make unlawful the Closing.
(c) If the Closing shall not have occurred by September 30,
2000.
(d) If there shall have been any material breach of any
representation, warranty, covenant or agreement made herein on the part of Buyer
and Buyer shall not have cured such breach within twenty (20) days after Seller
has given notice to Buyer of such breach.
13.2 Termination by Buyer Upon Seller's Default. This Agreement may be
terminated by Buyer and the purchase and sale of the Stations abandoned, if
Buyer is not then in material default, upon written notice to Seller, upon the
occurrence of any of the following:
(a) If on the date that would otherwise be the Closing Date any
of the conditions precedent to the obligations of Buyer set forth in this
Agreement have not been satisfied in all material respects or waived in writing
by Buyer and Seller shall not have cured such failure to satisfy such conditions
within ten (10) days thereafter.
(b) If there shall be in effect on the date that would
otherwise be the Closing Date any judgment, decree or order that would prevent
or make unlawful the Closing.
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(c) If the Closing shall not have occurred by September 30,
2000.
(d) If there shall have been any material breach of any
representation, warranty, covenant or agreement made herein on the part of
Seller and Seller shall not have cured such breach within twenty (20) days after
Buyer has given notice to Seller of such breach.
13.3 Letter of Credit. Upon execution and delivery of this Agreement,
Buyer shall deliver a letter of credit in the amount of Nine Hundred Thousand
Dollars ($900,000) (the "Letter of Credit") to Xxxxxxxxx & Company, Inc. (the
"Escrow Agent") in accordance with an escrow agreement among Buyer, Seller and
the Escrow Agent (the "Escrow Agreement") attached hereto as Exhibit C. The
Letter of Credit shall be held and disbursed in accordance with the terms of the
Escrow Agreement and the following provisions:
(a) Upon Closing, Buyer and Seller shall jointly instruct the
Escrow Agent to return the Letter of Credit to Buyer.
(b) If this Agreement is terminated pursuant to Section 9.6,
13.2 or Article XIV and Section 13.3(c) does not apply and Buyer is not in
material breach of this Agreement, Buyer and Seller shall jointly instruct the
Escrow Agent to return the Letter of Credit to Buyer.
(c) If this Agreement is terminated pursuant to Section 13.1 or
otherwise on account of a breach by Buyer, and Seller is not in material breach
of this Agreement, then Buyer and Seller shall jointly instruct the Escrow Agent
to disburse all amounts held by the Escrow Agent pursuant to the Escrow
Agreement to Seller.
13.4 Seller's Remedies. If this Agreement is terminated by Seller and
Section 13.3(c) applies, then the payment to Seller pursuant to Section 13.3(c)
shall be liquidated damages and shall constitute full payment and the exclusive
remedy for any damages suffered by Seller. Seller and Buyer agree in advance
that actual damages would be difficult to ascertain and that the amount of the
payment to be made to Seller pursuant to Section 13.3(c) is a fair and equitable
amount to reimburse Seller for damages sustained due to Buyer's breach of this
Agreement. IF THIS AGREEMENT IS TERMINATED BY SELLER AND SECTION 13.3(c) DOES
NOT APPLY, SELLER'S CLAIMS TO DAMAGES ARISING FROM A BREACH BY BUYER SHALL NOT
EXCEED NINE HUNDRED THOUSAND DOLLARS ($900,000).
13.5 Buyer's Remedies. The parties recognize that if, prior to Closing,
Seller breaches this Agreement and refuses to perform under the provisions of
this Agreement, monetary damages alone would not be adequate to compensate Buyer
for its injury. Buyer shall therefore be entitled, in addition to any other
remedies that may be available, to obtain specific performance of the terms of
this Agreement prior to Closing. If any action is brought by Buyer to enforce
this Agreement prior to Closing, Seller shall waive the defense that there is an
adequate remedy at law. In the event Buyer elects to terminate this Agreement as
a result of Seller's default instead of seeking specific performance, Buyer
shall be entitled to recover
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Buyer's damages. Following the Closing, Buyer shall be entitled, in addition to
any other remedies that may be available, to seek specific performance of the
terms of this Agreement if such remedy is available at equity.
ARTICLE XIV.
TERMINATION
14.1 Designation for Hearing. Either party may terminate this Agreement
upon notice to the other, if, for any reason, the Assignment Applications are
designated for hearing by the Commission; provided, however, that notice of
termination must be given within twenty (20) days after release of the hearing
designation order and that the party giving such notice is not in default and
has otherwise complied with its obligations under this Agreement. Upon
termination pursuant to this Section 14.2, the parties shall be released and
discharged from any further obligation hereunder.
14.2 Damage.
14.2.1 Risk of Loss. The risk of loss or damage to the Assets
shall be upon Seller at all times prior to the Closing. In the event of loss or
damage, Seller shall promptly notify Buyer thereof and shall repair, replace and
restore the lost or damaged property to its former condition as soon as
possible. If such repair, replacement and restoration has not been completed
prior to the Closing Date, Buyer may, at its option:
(a) elect to terminate this Agreement, but only if the failure
to repair, replace and restore the lost or damaged property continues for a
period in excess of sixty (60) days from the date that would be the Closing Date
without consideration of this Section 14.2;
(b) elect to consummate the Transaction on the Closing Date in
which event Seller shall pay to Buyer the amount necessary to restore the lost
or damaged property to its former condition and against such obligation shall
assign to Buyer all of Seller's rights under any applicable insurance policies;
or
(c) elect to postpone the Closing Date, with prior consent of
the Commission if necessary, which consent both parties will use their
reasonable best efforts to obtain, until a date within fifteen (15) business
days after Seller gives written notice to Buyer of completion of the repair,
replacement and restoration of such lost or damaged property. If, after the
expiration of that extension period, the lost or damaged property has not been
adequately repaired, replaced or a restored, Buyer may terminate this Agreement,
and the parties shall be released and discharged from any further obligation
hereunder.
14.2.2 Failure of Broadcast Transmission. Seller shall give prompt
written notice to Buyer if either of the following (a "Specified Event") shall
occur: (i) the regular broadcast transmissions of any of the Stations in the
normal and usual manner are interrupted or discontinued; or (ii) any of the
Stations are operated at less than their respective licensed antenna
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height above average terrain or at less than ninety percent (90%) of its
licensed effective radiated power. If any Specified Event persists for more than
seventy-two (72) hours (or, in the event of force majeure or utility failure
affecting generally the markets served by the Stations, ninety-six (96) hours),
whether or not consecutive, during any period of thirty (30) consecutive days,
then Buyer may, at its option: (i) terminate this Agreement by written notice
given to Seller not more than ten (10) days after the expiration of such thirty
(30) day period, or (ii) proceed in the manner set forth in Section 14.2.1,
provided, however, that such seventy-two (72) hour or ninety-six (96) hour time
limit, as applicable, shall not apply so long as Seller immediately proceeds in
a commercially reasonable manner to do all actions necessary to remedy the
Specified Event. In the event of termination of this Agreement by Buyer pursuant
to this Section, the parties shall be released and discharged from any further
obligation hereunder.
14.2.3 Resolution of Disagreements. If the parties are unable to
agree upon the extent of any loss or damage, the cost to repair, replace or
restore any lost or damaged property, the adequacy of any repair, replacement,
or restoration of any lost or damaged property, or any other matter arising
under this Section 14.2, the disagreement shall be referred to a qualified
consulting communications engineer mutually acceptable to Seller and Buyer who
is a member of the Association of Federal Communications Consulting Engineers,
whose decision shall be final, binding upon and non-appealable by the parties,
and whose fees and expenses shall be paid one-half by Seller and one-half by
Buyer.
14.3 Legal Actions. If, prior to the Closing Date, any action, suit, or
proceeding shall have been instituted by or before any court or other
governmental authority (other than the Commission) to enjoin, restrain, or
prohibit the consummation of the Transaction, the Closing may be adjourned at
the option of either party, with prior consent of the Commission if necessary,
which consent both parties will use their reasonable best efforts to obtain, for
a period of up to ninety (90) days, and if, at the end of such period, the
action, suit, or proceeding shall not have been favorably resolved, either party
may, by written notice to the other, terminate this Agreement; provided,
however, that if such action, suit, or proceeding shall have been solicited or
encouraged by, or instituted as a result of any act or omission of, Seller or
Buyer, then such party shall not have any right of adjournment or termination
pursuant to this Section. In the event of termination pursuant to this Section,
the parties shall be released and discharged from any further obligation
hereunder.
ARTICLE XV.
POST-CLOSING OBLIGATIONS OF SELLER
15.1 Future Financings. Seller acknowledges that Buyer may use the
financial statements of Seller and other information regarding Seller in
connection with future financings by Buyer, including in an initial public
offering prospectus and a registration statement filed under the Securities Act
of 1933, as amended (the "Public Filings") to be issued or filed by Buyer so
long as neither Seller nor any affiliate thereof shall incur potential liability
under the securities laws as a result of such inclusion of the financial
statements in the Public Filings. For a period of three (3) years from the
Closing Date, Seller shall cooperate in a commercially reasonable manner with
Buyer so that Buyer can obtain information sufficient for
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Buyer to prepare an initial public offering prospectus and the Public Filings,
in each case at Buyer's sole expense. The foregoing cooperation of Seller shall
include (i) compiling the requisite financial information, including supplying
financial information for purposes of comfort letters to be issued in connection
with Public Filings, and (ii) granting Buyer and its accountants full and
complete access to the books and records of Seller and to any personnel
knowledgeable about such books and records (including the Seller's accountants),
in each case, to the extent reasonably requested by Buyer. Notwithstanding
anything contained herein, Seller shall not be required to take any act under
this Article XV that could impose any liability on Seller or any affiliate
thereof.
15.2 Removal of Liens. Seller shall cause its obligations which are not
yet due and payable as of the Closing Date and which could result in a Lien on
the Assets, to be timely paid in full. Notwithstanding any other provision in
this Agreement, this Section 15.2 shall survive Closing for a period of three
(3) years, at which time the same shall expire (except for claims asserted
during such three (3) year period). Notwithstanding the immediately preceding
sentences, after the first twelve (12) months following the Closing, Buyer shall
not be entitled to make a claim against Seller in respect of a breach of this
Section 15.2 except to the extent that the aggregate amount of such damages
exceeds the amount of One Thousand Dollars ($1,000); provided, however that once
such aggregate amount has been exceeded, Seller shall be liable for the full
amount of such damages. During the first twelve (12) months following the
Closing, Section 12.1.5 shall apply.
ARTICLE XVI.
GENERAL PROVISIONS
16.1 Brokerage. Each party represents and warrants to the other that no
agent, broker, investment banker, or other person or firm acting on behalf of
such party or any of its affiliates or under the authority of any of them, other
than Xxxxxxxxx & Company, Inc., is or will be entitled to any broker's or
finder's fee or any other commission or similar fee in connection with the
Transaction. Seller shall pay Three Hundred Sixty-Five Thousand Dollars
($365,000) to Xxxxxxxxx & Company, Inc., representing all fees due and owing to
Xxxxxxxxx & Company, Inc. Each party hereby agrees to indemnify, save harmless
and defend the other from and against all claims, losses, liabilities and
expenses, including reasonable attorney's fees, arising out of any claim made by
any broker, finder or other intermediary who claims to have dealt with such
party in connection with the transaction which is the subject of this Agreement.
The provisions of this Section 16.1 shall survive Closing hereunder.
16.2 Expenses. Except as otherwise provided herein, all expenses
involved in the preparation and consummation of this Agreement shall be borne by
the party incurring the same whether or not the Transaction is consummated. All
Commission filing fees for the Assignment Applications and all filing fees
required to be paid under the HSR Act shall be shared equally by Buyer and
Seller. All recording costs for instruments of transfer, and all stamp, sales,
use and transfer taxes shall be paid by Seller.
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16.3 Notices. All notices, requests, demands, and other communications
pertaining to this Agreement shall be in writing and shall be deemed duly given
when delivered personally (which shall include delivery by Federal Express or
other nationally recognized, reputable overnight courier service that issues a
receipt or other confirmation of delivery) to the party for whom such
communication is intended, or three (3) business days after the date mailed by
certified or registered U.S. mail, return receipt requested, postage prepaid,
addressed as follows:
(a) If to Seller:
SMH Broadcasting, Inc.
0000 X. Xxxxxxx Xxxxxxx
Xxxxx 000
Xxxx Xxxxx, XX 00000
Attn: Xxxxxx Xxxxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
and
Xxxx Xxxxx, Esq.
Dow, Xxxxxx & Xxxxxxxxx, PLLC
0000 Xxx Xxxxxxxxx Xxxxxx, X.X.
Xxxxx 000
Washington, D. C. 20036-6802
Tel: 000-000-0000
Fax: 000-000-0000
(Counsel to Seller)
(b) If to Buyer:
Xxxxxxx XX Acquisition Corp.
0000 Xxxxxxx Xxxxx, Xxxxx 000
Xxxxxx, Xxxxxxx 00000
Attn: Xxxxxxxx Xxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
and
Xxxxxx X. Xxxxxxxx, Esq.
Xxxxxx & Xxxxxxx
0000 Xxxxxxxxxxxx Xxxxxx, X.X.
Xxxxx 0000
Xxxxxxxxxx, X.X. 00000
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Tel: (000) 000-0000
Fax: (000) 000-0000
(Counsel to Xxxxxxx XX Acquisition Corp.)
(c) If to Escrow Agent:
Xxxxxxxxx & Company, Inc.
000 X. Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000
Attn: Xxxxx X. Xxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
Any party may change its address for notices by notice to the others given
pursuant to this Section.
16.4 Attorneys' Fees. If either party initiates any litigation against
the other party involving this Agreement, the prevailing party in such action
shall be entitled to receive reimbursement from the other party for all
reasonable attorneys' fees and other costs and expenses incurred by the
prevailing party in respect of that litigation, including any appeal, and such
reimbursement may be included in the judgment or final order issued in that
proceeding.
16.5 Survival of Representations, Warranties and Indemnification
Rights. The several representations and warranties of the parties contained
herein, and the parties respective indemnification rights pursuant to Section
12.1, shall survive the Closing for a period of one (1) year, at which time the
same shall expire (except for claims asserted during such one (1) year period).
16.6 Exclusive Dealings. For so long as this Agreement remains in
effect, neither Seller, its officers, directors, employees, nor any person
acting on Seller's behalf, shall, directly or indirectly, solicit or initiate
any offer from, or conduct any negotiations with, any person other than Buyer or
Buyer's assignee(s) concerning the acquisition of the Stations.
16.7 Waiver. Unless otherwise specifically agreed in writing to the
contrary: (i) the failure of any party at any time to require performance by any
other of any provision of this Agreement shall not affect such party's right
thereafter to enforce the same; (ii) no waiver by any party of any default by
any other shall be valid unless in writing and acknowledged by an authorized
representative of the non-defaulting party, and no such waiver shall be taken or
held to be a waiver by such party of any other preceding or subsequent default;
and (iii) no extension of time granted by any party for the performance of any
obligation or act by any other party shall be deemed to be an extension of time
for the performance of any other obligation or act hereunder.
16.8 Assignment. No party may assign its rights or obligations
hereunder without the prior written consent of the other parties except: (i)
Buyer may assign all or a portion of its rights and obligations to a
corporation, partnership or other business entity that
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controls, is controlled by, or is under common control with Buyer, including
without limitation, the assignment of the Station Licenses and Station
Applications to an affiliate (a "License Sub"), provided that any such
assignment shall not release Buyer from any of its obligations under this
Agreement and (ii) Buyer may make a collateral assignment of its rights under
this Agreement to any lender that provides funds to Buyer for the acquisition or
operation of the Stations. Seller agrees to execute acknowledgments of any
assignment(s) and collateral assignment(s) pursuant to this Section 16.8 in such
forms as Buyer or Buyer's lender(s) may from time to time reasonably request.
Subject to the foregoing, this Agreement shall be binding upon, inure to the
benefit of, and be enforceable by the parties hereto and their respective
successors and assignees.
16.9 Entire Agreement. This Agreement and the Exhibits and Schedules
hereto (which are incorporated by reference herein) constitute the entire
agreement between the parties with respect to the subject matter hereof and
referenced herein, supersede and terminate any prior agreements between the
parties (written or oral). This Agreement may not be altered or amended except
by an instrument in writing signed by the party against whom enforcement of any
such change is sought.
16.10 Counterparts. This Agreement may be signed in any number of
counterparts with the same effect as if the signatures on each such counterpart
were on the same instrument.
16.11 Construction. The Section headings of this Agreement are for
convenience only and in no way modify, interpret or construe the meaning of
specific provisions of the Agreement. As used herein, the neuter gender shall
also denote the masculine and feminine, and the masculine gender shall also
denote the neuter and feminine, where the context so permits.
16.12 Schedules and Exhibits. The Schedules and Exhibits to this
Agreement are a material part of this Agreement.
16.13 Severability. If any one or more of the provisions contained in
this Agreement should be found invalid, illegal or unenforceable in any respect,
the validity, legality, and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby. Any illegal or
unenforceable term shall be deemed to be void and of no force and effect only to
the minimum extent necessary to bring such term within the provisions of
applicable law and such term, as so modified, and the balance of this Agreement
shall then be fully enforceable.
16.14 Choice of Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Florida, without regard to the
choice of law rules utilized in that jurisdiction.
16.15 Counsel. Each party has been represented by its own counsel in
connection with the negotiation and preparation of this Agreement and,
consequently, each party hereby waives the application of any rule of law that
would otherwise be applicable in connection with the interpretation of this
Agreement, including but not limited to any rule of law
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to the effect that any provision of this Agreement shall be interpreted or
construed against the party whose counsel drafted that provision.
[THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.
SIGNATURES FOLLOW ON NEXT PAGE.]
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IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
executed by a respective duly authorized officer as of the date first written
above.
SELLER:
SMH BROADCASTING, INC.
By: /s/ XXXXXX X. XXXXXXXXX
----------------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: VP
HHH BROADCASTING, INC.
By: /s/ XXXXXX X. XXXXXXXXX
----------------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: President
HMS BROADCASTING, INC.
By: /s/ XXXXXX X. XXXXXXXXX
----------------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: President
BUYER:
XXXXXXX XX ACQUISITION CORP.
By: /s/ XXXXXXXX XXXXXXX
----------------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Secretary
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