THE EXECUTION AND DELIVERY OF THIS AGREEMENT SHALL NOT RESULT IN THE LOSS OF ANY
CONTROL BY SELLERS WITH RESPECT TO ANY OF THE STATIONS OR ANY OTHER CONTROL THE
LOSS OF WHICH WOULD BE IN VIOLATION OF FCC RULES AND REGULATIONS, UNTIL SUCH
TIME AS THE FCC APPROVES THE CHANGE OF CONTROL OF ALL OF THE STATIONS FROM THE
SELLERS TO THE BUYER AND THE CLOSING HAS IN FACT TAKEN PLACE.
ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement, dated February 3, 1998 is entered into by
and between the Sellers (hereafter defined) and Buyer (hereafter defined).
RECITALS:
A. Sellers are collectively the owners of the Assets (hereafter
defined) which include licenses duly granted by the Federal Communications
Commission.
B. Buyer desires to purchase the Assets from Sellers, and Sellers
desire to sell the Assets to Buyer, subject to approval of the Federal
Communications Commission and upon the terms and provisions of this Agreement.
NOW, THEREFORE, Know All Men By These Presents, that for and in
consideration of the premises and the respective agreements hereinafter set
forth, the parties hereto agree, covenant, warrant and represent as follows:
Section 1. Definitions. For purposes of this Agreement the following
terms shall have the indicated meaning:
"ABI" means Abilene Broadcasting, Inc., a Texas corporation.
"ACCOUNTS RECEIVABLE" means the rights of Sellers, and each of them, to
receive cash payments for the sale of air time and all other services and
business of the Stations rendered or sold at any time prior to the Closing
Date.
"AFFILIATE" means with reference to the Person indicated by the context
any Person directly or indirectly controlling, controlled by or under
common control with such indicated Person and any director, shareholder,
officer, partner, principal, member, owner or employee of any of such
Persons. For purposes of this definition and this Agreement, the term
"control" (and correlative terms) means the power, whether by contract,
equity ownership or otherwise, to direct the policies or management of a
Person.
Asset Purchase Agreement Sunburst/SunGroup Page 1
"AGREEMENT" means this Asset Purchase Agreement and all Exhibits and
Schedules attached hereto.
"APPLICABLE LAWS" means all laws, statutes, rules, regulations, ordinances,
judgments, orders, decrees, injunctions and writs of any Governmental
Entity (including, but not limited to, the FCC and the FAA) having
jurisdiction over the Assets and/or the business and/or operations of the
Stations, or any of them, as each of the foregoing may be in effect on or
prior to the Closing.
"ALPHA-WEB" means Alpha-Web, Inc., a Louisiana corporation.
"ARKLATEX" means Arklatex, Inc. a Louisiana corporation.
"ASI" means Air Signs, Inc., a [______] corporation.
"ASSETS" is defined in Section 2.
"BANKING EVENT" means that a general moratorium on commercial banking
activities in New York, New York shall have been declared by any federal or
state authority.
"BARTER CONTRACTS" mean those Contracts which provide for the exchanges by
a Station of its advertising time for goods or services, other than in
connection with the licensing of programs and programming material.
"BARTER PAYABLES" mean, at the point in time then being referred to, the
aggregate value of all then remaining unaired broadcast time due from a
Station under Barter Contracts based upon the contract stated value of such
broadcast time.
"BARTER RECEIVABLES" mean, at the point in time then being referred to, the
aggregate value of all then remaining unused or unapplied goods or services
due to a Station under Barter Contracts based upon the contract stated
value of such goods or services.
"BBCI" means Big Bass Classics, Inc., a Tennessee corporation.
"BUSINESS DAY" means any day other than (i) Saturday or Sunday or (ii) a
day on which commercial banks in Dallas, Texas are authorized or required
to be closed.
"BUYER" means Sunburst Media, LP, a Delaware limited partnership, and as to
any Permitted Assignee, Buyer
Asset Purchase Agreement Sunburst/SunGroup Page 2
shall mean such Permitted Assignee as to that portion of the Assets
comprising a particular Station that such Permitted Assignee shall acquire
the rights to purchase hereunder from Sunburst Media, LP, all as
contemplated by Section 39.
"CASH CONTRACTS" mean cash contracts for the sale of air time and all other
services and business of a Station that are entered into in the ordinary
course of business.
"CESSATION DATE" shall mean the date on which a Trading Event, Banking
Event, Conflict Event, or a Station Event ends.
"CHOSES IN ACTION" means a right to receive or recover property, debt, or
damages on a cause of action, whether pending or not and whether arising in
contract, tort or otherwise, including, but not limited to, rights to
indemnification, damages for breach of warranty or any other event or
circumstance, judgments, settlements, and proceeds from judgments or
settlements.
"CLOSING" is defined in Section 25.
"CLOSING DATE" is defined in Section 25.
"CODE" means the Internal Revenue Code of 1986, as amended. All references
to a particular section of the Code shall be deemed to include references
to the successor or amended section thereto.
"COMPANY REPORTS" has the meaning set forth in Section 17(aa).
"CONFLICT EVENT" shall mean the occurrence of any major armed conflict
involving the participation by a substantial segment of the armed forces of
the United States of America.
"CONSECO" shall mean Conseco Capital Management, Inc., an Indiana
corporation.
"CONTRACTS" means all agreements, contracts, or other binding commitments
or arrangements, as amended, whether written or oral, to which any party
comprising Sellers is a party or is otherwise bound or which affects or
relates to the Assets or the business or operations of any of the Stations,
including leases for the Ground Leased Real Property and the Leased Real
Property.
Asset Purchase Agreement Sunburst/SunGroup Page 3
"EMPLOYEE BENEFIT PLANS" means any "employee benefit plan" within the
meaning of Section 3(3) of ERISA and any bonus, deferred compensation,
incentive compensation, stock ownership, stock purchase, stock option,
phantom stock, vacation, severance, disability, death benefit,
hospitalization or insurance plan providing benefits to any present or
former employee or contractor of any of Sellers or any member of the ERISA
Group maintained by any such entity or as to which any such entity has any
liability or obligation.
"ENCUMBRANCES" means all claims, demands, restrictions, tenancies,
possessory interests, assessments, covenants, restrictions, rights of first
refusal, defects in title, burdens, options or other encumbrances of any
kind.
"ENVIRONMENTAL LAWS" means all Applicable Laws and rules of common law
pertaining to the environment, natural resources, and public or employee
health and safety including the Comprehensive Environmental Response
Compensation and Liability Act (42 U.S.C. Section 9601 et seq.) ("CERCLA"),
the Emergency Planning and Community Right to Know Act and the Superfund
Amendments and Reauthorization Act of 1986, the Resource Conservation and
Recovery Act, the Hazardous and Solid Waste Amendments Act of 1984, the
Clean Air Act, the Clean Water Act, the Toxic Substances Control Act, the
Safe Drinking Water Act, the Occupational Safety and Health Act of 1970,
the Oil Pollution Act of 1990, the Hazardous Materials Transportation Act,
and any similar or analogous statutes, regulations and decisional law of
any Governmental Entity, as each of the foregoing may be amended and in
effect on or prior to the Closing.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"ERISA GROUP" has the meaning set forth in Section 17(m).
"ESA'S" means Environmental Site Assessments.
"ESCROW AGENT" means Xxxxxxx X. Xxxx Co., 00000 X. Xxxxxxxx Xxxxxx, Xxxxx
000, Xxxxxx, Xxxxxxx 00000.
"EVENT DATE" shall mean the date on which a Trading Event, Banking Event,
Conflict Event, or a Station Event shall first occur.
"EXCLUDED ASSETS" is defined in Section 9.
Asset Purchase Agreement Sunburst/SunGroup Page 4
"EXISTING LIENS" are those Liens against any of the Assets which are set
forth on SCHEDULE 1(A) attached hereto
"FAA" means the Federal Aviation Administration.
"FCC" means the Federal Communications Commission.
"FCC APPLICATIONS" is defined in Section 14.
"FCC LICENSES" is defined in Section 14.
"FINAL FCC CONSENT" is defined in Section 14.
"FINANCING LEASES" mean any tangible (or movable) personal property lease
which is either (a) in effect a financing arrangement for the purchase of
any item of tangible (or movable) personal property or (b) a lease of any
item of tangible (or movable) personal property for a material portion of
the useful life thereof or (c) listed on SCHEDULE 5 attached hereto.
"GAAP" means generally accepted accounting principles in the United States.
"GO AHEAD DATE" is defined in Section 22(q).
"GOVERNMENTAL ENTITY" means any governmental department, commission, board,
bureau, agency, court or other instrumentality of the United States or of
any state, county, parish or municipality, jurisdiction, or other political
subdivision thereof, including the FCC, the FAA, the SEC and the IRS.
"GROUND LEASED REAL PROPERTY" means all of the leasehold interests,
easements, licenses, rights to access and rights-of-way which are used or
held for use in the business and operations of any Station as described in
SCHEDULE 1(B).
"HOLDBACK AMOUNT" is the sum of One Million Dollars ($1,000,000) which
shall be delivered to the Escrow Agent at Closing to be held, administered
and distributed pursuant to the Indemnification Escrow Agreement as
provided further in this Agreement.
"INDEMNIFICATION ESCROW AGREEMENT" shall mean the Indemnification Escrow
Agreement in the form attached hereto as EXHIBIT 34.
Asset Purchase Agreement Sunburst/SunGroup Page 5
"INDEMNITY ESCROW AGENT" shall mean the escrow agent under the
Indemnification Escrow Agreement in the form attached hereto as EXHIBIT 34.
"INITIAL FCC CONSENT" is defined in Section 14.
"INTELLECTUAL PROPERTY" means all trademarks, Know-how, copyrights,
copyright registrations and applications for registration, and all other
intellectual property rights, whether registered or not, licensed to, or
owned by, Sellers relating to the business or operations of any Station,
including the call letters of each of the Stations and the goodwill related
to the foregoing.
"IRS" means the Internal Revenue Service.
"KEY STATION PERSONNEL" as to each Station, means the Station Management,
independent programming consultants and the morning show on-air
personalities.
"KNOW-HOW" means all plans, ideas, concepts and data, research records, all
promotional literature, customer and supplier lists and similar data and
information and all other confidential or proprietary technical and
business information.
"KNOWLEDGE" means, with respect to the party indicated by the context, the
actual knowledge of such party (including, but not limited to, the actual
knowledge of such party's partners, officers, directors, employees,
consultants, and counsel), together with such additional knowledge as would
be acquired by a reasonable person upon conducting reasonable and diligent
inquiry concerning the subject matter in question.
"LEASED REAL PROPERTY" means all of the leasehold interests, easements,
licenses, rights to access and rights-of-way (other than Ground Leased Real
Property) which are used or held for use in the business and operations of
any Station as described in SCHEDULE 1(C), and as such Schedule is modified
by any addition or permitted deletion thereto between the date hereof and
the Closing Date.
"LIENS" mean liens, security interests, pledges, mortgages, conditional
sale, title retention agreements and any other similar claims or charges
against any of the Assets for the payment of some debt, obligation or
liability.
Asset Purchase Agreement Sunburst/SunGroup Page 6
"MATERIAL ADVERSE EVENT" means any event, fact, condition or circumstance
that results in a material adverse effect on the business, operations,
properties, financial condition, prospects, results of operations, assets
or liabilities of any one or more of the Stations, including, but not
limited to, any or all of the following: (a) the occurrence of a Station
Event; (b) the failure of any Station to transmit its fully authorized
broadcast signal for any reason, technical or otherwise, during its
prescribed hours of operation except for the failure to transmit its fully
authorized broadcast signal which does not, in any one instance, exceed 24
consecutive hours or which does not, in all such instances, exceed 48 hours
(whether or not consecutive) in the aggregate; (c) any one or more of the
Stations experiencing a ten percent (10%) or more drop in ratings in the
12+, All Persons, demographic as measured by Arbitron Ratings Service (the
"12+ Demographic") determined with reference to the most recent ratings in
the 12+ Demographic for such Station issued prior to the date of this
Agreement; (d) the loss of any Contract, rights to conduct business or
other Asset that is material to the continued operations of any one or more
of the Stations; or (e) the loss of the services of a significant number of
the Key Station Personnel at any one or more of the Stations; except that
the failure of Buyer to hire the Key Employees named in Section 10-B shall
not be deemed a Material Adverse Event. TO AVOID ANY CONFUSION AND TO
REMOVE ALL DOUBT, IT IS CLEARLY AGREED AND UNDERSTOOD THAT A MATERIAL
ADVERSE EVENT WITH RESPECT TO ONLY ONE OF THE STATIONS SHALL BE DEEMED A
MATERIAL ADVERSE EVENT FOR ALL PURPOSES OF THIS AGREEMENT.
"MATERIAL" means that something is either significant or important and
"IMMATERIAL" means that something is neither significant nor important.
"MULTIEMPLOYER PLAN" has the meaning set forth in Section 3(37) or Section
4001(a)(3) of ERISA.
"OWNED REAL PROPERTY" means those parcels of real property owned in fee and
used or held for use by any of the Sellers as described in SCHEDULE 1(D),
and all buildings, structures, improvements, and fixtures thereon, together
with all rights of way, easements, privileges, and appurtenances pertaining
or belonging thereto, including any right, title, and interest of Sellers
in and to any street or other property adjoining any portion of such
property.
Asset Purchase Agreement Sunburst/SunGroup Page 7
"PERMITTED ASSIGNEE" is defined in Section 39.
"PERMITTED EXCEPTIONS" mean any of the following as applicable to any
particular item of the Assets: (i) the lien for current taxes not yet due
and payable, (ii) utility easements and any other easements, reservations,
restrictions or other matters which are not inconsistent with or contrary
to the current and anticipated use of any parcel of the Subject Real
Property, (iii) matters that are set forth in any Title Binder or Survey
with respect to any parcel of Subject Real Property to which Buyer does not
timely object as provided in Section 16(e), (iv) landlord's liens arising
under state law or by contract, provided that no default shall have
occurred giving rise to enforcement of any such lien, and (v) liens created
by Buyer upon the Closing.
"PERSON" means an individual, corporation, partnership, limited liability
company, association, trust, unincorporated organization, or other entity,
including a Governmental Entity.
"PURCHASE PRICE" is defined in Section 11.
"RSGBCS" means Radio SunGroup of Xxxxx/College Station, Inc., a Texas
corporation.
"RSGT" means RadioSunGroup of Texas, Inc., a Texas corporation.
"SELLERS" collectively mean SGI, RSGT, RSGBCS, SGBL, SGBNM, ASI, BBCI,
Arklatex, Alpha-Web, SMI and ABI "SELLER" means one of the Sellers as
indicated by the context.
"SEC" shall mean the Securities Exchange Commission.
"SENIOR LENDER" means that non-affiliated third party lender of the Buyer
providing the debt financing for the Transaction on a senior lien basis.
"SGI" means SunGroup, Inc., a Tennessee corporation.
"SGBL" means SunGroup Broadcasting of Louisiana, Inc., a Louisiana
corporation.
"SGBNM" means SunGroup Broadcasting of New Mexico, Inc., a New Mexico
corporation.
"SMI" means Sun Management, Inc., a Tennessee corporation.
Asset Purchase Agreement Sunburst/SunGroup Page 8
"STATIONS" shall mean Radio Stations XXXX-FM, XXXX-AM, XXXX-FM, KYKX-FM,
KKYS-FM, KMJJ-FM and KKSS-FM all as ongoing businesses and "STATION" shall
mean any one of the Stations as indicated by the context.
"STATION ASSETS" shall mean, as to any particular Station then being
referred to, that portion of the Assets which are described on the
appropriate Schedule 2.1, 2.2, 2.3, 2.4, 2.5, 2.6 or 2.7, as the case may
be.
"STATION EVENT" means any act of nature (including fires, floods,
earthquakes, and storms), calamity, casualty or condemnation or the act or
omission to act of any Governmental Entity having jurisdiction over a
Station that has caused such Station not to be operating in a manner
substantially consistent with the operations conducted before such Station
Event.
"STATION EXPENSES" mean all expenses arising out of the business and
operation of the Stations, as determined on a Station by Station basis, of
any nature, kind and type whatsoever and however arising, including, but
not limited to, tower rent, artist personal appearance fees, show
production fees, all utilities, insurance, vehicle expense, programming
costs, repairs and maintenance, travel expenses, employee compensation,
business and license fees, employee benefits, including accrued vacation
and sick leave, health, dental and medical benefits, employee expense
reimbursements, sales commissions and fees and other commissions and fees,
SESAC, ASCAP and BMI payments, expenses under Contracts, property and ad
valorem taxes (pro rated on a per diem basis) and other Taxes, office
expenses, property and equipment rentals, applicable copyright or other
fees, sales and service charges, general and administrative expenses,
accounts payable and trade payables.
"STATION LICENSES" mean the XXXX-FM Licenses (as defined in Schedule 2.1) ,
the XXXX-AM Licenses (as defined in Schedule 2.2), the KROW-FM Licenses (as
defined in Schedule 2.3), the KYKX-FM Licenses (as defined in Schedule
2.4), the KKYS-FM Licenses (as defined in Schedule 2.5), the KMJJ-FM
Licenses (as defined in Schedule 2.6) and the KKSS-FM Licenses (as defined
in Schedule 2.7).
"STATION MANAGEMENT" means, as to each Station, the general manager,
station manager, general sales manager, local sales manager, programming
director, business manager, or persons performing comparable duties.
Asset Purchase Agreement Sunburst/SunGroup Page 9
"SUBJECT REAL PROPERTY" means the Owned Real Property and the Ground Leased
Real Property.
"TAXES" means taxes, charges, fees, imposts, levies, interest, penalties,
additions to tax or other assessments or fees of any kind, including, but
not limited to, income, corporate, capital, excise, property, sales, use,
turnover, value added and franchise taxes, deductions, withholdings and
customs duties, imposed by any Governmental Entity and any payments with
respect to Taxes required under any tax-sharing agreement.
"TAX RETURNS" means any return, report, information return or other
document (including any related or supporting information) filed or
required to be filed with any Governmental Entity in connection with the
determination, assessment, collection or administration of any Taxes or the
administration of any Applicable Laws relating to any Taxes.
"TRADING EVENT" shall mean that trading generally in securities on the New
York Stock Exchange shall have been materially suspended or materially
limited.
"TRANSACTION" means the sale and purchase of all of the Stations as
contemplated by this Agreement and all other transactions contemplated by
this Agreement and the other Transaction Documents.
"TRANSACTION DOCUMENTS" means this Agreement, Xxxx of Sale and Assignment
of Interests and Assumption, Escrow Agreement, Indemnification Escrow
Agreement(s), Special Warranty Deeds, Assignments of Ground Leased Real
Property, Assignments of Leased Real Property, Consulting Agreements,
certificates, and all other agreements, instruments, certificates and other
matters delivered in connection with the Transaction; provided that with
respect to a Permitted Assignee, the Transaction Documents shall mean only
those of the Transaction Documents which pertain to the acquisition of the
particular Station Assets being acquired by such Permitted Assignee and to
which the Permitted Assignee is a party, and shall not mean any of the
other Transaction Documents.
Section 2. Sale of Assets. Subject to the approval of the FCC and
subject to the terms and conditions of this Agreement, Sellers agree to sell,
transfer, assign and convey unto Buyer, free and clear of all Liens and
Encumbrances, except for the Permitted Exceptions, and Buyer agrees to purchase
and accept the transfer, assignment and conveyance from Sellers of, good and
marketable
Asset Purchase Agreement Sunburst/SunGroup Page 10
title to the licenses, assets, properties, contracts, rights, titles and
interests described on Schedules 2.1 through 2.8, inclusive (the XXXX-FM Assets,
the XXXX-AM Assets, the KROW-FM Assets, the KYKX-FM Assets, the KKYS-FM Assets,
the KMJJ-FM Assets, the KKSS-FM Assets and the Additional Assets are
collectively referred to herein as the "Assets").
(a) The licenses, assets, properties, contracts, rights, titles and
interests comprising XXXX-FM as set forth on Schedule 2.1 (the
"XXXX-FM Assets").
(b) The licenses, assets, properties, contracts, rights, titles and
interests comprising XXXX-AM as set forth on Schedule 2.2 (the
"XXXX-AM Assets").
(c) The licenses, assets, properties, contracts, rights, titles and
interests comprising KROW-FM as set forth on Schedule 2.3 (the
"KROW-FM Assets").
(d) The licenses, assets, properties, contracts, rights, titles and
interests comprising KYKX-FM as set forth on Schedule 2.4 (the
"KYKX-FM Assets").
(e) The licenses, assets, properties, contracts, rights, titles and
interests comprising KKYS-FM as set forth on Schedule 2.5 (the
"KKYS-FM Assets").
(f) The licenses, assets, properties, contracts, rights, titles and
interests comprising KMJJ-FM as set forth on Schedule 2.6 (the
"KMJJ-FM Assets").
(g) The licenses, assets, properties, contracts, rights, titles and
interests comprising KKSS-FM as set forth on Schedule 2.7 (the
"KKSS-FM Assets").
(h) The construction permits, licenses, assets, properties, contracts,
rights, titles and interests of the Sellers as set forth on Schedule
2.8 (the "Additional Assets").
Section 3. Provisions Regarding Cash Contracts. At the Closing Sellers
shall provide Buyer with a then current listing of all Cash Contracts separately
stated for each of the Stations then in effect. All Cash Contracts entered into
by Sellers between the date of this Agreement and the Closing Date shall be
consistent with sound business and financial practices and shall be at rates no
less than currently charged for the same or similar services. Furthermore,
Sellers agree that they will obtain the advance written approval of Buyer before
any of the Sellers enters into any Cash Contract under which the commitment to
be assumed by Buyer at Closing as to any one Station (i) will exceed $5,000 of
broadcast
Asset Purchase Agreement Sunburst/SunGroup Page 11
time, (ii) will exceed, when combined with all other Cash Contracts to be
assumed by Buyer at Closing, $20,000 of broadcast time or (iii) will extend at
least six (6) months beyond the Closing. In connection with the preceding
sentence, SGI agrees that it will contact Xxx X. Xxxxxx (or such other person as
may hereafter be designated by Buyer) at the address set forth in the notice
provisions hereof following which Buyer will have until the close of the second
Business Day thereafter to approve or disapprove of such Cash Contract; and if
Buyer shall not approve of such Cash Contract in writing, then it shall be
deemed that the Buyer did not approve of such Cash Contract. For purposes of
determining the $5,000 and $20,000 commitments described in the preceding
sentence, the rates at the particular Station in question shall be the greater
of (a) the rates in effect as of the date of this Agreement and (b) the rates in
effect as of the date of Closing. If on or prior to the time of Closing, any of
the Sellers have either pre-billed or collected a pre-payment under a Cash
Contract for which the broadcast time will not be aired or the services will not
be rendered, as the case may be, until after the Closing, then the Purchase
Price shall be reduced by the amount of such pre-xxxxxxxx and pre-payments.
Section 4. Provisions Regarding Barter Contracts. Sellers represent to
Buyer that all existing Barter Contracts (on a Station by Station basis) are set
forth on SCHEDULE 4 attached hereto and the list referred to in Section 17(s)
hereof. Sellers agree that prior to Closing Sellers will not, without Buyer's
prior written approval, enter into any further Barter Contracts the air time for
which will not be run off in full prior to Closing. At the Closing Sellers
shall provide Buyer with a then current listing of all Barter Contracts then in
effect. Sellers will assign to Buyer all Barter Contracts which are in effect
at the Closing Date. Sellers will assign to Buyer all Barter Receivables
remaining at the time of Closing. Buyer will assume all Barter Payables
remaining at the time of Closing. Sellers agree that they will use commercially
reasonable best efforts to run off all of the remaining air time for all Barter
Contracts prior to Closing. If at the time of Closing the amount of the Barter
Payables in any one or more of the (i) Abilene, (ii) Xxxxx/College Station,
(iii) Longview, (iv) Shreveport and (v) Albuquerque markets shall exceed
$25,000, then the Purchase Price shall be reduced by an amount equal to the
excess by which the Barter Payables in each market exceeds $25,000; and for
these purposes, no credit shall be given for Barter Payables which may be below
$25,000 in any particular market or the number of Stations owned by Sellers in a
particular market. Notwithstanding the preceding sentence, there shall be
excluded from the Barter Payables for purposes of the $25,000 limitation, any
Barter Payables that (a) are incurred for television advertising and other
advertising and promotion of the Station which are directly related to the 1998
Spring Arbitron Ratings Book and (b) that do not exceed $50,000 per market as
described above.
Asset Purchase Agreement Sunburst/SunGroup Page 12
Section 5. Provisions Regarding Financing Leases. Attached hereto as
SCHEDULE 5 is a list of all Financing Leases of all items of tangible personal
property included within the Assets. Sellers agree with respect to each
Financing Lease that either (i) Sellers will fully prepay and satisfy such
Financing Lease at or prior to Closing and deliver, or cause to be delivered,
good and marketable title to each item of tangible personal property covered by
such Financing Lease free and clear of any Liens and Encumbrances or (ii) the
Purchase Price shall be reduced by the amount equal to the present value of the
remaining obligation of the lessee due under such Financing Leases discounted to
the Closing Date at an annual rate of eight percent (8%) and the Sellers shall
assign, and the Buyer shall assume, such Financing Lease to Buyer.
Section 6. Provisions Regarding Certain Contracts. With respect to any
Contract other than Cash Contracts, Barter Contracts and Financing Leases which
are covered by Sections 3, 4 and 5 hereof, to the extent an obligation or
liability thereunder has been assumed by the Buyer and any of the Sellers have
received any compensation or other benefit with respect to the obligation or
liability assumed by the Buyer, then Sellers agree that the Purchase Price shall
be reduced by the amount equal to the amount of such compensation or other
benefit received by any of the Sellers.
Section 7. Provisions Regarding Unscheduled Contracts and Renewals,
Replacements Etc. of Scheduled Contracts. If as of the date hereof there is
any Contract that is in existence, but is not included on any of SCHEDULES
2.1(F), 2.2(F), 2.3(F), 2.4(F), 2.5(F), 2.6(F) OR 2.7(F), (an "Unscheduled
Contract") then the Sellers agree to assign same to Buyer at Closing, but only
if the Buyer requests such assignment; and if the Buyer does not request such
assignment, then the Sellers will be responsible for such Unscheduled Contract
and will indemnify Buyer with respect to same. In the case of renewals,
extensions or replacements of any of the Contracts listed on any of SCHEDULES
2.1(F), 2.2(F), 2.3(F), 2.4(F), 2.5(F), 2.6(F) OR 2.7(F), the Sellers agree that
they will not in any case renew, extend or replace any of such Contracts for a
term exceeding one (1) year or otherwise on terms more burdensome to the
applicable Station(s) without the prior consent of Buyer; and if such consent is
not obtained such Contract shall be deemed and considered for all purposes as an
Unscheduled Contract. Additionally, Sellers will assign to Buyer all other
Contracts entered into by any of Sellers from the date hereof to the Closing
Date with respect to the operations of any of the Stations (except Cash
Contracts, Barter Contracts and Financing Leases which are provided for
separately under Sections 3, 4 and 5 hereof) which, as to any one Station, are
either (i) made in the normal course of business and which do not, in the case
of any single contract, involve a commitment (contingent or otherwise) to be
assumed by Buyer of more than $2,000 and which in the aggregate
Asset Purchase Agreement Sunburst/SunGroup Page 13
do not involve commitments (contingent or otherwise) to be assumed by Buyer of
more than $10,000 or (ii) consented to in writing by Buyer.
Section 8. Accounts Receivable Collection Agreement.
(a) For a period commencing on the Closing Date and ending on the last
day of the sixth (6th) full calendar month following the Closing Date (such
period is referred to as the "Collection Period"), Buyer will have the sole and
exclusive right on a Station by Station basis (to the exclusion of all persons
including, but not limited to, the Sellers) to collect for the account of
Sellers the Accounts Receivable.
(b) Within three (3) business days following the Closing Date, Sellers
will furnish Buyer with a complete and current accounts receivable list, current
as of the Closing Date, detailing customer name, address, amount owed, aging and
invoice numbers.
(c) All receipts on the collection of an Account Receivable from a
particular account debtor shall be applied first to the oldest outstanding
invoice, unless the payment is made with reference to a specific invoice in
which case the payment shall be allocated to the specific invoice. Any monies
or payments received by Buyer which are in payment for commercial air time or
for other services or business provided by Buyer on or after the Closing Date
shall belong to the Buyer and Buyer shall not be obligated to remit any of such
sums to Sellers. The Buyer will not, without the written consent of Sellers,
compromise or settle for less than full value any of the Accounts Receivable.
(d) If any account debtor shall dispute his obligation to Sellers, if
any account debtor shall pay any invoice of Buyer's before having paid in full
all outstanding invoices due to Sellers or if any Account Receivable shall be
deemed uncollectible by Buyer, then the Buyer shall return such disputed, unpaid
or deemed uncollectible account to Sellers and Buyer will thereafter have no
further responsibility with respect to the collection thereof.
(e) On the 10th day of each month immediately following each calendar
month during the Collection Period the Buyer will provide Sellers with a list of
all Accounts Receivable collected during the preceding calendar month. On the
10th day of the month immediately following the second (2nd) full calendar month
of the Collection Period, Buyer will remit to Sellers all sums collected by
Buyer (and not theretofore remitted to Sellers) from the Accounts Receivable
through the end of the second (2nd) full calendar month of the Collection
Period. On the 10th day of the month immediately following the fourth (4th)
full calendar month of the Collection Period, Buyer will remit to Sellers all
sums collected by Buyer (and not theretofore remitted to Sellers) from the
Accounts
Asset Purchase Agreement Sunburst/SunGroup Page 14
Receivable through the end of the fourth (4th) full calendar month of the
Collection Period. On the 10th day of the month immediately following the end of
the Collection Period, Buyer will remit to Sellers all remaining sums collected
by Buyer (and not theretofore remitted to Sellers) from the Accounts Receivable
through the end of the Collection Period. The Sellers are responsible for the
payment of all sales commissions (and other costs of generating the Accounts
Receivable) due to any persons resulting from the collection of or otherwise
with respect to the Accounts Receivable.
(f) The obligation of Buyer hereunder will be to use reasonable efforts
to collect the Accounts Receivable in the ordinary course of business and does
not extend to the institution of litigation, employment of counsel or other
collection agency, or any other extraordinary means of collection, including the
sending of demand letters.
(g) If requested by Buyer, Sellers will provide the Buyer with a power
of attorney which will be sufficient for the purposes of evidencing to the
various account debtors the exclusive authority of the Buyer to collect the
Accounts Receivable.
(h) At the conclusion of the Collection Period the collection rights to
all of the remaining uncollected Accounts Receivable shall automatically revert
to Seller; and Buyer will thereafter have no further responsibility with respect
to the collection of the Accounts Receivable.
(i) Sellers hereby represent to Buyer that all mail and other
correspondence concerning each respective Station is mailed to the address set
forth on SCHEDULE 17 (EE) for the current studio site of each such Station.
Section 9. Assets Retained by Sellers. Sellers and Buyer agree that the
assets and properties belonging to Sellers that are set forth in more detail and
description on SCHEDULE 9 attached hereto (referred to herein as the "Excluded
Assets") are not part of the Assets and are not to be sold to Buyer and Buyer is
not intending to purchase same. The parties hereto agree that in order for any
asset, property, license, right, title or interest of any nature owned, claimed
or controlled by any of the Sellers that pertains or relates to any of the
Stations (that might reasonably be considered by Buyer to be used or usable in
connection with any of the Stations) to not be part of the Assets, such asset,
property, license, right, title or interest must be described on SCHEDULE 9 with
sufficient enough detail to reasonably identify same; otherwise it is agreed
that such asset, property, license, right, title or interest shall constitute a
part of the Assets and is to be delivered to Buyer at Closing.
Asset Purchase Agreement Sunburst/SunGroup Page 15
Section 10. Liabilities. The parties hereto agree that all obligations,
debts, claims and other liabilities (referred to herein simply as "liabilities")
of Sellers shall remain the liabilities of Sellers and Buyer will not assume,
nor be required to assume, any liabilities of Sellers except that at the Closing
the Buyer will assume those liabilities accruing from and after Closing under
Contracts that are assumed by Buyer at Closing.
Section 10-A. Consulting Agreements. At the Closing Buyer shall enter
into a Consulting Agreement in the form of EXHIBIT 10-A with each of Xxxx X.
Xxxxxxxxx and Xxxxx Xxxxxxx. The Consulting Agreement for Xxxx X. Xxxxxxxxx
shall provide for aggregate consulting payments in the amount of $350,000 over
36 months at a rate of $9,722.22 per month. The Consulting Agreement for Xxxxx
Xxxxxxx shall provide for aggregate consulting payments in the amount of
$150,000 over 24 months at a rate of $6,250 per month.
Section 10-B. Management Employments Agreements. At the Closing Buyer
shall offer employment to each of the following Station General Managers of
Sellers provided such persons continue to be employed by Sellers in the same
capacities as they are currently employed by Sellers at the time of Closing: Xxx
Xxxxx (Xxxxx/College Station), Xxxxx X. Xxxxxxx, III (Longview), Xxxx X. Xxxxxx
(Shreveport), Xxxxx X. Xxxxxx (Abilene), Xxxx Xxxxx Xxxxxxxx (Albuquerque). All
of the terms of each such employment shall be determined by agreement of Buyer
and the particular employee; provided that Buyer agrees the term of employment,
subject to termination for cause as defined in the employment agreement, shall
be at least until December 31, 1998 and the rate of compensation (regularly
recurring and bonus and commission arrangements) until December 31, 1998 shall
be no less than such rates currently provided for in the existing written
employment agreement of such employee dated January 1, 1997; provided further
that the preceding proviso shall not be construed to mean that Buyer is required
to offer any employee any termination, severance, "golden parachute" or other
benefits beyond that which Buyer is willing to offer.
Section 11. Amount and Payment of Purchase Price. As consideration for
the sale of the Stations from Sellers to Buyer and the other agreements,
warranties and representations of Sellers made herein, Buyer shall pay to
Sellers at Closing a Purchase Price (herein so called) in the amount of Twenty
Four Million Dollars ($24,000,000), subject to adjustment as provided in
Sections 3, 4, 5 and 6. At the Closing, the Buyer shall (i) deliver the
Holdback Amount to the Indemnity Escrow Agent to be held, administered and
distributed pursuant to the Indemnification Escrow Agreement and (ii) shall pay
the remaining balance of the Purchase Price, after reduction for the Holdback
Amount and after adjustment as provided in this Section, in cash, as instructed
by Sellers in wire transfer instructions delivered to Buyer at least one (1) day
prior to Closing.
Asset Purchase Agreement Sunburst/SunGroup Page 16
Section 12. Escrow Provisions. Sellers, Buyer and Escrow Agent have
entered into the Escrow Agreement dated of even date herewith (the "Escrow
Agreement"). Within two (2) Business Days following the Go Ahead Date the Buyer
shall deposit with the Escrow Agent an irrevocable letter of credit in the
amount of One Million Two Hundred Thousand Dollars ($1,200,000) (said $1,200,000
letter of credit is referred to herein as the "Escrow Letter of Credit"). The
Escrow Letter of Credit shall be held and distributed as provided in this
Agreement. At the Closing Sellers and Buyer will direct the Escrow Agent to
deliver the Escrow Letter of Credit to Buyer.
Section 13. Payment of Station Expenses. Sellers and Buyer agree to the
following terms and provisions regarding the payment of Station Expenses:
(a) Sellers shall bear the cost of, and indemnify Buyer from, all
Station Expenses incurred at any time prior to, or attributable to the
operations of the Stations prior to, the Closing Date. Buyer shall bear the
cost of, and indemnify Sellers from, all Station Expenses incurred at any time
on or after, or attributable to the operations of the Stations on or after, the
Closing Date.
(b) On the Closing Date (a) the Sellers shall pay the entirety of their
respective accounts payable existing on the Closing Date and (b) the Sellers
shall pay to their respective employees, agents and representatives all accrued
wages, salaries, bonuses, commissions and all other accrued liabilities and
payments, including accrued vacation pay, that are due to any employee of any of
the Sellers, or that would otherwise become due to any employee of any of the
Sellers at a later date, on account of any contract, agreement, understanding,
policy, plan, program or benefit of any of the Sellers existing on or prior to
Closing.
(c) Sellers agree that they will use their respective best faith efforts
to fully and accurately determine all remaining Station Expenses incurred
through the Closing Date, including all accounts payable and other Station
Expenses for which invoices have not been received on or before the Closing
Date, but will be received thereafter for Station Expenses incurred on or prior
to the Closing Date. At the Closing the Sellers shall pay all such Station
Expenses directly to the appropriate parties. However, to the extent direct
payment on the Closing Date is not practical, the Sellers agree to make adequate
provision therefore by making a
Asset Purchase Agreement Sunburst/SunGroup Page 17
cash payment to Buyer at the Closing in the amount of the remaining estimated
Station Expenses which are the responsibility of the Sellers to pay; and the
Buyer will apply such amount to the payment of Sellers' Station Expenses and
account to the Sellers for same. However, if the Sellers' estimated cash payment
is insufficient to pay the remaining Station Expenses on or before the due dates
thereof, then the Sellers shall either promptly (i) pay said Station Expenses as
requested by Buyer or (ii) authorize the Indemnity Escrow Agent to pay said
Station Expenses out of the Holdback Amount.
(d) Sellers and Buyer agree that within forty five (45) days following
Closing each of them will provide the other with an accounting of any Station
Expenses paid by such party (or with respect to which such party has received an
invoice) that are the responsibility of the other party to pay and Buyer will
also at that time provide Sellers with an accounting of the application by the
Buyer of the cash payment received from the Sellers as described in Section
13(c). At such time Sellers and Buyer agree to make adjusting payments between
themselves and/or promptly make appropriate third party payments, as the case
may be, such that Sellers and Buyer shall have each paid their own respective
Station Expenses.
Section 14. FCC Approval.
(a) Consummation of the Transaction is conditioned upon the FCC having
given its consents in writing (without, in Buyer's reasonable opinion, any
condition materially adverse to Buyer) to the assignment and change of control
from Sellers to Buyer ("FCC Consent") of all licenses, permits and
authorizations granted by the FCC to Sellers relating to the operation of each
of the Stations (collectively, the "FCC Licenses") and said consents having
become Final FCC Consent.
(b) For purposes of this Agreement, such FCC Consent shall be deemed to
be Initial FCC Consent (herein so called) once it is granted and published. For
purposes of this Agreement, such FCC Consent shall be deemed to have become
Final FCC Consent (herein so called) after it is granted and published and when
the time for administrative or judicial review or reconsideration has expired
and when the time for the filing of any protest, request for stay, petition for
rehearing, reconsideration or appeal of such order of consent has expired and no
protest, request for stay, petition for rehearing, reconsideration or appeal has
been timely filed and is pending. Once Initial FCC Consent shall have occurred,
Buyer may waive the condition of Final FCC Consent as set forth in Section
23(o).
Asset Purchase Agreement Sunburst/SunGroup Page 18
(c) The parties agree to proceed to file or cause to be filed all
necessary applications (collectively, the "FCC Applications") requesting FCC
consent to the Transaction on or before the 15th Business Day following the Go
Ahead Date; provided that neither party hereto shall be liable to the other for
the failure to file by said 15th Business Day if such party has proceeded with
due diligence and in good faith. In no event shall the FCC Applications be
filed later than 20 Business Days following the Go Ahead Date.
(d) The parties agree with each other that each of them will prosecute
the FCC Applications, including all necessary amendments and supplements
thereto, in good faith and with due diligence. Each party agrees that it will
timely, promptly and fully respond to all matters involving the FCC
Applications. If an objection to the grant of the FCC Applications is raised
before the FCC by any party, or is raised by the FCC upon its own motion, then
Buyer and Sellers shall each use their individual and joint best efforts to
resolve such objection in a manner that will permit grant of the FCC
Applications within the time period required by this Agreement; and if the said
objection pertains to any portion of this Agreement, then Buyer and Sellers
agree to examine the objection in good faith and to amend this Agreement to
delete or otherwise modify any provision found objectionable if said can be
accomplished without materially decreasing the rights or benefits of either
party under this Agreement and without materially increasing the obligations or
duties of either party under this Agreement.
(e) If the FCC shall not have consented to the Transaction within nine
(9) months following the filing of the FCC Applications, then this Agreement
shall be terminable by either Buyer (assuming Buyer is not in default under this
Section) or Sellers (assuming Sellers are not in default under this Section)
upon written notice to the other unless the FCC has theretofore set one or more
of the FCC Applications for a hearing in which case this Agreement shall be
extended for a sufficient period of time to permit the hearing to be held and
the FCC to make a decision.
Section 15. Allocation of Purchase Price. No later than 45 days after
the close of the calendar year in which Closing shall take place, Seller and
Buyer may allocate the Purchase Price among the Assets in accordance with their
relative fair market values based upon an appraisal to be obtained by Buyer;
provided that the gross fair market value of the Assets comprising a particular
Station with respect to which the rights to acquire were assigned to a Permitted
Assignee shall be an amount equal to that portion of the Purchase Price funded
by such Permitted Assignee; and provided further the gross fair market value of
the Assets comprising each of the other Stations acquired by Sunburst Media, LP
shall be an amount as determined in good faith by the Buyer. If either (i)
Asset Purchase Agreement Sunburst/SunGroup Page 19
Buyer shall not obtain such appraisal or (ii) if Buyer shall obtain such
appraisal, but the Seller and the Buyer fail to agree to allocate the Purchase
Price in accordance with such appraisal, then Seller and Buyer shall allocate
the Purchase Price, on a Station by Station basis, in accordance with the
following: first, an amount equal to the replacement cost for the tangible
assets shall be allocated to the tangible assets; second, in the case of Subject
Real Property, the amount of coverage for title insurance or title opinion
purposes as specified on Schedule 1(d); third, $25,000 shall be allocated to
goodwill; and fourth, the balance shall be allocated to the Station Licenses and
other intangible assets. Seller and Buyer agree to report the allocation of the
Purchase Price, as determined in accordance with the foregoing, for purposes of
Section 1060 of the Internal Revenue Code of 1986 and for other tax purposes.
Section 16. Sale Provisions Regarding Subject Real Property. In addition
to the other terms and provisions of this Agreement which apply to the Assets of
which the Subject Real Property is a part, the following terms and provisions
shall also apply to the sale of each parcel of the Subject Real Property:
(a) Warranty of Title. Sellers represent and warrant to Buyer that at
the Closing Sellers will have and will convey to Buyer good and fee simple title
to each parcel of the Subject Real Property, free and clear of any and all Liens
and Encumbrances except the Permitted Exceptions. Notwithstanding anything else
in this Agreement to the contrary, Sellers agree that, at their sole cost and
expense, (i) they will pay all liabilities secured by Liens against each parcel
of the Subject Real Property and have such Liens removed and (ii) they will
discharge all Encumbrances against each parcel of the Subject Real Property,
other than for the Permitted Exceptions; it being the intent of the parties
hereto that each parcel of the Subject Real Property shall be conveyed to Buyer
free and clear of all Liens and Encumbrances other than for the Permitted
Exceptions.
(b) Zoning Ordinances. Sellers represent and warrant to Buyer that each
parcel of the Subject Real Property is not in violation of any applicable zoning
ordinances. If prior to Closing Buyer should determine that any parcel of the
Subject Real Property is in violation of any zoning ordinances (it being
understood that the Buyer shall have no obligation to make any investigation),
then Buyer may either (i) close the Transaction, if it is otherwise ready to
close, and receive such parcel of the Subject Real Property with any such zoning
violations and retain its rights for breach of warranty or (ii) terminate the
Agreement by written
Asset Purchase Agreement Sunburst/SunGroup Page 20
notice to Sellers and the Escrow Letter of Credit shall be
returned to Buyer and Buyer shall retain its rights for breach of warranty.
(c) Buyer's Inspection. Sellers hereby grant Buyer and its
representatives the right to enter each parcel of the Subject Real Property for
purposes of conducting physical inspections; provided that Buyer agrees to
indemnify and hold Sellers free and harmless of and from any and all
liabilities, claims, demands and expenses, of any kind or nature arising or
accruing as a result of any activities of Buyer on each parcel of the Subject
Real Property prior to Closing.
(d) Title Binder, Survey and Environmental Audit. Within forty-five
(45) days after the Go Ahead Date, Sellers shall, at Sellers' expense, obtain
and deliver to Buyer, the following:
(1) A copy of a current on-the-ground survey ("Survey") of each parcel
of the Subject Real Property made by a duly licensed surveyor reasonably
acceptable to the Buyer. The Survey shall be in a form acceptable to the
Title Company (hereinafter defined) in order to allow the Title Company to
delete the survey exception (except as to "shortages in area") from the
Title Policy to be issued by the Title Company. Each Survey shall show the
location of all buildings and improvements on the parcel of the Subject
Real Property covered by such Survey.
(2) A title commitment ("Title Binder") covering the Property binding a
title company reasonably acceptable to Buyer (the "Title Company") to issue
an Owner's Policy of Title Insurance on the standard form of policy
prescribed by the applicable State Board of Insurance at the Closing in the
indicated amount for each parcel of the Subject Real Property as set forth
on SCHEDULES 1(B) AND (D). There shall also be included with the Title
Binder true, correct and legible copies of any and all instruments referred
to in the Title Binder as constituting exceptions or restrictions upon the
title of the applicable party of the Sellers. In the case of real estate
located in Louisiana, if an Owner's Policy of Title Insurance is not
available, then adequate opinion of reputable local
Asset Purchase Agreement Sunburst/SunGroup Page 21
counsel licensed to practice law in Louisiana shall be utilized instead.
(3) A Phase I ESA on each parcel of the Subject Real Property addressed
to Buyer and issued by a professional environmental consulting firm
reasonably acceptable to Buyer (and performed in a manner that at a minimum
satisfies the requirements of ASTM Practice E 1527-94) stating that after
due inspection there is no action required to place the particular parcel
of the Subject Real Property into compliance with Environmental Laws or if
there is any further investigation required or some other action required
to place the property into compliance with Environmental Laws, the nature
of the condition or suspected condition and the nature of the further
investigation or further action required.
(4) Any Phase II ESA's recommended by the environmental consulting firm.
(e) Objections to Title Binder and Survey. Buyer shall have thirty (30)
days after the receipt of the Survey and the Title Binder as to each separate
parcel of the Subject Real Property to review them and to deliver in writing to
Sellers such objections as Buyer may reasonably have to anything contained in
them other than for the Permitted Exceptions. Any such item to which Buyer
shall not object shall also be deemed a "Permitted Exception" as to the
particular parcel of the Subject Real Property. Any Liens and Encumbrances
shall automatically be deemed objected to by Buyer whether or not Buyer objects
in writing at such time. If there are other objections by Buyer to matters
(excluding Liens and Encumbrances which Sellers are required to remove under the
terms of this Agreement) Sellers shall exercise their best faith efforts to
satisfy such other matters prior to Closing. If Sellers deliver written notice
to Buyer prior to Closing that Sellers are unable to satisfy such other matters,
then Buyer may either close the Transaction and receive such title as Sellers
are able to convey or elect not to close the Transaction by written notice to
Sellers delivered within twenty (20) days after Sellers' written notice to Buyer
and the Escrow Letter of Credit shall be returned to Buyer.
(f) Objections for Environmental Matters. Buyer shall have thirty (30)
days after the receipt of the Phase I ESA as to each separate parcel of the
Subject
Asset Purchase Agreement Sunburst/SunGroup Page 22
Real Property to review it and to deliver in writing to Sellers such objections
as Buyer may reasonably have to anything contained therein. If there are
objections by Buyer, Sellers shall satisfy such objections prior to Closing. If
Sellers deliver written notice to Buyer prior to Closing that Sellers are unable
to satisfy such objections, then Buyer may either close the Transaction and
receive the particular parcel of the Subject Real Property or elect not to close
the Transaction by written notice to Sellers delivered within twenty (20) days
after Sellers' written notice to Buyer and the Escrow Letter of Credit shall be
returned to Buyer.
(g) Deliveries at Closing. At the Closing, Sellers shall deliver to the
Buyer (i) a Special Warranty Deed conveying each parcel of the Subject Real
Property to the Buyer subject only to the Permitted Exceptions; (ii) an Owner's
Title Policy issued by the underwriter pursuant to the Title Binder, with the
survey exception deleted (except as to shortages in area) subject only to the
Permitted Exceptions; and (iii) possession of each parcel of the Subject Real
Property. In case of a dispute as to the form of any document required
hereunder, such as the Special Warranty Deed, the current form prepared by the
State Bar of the State in which the parcel of Subject Real Property is situated
shall be conclusively deemed reasonable.
(h) Closing Costs. Each party hereto shall pay its share of the closing
costs which are normally assessed by the Title Company against a seller or buyer
in a sale of real estate in the county where the property is located except that
the Sellers shall pay the premium cost of the Title Policy. Real estate taxes
and ad valorem taxes for the current year shall be pro rated at the Closing
effective as of the Closing Date. If the Closing shall occur before the tax
rate is fixed for the then current year, the apportionment of taxes shall be
upon the basis of the tax rate for the preceding year applied to the latest
assessed valuation, but any difference in actual and estimated ad valorem taxes
for the year of sale actually paid by Buyer shall be adjusted between the
parties upon receipt of written evidence of the payments thereof. All taxes
imposed because of a change of use of the Property after the Closing shall be
for the account of Buyer.
(i) Condemnation. If prior to the Closing, condemnation proceedings are
commenced with respect to any parcel of the Subject Real Property, Buyer may at
any time on or prior thirty (30) days following notice of
Asset Purchase Agreement Sunburst/SunGroup Page 23
such fact terminate this Agreement by delivery of written notice to Sellers. In
the event of such termination, neither party shall have any further right or
obligation under this Agreement and the Escrow Letter of Credit shall be
returned to Buyer.
Section 17. Representations and Warranties of Sellers. Except as set
forth on the SCHEDULE OF EXCEPTIONS TO WARRANTIES attached hereto as SCHEDULE 17
and with the understanding that Buyer is relying on such representations and
warranties being correct in all respects in entering into and performing this
Agreement, Sellers hereby represent and warrant to Buyer as follows:
(a) Organization, Good Standing, Etc. Each party comprising Seller is
corporation duly organized, validly existing and in good standing under the laws
of its state of incorporation, has all requisite power and authority to own,
lease and operate its properties and to carry on its business as now being
conducted and is duly qualified and in good standing in each state in which the
nature of its business or the ownership or leasing of its properties makes such
qualification necessary. Sellers have delivered to Buyer true and complete
copies of their respective Articles of Incorporation and Bylaws, with all
amendments, if any, as in effect at the date of this Agreement. None of the
Sellers is in violation of any provisions of its Articles of Incorporation or
Bylaws.
(b) Corporate Structure of SunGroup. SunGroup, Inc. owns all of the
issued and outstanding stock, all classes, of (1) RadioSunGroup of Texas, Inc.,
(2) RadioSunGroup of Xxxxx/College Station, Inc., (3) SunGroup Broadcasting of
New Mexico, Inc., (4) SunGroup Broadcasting of Louisiana, Inc., (5) Big Bass
Classics, Inc., (6) Sun Management, Inc., a Tennessee corporation, and (7)
Abilene Broadcasting, Inc., a Texas corporation. SunGroup, Inc. is a holding
company only and does conduct any active business operations other than
providing management services to its subsidiaries. Arklatex, Inc. and Alpha-Web,
Inc. are wholly owned subsidiaries of SunGroup Broadcasting of Louisiana, Inc.
All of the issued and outstanding stock of Air Signs, Inc. is owned by the
following companies in the following proportions: RadioSunGroup of Texas, Inc.,
40%; RadioSunGroup of Xxxxx/College Station, Inc., 20%; SunGroup Broadcasting of
New Mexico, Inc., 20%; and SunGroup Broadcasting of Louisiana, Inc., 20%.
SunGroup, Inc. does not own, or have any rights to acquire, an interest in any
other Person, whether as a shareholder, partner, principal, member or otherwise.
Asset Purchase Agreement Sunburst/SunGroup Page 24
(c) Authority. Subject to obtaining the approval of the Board of
Directors and the requisite number of shares of voting stock of the respective
corporations comprising the Sellers as set forth in Section 22 (q), Sellers have
all requisite power and authority to enter into the Transaction Documents and to
consummate the Transaction. Except for the approval of the Board of Directors
and the requisite number of shares of voting stock of the respective
corporations comprising the Sellers as set forth in Section 22 (q), the
execution and delivery of the Transaction Documents by Sellers and the
consummation by Sellers of the Transaction have been duly authorized by all
necessary action on the part of Sellers. The Transaction Documents have been,
or upon execution and delivery will be, duly executed and delivered and
constitute the valid and binding obligations of Sellers enforceable against them
in accordance with their terms, subject as to enforceability to applicable
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and
similar laws affecting creditors' rights and remedies generally and to general
principles of equity regardless of whether enforcement is sought in a proceeding
at law or in equity.
(d) Cash Receipt Schedules. The Sellers have heretofore delivered to
the Buyer schedules showing, on a month by month basis, the ordinary cash
receipts from the sale of air time on each of the Stations (separately stated
for each Station) for the calendar year ended 12/31/95, 12/31/96 and for the
twelve month period ended 12/31/97 (the "Monthly Cash Reports"). Furthermore,
commencing on February 15, 1998 and continuing on or before the 15th day of each
consecutive month thereafter until the Closing, the Sellers will continue to
provide the Buyer with a Monthly Cash Report in the same format showing for the
immediately preceding calendar month the ordinary cash receipts from the sale of
air time on each of the Stations (separately stated for each Station) for such
month. For example on February 15, 1998 Sellers will provide Buyer with the
Monthly Cash Report for the month ended January 31, 1998. The Monthly Cash
Reports are, and the information to be contained on the Monthly Cash Reports
will be, true, correct and complete in all material respects and correctly show,
and will correctly show, the amount of ordinary cash receipts from the sale of
air time on each of the Stations (separately stated for each Station) for the
particular month being shown, and does not reflect, and will not reflect, any
other source of cash including, but not limited to, loan proceeds, capital
contributions and cash receipts from
Asset Purchase Agreement Sunburst/SunGroup Page 25
any sources other than the sale of air time on any of the Stations.
(e-1) Sellers' Annual Financial Statements. SGI has delivered to the
Buyer the Sellers' audited annual balance sheet and income and expense
statements, including supplemental information schedules, prepared on a
consolidated basis (the "Annual Financial Statements") for fiscal years ended
12/31/95 and 12/31/96. No later than May 15, 1998, or immediately when
available if sooner, SGI will deliver to Buyer the Annual Financial Statements
for fiscal year ending 12/31/97. The Annual Financial Statements have been, and
will be, prepared in accordance with GAAP consistently applied, and accurately
reflect, and will reflect, the subject matter contained therein and do not omit,
and will not omit, any material item which, if omitted, would cause the Annual
Financial Statements to be materially misleading. Furthermore, the Annual
Financial Statements do reflect, and will reflect, substantially, materially and
accurately the financial condition and results of operations of the Stations for
the periods covered thereby.
(e-2) Sellers' Monthly Financial Statements. SGI have heretofore
delivered to the Buyer the Sellers' monthly income and expense statements on a
Station by Station basis (the "Monthly Financial Statements") for the twelve
month periods ended 12/31/95 and 12/31/96 and for the eleven month period ended
11/30/97. Furthermore, commencing on or before the last day of January, 1998 and
continuing on or before the last day of each consecutive month thereafter until
the Closing, the Sellers will provide the Buyer with an income and expense
statements on a Station by Station basis for the immediately preceding calendar
month. For example on January 31, 1998 the Sellers will provide the Buyer with
the Monthly Financial Statements for the month ended December 31, 1997. The
Monthly Financial Statements have been, and will be, prepared in accordance with
GAAP consistently applied, and accurately reflect, and will reflect, the subject
matter contained therein and do not omit, and will not omit, any material item
which, if omitted, would cause the Monthly Financial Statements to be materially
misleading. Furthermore, the Monthly Financial Statements do reflect, and will
reflect, substantially, materially and accurately the financial condition and
results of operations of the Stations for the periods covered thereby.
(f) Sellers' 1998 Annual Budgets. The Sellers have heretofore delivered
to the Buyer the Sellers' 1998
Asset Purchase Agreement Sunburst/SunGroup Page 26
Annual Budgets and 1998 Budget Detail for each of the Stations (the "1998
Station Budgets"). The Sellers reasonably believe that the Stations 1998
Station Budgets represent the bona fide business plans of the Sellers, and are
based on projections and assumptions of Sellers' respective managements which
are reasonable in light of the Stations' historical business performance and
present business prospects.
(g) Absence of Undisclosed Liabilities. Sellers have disclosed to Buyer
all liabilities or potential liabilities of Sellers which have, or could have,
an adverse impact on, or otherwise create or could create a Lien or Encumbrance
against, the Assets.
(h) Absence of Certain Changes or Events. At any time since December 1,
1997 there has not been, and from and after the date hereof and until the
Closing, there shall not be:
(1) Any Material Adverse Event;
(2) Without Buyer's prior approval any increase in the compensation
required to be paid by Buyer to any employees or agents of Sellers under
Contracts that Buyer will assume at Closing;
(3) Any employment contracts other than contracts terminable without
liability by the employer upon notice of 10 days or less and other than for
those which will expire prior to Closing;
(4) Any sale, lease, transfer, assignment, abandonment or other
disposition of any of the Assets other than (i) dispositions of obsolete
property, (ii) property in connection with the acquisition of replacement
property of equal value, or (iii) as to any one Station, assets having a
value of less than $3,000, in the aggregate, disposed of in the ordinary
course of business and consistent with past practices.
(i) Title to Properties. Except for the Existing Liens which are to be
removed at Closing and the Permitted Exceptions, all Assets to be conveyed to
Buyer pursuant to this Agreement are presently and shall remain prior to Closing
free and clear of all Liens and Encumbrances. At the Closing the Sellers shall
convey
Asset Purchase Agreement Sunburst/SunGroup Page 27
good and marketable title in and to all of the Assets free and clear of all
Liens and Encumbrances except for the Permitted Exceptions.
(j) Defaults. As of the date of this Agreement, at all times prior to
Closing and at Closing, Sellers are not, and shall not be, in material violation
of the rights of any third party or in material default or arrears under any
Contract, Station License, or other obligation of Sellers that is relevant or
material to the business and operations of the Stations, the Assets or the
Transaction.
(k) Violations of Law. As of the date of this Agreement, at all times
prior to Closing and at Closing Sellers are not, and shall not be, in violation
of any Applicable Law which violations could have a material adverse impact on
the Sellers, the ownership or operations of any of the Stations, the Assets or
the Transaction.
(l) Pending Matters. No claim, investigation, litigation or proceeding
at law, in equity, or before any Governmental Entity is now, or at anytime prior
to or at the Closing shall be, pending or, to the Knowledge of Sellers is now,
or at anytime prior to or at the Closing shall be, threatened against Sellers,
any of the Stations, the Station Licenses or any of the Assets, which claims,
investigations, litigations or proceedings could have a material adverse impact
on any of the Sellers, the ownership or operation of any of the Stations, any of
the Assets or the Transaction. There is not presently, or at anytime prior to
or at the Closing there shall not be, any claim, investigation, litigation or
proceeding pending or, to Sellers' Knowledge, threatened which affects the
title or interest of any of the Sellers in or to any of the Assets or which
would prevent or adversely affect the ownership or operation of the Assets by
Buyer, or the ownership or operation of any of the Stations by Buyer.
(m) Employee Benefit Plans. None of the Employee Benefit Plans are
subject to Title IV of ERISA. The present value of all accrued benefits (vested
and unvested) under all the Employee Pension Benefit Plans, which any of the
Sellers or any other trades or businesses under common control within the
meaning of Section 4001(b)(1) of ERISA with any of the Sellers (collectively,
the "ERISA Group") maintains, or to which any of the Sellers or any member of
the ERISA Group is or has been obligated to contribute (the "Pension Plans"),
Asset Purchase Agreement Sunburst/SunGroup Page 28
did not, as of the respective last annual valuation dates for such Pension
Plans, exceed the value of the assets of such Pension Plan allocable to such
benefits. None of the Employee Pension Benefit Plans or any of their related
trusts has been terminated or partially terminated. None of the Sellers or any
member of the ERISA Group has contributed or been obligated to contribute to any
Multiemployer Plan. Except as set forth on SCHEDULE 17(M), none of the Sellers
nor any member of the ERISA Group has any Employee Benefit Plans. True,
correct, and complete copies of each of the Employee Benefit Plans, and related
trusts, if applicable, have been furnished to Buyer, along with the most recent
report filed on Form 5500, if available, and summary plan description with
respect to each Employee Benefit Plan required to file Form 5500.
(n) Labor. As of the date of this Agreement and at all times prior to
and at the Closing none of the Sellers are, nor will any of the Sellers be, a
party to any collective bargaining agreements. None of the Sellers have agreed
to recognize any union or other collective bargaining representative, nor has
any union or other collective bargaining representative been certified as the
exclusive bargaining representative of any of the employees of any of the
Sellers. To the Sellers' Knowledge and excluding any fact, event or
circumstance that has not resulted or would not result in a Material Adverse
Event, Sellers (1) are, and have always been in substantial compliance with all
Applicable Laws regarding labor, employment and employment practices, terms and
conditions of employment, equal employment opportunity, employee benefits,
affirmative action, wages and hours, occupational safety and health,
immigration, and workers' compensation, (2) are not engaged, nor have they ever
engaged, in any unfair labor practices, and have no, and have not ever had any,
unfair labor practice charges or complaints before the National Labor Relations
Board pending or, to the Knowledge of Sellers threatened against them or any of
them, (3) have no, and have not ever had any, grievances, arbitrations, or other
proceedings arising or asserted to arise under any collective bargaining
agreement, pending or, to the Knowledge of Sellers threatened, against them or
any of them and (4) have no, and have not ever had any, charges, complaints, or
proceedings before the Equal Employment Opportunity Commission, Department of
Labor or any other Governmental Entity responsible for regulating employment
practices, pending, or, to Sellers' Knowledge, threatened against them or any of
them. There is no labor strike, slowdown, work stoppage or lockout pending or,
to the
Asset Purchase Agreement Sunburst/SunGroup Page 29
Knowledge of Sellers, threatened against or affecting any of the Sellers, and
Sellers have not ever experienced any labor strike, slowdown, work stoppage or
lockout. To the Knowledge of Sellers no union organizational campaign or
representation petition is currently pending with respect to any of the
employees of any of the Sellers.
(o) Full Disclosure. At the date of this Agreement and at all times
prior to Closing and at Closing Sellers have, and will have, disclosed all
facts, events, circumstances and conditions that result, or could result, in a
Material Adverse Event or a Station Event. The Sellers have not withheld, and
will not withhold, knowledge of events, conditions or facts of which any of the
Sellers have Knowledge, and which are inconsistent with or contrary to any of
Sellers' representations and warranties as set forth in any of the Transaction
Documents. The disclosure to Buyer of any such events, conditions or facts
after the date hereof shall not operate as a waiver of or exception to the
affected representation or warranty or any other provision of this Agreement.
None of the representations and warranties made by Sellers in any of the
Transaction Documents or other instrument furnished to Buyer pursuant hereto or
thereto contains or will contain any untrue statement of a material fact or
omits or will omit to state a material fact necessary in order to make the
statements contained herein or therein not misleading.
(p) No Conflicts, Breach or Violation. Subject to obtaining FCC Consent
as described in Section 14 hereof and obtaining the consents and approvals
described on SCHEDULE 17(R), the execution and delivery of the Transaction
Documents by Sellers do not, and the performance by Sellers of the Transaction
will not, (1) violate, conflict with, or result in any breach of any provision
any of Sellers' respective Articles of Incorporation or Bylaws, shareholders'
agreements, and other corporate governance documents applicable to any of the
Sellers, (2) violate, conflict with, or result in a violation or breach of, or
constitute a default (with or without due notice or lapse of time or both)
under, or permit the termination of, or result in the acceleration of, or
entitle any party to accelerate (whether as a result of a change of control of
Sellers or otherwise) any obligation, or result in the loss of any benefit, or
give any person the right to require any security to be repurchased, or give
rise to the creation of any Lien upon any of the Assets under any of the terms,
conditions, or provisions of any loan or credit agreement, note, bond, mortgage,
indenture, or deed of
Asset Purchase Agreement Sunburst/SunGroup Page 30
trust, or any license, lease, Contract, or other instrument or obligation to
which any of the Sellers is a party or by which any of the Sellers or any of the
Assets may be bound or subjected, or (3) violate any Applicable Law.
(q) Governmental Consents. Except for the FCC, no consent of any
governmental body, entity, unit or agency is required for the performance of
Sellers' obligations hereunder and otherwise for the consummation of the
Transaction by Sellers.
(r) Third Party Consents. Except as set forth on SCHEDULE 17(R) and as
contemplated by Section 22(q), no consent of any person is required for the
performance of Sellers' obligations hereunder, the conveyance of all Assets to
Buyer hereunder and otherwise for the consummation of the Transaction by
Sellers.
(s) Accurate Information. Sellers have delivered to Buyer accurate
lists and summary descriptions, hereby certified to be correct by the Sellers,
of the following:
(1) Itemized lists of all material fixed assets and equipment of each of
the Stations, all of which are a part of the Assets to be delivered to
Buyer at Closing;
(2) True and correct copies of all written Contracts (or written
memorandums describing oral Contracts) pertaining to the ownership or
operation of any of the Stations;
(3) All trademarks, tradenames, service marks and copyright
registrations and applications, if any, included within the Assets;
(4) The names and current salary rates of all of the employees of each
of the Stations;
(5) Lists of active customer accounts for each of the Stations,
including for each account, the customer's name, address, kind of business
and billing history;
(6) A list of all Barter Contracts currently in existence and the Barter
Receivable balances and Barter Payable balances thereof, separately stated
as to each of the Stations; and
Asset Purchase Agreement Sunburst/SunGroup Page 31
(7) A list of all Cash Contracts currently in existence, separately
stated as to each of the Stations.
(t) Completeness of Assets. The Assets being sold and delivered to the
Buyer pursuant to this Agreement constitute all of the material assets,
properties, rights and privileges owned and operated by the Sellers in the
operation of the Stations. The assets, properties and rights described on
SCHEDULES 2.1 THROUGH 2.7 hereof, inclusive, constitute a complete and accurate
listing of all material items of real property and personal property owned or
leased by any of the Sellers and used, acquired for use or usable in the
ownership and operation of the Stations. There is no material asset used or
required by Sellers in the proper and normal conduct of business of each of the
Stations which is not owned or leased by Sellers and which is not listed or
described in Section 2 or any of the Schedules referred to therein; provided
that all Assets are hereby represented by the Sellers to be owned, and not
leased, except to the extent set forth on SCHEDULE 5 attached hereto.
(u) Operation of Stations in Compliance with Applicable Laws. The
respective physical facilities, transmitting facilities, studio facilities,
electrical and mechanical systems and all studio, broadcasting and transmitting
equipment of each of the Stations are being, have been, and pending Closing will
be, operated in accordance with the terms of each of the respective FCC Licenses
of each of the Stations and all Applicable Law, and on the Closing Date will be
in full compliance with the rules and regulations of the FCC and all Applicable
Law; except that no warranty is being made with respect to minor and immaterial
violations, if any, of city and county local laws and ordinances. Sellers have
the power and authority to own and operate all of the Stations and the Assets
and hold, and on the Closing Date will continue to hold, valid FCC Licenses and
valid authorizations from other applicable Governmental Entities which are
necessary for Sellers to own and operate all of the Stations and the Assets in
accordance with Applicable Law. All FCC Licenses that have expired at their most
recent expiration dates have been renewed by the FCC and are presently valid
licenses. No action or proceeding is pending or, to the Knowledge of Sellers,
threatened, or on the Closing Date will be threatened or pending, before the FCC
or any other Governmental Entity for the cancellation or material and adverse
modification of the respective FCC Licenses or other governmental authorizations
of each of the Stations. The material
Asset Purchase Agreement Sunburst/SunGroup Page 32
required by 47 C.F.R. Section 73.3526 to be kept in the public inspection file
of each of the Stations is in such file.
(v) Condition of Tangible Assets. All tangible personal property items
with a replacement cost (new) in excess of $1,000 included within the Assets
are, and prior to and at Closing will be, in good operating condition for the
intended use and operation of such tangible assets except for ordinary wear and
tear.
(w) Condition of Intangible Assets. The intangible personal property
items comprising the Assets will be delivered to Buyer in such a manner and
condition that Buyer will have full enjoyment of the rights and privileges
attendant thereto.
(x) No Other Agreements. Sellers are not a party to any outstanding
agreements with any Person other than Buyer for transfer or sale, directly or
indirectly, of any interest in all or any part of the Assets.
(y) FCC Consent. Sellers know of no reason why the FCC would not
consent to the assignment of the FCC Licenses to Buyer.
(z) Warranty Regarding Solvency. The net saleable value of each of the
Seller's assets as of the date hereof, and at all times prior to and at the
Closing, exceeds, and will exceed, the liabilities of such Seller.
(aa) Taxes and Company Reports. Sellers have paid all Taxes which have
become due and payable on or prior to Closing in the full amount of the
liability thereof and have filed all Tax Returns to be filed with respect to
Taxes. There are presently no Taxes of any kind which are due and payable which
have not already been paid. Sellers have timely filed all forms, reports,
statements, and other documents required to be filed with the FCC. Sellers have
filed all forms, reports, statements, and other documents required to be filed
with any and all Governmental Entities. All such forms, reports, statements and
other documents required to be filed with the FCC or any other Governmental
Entity are referred to herein, collectively, as the "Company Reports". The
Company Reports were prepared in all material respects in accordance with the
requirements of Applicable Law.
(bb) Barter Balances. The Barter Receivables balance and the Barter
Payables balance as of the date hereof for each Stations do not exceed the
amounts set forth on SCHEDULE 17(BB).
Asset Purchase Agreement Sunburst/SunGroup Page 33
(cc) Environmental Matters. There is not presently, nor at or prior to
the Closing will there be, any material violation of any Environmental Laws with
respect to any parcel of the Subject Real Property which imposes any liability
on the owner or operator of such real estate for any environmental condition or
hazard, including, but not limited to, any liability for cleanup or remediation
of any environmental condition or hazard or which would otherwise obligate any
of the Sellers or, with the passage of time, could cause any of the Sellers, or
the Buyer, to be obligated to clean up, remedy or otherwise restore to a former
condition, by itself or jointly with others, any contaminated surface water,
ground water, soil or any natural resources associated therewith (such violation
being referred to herein as an "Environmental Violation"). The operations of
the Sellers conducted on the real property and facilities owned, operated, or
leased by any of the Sellers comply and have at all times complied in all
material respects with all Applicable Laws and rules of common law pertaining to
the environment, natural resources, and public or employee health and safety,
including all Environmental Laws and the Sellers have not been notified
otherwise by any Governmental Entity or other Person.
(dd) Insurance. Seller has heretofore provided Buyer with an accurate
summary of all casualty, fire, general liability and other forms of insurance
and all fidelity bonds held by or applicable to the Stations. The insurance
coverages effected by the policies of insurance presently maintained (and which
will be maintained until Closing) by Sellers with respect to the operations,
assets, or business of the Stations are usual and customary and no less than
historically carried by Sellers. No event has occurred, including the failure
by Sellers to give any adequate notice or information, that limits or impairs
the rights of Sellers under any such insurance policies in such a manner as
could result in a Material Adverse Event. Excluding insurance policies that
have expired and been replaced in the ordinary course of business, no insurance
policy has been canceled within the last two years prior to the date hereof.
(ee) Lien Search Information. SCHEDULE 17(EE) sets forth as to each of
the Stations for all periods of time since January 1, 1992 the following
information: (i) the full and correct legal name of the FCC licensee of such
Station and any d/b/a's for such Person, (ii) all call letters used for such
Station, (iii) the main studio address for such Station, including the name of
the county in which the main studio was or is located and
Asset Purchase Agreement Sunburst/SunGroup Page 34
(iv) the address of the main transmitter site for such Station including the
name of the county in which the main transmitter site was or is located. Except
as set forth on SCHEDULE 1(A) there are no Liens, recorded or unrecorded,
against any of the Assets.
(ff) Certain Agreements. SCHEDULE 17(FF) lists each (1) employment or
consulting Contract to which any of the Sellers are a party other than those
which may be terminated by the employer without liability upon written notice of
30 days or less, (2) Contract under which any party thereto remains obligated to
provide goods or services having a value, or to make payments aggregating, in
excess of $5,000 per year, and (3) Contract that is material to the operation of
the Stations. To the Sellers' Knowledge, each such Contract described in
SCHEDULE 17(FF) or required to be so described is a valid and binding obligation
of Sellers and is in full force and effect, and any amendments to any of such
Contracts are listed in SCHEDULE 17(FF). Sellers and, to the Knowledge of
Sellers, each other party to such Contracts, have performed in all material
respects the obligations required to be performed by such other party under such
Contracts and is not (with or without lapse of time or the giving of notice, or
both) in breach or default thereunder. SCHEDULE 17(FF) identifies, as to each
such Contract listed thereon, whether the consent of the other party thereto is
required, and the amount of any payments required, in order for such Contract to
continue in full force and effect upon the consummation of the Transaction or
whether such Contract can be canceled by the other party without liability to
such other party due to the consummation of the Transaction. A complete copy of
each written Contract and a description of each oral Contract set forth in
SCHEDULE 17(FF) has been provided to Buyer prior to the date of this Agreement.
Except as provided in SCHEDULE 17(FF), none of the Sellers is a party to any
oral or written agreement, plan or arrangement with any employee or other
station or broadcast personnel of any of the Sellers (whether an employee,
consultant or an independent contractor) (4) the benefits of which are
contingent, or the terms of which are materially altered, upon, or result from,
the occurrence of a transaction involving any of the Sellers of the nature of
the Transaction, (5) providing severance benefits longer than 30 days or other
benefits after the termination of employment or other contractual relationship
regardless of the reason for such termination and regardless of whether such
termination is before or after a change of control, (6) under which any person
may receive payments subject to the tax imposed by Section 4999 of the Code or
Asset Purchase Agreement Sunburst/SunGroup Page 35
(7) any of the benefits of which will be increased, or the vesting of benefits
of which will be accelerated, by the consummation of the Transaction or the
value of any of the benefits of which will be calculated on the basis of the
Transaction.
(gg) Conflicts of Interest. Except as set forth on SCHEDULE (GG), no
Affiliate of any of the Sellers owns, or will own at anytime prior to or at
Closing, directly or indirectly, any interest in, or is a director, officer or
principal employee of, or a consultant to, any Person which (i) is a competitor,
supplier or customer of the Stations, (ii) is in any way associated with or
involved in the business conducted by any of the Stations or (iii) owns,
directly or indirectly, in whole or in part, any property, asset or right which
any of the Sellers are presently operating or using.
(hh) Owned Real Property. SCHEDULE 1(D) contains an accurate description
of all the Owned Real Property. Sellers have good and marketable, fee simple,
absolute title in and to the Owned Real Property. Sellers have sufficient title
to such easements, rights of way and other rights appurtenant to each parcel of
the Owned Real Property as are necessary to permit ingress and egress to and
from the Owned Real Property to a public way, and the improvements on the Owned
Real Property have access to such sewer, water, gas, electric, telephone and
other utilities as are necessary to allow the business of Sellers that is
operated thereon to be operated in the ordinary course; provided that if it
shall be later determined by Survey, Title Commitment or otherwise that the
representation and warranty contained in the preceding clause shall be incorrect
in any respect and the Transaction shall not be consummated for that or any
other reason, then the Sellers shall not be liable to Buyer for damages for the
breach of such warranty and representation. There is no pending condemnation or
similar proceeding affecting the Owned Real Property, or any portion thereof,
and to the Knowledge of Seller, no such action is threatened. Except as set
forth on SCHEDULE 1(D), the improvements located on the Owned Real Property are
in sufficiently good condition (except for ordinary wear and tear) to allow the
business of the Sellers to be operated in the ordinary course and there has been
no damage to such improvements that affects the conduct of such business in any
material respect that has not been repaired or remedied. Except as set forth on
SCHEDULE 1(D), there are no lessees or tenants at will in possession of any
portion of any of the Owned Real Property other than Seller, whether as lessees,
tenants
Asset Purchase Agreement Sunburst/SunGroup Page 36
at will, trespassers or otherwise. Except as set forth on SCHEDULE 1(D), no
zoning, building or other federal, state or municipal law, ordinance, regulation
or restriction is violated in any material respect by the continued maintenance,
operation or use of the Owned Real Property or any tract or portion thereof or
interest therein in its present manner. The current use of the Owned Real
Property and all parts thereof does not violate any restrictive covenants of
record affecting any of the Owned Real Property. All necessary licenses and
permits issued by any Governmental Entity with respect to the Owned Real
Property have been obtained, have been validly issued and are in full force and
effect.
(ii) Ground Leased Real Property and Other Leased Real Property.
SCHEDULES 1(B) AND 1(C) contains an accurate description of all the lease
agreements (oral or written) of real property used or held for use in the
business and operations of each of the Stations as now conducted. To Sellers'
Knowledge each lease agreement described in SCHEDULES 1(B) AND 1(C) is a valid
and binding obligation of one or more parties comprising the Seller and is in
full force and effect without amendment other than as described in SCHEDULES
1(B) AND 1(C). Except as otherwise disclosed on SCHEDULES 1(B) AND 1(C),
Sellers are not, and to the Knowledge of the Sellers, no other party is, in
default under any such real estate lease. Subject to obtaining the Consents
disclosed in SCHEDULE 17(R), Seller has the full legal power and authority to
assign its rights under the leases listed in SCHEDULES 1(B) AND 1(C), to Buyer.
All leasehold interests (including the improvements thereon) created by the
lease agreements listed on SCHEDULES 1(B) AND 1(C) are available for immediate
use in the conduct of the business and operations of each of the Stations as
currently conducted.
Section 18. Representations and Warranties by Buyer. Buyer hereby
represents and warrants to Sellers as follows:
(a) Organization. Buyer is a limited partnership duly organized,
validly existing and in good standing under the laws of the State of Delaware,
and is duly qualified to conduct business and in good standing under the laws of
the State of Texas. As to any Permitted Assignee this representation and
warranty shall be deemed revised to read to refer to the form of organization of
the Permitted Assignee. Buyer has all requisite power and authority to carry on
its business, and is duly qualified to do business, and is in good standing, in
each jurisdiction in which the character of the
Asset Purchase Agreement Sunburst/SunGroup Page 37
properties owned by it or the nature of the business transacted by it makes such
qualification required by law.
(b) Authority Relative to this Agreement. The execution, delivery and
performance of this Agreement has been duly and validly authorized by Buyer.
(c) Binding Agreement. The Transaction Documents have been, or upon
execution and delivery will be, duly executed and delivered and constitute the
valid and binding obligations of Buyer enforceable against it in accordance with
their terms, subject as to enforceability to applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and similar laws affecting
creditors' rights and remedies generally and to general principles of equity
(regardless of whether enforcement is sought in a proceeding at law or in
equity).
(d) No Breach or Violation. The execution, delivery and performance of
this Agreement and the consummation of the Transaction does not and will not
conflict with, or result in any material breach or violation of, any applicable
provision of law or administrative regulation or any material mortgage, lien,
lease, agreement, instrument, order, judgment or decree, or any other material
obligation or restriction of any kind to which Buyer is a party or by which its
properties are bound.
(e) Governmental Consents. Except for the FCC, no consent of any
Governmental Entity is required for the performance of Buyer's obligations
hereunder and otherwise for the consummation of the Transaction by Buyer.
(f) Third Party Consents. Other than for the consent of Buyer's
existing non-affiliated third party lenders, no consent of any person is
required for the performance of Buyer's obligations hereunder and otherwise for
the consummation of the Transaction.
(g) Warranty Regarding Solvency. The net saleable value of the Buyer's
assets as of the date hereof, and at all times prior to and at the Closing,
exceeds, and will exceed, the liabilities of the Buyer.
(h) Warranty Regarding Financial Ability. To its Knowledge the Buyer
has the financial resources and
Asset Purchase Agreement Sunburst/SunGroup Page 38
ability necessary to fund the Purchase Price and otherwise meet its obligations
hereunder.
(i) Full Disclosure. None of the representations and warranties made by
Buyer herein or contained in any certificate or other instrument furnished or to
be furnished to Sellers pursuant hereto contains or will contain any untrue
statement of a material fact or omits or will omit to state a material fact
necessary in order to make the statements contained herein or therein not
misleading.
(j) FCC Consent. Buyer knows of no reason why the FCC would not consent
to the assignment of the FCC Licenses to Buyer.
Section 19. Survival of Representations and Warranties Etc. All of the
representations and warranties (1) of the Sellers contained in sub-sections
(b), (d), (e-1), (e-2), (f), (g), (h), (j), (k), (l), (m), (n), (p), (q), (r),
(t) (v), (w), (x), (y), (z), (bb), (dd), (ff), (gg) and (ii) of Section 17 and
(2) of the Buyer contained in sub-sections (d), (e), (f), (g), (h), (i) and (j)
of Section 18 shall survive for only a period of two (2) years after the Closing
and shall at that time terminate. All other representations and warranties of
the Sellers contained in this Agreement and (ii) of the Buyer contained
elsewhere in this Agreement shall survive the Closing and shall continue for all
applicable periods of limitations. All of the covenants and agreements of
Sellers and Buyer contained herein shall survive the Closing and shall continue
until fully performed.
Section 20. Risk of Loss. Risk of loss, damage or destruction to the
physical property to be sold and conveyed hereunder shall be upon Sellers until
Closing and thereafter upon Buyer. In the event any such damage, destruction or
loss occurs on or prior to Closing, (e.g., without limitation, damage or
destruction to the any tower, antennae, studio, broadcasting or transmitting
facilities) and such loss, damage or destruction either materially interferes or
disrupts the operation of any of the Stations (e.g., without limitation, the
failure of any of the Stations to transmit, or material interruption(s) of, its
normal authorized broadcast signal) or results in a Material Adverse Event then
Buyer may elect any of the following: (i) to consummate the Closing on the
Closing Date and accept the property in its then condition, in which event,
Sellers shall assign to Buyer all Sellers' rights under any insurance or pay
over to Buyer all proceeds of insurance covering the property damage,
destruction or loss, (ii) postpone Closing until such time as the loss, damage
or destruction is repaired or replaced to its condition intended by this
Agreement, provided that such postponement may not exceed six
Asset Purchase Agreement Sunburst/SunGroup Page 39
(6) months or (iii) terminate this Agreement with Buyer receiving the Escrow
Letter of Credit.
Section 21. Pre-Closing Covenants of Buyer. Buyer agrees to perform the
following covenants pending Closing:
(a) Buyer agrees that if at anytime prior to Closing it should determine
(it being understood that there shall be no duty to investigate or other duty of
due diligence) that the Sellers have breached any warranty or representation,
the Buyer will give the Sellers notice and a reasonable opportunity (not less
than 20 days) to cure such breach and the Closing shall be postponed to permit
the Sellers to cure unless the Buyer waives the breach so that Closing can occur
as otherwise scheduled.
(b) Buyer shall promptly deliver to Sellers any and all information
regarding events, transactions, conditions or other matters occurring subsequent
to the date of this Agreement and on or prior to Closing (i) that have a
material adverse impact on, or that could reasonably be expected to have a
material adverse impact on, the accuracy or effectiveness of any of the
representations and warranties made in this Agreement by Buyer or (ii) that
would otherwise cause any of Buyer's representations and warranties made in this
Agreement to Sellers to be untrue or incomplete in any respect either on the
date of this Agreement or at any time on or prior to Closing.
(c) Buyer shall not take any action, or permit any action to be taken,
that would cause any of Buyer's representations and warranties made in this
Agreement to Seller to be untrue or incomplete in any material respect at
anytime on or prior to Closing.
Section 22. Pre-Closing Covenants and Agreements of Sellers. Sellers
agree that Sellers will promptly do and perform the following pending Closing:
(a) Sellers shall pay all Taxes as same shall become due and payable and
shall timely file all necessary Tax Returns with respect to such Taxes.
(b) Sellers shall promptly deliver to Buyer any and all information
regarding events, transactions, conditions or other matters occurring subsequent
to the date of this Agreement and on or prior to Closing (i) that have a
material adverse impact on, or that could reasonably be expected to have a
material adverse impact
Asset Purchase Agreement Sunburst/SunGroup Page 40
on, the accuracy or effectiveness of any of the representations and warranties
made in this Agreement by Sellers, (ii) that would otherwise cause any of
Sellers' representations and warranties made in this Agreement to Buyer to be
untrue or incomplete in any respect either on the date of this Agreement or at
any time on or prior to Closing or (iii) that result in, or could forseeably
result in, a Material Adverse Event.
(c) Sellers will give to Buyer and its counsel, accountants, and other
representatives reasonable access, during normal business hours throughout the
period prior to Closing, to all of Sellers' properties, equipment, books,
Contracts, commitments, and records related to any of the Stations and will
furnish to Buyer during such period all information concerning the business and
affairs of all of the Stations as Buyer may reasonably request.
(d) Sellers shall conduct the business and affairs of each of the
Stations in accordance with their best business judgment and Sellers will not
enter into any commitment affecting any of the Stations that is unusual or
outside the normal course of sound operation of the Stations and Sellers will
not materially change any programming (including music formats) and sales
policies of any of the Stations except those fully consistent with sound
broadcasting practices provided Sellers advise Buyer beforehand.
(e) Sellers shall not (i) make any dispositions of any of the Assets
except for dispositions of items of tangible personal property in the ordinary
course of business, but only when replaced by items of equal or greater value,
(ii) suffer or permit a change of control of any of the Sellers to occur, or
(iii) otherwise take any action that adversely affects the ability of the
Sellers to consummate the Transaction in accordance with the terms of this
Agreement.
(f) Sellers will use their best efforts to preserve the business of each
of the Stations and to keep the Stations' organizations intact, to keep
available to Buyer the services of the Key Station Personnel and to preserve for
Buyer the goodwill of Sellers' customers. Notwithstanding the foregoing, and
prior to Closing, Sellers will not, without the prior consent of Buyer, pay any
substantial bonuses or significantly adjust the rates of commission or
compensation of any Station employee; provided that the Sellers may (i) pay
bonuses due under the terms and provisions of the "Xxxxxxxxx Invitational
Asset Purchase Agreement Sunburst/SunGroup Page 41
Cash Flow Tournament" in the form attached to SCHEDULE 17(M) and (ii) pay
bonuses required to be paid under written employment agreements.
(g) Sellers will keep and maintain the property and equipment of each of
the Stations in normal operating repair and efficiency and in material
compliance with all Applicable Law.
(h) Sellers shall have complete control of the equipment, operation and
programming of each of the Stations; however Sellers agree to advise Buyer on
such matters as Buyer may reasonably request.
(i) Sellers shall not take any action, or permit any action to be taken,
that would cause any of Sellers' representations and warranties made in this
Agreement to Buyer to be untrue or incomplete in any material respect at anytime
on or prior to Closing. (j) At the appropriate time after Initial FCC
Consent, but prior to Closing, Sellers agree that Buyer may extend offers of
employment to the employees of each of the Stations upon such terms and
conditions as Buyer shall decide.
(k) Sellers will collect the Accounts Receivable in the ordinary course
of business and will not, regardless of any past practices or customs, take any
of the following actions with respect to the creation or collection of Accounts
Receivable: (1) settle any Account Receivable for less than the full amount
owed, (2) offer any discounts, premiums or other incentives of any kind in
exchange for early or quick payment of any Account Receivable, (3) other than
for historic seasonal adjustments in the rates charged by Sellers for sale of
air time and other services of the Stations, decrease the rates charged by the
Sellers, (4) change or modify Sellers' billing practices or the timing of
billing cycles or intervals or (5) undertake any actions or course of dealings
that are intended to accelerate the normal rate of collection of Accounts
Receivable.
(l) Sellers agree that if at anytime prior to Closing it should
determine (it being understood that there shall be no duty to investigate or
other duty of due diligence) that the Buyer has breached any of its warranties
or representations, the Sellers will give the Buyer notice and a reasonable
opportunity (not less than 20 days) to cure such breach and the Closing shall be
postponed to permit the Buyer to cure unless the Sellers
Asset Purchase Agreement Sunburst/SunGroup Page 42
waive the breach so that Closing can occur as otherwise scheduled.
(m) Sellers shall not terminate any of the Key Station Personnel without
prior consultation with Buyer regarding the basis for such termination.
(n) Sellers shall not enter into, or enter into negotiations or
discussions with any person other than Buyer with respect to, any local
marketing agreement, time brokerage agreement, joint sales agreement, or any
other similar agreement.
(o) Sellers shall not, directly or indirectly, through any agent,
financial advisor, banker or other representative, or otherwise, solicit,
initiate, or encourage the submission of any proposal or offer from any Person
relating to any acquisition or purchase of all or any material portion of the
Assets or participate in any negotiations regarding, or furnish to any other
person any information with respect to, or otherwise cooperate in any way with,
or assist or participate in, facilitate, or encourage, any effort or attempt by
any other Person to do or seek the foregoing. Sellers shall immediately
communicate to Buyer the material terms of any such proposal (and the identity
of the party making such proposal) which it may receive and, if such proposal is
in writing, the Sellers shall promptly deliver a copy of such proposal to Buyer.
Sellers immediately shall cease and cause to be terminated all existing
discussions or negotiations, if any, with any parties conducted heretofore with
respect to any of the foregoing. The provisions of this sub-section shall not
apply if the Buyer shall remain in material breach of this Agreement following
Sellers' notice to Buyer specifying the nature of the breach and granting to the
Buyer a reasonable opportunity of no less than 20 days to cure said beach.
(p) Sellers shall deliver to Buyer within 45 days of the Go Ahead Date a
Phase I ESA on each item of Leased Real Property addressed to Buyer and issued
by a professional environmental consulting firm reasonably acceptable to Buyer
(and performed in a manner that at a minimum satisfies the requirements of ASTM
Practice E 1527-94) stating that after due inspection there is no action
required to place the particular parcel of the Leased Real Property into
compliance with Environmental Laws or if there is any further investigation
required or some other action required to place the property into compliance
with Environmental Laws, the nature of the
Asset Purchase Agreement Sunburst/SunGroup Page 43
condition or suspected condition and the nature of the further investigation or
further action required.
(q) The obligations of the Seller and the Buyer hereunder are subject to
and conditioned upon the Board of Directors of SGI and the requisite number of
shares of voting stock of SGI approving the Transaction Documents and the
Transaction. SGI will properly notify and hold meetings of its Board of
Directors and shareholders no later than thirty (30) days after the date of this
Agreement (said 30th day is referred to as the "Sellers' Approval Date") to vote
upon a proposal to approve the execution and delivery by each of the parties
comprising Sellers of the Transaction Documents, and any amendments thereto
subsequently approved by the President of SGI, and the consummation of the
Transaction in accordance with the terms and provisions of the Transaction
Documents, as amended. Assuming the Board of Directors and requisite number of
shares of voting stock of SGI approve the Transaction Documents and the
Transaction as provided in the preceding sentence, then the Board of Directors
of SGI will cause the Board of Directors and the sole corporate shareholders of
the other parties comprising Sellers to likewise approve the execution and
delivery by each such party of the Transaction Documents, and any amendments
thereto subsequently approved by the President of such party, and the
consummation of the Transaction in accordance with the terms and provisions of
the Transaction Documents, as amended. If the foregoing described approvals
are not obtained by the Sellers' Approval Date, then this Agreement shall be
deemed terminated and no party hereto shall have any further obligation to any
other party hereto. If the foregoing described approvals are obtained on or
prior to the Sellers' Approval Date, then the President of SGI shall within 2
Business Days send written notice (the "Sellers' Approval Notice") to the Buyer
stating that all necessary board of directors' and shareholders' approvals as
contemplated by this provision have been validly obtained. Immediately and
automatically upon the Buyer's receipt of the Sellers' Approval Notice this
Agreement shall be deemed fully executed and delivered by and among the parties
hereto. The later to occur of (i) the date on which the Buyer receives the
Sellers' Approval Notice and (ii) March 3, 1998, shall be referred to herein as
the "Go Ahead Date". If the Go Ahead Date shall not have occurred by March 18,
1998, then this Agreement shall be deemed terminated and no party hereto shall
have any further obligation to any other party hereto.
Asset Purchase Agreement Sunburst/SunGroup Page 44
(r) As of the date of this Agreement, RSGT's rights to KTAB-TV's tower
site for use as XXXX-FM's main transmitter site are verbal and on a
month-to-month basis. Buyer has no present intention to acquire the Station
Assets of XXXX-FM if a long term solution (of no less than 10 years) on terms
satisfactory to the Buyer in its sole discretion (referred to as the "XXXX-FM
Transmitter Site Solution") is not obtained by the time of Closing. Sellers
agree to use their best faith efforts prior to Closing to obtain a XXXX-FM
Transmitter Site Solution at Sellers' sole cost and expense.
(s) Sellers agree to remediate at their sole cost and expense prior to
Closing and in accordance with all Applicable Law any Environmental Violation on
any Subject Real Property owned or occupied by any of the Sellers; and if the
Sellers shall fail to remediate same, then Buyer shall have the right to refuse
to accept the affected Subject Real Property and proceed to Closing without
accepting or assuming the Sellers' rights and obligations with respect thereto
whether the Subject Real Property is owned or leased by Sellers.
Section 23. Conditions Precedent to Obligations of Buyer. All
obligations of Buyer under this Agreement are subject to the fulfillment at or
prior to Closing of each of the following conditions unless waived in writing by
Buyer. If Buyer shall elect not to close because of the failure of any of the
following conditions which Buyer will not waive in writing, then Buyer shall
have the option (i) to cancel this Agreement and be entitled to the immediate
return of the Escrow Letter of Credit or (ii) postpone Closing until such time
as such condition has either been met or waived. The conditions precedent are
as follows:
(a) Sellers' representations and warranties contained in this Agreement
shall be deemed to have been made again at and as of the Closing Date and shall
then be true in all material respects; provided that any representation or
warranty of Sellers contained herein that is already qualified by a materiality
standard or a Material Adverse Event qualification shall not be compounded again
by this Section for materiality.
(b) Sellers shall have performed and complied with all agreements and
conditions required by this Agreement to be performed or complied with prior to
or at the Closing.
(c) Buyer shall have been furnished with a certificate of the Sellers
dated the Closing Date
Asset Purchase Agreement Sunburst/SunGroup Page 45
certifying the fulfillment of the foregoing two conditions.
(d) Buyer shall not have discovered any material adverse error,
misstatement, or omission in Sellers' representations and warranties made in
this Agreement that have not been cured by the time of Closing.
(e) Buyer and Senior Lender shall have been furnished with a written
legal opinion, dated the Closing Date, of Sellers' legal counsel, Boult Xxxxxxxx
Xxxxxxx & Xxxxx PLC, opining as to such matters and in such form and substance
as the Buyer and Senior Lender shall reasonably request, including, but not
limited to:
(1) The execution, delivery and performance of the Transaction Documents
by Sellers has been duly authorized and approved by all requisite actions
and proceedings.
(2) The Transaction Documents have been duly executed and delivered by
Sellers and constitutes the valid, binding and enforceable obligation of
Sellers in accordance with their respective terms, subject as to
enforceability to applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and similar laws affecting creditors' rights and
remedies generally and to general principles of equity regardless of
whether enforcement is sought in a proceeding at law or in equity.
(3) All other actions and proceedings required by law or the Transaction
Documents to be taken by Sellers at or prior to the Closing in connection
with the Transaction Documents and the Transaction been duly and validly
taken.
(4) Except as may be specified by such counsel, he does not know of any
litigation, proceeding or government investigation pending or threatened
against or relating to Sellers, the Assets, the Station, or to the
Transaction, and any legal impediment to the continued operation of the
Stations in the ordinary course.
(5) That based upon the results of complete and adequate lien and title
searches conducted
Asset Purchase Agreement Sunburst/SunGroup Page 46
at the direction of such counsel, such counsel knows of no creditor,
claimant or other person claiming any interest or making any demand against
the Stations or any of the Assets that will not be released at Closing.
The foregoing legal opinion shall not be limited to the laws of any one
jurisdiction and shall cover the laws of the jurisdictions of Texas, Tennessee,
New Mexico and Louisiana, as applicable to the subject matter of the particular
opinion; and for these purposes Sellers' legal counsel may rely upon the
opinions of reputable legal counsel licensed to practice laws in those
jurisdictions as to the portions of the opinion peculiar to those jurisdictions.
Additionally, each Permitted Assignee and its Senior Lender shall also be
entitled to receive a legal opinion as described in this item (e), but only as
may be related to the Station Assets being acquired by such Permitted Assignee
and the Transaction Documents to which such Permitted Assignee is a party.
(f) Buyer and Senior Lender shall have been furnished with a written
legal opinion, dated the Closing Date, in form and substance reasonably
acceptable to Buyer and Senior Lender, of competent and reputable FCC legal
counsel who is reasonably acceptable to Buyer and Senior Lender, opining as to
such matters as the Buyer and Senior Lender shall reasonably request, including,
but not limited to:
(1) The execution and delivery of the Agreement, and the performance by
the Sellers of their obligations in accordance with the Agreement will not
violate the Communications Act of 1934 or the rules and regulations of the
FCC.
(2) Exhibit "A" to the legal opinion completely lists all of the
licenses, permits and authorizations granted by the FCC to Sellers
(collectively, the "FCC Licenses") in connection with the ownership and
operation of the Station. The FCC Licenses are in full force and effect
and, to such counsel's knowledge, constitute the only licenses, permits,
and authorizations of the FCC required for the present broadcast operations
of the Station. The FCC Licenses for each Station are issued in the name
of and validly held by one of the Sellers. The FCC Licenses
Asset Purchase Agreement Sunburst/SunGroup Page 47
are not subject to any conditions outside the ordinary course.
(3) The most recent renewal of the FCC Licenses has been granted by the
FCC in the ordinary course.
(4) The FCC has granted its consent to the assignment of the FCC
Licenses to Buyer without the imposition of conditions outside the ordinary
course and such FCC consent is in full force and effect and has become
final.
(5) There is no judgment, decree, or order that has been issued by the
FCC against Sellers or concerning the Station or the FCC Licenses, other
than FCC orders affecting the radio station industry in general. There is
no action, proceeding, investigation, notice of apparent liability or order
of forfeiture pending or outstanding or, to such counsel's knowledge,
threatened by the FCC against Sellers or concerning the Station or the FCC
Licenses.
(6) After such counsel's review of the records on file with the FCC, and
to the best of such counsel's knowledge, there is no complaint or
proceeding pending before the FCC relating to actions by (or omissions of)
Sellers as a result of which an investigation, notice of apparent
liability, order of forfeiture or other FCC order or decision could issue
from the FCC affecting the right of Sellers to hold any of the FCC Licenses
or to operate the Station.
(7) There has been filed with the FCC with respect to the Station by the
Sellers all material reports, applications, documents, instruments and
information required to be filed by such licensee under the published rules
and regulations of the FCC.
Additionally, each Permitted Assignee and its Senior Lender shall also be
entitled to receive a legal opinion as described in this item (f), but only as
may be related to the FCC Licenses being acquired by such Permitted Assignee.
Asset Purchase Agreement Sunburst/SunGroup Page 48
(g) Sellers will have obtained and delivered to Buyer the results of
complete and adequate lien searches (effective to within a reasonable date prior
to Closing, but not to exceed 30 days prior to Closing) conducted by a reputable
private research firm acceptable to Buyer which results demonstrate that no
financing statements, judgment liens and tax liens (federal, state and local)
are filed of record with respect to any of the Assets except for those which
will be released at Closing.
(h) Buyer will have received (i) from each lessor under each Ground
Leased Real Property and Leased Real Property and from the other party to each
material Contract listed on SCHEDULE 17(FF) a letter confirming that to the
knowledge of the lessor there are no material defaults or other adverse
conditions existing under such Lease and such other matters as Buyer may
reasonably require and (ii) from each and every third party who is a party to
any Contract that Buyer will assume at Closing a letter consenting to the
assignment of such Contract to the extent consent is required under the terms of
such Contract or in accordance with applicable law.
(i) There shall not be in effect any temporary restraining order,
preliminary or permanent injunction, or other order, decree or administrative
ruling issued by any Governmental Entity or other legal restraint or prohibition
preventing the consummation of the Transaction.
(j) No action shall have been taken nor any statute, rule, or regulation
shall have been enacted by any Governmental Entity that makes the consummation
of the Transaction illegal.
(k) There shall not exist any Environmental Violation at any parcel of
the Subject Real Property or on any Leased Real Property.
(l) All other conditions to Buyer's obligation to close as set forth in
this Agreement have been either satisfied in all material respects or waived by
Buyer.
(m) A Material Adverse Event shall not have occurred prior to Closing;
however if a Material Adverse Event shall have occurred prior to Closing, the
adverse effects thereof shall have been removed, remedied or rectified to the
satisfaction of the Buyer prior to Closing.
Asset Purchase Agreement Sunburst/SunGroup Page 49
(n) Sellers shall have timely delivered to Buyer all Monthly Cash
Reports, Annual Financial Statements and Monthly Financial Statements as
required by Section 17(d), (e-1) and (e-2).
(o) Final FCC Consent has been obtained.
(p) Sellers shall have obtained a XXXX-FM Transmitter Site Solution.
(q) Sellers shall have remediated in accordance with all Applicable Law,
and at their sole cost and expense, all Environmental Violations which exist at
all facilities of all Stations including, but not limited to, the presence of
PCB's at any transmitter site.
(r) Senior Lender shall have received from the Lessors or Landlords of
all Ground Leased Real Property and Leased Real Property such agreements
containing such terms and provisions as Senior Lender shall normally require
such as, but not limited to, subordination of liens, rights of access, cure and
notice (it is understood that the Sellers shall have no obligation under this
Agreement to insure that such Lessors and Landlords will execute and deliver
such agreements to Senior Lender).
Section 24. Conditions Precedent to Obligations of Sellers. All
obligations of Sellers under this Agreement are subject to the fulfillment at or
prior to Closing of each of the following conditions (unless waived in writing
by Seller):
(a) Buyer's warranties and representations contained in this Agreement
shall be deemed to have been made again at and as of the Closing Date and shall
then be true in all material respects; provided that any representation or
warranty of Buyer contained herein that is already qualified by a materiality
standard or a Material Adverse Event qualification shall not be compounded again
by this Section for materiality.
(b) Buyer shall have performed and complied with all agreements and
conditions required by this Agreement to be performed or complied with prior to
or at Closing.
(c) Sellers shall have been furnished with a Certificate of appropriate
officers of the General Partner of Buyer (or in the case of a Permitted
Assignee, that certificate which would be applicable to the form of organization
of the Permitted Assignee), dated the
Asset Purchase Agreement Sunburst/SunGroup Page 50
Closing Date, certifying the fulfillment of the foregoing two conditions.
(d) Sellers shall have not discovered any material adverse error,
misstatement or omission in Buyer's warranties and representations made in this
Agreement which have not been cured by the time of Closing.
(e) Sellers shall have been furnished with an opinion, dated the Closing
Date, of Xxxxxxxx Xxxxxxxx & Xxxxxx P.C., counsel for Buyer, (or in the case of
a Permitted Assignee, legal counsel, reasonably acceptable to Sellers, for the
Permitted Assignee) substantially to the effect that:
(1) The execution, delivery and performance of the Transaction Documents
by Buyer (or in the case of a Permitted Assignee, those Transaction
Documents to which such Permitted Assignee is a party) has been duly
authorized and approved by all requisite actions and proceedings.
(2) The Transaction Documents (or in the case of a Permitted Assignee,
those Transaction Documents to which such Permitted Assignee is a party)
have been duly executed and delivered by Buyer and constitutes the valid,
binding and enforceable obligations of Buyer in accordance with their
respective terms, subject as to enforceability to applicable bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and similar
laws affecting creditors' rights and remedies generally and to general
principles of equity regardless of whether enforcement is sought in a
proceeding at law or in equity.
(3) All other actions and proceedings required by law or the Transaction
Documents (or in the case of a Permitted Assignee, those Transaction
Documents to which such Permitted Assignee is a party) to be taken by Buyer
at or prior to the Closing in connection with the Transaction Documents and
the Transaction been duly and validly taken.
Asset Purchase Agreement Sunburst/SunGroup Page 51
(4) Except as may be specified by such counsel, he does not know of any
litigation, proceeding or government investigation pending or threatened
against or relating to Buyer or to the Transaction.
Additionally, reputable legal counsel for each Permitted Assignee, shall also
deliver to Sellers a legal opinion as described in this item (e), but only as
may be related to the Station Assets being acquired by such Permitted Assignee
and the Transaction Documents to which such Permitted Assignee is a party.
(f) There shall not be in effect any temporary restraining order,
preliminary or permanent injunction, or other order, decree or administrative
ruling issued by any Governmental Entity or other legal restraint or prohibition
preventing the consummation of the Transaction.
(g) No action shall have been taken nor any statute, rule, or regulation
shall have been enacted by any Governmental Entity that makes the consummation
of the Transaction illegal.
Section 25. Closing.
(a) The consummation of the Transaction (the "Closing") shall take place
at the offices of Sunburst Media, LP in Dallas, Texas within ten (10) business
days following (i) Final FCC Consent or (ii) Buyer's waiver of Final FCC Consent
after Initial FCC Consent unless Sellers shall have some reason to believe that
a petition or motion for review or reconsideration of the Initial FCC Consent
may be filed by some third party, in which case the parties shall wait for Final
FCC Consent. If Final FCC Consent shall have been obtained (or waived as
provided in the preceding sentence), but not all of the other conditions
precedent to the obligations of Buyer to close as set forth in Section 23 hereof
have been satisfied or if a Material Adverse Event shall have occurred prior to
Closing and the adverse effects thereof shall not have been removed, remedied or
rectified to the satisfaction of the Buyer prior to Closing, then, in any such
case, Buyer at its option may extend (and re-extend) the time for Closing in
order for such unsatisfied conditions to be satisfied. If Final FCC Consent
shall have been obtained, but not all of the other conditions precedent to the
obligations of Sellers to close as set forth in Section 24 hereof have been
satisfied, then Sellers at their option may extend (and re-extend) the time for
Closing in order for such unsatisfied conditions to be satisfied. As used in
this Agreement, the term "Closing Date" means the date on which Closing takes
place. If the Closing shall not have occurred by the first anniversary of the
Go
Asset Purchase Agreement Sunburst/SunGroup Page 52
Ahead Date, then, subject to any applicable postponement provided for in Section
20 and subsections (b) and (c) of this Section, this Agreement shall be
terminable by either Buyer (assuming Buyer is not in default under this
Agreement) or Sellers (assuming Sellers are not in default under this Agreement)
upon written notice to the other.
(b) If a Trading Event, Banking Event or Station Event shall occur, then
the following provisions shall control the timing of the Closing. If the
Cessation Date is less than 60 days after the Event Date, then Buyer may in its
discretion extend the Closing to a date specified by the Buyer that is not later
than 30 days after the Cessation Date. If the Cessation Date is more than 60
days, but less than 90, days after the Event Date, Buyer shall in its discretion
elect on the first to occur of (i) the 10th Business Day after the Cessation
Date or (ii) the 90th day after the Event Date (the "Election Date") to either
(1) close the transactions contemplated by this Agreement on the later to occur
of the 10th Business Day after the Election Date or the 90th day after the Event
Date or (2) terminate this Agreement. If the Cessation Date has not occurred by
the 90th day after the Event Date, then on the 90th day after the Event Date
Buyer, in its discretion, shall elect to close the transactions contemplated by
this Agreement on the fifth Business Day after the 90th day or terminate this
Agreement. If the 90th day shall not occur on a Business Day, then the next
Business Day shall be deemed the 90th day.
(c) If a Conflict Event shall occur, then Buyer, in its discretion, may
extend the Closing to a date specified by the Buyer not to exceed 90 days after
the Event Date.
(d) If necessary to comply with FCC rules the parties agree to file with
the FCC (and diligently prosecute) whatever motions, requests or other matters
as are necessary to extend (and re-extend) any closing deadlines imposed by the
FCC until such time as all of the conditions to Closing as set forth herein have
been met.
Section 26. Documents To Be Delivered by Sellers at Closing. At the
Closing Sellers shall make the following deliveries to Buyer:
(a) Sellers' bring down certificate required by Section 23(c);
(b) Results of the lien searches (described in Section 23(g);
(c) Opinion of Sellers' legal counsel as required by Section 23(e);
(d) Opinion of Sellers' FCC legal counsel as required by Section 23(f);
Asset Purchase Agreement Sunburst/SunGroup Page 53
(e) Certificates of Existence and Good Standing for each of the Sellers
issued by the appropriate Governmental Entities of their respective states of
incorporation and by the appropriate Governmental Entities of the respective
states in which they are authorized to conduct business;
(f) Certified copies of the resolutions of the Board of Directors and
shareholders of each of the parties comprising the Sellers authorizing the
execution, delivery and performance of the Transaction Documents by the Sellers;
(g) Xxxx of Sale and Assignment of Interest and Assumption in the form
attached hereto as EXHIBIT 26(G) (as to the conveyance of Assets);
(h) Special Warranty Deeds to all Owned Real Property;
(i) Separate recordable Assignments to all Ground Leased Real Property;
(j) Separate Assignments to all Leased Real Property;
(k) Indemnification Escrow Agreement;
(l) Consulting Agreements;
(m) The payment required by Section 13(c);
(n) Any items regarding the Subject Real Property which are required by
Section 16;
(o) The Release from CONSECO as described in SCHEDULE 17; and
(p) Any other items required by this Agreement.
Section 27. Documents To Be Delivered by Buyer at Closing.
At the Closing Buyer shall make the following deliveries to Seller:
(a) Payment of the Purchase Price as described in Section 11;
(b) Buyer's bring down certificate required by Section 24(c);
(c) Certificate of Existence and Good Standing for Buyer issued by the
state of its incorporation or organization;
(d) Certificate of Authority and Good Standing for Buyer issued by the
States of Texas, Louisiana and New Mexico, as applicable;
Asset Purchase Agreement Sunburst/SunGroup Page 54
(e) Opinion of Buyer's legal counsel as required by Section 24(e);
(f) Certified copy of the resolutions of the Board of Directors of the
General Partner of the Buyer (or in the case of a Permitted Assignee, those
resolutions which are applicable to the form of organization applicable to the
Permitted Assignee) authorizing the execution, delivery and performance of the
Transaction Documents (or in the case of a Permitted Assignee, those Transaction
Documents to which such Permitted Assignee is a party) by the Buyer;
(g) Xxxx of Sale and Assignment of Interest and Assumption in the form
attached hereto as EXHIBIT 26(G) (as to the assumption); and
(h) Indemnification Escrow Agreement; and
(i) Any other items required by this Agreement.
Section 28. Rights and Remedies If Closing Shall Not Occur.
(a) If (1) the Closing shall not take place due to either (i) the FCC
refusing to consent to the assignment and change of control or (ii) the FCC
consenting to the assignment and change of control, but in Buyer's reasonable
opinion, with condition(s) materially adverse to Buyer, and (2) both Sellers and
Buyer shall have timely and fully met their obligations with respect to the
filing and prosecution of the FCC Applications as set forth in Section 14, then
(x) this Agreement shall terminate, (y) there shall be no liability of any party
hereto to any other party hereto as a result of such termination notwithstanding
any breach or alleged breach of other provisions of this Agreement by any party
that are not related to the filing and prosecution of the FCC Applications and
(z) the Escrow Letter of Credit shall be returned to Buyer.
(b) If the Transaction is otherwise ready to close in accordance with
the terms of this Agreement and all the conditions precedent to Buyer's
obligation to close as set forth in this Agreement have been met and Buyer
wrongfully fails to deliver the Purchase Price to Sellers at Closing, then
Sellers shall thereby take, as their liquidated damages and as their sole and
exclusive remedy, the Escrow Letter of Credit; provided that if either (i) the
Buyer wrongfully fails to deliver written instructions to the Escrow Agent to
deliver the Escrow Letter of Credit to the Sellers and the Escrow Letter of
Credit is not delivered to Sellers or (ii) the Buyer wrongfully disputes the
obligation of the issuer of the Escrow Letter of Credit to honor draws made
thereunder by Sellers, then the Sellers shall not be restricted to the Escrow
Letter of
Asset Purchase Agreement Sunburst/SunGroup Page 55
Credit as their liquidated damages and as their sole and exclusive remedy;
provided that the Buyer's failure to deliver written instructions or the Buyer's
dispute of the issuer's obligation shall not be considered wrongful for purposes
hereof unless such actions are determined in a finding of the arbitrators or a
court of competent jurisdiction to have been taken by Buyer in bad faith. Upon
Buyer's delivery of written instructions to the Escrow Agent to deliver the
Escrow Letter of Credit to the Sellers, Buyer shall have no further liability to
Sellers with respect to the Transaction Documents, this Agreement and the
Transaction and Sellers shall have no further rights or remedies against Buyer
at law or equity. TO AVOID ANY CONFUSION AND TO REMOVE ANY DOUBT, THIS
PROVISION CONTAINED IN THIS SUB-SECTION (B) DESCRIBES THE ONE AND ONLY
CIRCUMSTANCE CONTAINED IN ANY AND ALL AGREEMENTS BY AND AMONG THE PARTIES HERETO
UNDER WHICH THE SELLERS SHALL BE ENTITLED TO THE ESCROW LETTER OF CREDIT. IN
ALL OTHER SITUATIONS THE BUYER SHALL BE ENTITLED TO THE RETURN OF THE ESCROW
DEPOSIT UPON THE CLOSING OF THE TRANSACTION OR TERMINATION OF THIS AGREEMENT
WITHOUT A CLOSING HAVING TAKEN PLACE.
(c) If the Transaction is otherwise ready to close in accordance with
the terms of this Agreement and all the conditions precedent to Sellers'
obligation to close have been met in accordance with the terms of this Agreement
and Sellers fail to deliver the Assets to Buyer at Closing, then (i) Buyer may
pursue its remedy of specific performance as set forth in Section 29 and may
also take such other actions and seek such other remedies and relief as Buyer
shall be entitled under all applicable law and (ii) regardless of the remedy or
relief sought by Buyer, if Buyer so elects, Buyer shall be entitled to a return
of the Escrow Letter of Credit. If (i) the Transaction shall not be close, or
can not close on the terms set forth in this Agreement, due to the breach by the
Sellers of any of Sellers' material warranties, representations, agreements and
covenants contained in this Agreement, (ii) such breach can not be cured by the
Sellers during the time periods permitted by this Agreement or as may be
extended by Buyer acting in good faith and (iii) Buyer does not elect to
postpone Closing as permitted by this Agreement, then Buyer shall have the right
to terminate this Agreement without liability to the Sellers and without
prejudice to, or diminution of, Buyer's rights and remedies for such breach
under applicable law.
Section 29. Specific Performance Granted to Buyer. Sellers and Buyer
hereby stipulate that each of the Stations is a unique property licensed to
operate by the FCC on one of a limited number of channels servicing its
respective city of license. Therefore, the remedy of specific performance of
Sellers' obligations under this Agreement is hereby expressly granted to Buyer
by Sellers. If the Transaction is otherwise ready to close in accordance with
the terms of this Agreement and all the conditions precedent to Sellers'
obligation to close have been met in accordance with the
Asset Purchase Agreement Sunburst/SunGroup Page 56
terms of this Agreement and Sellers shall fail or refuse to close the
Transaction, then Buyer shall have the right to bring an action in a court of
proper jurisdiction or to institute arbitration proceedings to compel Sellers to
specifically perform the Transaction in accordance with the terms set forth in
this Agreement. Nothing herein shall preclude Buyer from exercising any other
rights or remedies that it may have under applicable law.
Section 30. Further Assurances. From time to time on or after Closing,
at the request of Buyer, and without further consideration, Sellers and their
respective successors and assigns will execute and deliver such instruments of
conveyance and transfer as Buyer may reasonably request to more effectively
convey, transfer to and vest in Buyer, and to more effectively put Buyer in
ownership, possession or control of each of the Stations and all of the Assets.
Section 31. Indemnification by Sellers. Without in any way limiting the
warranties, representations or agreements contained herein, or the rights or
remedies available to Buyer for the breach thereof, Sellers hereby, jointly and
severally, agree to indemnify and hold Buyer, and its successors and assigns,
free and harmless from and against, and to fully reimburse and compensate Buyer
for, as the case may be, any and all loss, liability, damage or expense
(including reasonable attorneys' fees) arising from (i) the breach of any
representations, warranties, agreements and covenants made in any of the
Transaction Documents by Sellers to Buyer, (ii) the operations of all of the
Stations prior to the Closing and (iii) any Environmental Violation existing on
the date hereof or at the Closing; provided that with respect to Environmental
Violations the Buyer must make written claim to the Sellers no later than the
second (2nd) anniversary of Closing. This Section will apply to claims of
indemnification made against Sellers by Buyer based upon claims made against
Buyer by third parties. This Section will also apply to claims made by Buyer
directly against Sellers not involving any third party claim against Buyer.
Section 32. Indemnification by Buyer. Without in any way limiting the
warranties, representations or agreements contained herein, or the rights or
remedies available to Sellers for the breach thereof, Buyer hereby agrees to
indemnify and hold Sellers, and their respective successors and assigns, free
and harmless from and against, and to fully reimburse and compensate Sellers for
any and all loss, liability, damage or expense (including reasonable attorneys'
fees) arising from (i) the breach of any representations, warranties, agreements
and covenants made in any of the Transaction Documents by Buyer to Sellers and
(ii) the operations of the Stations after Closing. This Section will apply to
claims of indemnification made against Buyer by Sellers based upon claims made
against Sellers by third parties. This Section
Asset Purchase Agreement Sunburst/SunGroup Page 57
will also apply to claims made by Sellers directly against Buyer not involving
any third party claim against Sellers.
Section 33. Third Party Claims. In the event of third party claims
giving rise to a claim for indemnification under this Agreement, then the party
seeking indemnification ("Indemnified Party") shall notify the other party
("Indemnifying Party") in writing as soon as practicable but in no event later
than thirty (30) days after receipt of such claims. The Indemnified Party's
failure to give thirty (30) day's notice shall not preclude it from seeking
indemnification hereunder unless such failure has materially prejudiced the
Indemnifying Party's ability to defend such a claim. The Indemnifying Party
shall promptly defend such claim by counsel of its own choosing. The
Indemnified Party shall cooperate with the Indemnifying Party in the defense of
such claim. The Indemnifying Party shall copy the Indemnified Party with all
correspondence, pleadings, memorandum and other such matters and otherwise keep
the Indemnified Party fully informed regarding the defense of such claim. The
Indemnifying Party may settle the claim on such terms as the Indemnifying Party
and the claimant may agree with the Indemnifying Party being responsible for
all costs and expenses of such settlement; provided that (i) if there is a
reasonable probability that a claim may materially and adversely affect the
Indemnified Party, the Indemnified Party shall have the right, at its own cost
and expense, to defend, compromise or settle such claim against it, (ii) if the
facts giving rise to indemnification hereunder shall involve a possible claim by
the Indemnified Party against a third party, the Indemnified Party shall have
the right, at its own cost and expense, to undertake the prosecution, compromise
and settlement of such claim; and (iii) the Indemnifying Party will not, without
the Indemnified Party's written consent, settle or compromise any claim or
consent to any entry of judgment (a) which does not include as an unconditional
term thereof the giving by the claimant or the plaintiff to the Indemnified
Party of a release from all liability in respect to such claim and (b) which
includes any provision which requires the Indemnified Party to pay any money or
render any other performance. If the Indemnifying Party within reasonable time
after notice of a claim fails to defend the Indemnified Party, then the
Indemnified Party shall be entitled to undertake the defense, compromise or
settlement of such claim at the expense of and for the account and risk of the
Indemnifying Party.
Section 34. Indemnification Escrow Agreement. Attached hereto as EXHIBIT
34 is the Indemnification Escrow Agreement which the Sellers and Buyer will
enter into at Closing. At the Closing the Buyer will, on behalf of the Sellers,
deliver to the Indemnity Escrow Agent the Holdback Amount which the Indemnity
Escrow Agent will hold, administer and distribute pursuant to the terms and
conditions of the Indemnification Escrow Agreement. Sellers hereby covenant and
agree that at any time Sellers are or shall become
Asset Purchase Agreement Sunburst/SunGroup Page 58
obligated to indemnify the Buyer under the any of the terms of the Transaction
Documents, including Section 31 of this Agreement, then Sellers shall, at
Buyer's request, execute and deliver to the Indemnity Escrow Agent written
instructions to release to the Buyer that portion of the Holdback Amount as is
necessary to indemnify the Buyer.
Section 35. Expenses of Transaction. The parties shall be obligated for
their own respective costs and expenses related to this Agreement and the
transactions hereunder, and no party shall be obligated for such costs and
expenses of any other party. Each party will be solely responsible for the
expenses incurred by it in the preparation, filing and prosecution of the FCC
Applications; provided that, all fees paid to the FCC in connection with the
assignment of the FCC Licenses from Sellers to Buyer will be borne equally by
Sellers, on the one hand, and Buyer, on the other hand. In the event that either
Sellers or Buyer shall pay more than 50% of said FCC fees, then the other party
shall reimburse the paying party for the excess amount over 50% promptly after
written request therefor.
Section 36. Brokers. The sole and exclusive broker on the Transaction is
Xxxxxxx X. Xxxx Co. ("Xxxx") pursuant to an agreement by and between Rice and
Sunburst Media, LP (the "Broker Agreement"). Subject to and conditioned upon
the consummation of the Transaction, the Buyer agrees to pay to Rice a brokerage
fee pursuant to the Brokerage Agreement in the following manner: (i) Buyer shall
pay Rice $162,000 at Closing and (ii) Buyer shall pay Rice $7,625 per month
(without interest) for 24 months commencing one month after the Closing Date and
continuing thereafter on the same day of each succeeding month until all $7,625
monthly payments have been made. Sellers agree that they will indemnify the
Buyer from and against all claims and demands made by any broker claiming by,
through or under any of the Sellers.
Section 37. Publicity. Sellers and Buyer shall consult with each other
in good faith with regard to all press releases and other publicity issued at or
prior to the Closing concerning this Agreement or the Transaction and, except as
may be required by applicable laws or the applicable rules and regulations of
any Governmental Entity or in connection with the matters described in Section
22(q), neither Buyer nor Sellers shall issue any such press release or other
publicity concerning these matters without the prior written consent of the
other party.
Section 38. Notices. All notices or other communications ("notices")
required or permitted by this Agreement shall be sufficiently given if in
writing and (i) personally delivered, by any courier service such as Federal
Express, (ii) mailed by registered or certified mail, return receipt requested,
first class postage prepaid, or (iii) sent by facsimile transmission (FAX) with
Asset Purchase Agreement Sunburst/SunGroup Page 59
an accompanying telephone call to the person being noticed. All notices shall
be deemed to have been given either (a) if personally delivered, then at the
time of actual delivery thereof to any person entitled to receive such notice or
officer or employee thereof, (b) if mailed, then at the completion of the fifth
(5th) full calendar day following the mailing thereof or (c) if faxed, then upon
the successful completion of the FAX transmission and the accompanying telephone
call. For purposes of this Agreement, the following addresses and telephone and
FAX numbers shall be used:
Any or all of the parties comprising Sellers, c/o SunGroup, Inc., 0000
Xxxxx Xxxxx, Xxxxx 000-X, Xxxxxxxx, Xxxxxxx 00000; telephone 000-000-0000;
FAX 000-000-0000.
With a copy to: Xx. Xxxxxxx Xxxxxx, Boult, Cummings, Xxxxxxx & Xxxxx, 000
Xxxxx Xxxxxx, Xxxxx 0000, Xxxxxxxxx, Xxxxxxxxx 00000; telephone
000-000-0000; FAX 000-000-0000.
Sunburst Media, LP, 1350 One Galleria Tower, 00000 Xxxx Xxxx, Xxxxxx, Xxxxx
00000, Attention: Xx. Xxxx X. Xxxxxxx; telephone 000-000-0000; FAX
000-000-0000.
With a copy to: Mr. Xxxxxx Xxxxxxx, Xxxxxxxx Xxxxxxxx & Xxxxxx P.C., 5400
Renaissance Tower, 0000 Xxx Xxxxxx, Xxxxxx, Xxxxx 00000; telephone
000-000-0000; FAX 000-000-0000.
Any of the above addresses and numbers may be changed by written notice
delivered to the other parties in the same manner as described in this Section.
If any notification, communication or action is required or permitted to be
given or taken within a certain period of time and the last date for doing so
falls on a day that is not a Business Day, then the last day for such
notification, communication or action shall be extended to the first date
thereafter that is a Business Day.
Section 39. Provisions Regarding Assignment.
(a) The Sellers and the Buyer contemplate that the Buyer will either (i)
assign its rights and delegate its duties under the Transaction Documents to
purchase the Station Assets of one or more of the Stations or (ii) agree to make
such an assignment and delegation immediately prior to or upon the Closing to
one or more Persons (any one such Persons being referred to herein as a
"Permitted Assignee").
(b) At anytime during the five (5) Business Day period following the Go
Ahead Date, the Buyer shall have the right and authority (A) (i) to assign (a)
the rights to purchase at Closing the Station Assets of one or more of the
Stations, (b) the full
Asset Purchase Agreement Sunburst/SunGroup Page 60
benefit of the warranties, representations, covenants and agreements made by
Sellers with respect to such Station Assets and (c) the other rights, privileges
and remedies of the Buyer arising under the Transaction Documents as to such
Station Assets and (ii) to delegate the associated liabilities, duties and
obligations of the Buyer arising under the Transaction Documents as to the
particular Station Assets and/or (B) to agree to make such assignment and
delegation described in (A) immediately prior to or upon the Closing. The Buyer
shall notify the Sellers of all such assignments and delegations, or agreements
to make such assignments and delegations, to Permitted Assignees.
(c) Such assignment and delegation shall be upon such terms, provisions
and conditions as the Buyer and the Permitted Assignee shall agree up to the
same and full extent as though the Sellers and the Permitted Assignee had
entered into a separate written agreement as to the particular Station Assets on
the same terms and conditions as set forth herein; except that the amounts of
the Purchase Price and the Holdback Amount may be allocated between Sunburst
Media, LP and the Permitted Assignee as they shall agree between themselves.
Furthermore, the Sellers shall not be a third party beneficiary of any agreement
of Buyer to make such an assignment and delegation to a Permitted Assignee;
provided that immediately prior to or upon the Closing at which time the
assignment and delegation will become effective, the Sellers and the Permitted
Assignee will be deemed to be in a direct contractual relationship with each
other under this Agreement and the other Transaction Documents, but only as the
terms and provisions of this Agreement and the other Transaction Documents
relate or pertain to the Station Assets being acquired by such Permitted
Assignee.
(d) Without limiting the provisions of subsections (a), (b) and (c) of
this Section, the effects of any such assignment and delegation to a Permitted
Assignee will include the following: (1) except as provided in any written
assignment agreement(s) which effects the assignment and delegation, the
Permitted Assignee will become, as to the applicable Station Assets, the Buyer
for all purposes of this Agreement and the other applicable Transaction
Documents related to those Station Assets, (2) as determined by Buyer at or
prior to the time of filing the FCC Applications either (i) the FCC Form 314
Application for the applicable FCC Licenses will reflect the Permitted Assignee
as the assignee of such FCC Licenses directly from the applicable Seller or (ii)
the FCC Form 314 Application for such FCC Licenses will reflect the Buyer as the
assignee of such FCC Licenses directly from the applicable Seller and there will
be filed simultaneously with the FCC a second FCC Form 314 Application showing
the Buyer as the assignor and the Permitted Assignee as the assignee of such FCC
Licenses, (3) the Sellers will deliver at Closing to such Permitted Assignee, as
the Buyer of the applicable Station Assets, all the items described in Section
26, insofar as such items relate to the sale of the
Asset Purchase Agreement Sunburst/SunGroup Page 61
applicable Station Assets to the Permitted Assignee, including separate legal
opinions and a separate Indemnification Escrow Agreement between Sellers and the
Permitted Assignee pursuant to which the Indemnity Escrow Agent will hold a
portion of the Holdback Amount and (4) the Permitted Assignee, as the Buyer of
the applicable Station Assets, will deliver at Closing to the Sellers all the
items described in Section 27, insofar as such items relate to the purchase of
the applicable Station Assets from the Sellers including the legal opinion and
the counterpart to the Indemnification Escrow Agreement referred to in the
preceding item.
(e) Notwithstanding the preceding subparagraphs of this Section,
regardless of any such assignment and delegation from Sunburst Media, LP to any
Permitted Assignee, (i) as between the Sellers and Sunburst Media, LP, Sunburst
Media, LP shall remain liable, to the exclusion of any Permitted Assignee, for
all of the obligations arising on or prior to Closing of the Buyer as set forth
in this Agreement, (ii) if the Transaction shall not close for any reason
Sellers shall have no claims or demands against any Permitted Assignee, (iii)
there shall be only one Escrow Agreement between Sellers and Sunburst Media, LP
pursuant to which the Escrow Agent shall hold only one Escrow Letter of Credit
in the amount of $1,200,000, (iv) the sale of all of the Stations will be closed
simultaneously on the Closing Date and (v) prior to Closing the Sellers shall
only be required to send notices required hereunder and supply reports,
financial and other information required hereunder only to Sunburst Media, LP
who shall be responsible to forward, as applicable, such notices and information
to the Permitted Assignees.
(f) Upon advance written notice to Sellers containing an identification
of the lender and a statement that the lender is providing funds to the Buyer
to consummate the Transaction, Buyer may make a collateral assignment of its
rights under this Agreement to any institutional lender that provides funds to
Buyer to consummate the Transaction. Sellers shall execute an acknowledgment of
such collateral assignments in such form as Buyer's institutional lenders may
reasonably request; provided, however, that unless and until written notice is
given to Sellers that any such collateral assignment has been foreclosed upon,
Sellers shall be entitled to deal exclusively with Buyer as to any matters
arising under this Agreement or any of the other Transaction Documents.
(g) Except as provided in the preceding provisions of this Section,
neither this Agreement nor any of the rights, interests, or obligations
hereunder shall be assigned by any of the parties hereto, whether by operation
of law or otherwise.
Section 40. Buyer's Consent. Sellers and Buyer agree that whenever any
event, condition or transaction occurs or has occurred
Asset Purchase Agreement Sunburst/SunGroup Page 62
of which Sellers are required to give notice to Buyer pursuant to this
Agreement, that the consent of Buyer thereto shall not be deemed an assumption
of any liability, responsibility or duty relating the subject matter of the
consent unless Buyer expressly agrees to an assumption at that time.
Furthermore, Buyer will not be deemed to have consented to any event, condition
or transaction unless such consent shall be in writing.
Section 41. Attorneys' Fees. If any party to this Agreement shall ever
be required to file a law suit or institute other legal action against any other
party hereto based upon this Agreement, any of the other Transaction Documents
or the Transaction, then the prevailing party shall be entitled to recover
reasonable attorney's fees and court costs incurred with respect to such law
suit or other legal action from the non-prevailing party.
Section 42. Construction. The section headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. All Schedules and Exhibits
attached hereto are hereby incorporated herein for all purposes.
Section 43. Parties in Interest. This Agreement shall inure to the
benefit of and be binding upon the parties named herein and their respective
successors and assigns. No term or provision of this Agreement is intended to
confer, or confers, upon any person not a party to this Agreement any rights or
remedies under or by reason of this Agreement. THERE ARE NO THIRD PARTY
BENEFICIARIES OF THIS AGREEMENT.
Section 44. Arbitration. Any controversy, dispute or claim arising out
of or in connection with or relating to this Agreement, the Transaction and any
document and instrument delivered in connection therewith (the "Transaction
Documents") or the breach, termination or validity thereof or any transaction
contemplated hereby or thereby (any such controversy, dispute or claim being
referred to as a "Dispute") shall be finally settled by arbitration conducted
expeditiously in accordance with the Commercial Arbitration Rules then in force
(the "AAA Rules") of the American Arbitration Association (the "AAA"). There
shall be a panel of three arbitrators which shall be constituted pursuant to AAA
procedure within fifteen (15) business days of receipt of the demand for
arbitration by the respondent(s) in any such proceeding. Each of the
arbitrators shall be an attorney with no less than fifteen (15) years'
experience in the practice of business law (preferably with experience in the
acquisition and financing of communications businesses). The situs for an
arbitration pursuant to this Section shall be Dallas, Texas. A final award
shall be rendered as soon as reasonably possible and, in any event, within
ninety (90) days of the filing with AAA any demand for arbitration; provided,
however, that if the arbitrators determine by majority
Asset Purchase Agreement Sunburst/SunGroup Page 63
vote that fairness so requires, such ninety (90) day period may be extended by
no more than sixty (60) additional days. The parties agree that the arbitrators
shall have the right and power to shorten the length of any notice periods or
other time periods provided in the AAA Rules and to implement expedited
procedures under the AAA Rules in order to ensure that the arbitration process
is completed within the time frames provided herein. The arbitration decision
or award shall be reasoned and in writing. Judgment on the decision or award
rendered by the arbitrators may be entered and specifically enforced in any
court having jurisdiction thereof. Notwithstanding the provisions of this
Section, any arbitration held pursuant to the provisions of this Section shall
be governed by the Federal Arbitration Act. All arbitrations commenced pursuant
to this Agreement shall be consolidated and heard by the initially constituted
panel of arbitrators. The arbitrators are hereby authorized to allocate the
attorney's fees and costs of arbitration between the parties based upon the
arbitrators' assessment of the relative merits of the parties' positions, any
other factors the arbitrators shall deem applicable and in the interest of
achieving an equitable result.
Section 45. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY,
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, AND ENFORCEABLE UNDER, THE LAWS OF
THE STATE OF TEXAS APPLICABLE TO CONTRACTS MADE IN TEXAS AND THAT ARE TO BE
WHOLLY PERFORMED IN TEXAS WITHOUT REFERENCE TO THE CHOICE-OF-LAW PRINCIPLES OF
TEXAS.
Section 46. Consent to Jurisdiction. EACH OF THE PARTIES TO THIS
AGREEMENT HEREBY CONSENTS TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE
STATE OF TEXAS AND THE UNITED STATES DISTRICT COURTS FOR THE STATE OF TEXAS, AS
WELL AS TO THE JURISDICTION OF ALL COURTS TO WHICH AN APPEAL MAY BE TAKEN FROM
SUCH COURTS, FOR THE PURPOSE OF ANY SUIT, ACTION OR OTHER PROCEEDING ARISING OUT
OF ANY OF ITS OBLIGATIONS ARISING HEREUNDER OR UNDER OR IN CONNECTION WITH THE
OTHER TRANSACTION DOCUMENTS OR WITH RESPECT TO THE TRANSACTIONS CONTEMPLATED
HEREBY AND THEREBY, INCLUDING, WITHOUT LIMITATION, ANY PROCEEDING RELATING TO
ANCILLARY MEASURES IN AID OF ARBITRATION, PROVISIONAL REMEDIES AND INTERIM
RELIEF, OR ANY PROCEEDING TO ENFORCE ANY ARBITRAL DECISION OR AWARD. EACH OF
THE PARTIES TO THIS AGREEMENT EXPRESSLY WAIVES ANY AND ALL OBJECTIONS HE OR IT
MAY HAVE AS TO VENUE, INCLUDING, WITHOUT LIMITATION, THE INCONVENIENCE OF SUCH
FORUM, IN ANY OF SUCH COURTS. IN ADDITION, EACH OF THE PARTIES TO THIS AGREEMENT
CONSENTS TO THE SERVICE OF PROCESS BY PERSONAL SERVICE OR U.S. CERTIFIED OR
REGISTERED MAIL, RETURN RECEIPT REQUESTED, ADDRESSED TO SUCH PARTY AT THE
ADDRESS PROVIDED HEREIN.
Section 47. Waiver of Jury Trial. WITHOUT LIMITATION OF THE PROVISIONS
OF SECTION 44, EACH OF THE PARTIES TO THIS AGREEMENT HEREBY VOLUNTARILY AND
IRREVOCABLY WAIVES TRIAL BY JURY IN ANY ACTION BROUGHT ON OR IN CONNECTION WITH
THIS AGREEMENT OR ANY OTHER
Asset Purchase Agreement Sunburst/SunGroup Page 64
TRANSACTION DOCUMENTS OR OTHER AGREEMENTS, DOCUMENTS AND INSTRUMENTS EXECUTED IN
CONNECTION HEREWITH.
Section 48. Merger Clause. This Agreement represents the entire
agreement of the parties hereto and supersedes all prior agreements,
understandings, letters of intent and negotiations concerning the subject matter
hereof. Furthermore, the Sellers have delivered to the Buyer a substantial
amount of documents, data and other information ("Station Information")
concerning the Stations. However, it is agreed and understood that any
discrepancies or inconsistencies between such Station Information and the
representations, warranties, covenants and agreements of the Sellers made
herein, and the review of the Station Information by Buyer, shall not under any
circumstances constitute an exception or limitation of any representation,
warranty, covenant or agreement of the Sellers made herein; it being understood
that all of the exceptions and limitations to the representations, warranties,
covenants and agreements of the Sellers made herein have been specifically and
expressly set forth in this Agreement (or the Schedules and Sub-Schedules
attached hereto) and no where else, including, but not limited to, the Station
Information.
Xxxxxxx 00. XXX as Agent For All Sellers. SGBL, SGBNM, RSGBCS, RSGT,
ASI, ABI, BBCI, SMI, Arklatex and Alpha-Web hereby irrevocably designate and
appoint SGI as their agent for any and all matters related to or arising out of
the Transaction Documents and the Transaction and hereby authorize and instruct
Buyer to deal with representatives of SGI for all such matters.
Section 50. No Reversionary Interest. The parties expressly agree,
pursuant to Section 73.1150 of the FCC's rules, that Seller does not retain any
right to reassignment of any of the FCC Licenses in the future, or to operate or
use the facilities of the Stations for any period beyond the Closing Date.
Section 51. Counterparts. This Agreement shall be executed in multiple
counterparts, each of which shall be deemed an original of this Agreement.
Section 52. References and Titles. All references in this Agreement to
Exhibits, Schedules, Articles, Sections, subsections, and other subdivisions
refer to the corresponding Exhibits, Schedules, Articles, Sections, subsections,
and other subdivisions of this Agreement unless expressly provided otherwise.
The words "this Agreement," "herein," "hereby," "hereunder," and "hereof," and
words of similar import, refer to this Agreement as a whole and not to any
particular subdivision unless expressly so limited. The words "this Section,"
"this subsection," and words of similar import, refer only to the Sections or
subsections hereof in which such words occur. The word "or" is not exclusive,
and the word "including" (in its various forms) means "including without
Asset Purchase Agreement Sunburst/SunGroup Page 65
limitation." Pronouns in masculine, feminine, or neuter genders shall be
construed to state and include any other gender and words, terms, and titles
(including terms defined herein) in the singular form shall be construed to
include the plural and vice versa, unless the context otherwise expressly
requires. Unless the context otherwise requires, all defined terms contained
herein shall include the singular and plural and the conjunctive and disjunctive
forms of such defined terms.
Section 53. Miscellaneous. This Agreement shall not be amended except
pursuant to a written instrument executed by all of the parties hereto. If any
provision of this Agreement, or the application of any such provision to any
person or circumstance, shall be held invalid by a court of competent
jurisdiction, the remainder of this Agreement, or the application of such
provision to persons or circumstances other than those as to which the Agreement
is held invalid, shall not be affected thereby. No modification or waiver of
any provision of this Agreement shall be effective unless in writing and signed
by the party against whom such modification or waiver is asserted, and no
failure to exercise any right, power or privilege hereunder shall operate to
restrict the exercise of the same right, power or privilege upon any other
occasion or to restrict the exercise of any other right, power or privilege upon
the same or any other occasion. The rights and remedies of the parties hereto
are cumulative and are not exclusive of any right or remedies which they may
otherwise have.
[The rest of this page left blank intentionally.]
Asset Purchase Agreement Sunburst/SunGroup Page 66
IN WITNESS WHEREOF, the undersigned parties have signed and delivered this
Agreement as of the date and year first above written.
SELLERS:
SUNGROUP, INC.
By: XXXX X. XXXXXXXXX
--------------------------
Xxxx X. Xxxxxxxxx
Its: President
RADIOSUNGROUP OF TEXAS, INC.
By: XXXX X. XXXXXXXXX
--------------------------
Xxxx X. Xxxxxxxxx
Its: President
SUNGROUP BROADCASTING OF NEW
MEXICO, INC.
By: XXXX X. XXXXXXXXX
---------------------------
Xxxx X. Xxxxxxxxx
Its: President
SUNGROUP BROADCASTING OF
LOUISIANA, INC.
By: XXXX X. XXXXXXXXX
---------------------------
Xxxx X. Xxxxxxxxx
Its: President
RADIOSUNGROUP OF XXXXX/COLLEGE
STATION, INC.
By: XXXX X. XXXXXXXXX
---------------------------
Xxxx X. Xxxxxxxxx
Its: President
Asset Purchase Agreement Sunburst/SunGroup Page 67
BIG BASS CLASSICS, INC.
By: XXXX X. XXXXXXXXX
---------------------------
Xxxx X. Xxxxxxxxx
Its: President
AIR SIGNS, INC.
By: XXXX X. XXXXXXXXX
---------------------------
Xxxx X. Xxxxxxxxx
Its: President
ARKLATEX, INC.
By: XXXX X. XXXXXXXXX
---------------------------
Xxxx X. Xxxxxxxxx
Its: President
ALPHA-WEB, INC.
By: XXXX X. XXXXXXXXX
---------------------------
Xxxx X. Xxxxxxxxx
Its: President
SUN MANAGEMENT, INC.
By: XXXX X. XXXXXXXXX
---------------------------
Xxxx X. Xxxxxxxxx
Its: President
ABILENE BROADCASTING, INC.
By: XXXX X. XXXXXXXXX
---------------------------
Xxxx X. Xxxxxxxxx
Its: President
Asset Purchase Agreement Sunburst/SunGroup Page 68
BUYER:
SUNBURST MEDIA, LP
By: Sunburst Media Corporation
Sole General Partner
By: XXXX X. XXXXXXX
---------------------------
Xxxx X. Xxxxxxx
Its: President
Asset Purchase Agreement Sunburst/SunGroup Page 69
SCHEDULE 1(A)
EXISTING LIENS AGAINST THE ASSETS
UCC-1 Filings
Legend:
FSB = First Savings Bank of Texas
RTC = Resolution Trust Corporation
TBD = To be Determined
1.The following liens:
Debtor Instrument # Date Creditor Location
-----------------------------------------------------------------------
XXX 000000 10/18/90 Xxx Xxxxx Xxxxxxxxx
XXX 000000 01/03/90 Xxx Xxxxx Xxxxxxxxx
XXX 0000000 02/19/93 Conseco Indiana
RSGBCS 90-000078 01/02/90 FSB Texas
RSGBCS 1160/854 01/02/90 FSB Brazos Co., TX
SGBL 09-891858 01/05/90 FSB Cado Parish, LA
SGBL 0000000000 12/02/93 FSB Cado Parish, LA
SGBL 09-917604 12/02/93 FSB Cado Xxxxxx, XX
XXXX 000000 06/29/92 RTC Wichita Co., TX
RSGT 92-000248 01/06/92 Xxx Xxxxxxxx Texas
RSGT 2 01/02/92 Xxx Xxxxxxxx Xxxxxx Co., TX
RSGT XXX XXX Xxx Xxxxxxxx Indiana
RSGT XXX XXX Xxx Xxxxxxxx Xxxxx Xx., XX
SGBNM 960918037 09/18/96 Xxxxx Xxxxxx New Mexico
SGBNM 901010050 10/10/90 Xxx Xxxxx New Mexico
SGBNM 951018031 10/10/90 Xxx Xxxxx New Mexico
Asset Purchase Agreement Sunburst/SunGroup Page 70
2. Deed of Trust lien on KYKN-FM studio site
3. Mortgage lien on KMJJ-FM tower site and KMJJ-FM studio site held by First
Savings Bank of Texas.
4. Xxx Xxxxx has a security interest in all of the person property assets of
RadioSunGroup of Texas, Inc., but no UCC-1 was filed of record.
Asset Purchase Agreement Sunburst/SunGroup Page 71
SCHEDULE 1(B)
GROUND LEASED REAL PROPERTY
None
Asset Purchase Agreement Sunburst/SunGroup Page 72
SCHEDULE 1(C)
LEASED REAL PROPERTY
1. KROW-FM Main Tower Site (Spot, Inc., Lessor): Radio Tower Lease Agreement
dated May 15, 1997 by and between Spot, Inc., as the lessor, and Radio
SunGroup of Texas, Inc., as the Lessee, for antenna space lease on the
Lessor's tower and associated transmitter building for the term commencing
May 15, 1997 and ending May 15, 2007; provided lease may be terminated
early upon 365 day prior written notice of cancellation by either Lessor or
Lessee. CONSENT REQUIRED: LESSOR'S CONSENT TO ASSIGNMENT OF LESSEE'S
INTEREST IN THE LEASE IS EXPRESSLY REQUIRED UNDER THE LEASE AGREEMENT.
2. KKSS-FM Studio Site, First Security Bank Building, 0000 Xxxxxxx Xxxxxx,
X.X., Xxxxx 0000, Xxxxxxxxxxx, XX 00000 (Gulfstream Worldwide, Inc.,
Landlord): Office Building Lease dated January 2, 1991 by and between
Resource Savings Association, as the Landlord, and SunGroup Broadcasting of
New Mexico, Inc., as the Tenant, for 3,706 sq. ft. of office space for the
term commencing February 1, 1991 and ending January 31, 1994; as amended by
Amendment No. 1 To Lease, dated the "____" day of August, 1993 by
Gulfstream Worldwide, Inc. (successor in interest to Resource Savings
Association), as the Landlord and Tenant to extend to the lease term to
January 31, 1998; as further amended by Amendment Two Of Lease Agreement,
dated the 31st day of March, 1997 to add an additional 712 sq. ft. of
office space. CONSENT REQUIRED: LANDLORD'S CONSENT TO ASSIGNMENT OF
TENANT'S INTEREST IN THE LEASE IS EXPRESSLY REQUIRED UNDER THE LEASE
AGREEMENT.
3. KKSS-FM Main Tower Site, Santa Fe National Forest on No Name Mountain
(KASA-TV, Inc., Lessor): Lease Agreement by and between New Mexico Media
Co. and New Mexico Media, Ltd., as the Lessor, and New Mexico Broadcasting
Company, as the Lessee, and signed by the Lessor on 11/20/84 and signed by
the Lessee on 10/31/84, for antenna space lease on the Lessor's tower and
associated transmitter building for the term commencing [left blank in
lease] and ending December 31, 1992, provided that Lessee has three (3)
options to extend the lease term for 120 months each. Lessor's interest in
the Lease was subsequently acquired by Channel 2 Associates and thereafter
was subsequently acquired by Coronado Communications Company by Assignment
dated April 26, 1998 and thereafter was subsequently acquired by KASA-TV,
Inc. on December 31, 1992. The Lessee's interest in the Lease was acquired
by SunGroup Broadcasting of New Mexico, Inc. CONSENT REQUIRED: LANDLORD'S
CONSENT TO ASSIGNMENT OF TENANT'S INTEREST IN THE LEASE IS EXPRESSLY
REQUIRED UNDER THE LEASE AGREEMENT.
Asset Purchase Agreement Sunburst/SunGroup Page 73
4. XXXX-FM, XXXX-AM and KROW-FM Studio Site, 0000 Xxxxx Xxxxx Xxxxxx, Xxxxxxx,
Xxxxx 00000 (X.X. XxXxxxxxx Trust, Landlord): Agreement of Lease dated May
25, 1990 by and between Xxx X. XxXxxxxxx, Trustee of the X.X. XxXxxxxxx
Trust, as the Landlord, and RadioSungroup of Texas, Inc., as the Tenant,
for 2,776 sq. ft. of office space for the term commencing May 25, 1990 and
ending May 25, 1995; as amended by Modification and Extension of Agreement
of Lease dated May 25, 1995 extending the term to May 25, 2000, subject to
Landlord's right to terminate on one (1) year's notice if Landlord receives
and accepts a bona fide offer to purchase the property; as amended by
letter agreement dated October 17, 1997 to add an additional 875 sq. ft. of
office space. CONSENT REQUIRED: LANDLORD'S CONSENT TO ASSIGNMENT OF
TENANT'S INTEREST IN THE LEASE IS EXPRESSLY REQUIRED UNDER THE LEASE
AGREEMENT.
5. XXXX-FM Tower Lease, State Hwy. 36, SE of Abilene (KTAB-TV, Lessor):
Unwritten month to month lease agreement for antenna space on the Lessor's
tower and associated transmitter building at a cost of $1,200 per month
base rent. CONSENT REQUIRED: LESSOR'S CONSENT TO ASSIGNMENT OF LESSEE'S
INTEREST IN THE LEASE IS EXPRESSLY REQUIRED BY BUYER AS WELL AS THIS
SITUATION BEING CORRECTED TO THE SATISFACTION OF THE BUYER AS A CONDITION
PRECEDENT TO THE BUYER'S OBLIGATION TO CLOSE.
6. KKYS-FM Studio Site, Suite 130, 0000 Xxxxxxxxxx Xxxxx, Xxxxx, Xxxxx 00000
(GG Enterprises, Landlord): Office Lease dated May 25, 1990 by and between
GG Enterprises, as the Landlord, and RadioSungroup of Xxxxx/College
Station, Inc., as the Tenant, for 3,024.5 sq. ft. of office space for the
term commencing April 1, 1997 and ending March 31, 2002; as amended by
First Amendment For the Lease undated granting a right of first refusal for
an additional 800 sq. ft., being a retail pod adjacent to the demised
premises. CONSENT REQUIRED: LANDLORD'S CONSENT TO ASSIGNMENT OF TENANT'S
INTEREST IN THE LEASE IS EXPRESSLY REQUIRED UNDER THE LEASE AGREEMENT.
Asset Purchase Agreement Sunburst/SunGroup Page 74
SCHEDULE 1(D)
OWNED REAL PROPERTY
1. KYKX Studio Site, 0000 Xxxxxx Xxxx, Xxxxxxxx, Xxxxx 00000:
---------------------------------------------------------
All that certain lot, tract or parcel of land being a 1.67 acre of land
located in the Xxxx Xxxxxxx A-113 Survey, Xxxxx County, Texas, said 1.67
acre being a part of Xxx 0, Xxxxx X (X.X.X. 940) in the City of Longview,
and being the same tract as described in Deed of Trust from Xxxxxxx X.
Xxxxxxxx and X. X. Xxxxxx to Xxx X. Xxxxxx XX, and recorded in Volume 633,
Page 164, Deed of Trust Records of Xxxxx County, Texas and said 1.67 acre
being more particularly described as follows:
BEGINNING at 2" iron pipe at the Northwest corner of the above mentioned
Lot 4, said BEGINNING point also being in the East ROW line of Xxxxxx Road
(Spur 502) and being North 541.6 feet from the North ROW line of Eden
Drive;
THENCE S 88 deg. 41' 00" E, 536.00 feet along the North boundary line of
this tract to a point in the center of branch for corner; Reference a 1/2"
iron rod set on High Bank at N 88 deg. 41' 00" W, 20.0 feet;
THENCE along and with the centerline of said branch, the following
meanders: S 28 deg. 44' 00" E, 35.30 feet; S 54 deg. 43' 00" E, 27.60 feet;
S 38 deg. 10' 00" E, 35.3 feet and S 04 deg. 59' 00" W, 39.60 feet to a
point for corner; Reference a 1/2" iron rod set on High Bank of Creek at S
88 deg. 43' 47" W, 20.0 feet;
THENCE S 88 deg. 43' 47" W, 592.66 feet along the South boundary line of
this tract to a 3/8" iron rod found for corner in the East ROW line of
Xxxxxx Road (Spur 502);
THENCE N 00 deg. 30' 00" W, 139.56 feet along the East ROW line of said
Xxxxxx Road (Spur 502) to the PLACE OF BEGINNING and containing 1.67 acre
of land, more or less.
Allocated Value: $150,000
2. XXXX-AM Tower Site, 000X, X.X. 0xx Xxxxxx, Xxxxxxx, Xxxxx:
---------------------------------------------------------
The real property lying and being situated in Xxxxxx County, Texas, more
particularly described as 4.72 acres of land out of the Northwest (NW) One
Fourth (1/4) of Section 48, Blind Asylum Land, Xxxxxx County, Texas;
Asset Purchase Agreement Sunburst/SunGroup Page 75
Beginning at a point 470.2 feet West and 852.1 feet North of the Southeast
corner of the Xxxxxxxxx 0/0 xx Xxxxxxx 00, Xxxxx Xxxxxx Xxxx; Thence West
420.0 feet; Thence North 0 deg. 21 minutes West 488.0 feet; Thence North 89
deg. 46 minutes East 420 feet; Thence South 0 deg. 21 minutes East 489.7
feet to the place of beginning, and containing 4.72 acres in County of
Xxxxxx, State of Texas, and being that same real property described in deed
from Key City Broadcasters, Inc., to West Texas Media, Inc., recorded in
Vol. 998, at page 156, of the Deed Records of Xxxxxx County, Texas;
Save and Except, a tract of 0.16 acres conveyed by Xxxxxx County
Broadcasting, Inc., to the City of Abilene, Texas, by instrument dated
December 8, 1978, recorded in Vol. 1107, page 000, Xxxx Xxxxxxx, Xxxxxx
Xxxxxx, Xxxxx.
Allocated Value: $25,000
3. KKYS-FM Tower Site, Rabbit Lane, Bryan, Texas:
---------------------------------------------
1.5 Acre Tract: The certain tract or parcel of land lying and being
situated in the County of Brazos, State of Texas and BEING that one certain
1.5 acre tract of land lying and being situated in the Xxxxx Xxxxx League,
A-3, Brazos County, Texas and being all of that 1.50 acre tract of land
conveyed to Xxxxx & Xxxxx Enterprises, Inc. by Xxx X. Xxxx by Deed recorded
in Volume 521, Page 616 of the Deed Records of Brazos County, Texas, and
being more particularly described as follows:
BEGINNING: at an iron rod at the north corner of said 1.50 acre tract, same
being in the southeast right-of-way line of Rabbit Lane;
THENCE: S 45 deg. 00' E - 364.40 fee to an iron rod set for corner;
THENCE: S 44 deg. 29' W - 180.46 feet to an iron rod found for corner;
THENCE: N 45 deg. 00' W - 364.40 feet to an iron rod found for corner in
said Rabbit Lane line;
THENCE: N 44 deg. 29' E - 180.46 feet along said Rabbit Lane line to the
PLACE OF BEGINNING; and containing 1.5 acres of land, more or less,
according to a survey made on the ground under the supervision of Xxxxxx X.
Xxxxxxx, Registered Public Surveyor, No. 2972, on June 25, 1987.
Asset Purchase Agreement Sunburst/SunGroup Page 76
Guy Wire Easement: That certain guy wire easement created by that certain
Easement Agreement dated July 27, 1989 from Xxxxxxxxx, Xxxxxx & Xxxx, a
Texas partnership (hereinafter referred to as "CTB"), to Radio U.S.A.,
LTD., recorded in Volume 990, Page 77 in the office of the County Clerk of
Brazos County, Texas, BEING a 20' wide guy wire easement, lying and being
situated in the Xxxxx Xxxxx Survey, Abstract No. 3, Brazos County, Texas,
and being part of the 1.00 acre tract described in the deed from Xxx X.
Xxxx, dba Xxxxx & Xxxxx Enterprises, to Xxxxx X. Xxxx and wife, Xxxxxxx X.
Xxxx, recorded in Volume 507, Page 32, of the Deed Records of Brazos
County, Texas, the centerline of the 20' wide guy wire easement being more
particularly described as follows:
BEGINNING in the southwest line of the beforementioned 1.00 acre tract
located S 45 deg. 00' 00" E 192.67 feet from the 1/2" iron rod set at the
west corner of the said 1.00 acre tract, and iron rod being in the
southeast line of Xxxxxxx Xxxx;
THENCE N. 46 deg. 18' 57" E along the guy wire for a distance of 119.57
feet to the northeast line of the beforementioned 1.00 acre tract and the
end of this easement, a 1/2" iron rod set at the north corner of the said
1.00 acre tract bears N 45 deg. 00' 00" W 196.5 feet.
Guy Wire Easement: That certain guy wire easement conveyed to Radio
U.S.A., LTD. in that certain General Warranty Deed from CTB to Grantor,
recorded in Volume 900, Page 83 in the office of the County Clerk of Brazos
County, Texas, BEING a 20.00 foot wide guy wire easement, lying and being
situated in the XXXXX XXXXX LEAGUE, A-3, Brazos County, Texas, and being a
part of that 47.47 acre tract of land conveyed to Xxxxx Xxxxxxxx by Xxxx X.
Xxxxx by deed recorded in Volume B61, Page 228 of the Deed Records of
Brazos County, Texas and being more particularly described as follows:
COMMENCING: at an iron rod at the northwest corner of said 47.47 acre
tract, same being in the southeast right-of-way line of Rabbit Lane and
also being the north corner of the GTE-Tract;
THENCE: S 45 deg. 00'E - 186.49 feet to an iron rod for the PLACE OF
BEGINNING; same being the north corner of a 0.49 acre tract;
THENCE: N 46 deg. 18'57" E - 10.00 feet to an iron rod for corner;
Asset Purchase Agreement Sunburst/SunGroup Page 77
THENCE: S 45 deg. 00' E - 20.00 feet to an iron rod for corner;
THENCE: S 46 deg. `18'57" W - 10.00 feet to an iron rod for corner;
THENCE: N 45 deg. 00' W - 20.00 feet to the PLACE OF BEGINNING; and
containing 0.005 acres of land, more or less, according to a survey made on
the ground under the supervision of Xxxxxx X. Xxxxxxx, Registered Public
Surveyor, No. 2972, on June 25, 1987.
Allocated Value: $150,000
4. KMJJ-FM Studio Site, 000 Xxxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxxxx:
------------------------------------------------------------
Xxxx 00, 00 xxx 00 xx xxx XXXXX-XXXXXX AND XXXXXXX SUBDIVISION of TAL 17, a
subdivision of Shreveport, Caddo Parish, Louisiana, as per plat of
subdivision recorded in Conveyance Book 4, Page 264, Records of Caddo
Parish, Louisiana, together with all buildings and improvements located
thereon, LESS AND EXCEPT a strip of land 25 feet wide and 120 feet long
with said entire length adjoining and running parallel to the alley at the
rear (Northeasterly side) of said lots.
Allocated Value: $25,000
5. KMJJ-FM Tower Site, 0000 XX 0000, Xxxxx xx Xxxxxxxxxx, Xxxxxxxxx:
----------------------------------------------------------------
A TRACT OF LAND IN XXXXXXX 00 XXXXXXXX 00 XXXXX, XXXXX 00 XXXX, XXXXX
XXXXXX, XX. MORE FULLY DESCRIBED AS FOLLOWS: from the Northwest Corner of
said Section 26, run thence South along the West line of Sec. 26, a dist.
of 2650.49 Ft. run THENCE N.89 deg. 58'42"E a dist. of 1,317.42 ft. to a
found 1" iron pipe for corner and the point of beginning of the tract
herein described, run thence N. 89 deg. 58'42"E. a dist. of 2025.24 ft. to
a found 1" iron pipe for corner being a point on the West right-of-way line
of abandoned T.&P.R.R., run thence S. 5 deg. 29'10" W. along said
right-of-way line a dist. of 583.72 ft. to a set 1/2" iron pipe for corner,
run thence N.84 deg. 32'30"W. a dist. of 208.56 ft. to a set 1/2" iron pipe
for corner, run thence S. 5 deg. 24'30"W, a dist of 104.3 ft. to a set 1/2"
iron pipe for corner, run thence ____54'17W. a dist. of 85.71 ft to a set
1/2" iron pipe for corner, run thence S.5 deg. 27'30"W, a dist. of 120.22
xx.xx a set 1/2" iron pipe for corner, run thence S 89 deg. 58'42"W. a
dist. of 1059.7 ft. to set 1/2" iron pipe for corner, run thence N. 0 deg.
20'E, a dist.
Asset Purchase Agreement Sunburst/SunGroup Page 78
of 776.98 ft. to the point of beginning, containing 34.27 acres more
or less.
This survey was made without the benefit of a full and accurate title
search.
The bearing along the north line of the hereinabove surveyed tract was
taken from survey prepared by Xxxxxx X. Xxxx dated June 2, 1970.
Allocated Value: $25,000
6. XXXX-XX Xxxxx Xxxx, Xxxxx Xxxxxxx 000 and FM 1844:
-------------------------------------------------
All that certain lot, tract or parcel of land situated in Upshur and Xxxxx
Counties, Texas, about 11 miles Northwest of the Courthouse in the City of
Longv iew, being 34.553 acres of land, a part of the XXXXXXXX XXXX SURVEY
(A-302, Upshur County; A-133, Xxxxx County), and being a part o that
certain 49.837 acre tract of land described in a deed from Xxxxx X. Xxxx,
et ux, to Service Broadcasting Corp., dated October 26, 1995 and recorded
in Volume 2880, Page 228 of the Xxxxx County Official Records, said 34.553
acres being more particularly described as follows:
BEGINNING at a concrete monument found for corner at the Southwest corner
of said 49.837 acre tract, same being the Southeast corner of that certain
45.744 acre tract described in a deed to Xxxxx Xxxxxx Xxxxx, et ux,
recorded in Volume 34, Page 541 of the Upshur County Official Records, said
monument being on the North right-of-way line of State Hwy. 300 (also known
as Gilmer Road);
THENCE North 31 deg 47'00" East, with the common line between said 49.837
acre tract and said 45.744 acre tract, 1391.63 feet to a 1/2" iron rod set
for corner on same and being the Southwest corner of a 10.898 acre tract
surveyed from said 49.837 acre tract;
THENCE South 58 deg 13'00" East, with the South line of said 10.898 acre
tract, 778.57 feet to a 1/2" iron rod set for corner on the East line of
said 49.837 acre tract, being the Southeast corner of said 10.898 acre
tract and being on the West line of that certain 53.42 acre tract described
in deed to Xxxxxx XxXxx, recorded in Volume 2418, Page 619 of the Xxxxx
County Deed Records;
THENCE South 0 deg 43'03" West, with the common line between said 49.837
acre tract and said 53.42 acre tract,
Asset Purchase Agreement Sunburst/SunGroup Page 79
1249.63 feet to a 3/8" iron rod found for corner at the Easternmost
Southeast corner of said 49.837 acre tract and also being the Northeast
corner of a 0.48 acre tract described in deed to Xxxxxxx Xxxxxxxxxx, et ux,
recorded in Volume 748, Page 470 of said Xxxxx County Deed Records;
THENCE North 89 deg 07'56" West, with the Easternmost South line of said
49.837 acre tract and North line of said Xxxxxxxxxx 0.48 acre tract and
also the North line of another 0.48 acre tract described in deed to Xxxxx
X. Xxxxx, et ux, recorded in Volume 1185, Page 497 of said Xxxxx County
Deed Records, 210.13 feet to a 1/2" iron rod found for corner at the
Northwest corner of said Xxxxx 0.48 acre tract;
THENCE North 1 deg 21'47" East, with the East line of a 4.387 acre tract
surveyed from said 49.837 acre tract, 29.39 feet to a 1/2" iron rod set for
corner, being the Northeast corner of said 4.387 acre tract;
THENCE North 88 deg 54'13" West, with the North line of said 4.387 acre
tract, 305.44 feet to a 1/2" iron rod set for corner;
THENCE North 65 deg 57'17" West, continuing with the North line of said
4.387 acre tract, 119.06 feet to a 1/2" iron rod set for corner;
THENCE North 48 deg 25'01" West, continuing with the North line of said
4.387 acre tract, 410.97 feet to a 1/2" iron rod set for corner, being the
Northwest corner of said 4.387 acre tract;
THENCE South 41 deg 34'59" West - 210.00 feet to a 1/2" iron rod set for
corner, being the Southwest corner of said 4.387 acre tract and being on
the Southwest line of said 49.837 acre tract and said North right-of-way
line of State Hwy. 300;
THENCE North 48 deg 25'01" West, with said North right-of-way line, 412.92
feet to the place of beginning and containing 34.553 acres of land.
Allocated Value: $500,000
Asset Purchase Agreement Sunburst/SunGroup Page 80
SCHEDULE 2.1
XXXX-FM ASSETS
All of the licenses, assets, properties, contracts, rights, titles and
interests which are used, useful or acquired for use in connection with XXXX-FM
including, but not limited to, the following described items:
(a) Governmental Authorizations. All authorizations, permits,
licenses and other such privileges, including the FCC Licenses, issued by
any governmental entity, whether federal, state or local, for XXXX-FM
including, without limitation, those issued or granted by the FCC,
including pending applications for any of the foregoing, if any, including,
but not limited to those as set forth more fully on SUB-SCHEDULE 2.1(A)
attached hereto (the "XXXX-FM Licenses");
(b) Studio Site. All of the rights, titles and interests of the
Tenant arising under that one Agreement of Lease dated May 25, 1990 by and
between Xxx X. XxXxxxxxx, Trustee of the X.X. XxXxxxxxx Trust, as the
Landlord, and RadioSungroup of Texas, Inc., as the Tenant, for 2,776 sq.
ft. of office space for the term commencing May 25, 1990 and ending May 25,
1995; as amended by Modification and Extension of Agreement of Lease dated
May 25, 1995 extending the term to May 25, 2000, subject to Landlord's
right to terminate on one (1) year's notice if Landlord receives and
accepts a bona fide offer to purchase the property; as amended by letter
agreement dated October 17, 1997 to add an additional 875 sq. ft. of office
space, true and correct copies of which has been provided to the Buyer.
(c) Transmitter Site. All of the rights, titles and interests of
the Lessee arising under that one certain unwritten month to month lease
agreement for antenna space on the Lessor's tower and associated
transmitter building at a cost of $1,200 per month base rent.
(d) Leasehold Improvements, Improvements and Fixtures. All
leasehold improvements, improvements and fixtures which are used, usable or
acquired for use in connection with XXXX-FM and which are located at any
transmitter site or studio site described in items (b) or (c), next above.
(e) Tangible Personal Property. All furniture, furnishings,
machinery, equipment, broadcasting equipment, studio equipment,
transmitting equipment,
Asset Purchase Agreement Sunburst/SunGroup Page 81
technical equipment, towers, antennae, computers, printers, monitors,
vehicles, and any and all other items of tangible personal property which
are used, usable or acquired for use in connection with XXXX-FM including,
but not limited to, those items of tangible personal property set forth on
SUB-SCHEDULE 2.1(E) attached hereto; provided that to the extent any item
of tangible personal property which is used, usable or acquired for use in
connection with XXXX-FM, the applicable lease agreement has been listed on
SCHEDULE 5 hereto.
(f) Contracts. All Contracts which are described on SUB-SCHEDULE
2.1(F) except Cash Contracts and Barter Contracts which are provided for
separately under items (g) and (h), next below.
(g) Cash Contracts. All Cash Contracts entered into in the
ordinary course of business that are in effect at the Closing Date.
(h) Barter Contracts and Barter Receivables. All Barter
Contracts entered into in the ordinary course of business that are in
effect at the Closing Date and all Barter Receivables.
(i) Contract Deposits. All cash and other deposits under
Contracts assumed by the Buyer.
(j) Inventory and Supplies. All inventory, supplies, spare
parts, tools and other items of tangible personal property that are used,
usable or acquired for use in connection with XXXX-FM.
(k) Records and Tapes. All records, tapes, and all other media
and configurations for the reproduction of sound that pertain to XXXX-FM.
(l) Intangibles. All logos, jingles, marketing plans, the call
letters "XXXX-FM", business plans, unexpired or remaining warranties on any
item comprising the XXXX-FM Assets, common law property rights, Choses in
Action, and other intangible personal property, including goodwill, that
pertain to XXXX-FM.
(m) Intellectual Property. All Intellectual Property, including
goodwill associated therewith that pertain to XXXX-FM.
(n) Business and Technical Data. All schematics, blueprints,
engineering data and other technical information pertaining to the
technical operation of
Asset Purchase Agreement Sunburst/SunGroup Page 82
XXXX-FM, customer lists, sales records, books of accounts, and all files,
records, and logs, all of which pertain to the operation of XXXX-FM.
(o) Choses In Action. All Choses In Action related to or arising
out of any of the Assets listed on this Schedule or any sub-schedule
attached hereto.
(p) Additional Assets. Except for contacts which are not assumed
by Buyer, all replacements and substitutions of items described in the
preceding subparagraphs which shall be acquire or received after the date
hereof.
Asset Purchase Agreement Sunburst/SunGroup Page 83
SUB-SCHEDULE 2.1(A)
XXXX-FM
SCHEDULE OF FCC LICENSES
1. FM Broadcast Station License XXXX-FM
2. STL's
Asset Purchase Agreement Sunburst/SunGroup Page 84
SUB-SCHEDULE 2.1(E)
XXXX-FM
SCHEDULE OF TANGIBLE PERSONAL PROPERTY
See The Attached List
Asset Purchase Agreement Sunburst/SunGroup Page 85
SUB-SCHEDULE 2.1(F)
XXXX-FM
SCHEDULE OF ASSUMED CONTRACTS
Unless otherwise indicated Contract covers XXXX-FM only.
1. THE ARBITRON COMPANY, Arbitron License Agreement dated July 22, 1996
(ratings services) (covers XXXX-AM/FM and KROW-FM)
2. THE ARBITRON COMPANY, Increased Frequency Addendum Adding Any Report For
Remainder of License Agreement dated 07/17/97 (ratings services) (covers
XXXX-AM/FM and KROW-FM)
3. THE ARBITRON COMPANY, Supplementary Services ("Specials") License Agreement
dated 07/21/97 (ratings services) (covers XXXX-AM/FM and KROW-FM)
4. THE ARBITRON COMPANY, Standard License Agreement to Receive and Use
Arbitron Radio Listening Estimates dated 07/21/97 (ratings services)
(covers XXXX-AM/FM and KROW-FM)
5. THE AMERICAN COMEDY NETWORK, INC., Radio Station License Agreement dated
01/17/97 (programming)
6. SIS RADIO NETWORKS, LTD., Agreement dated 04/08/96 (Country Kickers)
7. DATACOUNT, INC., Software License Agreement dated 06/23/87, [do not have
copy] and Addendum [copy unsigned] dated [_____], 1996 and Addendum [copy
unsigned] dated 02/02/97 (DARTS software) (covers XXXX-AM/FM and KROW-FM)
8. ABC DIRECTION RADIO NETWORKS, Affiliation Agreement dated 09/24/97
(affiliation)
9. WESTWOOD ONE, INC., Program Agreement dated 05/20/92 (Country Countdown
U.S.A.)
10. ABC WATERMARK AND ABC RADIO NETWORK, Licensing Agreement dated 12/18/95
(American Country Countdown) (covers XXXX-AM/FM)
11. PREMIERE RADIO NETWORKS, INC., License Agreement dated 03/07/96 (music
library)
12. GTE GOVERNMENT SYSTEMS, Agreement dated 09/03/93 (weather information
services) (covers XXXX-AM/FM)
13. DIGITAL GENERATION SYSTEMS, INC., Letter of Agreement dated 03/06/96 (DGS
radio station terminal) (covers XXXX-AM/FM)
Asset Purchase Agreement Sunburst/SunGroup Page 86
14. ABC RADIO NETWORK, INC., ABC Newswire Affiliate Agreement dated 11/01/95
(affiliation) (covers XXXX-AM/FM)
15. SPECIAL PROMOTIONS, INC., 1988 Radio Station Agreement dated 12/01/97 (True
Value Country Showdown) (covers XXXX-AM/FM)
16. BUMPER PRODUCTIONS, Letter of Agreement dated 03/03/97 (voice over and
voice services)
17. XXX XXXX COMPANIES, INC. D/B/A FIRSTCOM BROADCAST SERVICES, Licensing
Agreement - Lease, dated 12/13/94 (music library) (covers XXXX-AM/FM)
18. RADIO ADVERTISERS BUREAU (RAB), 1988 membership
19. BROADCAST MUSIC, INC., Single Station Radio Blanket License Agreement dated
[_____] (music license) [Buyer not provided copy]
20. ASCAP, Local Station Blanket Radio dated [______] (music license) [Buyer
not provided copy]
21. SESAC, INC., SESAC Broadcasting Performance License For FM Stations
Agreement dated [______] (music license) [Buyer not provided copy]
22. XXXX X. XXXXXXX, Option dated 01/19/98 to purchase 21.556 acres out of the
SE/4 of Xxxxxxx 0, X.X.X.X. Xx. Xxxxxx, Xxxxx No.7, Abstract 340, Xxxxxxxx
County, Texas
Asset Purchase Agreement Sunburst/SunGroup Page 87
SCHEDULE 2.2
XXXX-AM ASSETS
All of the licenses, assets, properties, contracts, rights, titles and
interests which are used, useful or acquired for use in connection with XXXX-AM
including, but not limited to, the following described items:
(a) Governmental Authorizations. All authorizations, permits,
licenses and other such privileges, including the FCC Licenses, issued by
any governmental entity, whether federal, state or local, for XXXX-AM
including, without limitation, those issued or granted by the FCC,
including pending applications for any of the foregoing, if any, including,
but not limited to those as set forth more fully on SUB-SCHEDULE 2.2(A)
attached hereto (the "XXXX-AM Licenses");
(b) Studio Site. Same as for XXXX-FM.
(c) Transmitter Site. The transmitter site property which is
described on SUB-SCHEDULE 2.2(C) together with all improvements located
thereon. The parties have set forth in Section 16 the terms and provisions
of this Agreement which relate to the transmitter site property.
(d) Leasehold Improvements, Improvements and Fixtures. All
leasehold improvements, improvements and fixtures which are used, usable or
acquired for use in connection with XXXX-AM and which are located at any
transmitter site or studio site described in items (b) or (c), next above.
(e) Tangible Personal Property. All furniture, furnishings,
machinery, equipment, broadcasting equipment, studio equipment,
transmitting equipment, technical equipment, towers, antennae, computers,
printers, monitors, vehicles, and any and all other items of tangible
personal property which are used, usable or acquired for use in connection
with XXXX-AM including, but not limited to, those items of tangible
personal property set forth on SUB-SCHEDULE 2.2(E) attached hereto;
provided that to the extent any item of tangible personal property which is
used, usable or acquired for use in connection with XXXX-AM, the applicable
lease agreement has been listed on SCHEDULE 5 hereto.
(f) Contracts. All Contracts which are described on SUB-SCHEDULE
2.2(F) except Cash Contracts and Barter Contracts which are provided for
separately under items (g) and (h), next below.
Asset Purchase Agreement Sunburst/SunGroup Page 88
(g) Cash Contracts. All Cash Contracts entered into in the
ordinary course of business that are in effect at the Closing Date.
(h) Barter Contracts and Barter Receivables. All Barter
Contracts entered into in the ordinary course of business that are in
effect at the Closing Date and all Barter Receivables.
(i) Contract Deposits. All cash and other deposits under
Contracts assumed by the Buyer.
(j) Inventory and Supplies. All inventory, supplies, spare
parts, tools and other items of tangible personal property that are used,
usable or acquired for use in connection with XXXX-AM.
(k) Records and Tapes. All records, tapes, and all other media
and configurations for the reproduction of sound that pertain to XXXX-AM.
(l) Intangibles. All logos, jingles, marketing plans, the call
letters "XXXX-AM", business plans, unexpired or remaining warranties on any
item comprising the XXXX-AM Assets, common law property rights, Choses in
Action, and other intangible personal property, including goodwill, that
pertain to XXXX-AM.
(m) Intellectual Property. All Intellectual Property, including
goodwill associated therewith that pertain to XXXX-AM.
(n) Business and Technical Data. All schematics, blueprints,
engineering data and other technical information pertaining to the
technical operation of XXXX-AM, customer lists, sales records, books of
accounts, and all files, records, and logs, all of which pertain to the
operation of XXXX-AM.
(o) Choses In Action. All Choses In Action related to or arising
out of any of the Assets listed on this Schedule or any sub-schedule
attached hereto.
(p) Additional Assets. Except for contacts which are not assumed
by Buyer, all replacements and substitutions of items described in the
preceding subparagraphs which shall be acquire or received after the date
hereof.
Asset Purchase Agreement Sunburst/SunGroup Page 89
SUB-SCHEDULE 2.2(A)
XXXX-AM
SCHEDULE OF FCC LICENSES
1. AM Broadcast Station License XXXX-AM
2. STL's
Asset Purchase Agreement Sunburst/SunGroup Page 90
SUB-SCHEDULE 2.2(C)
XXXX-AM
TRANSMITTER SITE
XXXX-AM Tower Site, 000X, X.X. 0xx Xxxxxx, Xxxxxxx, Xxxxx:
---------------------------------------------------------
The real property lying and being situated in Xxxxxx County, Texas, more
particularly described as 4.72 acres of land out of the Northwest (NW) One
Fourth (1/4) of Xxxxxxx 00, Xxxxx Xxxxxx Xxxx, Xxxxxx Xxxxxx, Xxxxx;
Beginning at a point 470.2 feet West and 852.1 feet North of the Southeast
corner of the Xxxxxxxxx 0/0 xx Xxxxxxx 00, Xxxxx Xxxxxx Xxxx; Thence West 420.0
feet; Thence North 0 deg. 21 minutes West 488.0 feet; Thence North 89 deg. 46
minutes East 420 feet; Thence South 0 deg. 21 minutes East 489.7 feet to the
place of beginning, and containing 4.72 acres in County of Xxxxxx, State of
Texas, and being that same real property described in deed from Key City
Broadcasters, Inc., to West Texas Media, Inc., recorded in Vol. 998, at page
156, of the Deed Records of Xxxxxx County, Texas;
Save and Except, a tract of 0.16 acres conveyed by Xxxxxx County Broadcasting,
Inc., to the City of Abilene, Texas, by instrument dated December 8, 1978,
recorded in Vol. 1107, page 000, Xxxx Xxxxxxx, Xxxxxx Xxxxxx, Xxxxx.
Asset Purchase Agreement Sunburst/SunGroup Page 91
SUB-SCHEDULE 2.2(E)
XXXX-AM
SCHEDULE OF TANGIBLE PERSONAL PROPERTY
See the list attached to Schedule 2.1(e) for the XXXX-AM tangible personal
property.
Asset Purchase Agreement Sunburst/SunGroup Page 92
SUB-SCHEDULE 2.2(F)
XXXX-AM
SCHEDULE OF ASSUMED CONTRACTS
1. See Schedule 2.1(a) for Contracts which also cover XXXX-AM.
2. INTERNATIONAL SPEEDWAY CORPORATION D/B/A MOTOR RACING NETWORK, 1997
Broadcast Contract and Agreement dated 03/04/97 (programming)
3. ABC RADIO NETWORK, INC., ESPN Radio Network Affiliation Agreement dated
01/27/97 (programming)
4. TALK AMERICA RADIO NETWORKS, Agreement dated 12/11/97 (programming)
5. INDIANAPOLIS MOTOR SPEEDWAY CORPORATION, 1997 IMS Radio Network
Affiliation Agreement dated 02/24/97 (programming)
6. SPORTSFAN RADIO NETWORK, Affiliation Agreement dated 01/24/97 (programming)
7. ABC RADIO NETWORKS, The NFL on ESPN Radio (programming)
8. ABC RADIO NETWORKS, Game Football Gameday on ESPN Radio (programming)
9. ABC RADIO NETWORKS, The NBA on ESPN Radio (programming)
10. XXXXX XXXXXXXX COMMUNICATIONS, INC., Bass Pro Shops Outdoor World
(programming)
11. CBS RADIO SPORTS, NFL Football Package (programming)
12. CBS RADIO SPORTS, Major League Baseball Package (programming)
13. WESTWOOD ONE/CBS RADIO SPORTS, 1998 NCAA Basketball (programming)
14. DUCKS UNLIMITED RADIO NETWORK, (programming)
15. ABC/ESPN RADIO NETWORKS, The Xxxx Xxxxxxxxxx Show (programming)
16. ABC RADIO NETWORK, Licensing Agreement For "The Fabulous Sports Babe"
dated 01/28/97 (programming)
17. HOST COMMUNICATIONS, INC. D/B/A LONGHORN SPORTS NETWORK, Texas Longhorn
Football (programming)
Asset Purchase Agreement Sunburst/SunGroup Page 93
18. CAPITOL RADIO NETWORK, INC., Winston Cup Today Affiliation Agreement dated
02/09/97 (programming)
19. CAPITOL RADIO NETWORK, INC., 1997 Broadcast Rights Affiliation Agreement
dated 02/09/97 (programming)
20. WESTWOOD ONE/HBO, Inside the NFL (programming)
21. BROADCAST MUSIC, INC., Single Station Radio Blanket License Agreement dated
[_____] (music license) [Buyer not provided copy]
22. ASCAP, Local Station Blanket Radio dated [______] (music license) [Buyer
not provided copy]
23. SESAC, INC., SESAC Broadcasting Performance License For AM Stations
Agreement dated [______] (music license) [Buyer not provided copy]
Asset Purchase Agreement Sunburst/SunGroup Page 94
SCHEDULE 2.3
KROW-FM ASSETS
All of the licenses, assets, properties, contracts, rights, titles and
interests which are used, useful or acquired for use in connection with KROW-FM
including, but not limited to, the following described items:
(a) Governmental Authorizations. All authorizations, permits,
licenses and other such privileges, including the FCC Licenses, issued by
any governmental entity, whether federal, state or local, for KROW-FM
including, without limitation, those issued or granted by the FCC,
including pending applications for any of the foregoing, if any, including,
but not limited to those as set forth more fully on SUB-SCHEDULE 2.3(A)
attached hereto (the "KROW-FM Licenses");
(b) Studio Site. Same as for XXXX-FM.
(c) Transmitter Site. All of the rights, titles and interests of
the Lessee arising under that one certain Radio Tower Lease Agreement dated
May 15, 1997 by and between Spot, Inc., as the lessor, and Radio SunGroup
of Texas, Inc., as the Lessee, for antenna space lease on the Lessor's
tower and associated transmitter building for the term commencing May 15,
1997 and ending May 15, 2007, a true and correct copy of which has been
provided to the Buyer.
(d) Leasehold Improvements, Improvements and Fixtures. All
leasehold improvements, improvements and fixtures which are used, usable or
acquired for use in connection with KROW-FM and which are located at any
transmitter site or studio site described in items (b) or (c), next above.
(e) Tangible Personal Property. All furniture, furnishings,
machinery, equipment, broadcasting equipment, studio equipment,
transmitting equipment, technical equipment, towers, antennae, computers,
printers, monitors, vehicles, and any and all other items of tangible
personal property which are used, usable or acquired for use in connection
with KROW-FM including, but not limited to, those items of tangible
personal property set forth on SUB-SCHEDULE 2.3(E) attached hereto;
provided that to the extent any item of tangible personal property which is
used, usable or acquired for use in connection with KROW-FM, the applicable
lease agreement has been listed on SCHEDULE 5 hereto.
Asset Purchase Agreement Sunburst/SunGroup Page 95
(f) Contracts. All Contracts which are described on SUB-SCHEDULE
2.3(F) except Cash Contracts and Barter Contracts which are provided for
separately under items (g) and (h), next below.
(g) Cash Contracts. All Cash Contracts entered into in the
ordinary course of business that are in effect at the Closing Date.
(h) Barter Contracts and Barter Receivables. All Barter
Contracts entered into in the ordinary course of business that are in
effect at the Closing Date and all Barter Receivables.
(i) Contract Deposits. All cash and other deposits under
Contracts assumed by the Buyer.
(j) Inventory and Supplies. All inventory, supplies, spare
parts, tools and other items of tangible personal property that are used,
usable or acquired for use in connection with KROW-FM.
(k) Records and Tapes. All records, tapes, and all other media
and configurations for the reproduction of sound that pertain to KROW-FM.
(l) Intangibles. All logos, jingles, marketing plans, the call
letters "KROW-FM", business plans, unexpired or remaining warranties on any
item comprising the KROW-FM Assets, common law property rights, Choses in
Action, and other intangible personal property, including goodwill, that
pertain to KROW-FM.
(m) Intellectual Property. All Intellectual Property, including
goodwill associated therewith that pertain to KROW-FM.
(n) Business and Technical Data. All schematics, blueprints,
engineering data and other technical information pertaining to the
technical operation of KROW-FM, customer lists, sales records, books of
accounts, and all files, records, and logs, all of which pertain to the
operation of KROW-FM.
(o) Choses In Action. All Choses In Action related to or arising
out of any of the Assets listed on this Schedule or any sub-schedule
attached hereto.
(p) Additional Assets. Except for contacts which are not assumed
by Buyer, all replacements and substitutions of items described in the
preceding
Asset Purchase Agreement Sunburst/SunGroup Page 96
subparagraphs which shall be acquire or received after the date
hereof.
Asset Purchase Agreement Sunburst/SunGroup Page 97
SUB-SCHEDULE 2.3(A)
KROW-FM
SCHEDULE OF FCC LICENSES
1. FM Broadcast Station License KROW-FM
2. STL's
Asset Purchase Agreement Sunburst/SunGroup Page 98
SUB-SCHEDULE 2.3(E)
KROW-FM
SCHEDULE OF TANGIBLE PERSONAL PROPERTY
All of the KROW-FM tangible personal property is covered by the following
Equipment Leases:
1. KROW-FM Equipment: Lease Number 100 by and between SLT of Indiana, Inc.
and RadioSunGroup of Texas, Inc. dated July 11, 1997.
2. KROW-FM Equipment: Lease Number 200 by and between SLT of Indiana, Inc.
and RadioSunGroup of Texas, Inc. dated July 11, 1997.
See the provisions of Section 5 of the Agreement. These leases will be paid off
at Closing (not discounted) and the Sellers will cause the tangible personal
property covered by these Equipment Leases to be delivered to the Buyer at
Closing free and clear of all Liens and subject only to the Permitted
Exceptions.
Asset Purchase Agreement Sunburst/SunGroup Page 99
SUB-SCHEDULE 2.3(F)
KROW-FM
SCHEDULE OF ASSUMED CONTRACTS
1. See Schedule 2.1(a) for Contracts which also cover KROW-FM.
2. RADIO COMPUTING SERVICES, INC. Standard License Agreement and Software
Products Schedule dated 08/29/97 (Selector Software, Revision 12)
3. TM CENTURY, INC., Gold Disc License Agreement undated but would be after
01/21/97 (Classic Rock (AOR) music library)
4. ABC RADIO NETWORK, License Agreement For "Yesterday Live" dated 11/11/97
(programming)
5. ABC RADIO NETWORK, License Agreement For "American Gold" dated 11/11/97
(programming)
6. BROADCAST MUSIC, INC., Single Station Radio Blanket License Agreement dated
[_____] (music license) [Buyer not provided copy]
7. ASCAP, Local Station Blanket Radio dated [______] (music license) [Buyer
not provided copy]
8. SESAC, INC., SESAC Broadcasting Performance License For FM Stations
Agreement dated [______] (music license) [Buyer not provided copy]
Asset Purchase Agreement Sunburst/SunGroup Page 100
SCHEDULE 2.4
KYKX-FM ASSETS
All of the licenses, assets, properties, contracts, rights, titles and
interests which are used, useful or acquired for use in connection with KYKX-FM
including, but not limited to, the following described items:
(a) Governmental Authorizations. All authorizations, permits,
licenses and other such privileges, including the FCC Licenses, issued by
any governmental entity, whether federal, state or local, for KYKX-FM
including, without limitation, those issued or granted by the FCC,
including pending applications for any of the foregoing, if any, including,
but not limited to those as set forth more fully on SUB-SCHEDULE 2.4(A)
attached hereto (the "KYKX-FM Licenses");
(b) Studio Site. The studio site which is described on
SUB-SCHEDULE 2.4(B) together with all improvements located thereon. The
parties have set forth in Section 16 the terms and provisions of the
Agreement which relate to the studio site.
(c) Transmitter Site. The transmitter site property which is
described on SUB-SCHEDULE 2.4(C) together with all improvements located
thereon. The parties have set forth in Section 16 the terms and provisions
of this Agreement which relate to the transmitter site property.
(d) Leasehold Improvements, Improvements and Fixtures. All
leasehold improvements, improvements and fixtures which are used, usable or
acquired for use in connection with KYKX-FM and which are located at any
transmitter site or studio site described in items (b) or (c), next above.
(e) Tangible Personal Property. All furniture, furnishings,
machinery, equipment, broadcasting equipment, studio equipment,
transmitting equipment, technical equipment, towers, antennae, computers,
printers, monitors, vehicles, and any and all other items of tangible
personal property which are used, usable or acquired for use in connection
with KYKX-FM including, but not limited to, those items of tangible
personal property set forth on SUB-SCHEDULE 2.4(E) attached hereto;
provided that to the extent any item of tangible personal property which is
used, usable or acquired for use in connection with KYKX-FM, the applicable
lease agreement has been listed on SCHEDULE 5 hereto.
Asset Purchase Agreement Sunburst/SunGroup Page 101
(f) Contracts. All Contracts which are described on SUB-SCHEDULE
2.4(F) except Cash Contracts and Barter Contracts which are provided for
separately under items (g) and (h), next below.
(g) Cash Contracts. All Cash Contracts entered into in the
ordinary course of business that are in effect at the Closing Date.
(h) Barter Contracts and Barter Receivables. All Barter
Contracts entered into in the ordinary course of business that are in
effect at the Closing Date and all Barter Receivables.
(i) Contract Deposits. All cash and other deposits under
Contracts assumed by the Buyer.
(j) Inventory and Supplies. All inventory, supplies, spare
parts, tools and other items of tangible personal property that are used,
usable or acquired for use in connection with KYKX-FM.
(k) Records and Tapes. All records, tapes, and all other media
and configurations for the reproduction of sound that pertain to KYKX-FM.
(l) Intangibles. All logos, jingles, marketing plans, the call
letters "KYKX-FM", business plans, unexpired or remaining warranties on any
item comprising the KYKX-FM Assets, common law property rights, Choses in
Action, and other intangible personal property, including goodwill, that
pertain to KYKX-FM.
(m) Intellectual Property. All Intellectual Property, including
goodwill associated therewith that pertain to KYKX-FM.
(n) Business and Technical Data. All schematics, blueprints,
engineering data and other technical information pertaining to the
technical operation of KYKX-FM, customer lists, sales records, books of
accounts, and all files, records, and logs, all of which pertain to the
operation of KYKX-FM.
(o) Choses In Action. All Choses In Action related to or arising
out of any of the Assets listed on this Schedule or any sub-schedule
attached hereto.
(p) Additional Assets. Except for contacts which are not assumed
by Buyer, all replacements and substitutions of items described in the
preceding
Asset Purchase Agreement Sunburst/SunGroup Page 102
subparagraphs which shall be acquire or received after the date hereof.
Asset Purchase Agreement Sunburst/SunGroup Page 103
SUB-SCHEDULE 2.4(A)
KYKX-FM
SCHEDULE OF FCC LICENSES
1. FM Broadcast Station License KYKX-FM
2. STL's
Asset Purchase Agreement Sunburst/SunGroup Page 104
SUB-SCHEDULE 2.4(B)
KYKX-FM
STUDIO SITE
KYKX Studio Site, 0000 Xxxxxx Xxxx, Xxxxxxxx, Xxxxx 00000
---------------------------------------------------------
All that certain lot, tract or parcel of land being a 1.67 acre of land
located in the Xxxx Xxxxxxx A-113 Survey, Xxxxx County, Texas, said 1.67
acre being a part of Xxx 0, Xxxxx X (X.X.X. 940) in the City of Longview,
and being the same tract as described in Deed of Trust from Xxxxxxx X.
Xxxxxxxx and X. X. Xxxxxx to Xxx X. Xxxxxx XX, and recorded in Volume 633,
Page 164, Deed of Trust Records of Xxxxx County, Texas and said 1.67 acre
being more particularly described as follows:
BEGINNING at 2" iron pipe at the Northwest corner of the above mentioned
Lot 4, said BEGINNING point also being in the East ROW line of Xxxxxx Road
(Spur 502) and being North 541.6 feet from the North ROW line of Eden
Drive;
THENCE S 88 deg. 41' 00" E, 536.00 feet along the North boundary line of
this tract to a point in the center of branch for corner; Reference a 1/2"
iron rod set on High Bank at N 88 deg. 41' 00" W, 20.0 feet;
THENCE along and with the centerline of said branch, the following
meanders: S 28 deg. 44' 00" E, 35.30 feet; S 54 deg. 43' 00" E, 27.60 feet;
S 38 deg. 10' 00" E, 35.3 feet and S 04 deg. 59' 00" W, 39.60 feet to a
point for corner; Reference a 1/2" iron rod set on High Bank of Creek at S
88 deg. 43' 47" W, 20.0 feet;
THENCE S 88 deg. 43' 47" W, 592.66 feet along the South boundary line of
this tract to a 3/8" iron rod found for corner in the East ROW line of
Xxxxxx Road (Spur 502);
THENCE N 00 deg. 30' 00" W, 139.56 feet along the East ROW line of said
Xxxxxx Road (Spur 502) to the PLACE OF BEGINNING and containing 1.67 acre
of land, more or less.
Asset Purchase Agreement Sunburst/SunGroup Page 105
SUB-SCHEDULE 2.4(C)
KYKX-FM
TRANSMITTER SITE
XXXX-XX Xxxxx Xxxx, Xxxxx Xxxxxxx 000 and FM 1844:
-------------------------------------------------
All that certain lot, tract or parcel of land situated in Upshur and Xxxxx
Counties, Texas, about 11 miles Northwest of the Courthouse in the City of
Longview, being 34.553 acres of land, a part of the XXXXXXXX XXXX SURVEY
(A-302, Upshur County; A-133, Xxxxx County), and being a part o that
certain 49.837 acre tract of land described in a deed from Xxxxx X. Xxxx,
et ux, to Service Broadcasting Corp., dated October 26, 1995 and recorded
in Volume 2880, Page 228 of the Xxxxx County Official Records, said 34.553
acres being more particularly described as follows:
BEGINNING at a concrete monument found for corner at the Southwest corner
of said 49.837 acre tract, same being the Southeast corner of that certain
45.744 acre tract described in a deed to Xxxxx Xxxxxx Xxxxx, et ux,
recorded in Volume 34, Page 541 of the Upshur County Official Records, said
monument being on the North right-of-way line of State Hwy. 300 (also known
as Gilmer Road);
THENCE North 31 deg 47'00" East, with the common line between said 49.837
acre tract and said 45.744 acre tract, 1391.63 feet to a 1/2" iron rod set
for corner on same and being the Southwest corner of a 10.898 acre tract
surveyed from said 49.837 acre tract;
THENCE South 58 deg 13'00" East, with the South line of said 10.898 acre
tract, 778.57 feet to a 1/2" iron rod set for corner on the East line of
said 49.837 acre tract, being the Southeast corner of said 10.898 acre
tract and being on the West line of that certain 53.42 acre tract described
in deed to Xxxxxx XxXxx, recorded in Volume 2418, Page 619 of the Xxxxx
County Deed Records;
THENCE South 0 deg 43'03" West, with the common line between said 49.837
acre tract and said 53.42 acre tract, 1249.63 feet to a 3/8" iron rod found
for corner at the Easternmost Southeast corner of said 49.837 acre tract
and also being the Northeast corner of a 0.48 acre tract described in deed
to Xxxxxxx Xxxxxxxxxx, et ux, recorded in Volume 748, Page 470 of said
Xxxxx County Deed Records;
Asset Purchase Agreement Sunburst/SunGroup Page 106
THENCE North 89 deg 07'56" West, with the Easternmost South line of said
49.837 acre tract and North line of said Xxxxxxxxxx 0.48 acre tract and
also the North line of another 0.48 acre tract described in deed to Xxxxx
X. Xxxxx, et ux, recorded in Volume 1185, Page 497 of said Xxxxx County
Deed Records, 210.13 feet to a 1/2" iron rod found for corner at the
Northwest corner of said Xxxxx 0.48 acre tract;
THENCE North 1 deg 21'47" East, with the East line of a 4.387 acre tract
surveyed from said 49.837 acre tract, 29.39 feet to a 1/2" iron rod set for
corner, being the Northeast corner of said 4.387 acre tract;
THENCE North 88 deg 54'13" West, with the North line of said 4.387 acre
tract, 305.44 feet to a 1/2" iron rod set for corner;
THENCE North 65 deg 57'17" West, continuing with the North line of said
4.387 acre tract, 119.06 feet to a 1/2" iron rod set for corner;
THENCE North 48 deg 25'01" West, continuing with the North line of said
4.387 acre tract, 410.97 feet to a 1/2" iron rod set for corner, being the
Northwest corner of said 4.387 acre tract;
THENCE South 41 deg 34'59" West - 210.00 feet to a 1/2" iron rod set for
corner, being the Southwest corner of said 4.387 acre tract and being on
the Southwest line of said 49.837 acre tract and said North right-of-way
line of State Hwy. 300;
THENCE North 48 deg 25'01" West, with said North right-of-way line, 412.92
feet to the place of beginning and containing 34.553 acres of land.
Asset Purchase Agreement Sunburst/SunGroup Page 107
SUB-SCHEDULE 2.4(E)
KYKX-FM
SCHEDULE OF TANGIBLE PERSONAL PROPERTY
See The Attached List
Asset Purchase Agreement Sunburst/SunGroup Page 108
SUB-SCHEDULE 2.4(F)
KYKX-FM
SCHEDULE OF ASSUMED CONTRACTS
1. XXXXX WIRELESS GROUP, INC., LESSEE, Tower Rental Contract dated 02/03/97
and Addendum thereto dated 02/27/97 (lease of space on KYKX transmitting
tower)
2. BROADCAST MUSIC, INC., Single Station Radio Blanket License Agreement dated
January 1, 1996, runs until December 31, 2000 (music license)
3. ASCAP, Local Station Blanket Radio dated 01/01/96 (music license)
4. SESAC, INC., SESAC Broadcasting Performance License For FM Stations
Agreement dated [_______] [do not have copy of contract] (music license)
5. BOTA, INC., Xxxxxxx Xxxxxx Agency Talent & Literary Agency Contract for the
services of Xxxxx Xxxxx dated 01/28/98 (personal appearance on 05/23/98)
6. XXXX XXXXX ENTERPRISES, INC., Xxxxxxx Xxxxxx Agency Talent & Literary
Agency Contract for the services of Xxxx XxXxx dated 01/28/98 (personal
appearance on 05/26/98)
7. XXXXXXX XXXXXX, Xxxxxxx Xxxxxx Agency Talent & Literary Agency Contract for
the services of Xxxxxxx Xxxxxx dated 01/28/98 (personal appearance on
05/23/98)
8. ABC RADIO NETWORK, INC., ABC Newswire Affiliate Agreement, Contract #112
dated 12/04/95 (programming)
9. XXX XXXXXX, Letter of Agreement dated 08/14/97 (broadcast consulting
services)
10. EVENT CONCEPTS MARKETING, INC., Consulting Agreement dated 11/13/97
(special event consultation) (Contract prohibits assignment)
11. XXXXX XXXXXXX, Agreement dated 09/11/96 (production of rodeo shows)
12. THE ARBITRON COMPANY, Standard License Agreement to Receive and Use
Arbitron Radio Listening Estimates dated 10/23/97 (ratings services)
13. INTERNATIONAL DEMOGRAPHICS, INC., The Media Audit Subscriber Agreement
dated 01/27/98 (reporting service)
Asset Purchase Agreement Sunburst/SunGroup Page 109
14. DATA TRANSMISSION NETWORK, Annual Subscription Agreement dated 08/23/96
(weather service)
15. TM CENTURY, INC., Gold Disc License Agreement undated but would be after
01/21/97 (Country music library)
16. XXXX XXXXXX & ASSOCIATES, INC., Licensing Agreement dated 10/27/94 (music
library)
17. DIGITAL COURIER INTERNATIONAL, INC., U.S. Services Agreement dated 09/06/95
(DCI equipment and software)
18. DATACOUNT, INC., Software License Agreement dated [____], 1987 [do not have
copy] (DARTS III software)
19. ELECTRIC WORKS CORP. (NOW, XXXXX STUDIOS), Yearly AXS/DJ Support Contract
dated 12/03/96 (support services for AXS or DJ systems)
20. XXXXXXX XXXXXXXXXX, Commercial Lease dated 08/20/97 (lease of 34.553 acre
tract for single family residence)
21. RADIO COMPUTING SERVICES, INC., Standard License Agreement dated 04/11/94
(Selector Software, Revision 12)
22. MT. PLEASANT RADIO, INC., Agreement by and between RadioSunGroup of Texas,
Inc. and Mt. Pleasant Radio, Inc. dated January __, 1997.
Asset Purchase Agreement Sunburst/SunGroup Page 110
SCHEDULE 2.5
KKYS-FM ASSETS
All of the licenses, assets, properties, contracts, rights, titles and
interests which are used, useful or acquired for use in connection with KKYS-FM
including, but not limited to, the following described items:
(a) Governmental Authorizations. All authorizations, permits,
licenses and other such privileges, including the FCC Licenses, issued by
any governmental entity, whether federal, state or local, for KKYS-FM
including, without limitation, those issued or granted by the FCC,
including pending applications for any of the foregoing, if any, including,
but not limited to those as set forth more fully on SUB-SCHEDULE 2.5(A)
attached hereto (the "KKYS-FM Licenses");
(b) Studio Site. All of the rights, titles and interests of the
Tenant arising under that one certain Office Lease dated May 25, 1990 by
and between GG Enterprises, as the Landlord, and RadioSungroup of
Xxxxx/College Station, Inc., as the Tenant, for 3,024.5 sq. ft. of office
space for the term commencing April 1, 1997 and ending March 31, 2002; as
amended by First Amendment For the Lease undated granting a right of first
refusal for an additional 800 sq. ft., being a retail pod adjacent to the
demised premises, true and correct copies of which has been provided to the
Buyer.
(c) Transmitter Site. The transmitter site property which is
described on SUB-SCHEDULE 2.5(C) together with all improvements located
thereon. The parties have set forth in Section 16 the terms and provisions
of this Agreement which relate to the transmitter site property.
(d) Leasehold Improvements, Improvements and Fixtures. All
leasehold improvements, improvements and fixtures which are used, usable or
acquired for use in connection with KKYS-FM and which are located at any
transmitter site or studio site described in items (b) or (c), next above.
(e) Tangible Personal Property. All furniture, furnishings,
machinery, equipment, broadcasting equipment, studio equipment,
transmitting equipment, technical equipment, towers, antennae, computers,
printers, monitors, vehicles, and any and all other items of tangible
personal property which are used, usable or acquired for use in connection
with KKYS-FM including,
Asset Purchase Agreement Sunburst/SunGroup Page 111
but not limited to, those items of tangible personal property set forth on
SUB-SCHEDULE 2.5(E) attached hereto; provided that to the extent any item
of tangible personal property which is used, usable or acquired for use in
connection with KKYS-FM, the applicable lease agreement has been listed on
SCHEDULE 5 hereto.
(f) Contracts. All Contracts which are described on SUB-SCHEDULE
2.5(F) except Cash Contracts and Barter Contracts which are provided for
separately under items (g) and (h), next below.
(g) Cash Contracts. All Cash Contracts entered into in the
ordinary course of business that are in effect at the Closing Date.
(h) Barter Contracts and Barter Receivables. All Barter
Contracts entered into in the ordinary course of business that are in
effect at the Closing Date and all Barter Receivables.
(i) Contract Deposits. All cash and other deposits under
Contracts assumed by the Buyer.
(j) Inventory and Supplies. All inventory, supplies, spare
parts, tools and other items of tangible personal property that are used,
usable or acquired for use in connection with KKYS-FM.
(k) Records and Tapes. All records, tapes, and all other media
and configurations for the reproduction of sound that pertain to KKYS-FM.
(l) Intangibles. All logos, jingles, marketing plans, the call
letters "KKYS-FM", business plans, unexpired or remaining warranties on any
item comprising the KKYS-FM Assets, common law property rights, Choses in
Action, and other intangible personal property, including goodwill, that
pertain to KKYS-FM.
(m) Intellectual Property. All Intellectual Property, including
goodwill associated therewith that pertain to KKYS-FM.
(n) Business and Technical Data. All schematics, blueprints,
engineering data and other technical information pertaining to the
technical operation of KKYS-FM, customer lists, sales records, books of
accounts, and all files, records, and logs, all of which pertain to the
operation of KKYS-FM.
Asset Purchase Agreement Sunburst/SunGroup Page 112
(o) Choses In Action. All Choses In Action related to or arising
out of any of the Assets listed on this Schedule or any sub-schedule
attached hereto.
(p) Additional Assets. Except for contacts which are not assumed
by Buyer, all replacements and substitutions of items described in the
preceding subparagraphs which shall be acquire or received after the date
hereof.
Asset Purchase Agreement Sunburst/SunGroup Page 113
SUB-SCHEDULE 2.5(A)
KKYS-FM
SCHEDULE OF FCC LICENSES
1. FM Broadcast Station License KKYS-FM
2. STL's
Asset Purchase Agreement Sunburst/SunGroup Page 114
SUB-SCHEDULE 2.5(C)
KKYS-FM
TRANSMITTER SITE
KKYS-FM Tower Site, Rabbit Lane, Bryan, Texas:
---------------------------------------------
1.5 Acre Tract: The certain tract or parcel of land lying and being
situated in the County of Brazos, State of Texas and BEING that one certain
1.5 acre tract of land lying and being situated in the Xxxxx Xxxxx League,
A-3, Brazos County, Texas and being all of that 1.50 acre tract of land
conveyed to Xxxxx & Xxxxx Enterprises, Inc. by Xxx X. Xxxx by Deed recorded
in Volume 521, Page 616 of the Deed Records of Brazos County, Texas, and
being more particularly described as follows:
BEGINNING: at an iron rod at the north corner of said 1.50 acre tract, same
being in the southeast right-of-way line of Rabbit Lane;
THENCE: S 45 deg. 00' E - 364.40 fee to an iron rod set for corner;
THENCE: S 44 deg. 29' W - 180.46 feet to an iron rod found for corner;
THENCE: N 45 deg. 00' W - 364.40 feet to an iron rod found for corner in
said Rabbit Lane line;
THENCE: N 44 deg. 29' E - 180.46 feet along said Rabbit Lane line to the
PLACE OF BEGINNING; and containing 1.5 acres of land, more or less,
according to a survey made on the ground under the supervision of Xxxxxx X.
Xxxxxxx, Registered Public Surveyor, No. 2972, on June 25, 1987.
Guy Wire Easement: That certain guy wire easement created by that certain
Easement Agreement dated July 27, 1989 from Xxxxxxxxx, Xxxxxx & Xxxx, a
Texas partnership (hereinafter referred to as "CTB"), to Radio U.S.A.,
LTD., recorded in Volume 990, Page 77 in the office of the County Clerk of
Brazos County, Texas, BEING a 20' wide guy wire easement, lying and being
situated in the Xxxxx Xxxxx Survey, Abstract No. 3, Brazos County, Texas,
and being part of the 1.00 acre tract described in the deed from Xxx X.
Xxxx, dba Xxxxx & Xxxxx Enterprises, to Xxxxx X. Xxxx and wife, Xxxxxxx X.
Xxxx, recorded in Volume 507, Page 32, of the Deed Records of Brazos
County, Texas, the centerline of the 20' wide guy wire easement being more
particularly described as follows:
Asset Purchase Agreement Sunburst/SunGroup Page 115
BEGINNING in the southwest line of the beforementioned 1.00 acre tract
located S 45 deg. 00' 00" E 192.67 feet from the 1/2" iron rod set at the
west corner of the said 1.00 acre tract, and iron rod being in the
southeast line of Xxxxxxx Xxxx;
THENCE N. 46 deg. 18' 57" E along the guy wire for a distance of 119.57
feet to the northeast line of the beforementioned 1.00 acre tract and the
end of this easement, a 1/2" iron rod set at the north corner of the said
1.00 acre tract bears N 45 deg. 00' 00" W 196.5 feet.
Guy Wire Easement: That certain guy wire easement conveyed to Radio
U.S.A., LTD. in that certain General Warranty Deed from CTB to Grantor,
recorded in Volume 900, Page 83 in the office of the County Clerk of Brazos
County, Texas, BEING a 20.00 foot wide guy wire easement, lying and being
situated in the XXXXX XXXXX LEAGUE, A-3, Brazos County, Texas, and being a
part of that 47.47 acre tract of land conveyed to Xxxxx Xxxxxxxx by Xxxx X.
Xxxxx by deed recorded in Volume B61, Page 228 of the Deed Records of
Brazos County, Texas and being more particularly described as follows:
COMMENCING: at an iron rod at the northwest corner of said 47.47 acre
tract, same being in the southeast right-of-way line of Rabbit Lane and
also being the north corner of the GTE-Tract;
THENCE: S 45 deg. 00'E - 186.49 feet to an iron rod for the PLACE OF
BEGINNING; same being the north corner of a 0.49 acre tract; THENCE: N
46 deg. 18'57" E - 10.00 feet to an iron rod for corner;
THENCE: S 45 deg. 00' E - 20.00 feet to an iron rod for corner;
THENCE: S 46 deg. `18'57" W - 10.00 feet to an iron rod for corner;
THENCE: N 45 deg. 00' W - 20.00 feet to the PLACE OF BEGINNING; and
containing 0.005 acres of land, more or less, according to a survey made on
the ground under the supervision of Xxxxxx X. Xxxxxxx, Registered Public
Surveyor, No. 2972, on June 25, 1987.
Asset Purchase Agreement Sunburst/SunGroup Page 116
SUB-SCHEDULE 2.5(E)
KKYS-FM
SCHEDULE OF TANGIBLE PERSONAL PROPERTY
See The Attached List
Asset Purchase Agreement Sunburst/SunGroup Page 117
SUB-SCHEDULE 2.5(F)
KKYS-FM
SCHEDULE OF ASSUMED CONTRACTS
1. XXXX XXXXX MAZDA, Motor Vehicle Lease Agreement dated 12/31/96 and
Agreement of Xxxx Xxxxx Mazda dated 12/20/96 to minimum advertising
schedule to offset vehicle lease payment (van trade out)
2. XXXXXX INDUSTRIES, INC., Agreement dated 06/12/97 (copier lease)
3. XXX XXXX COMPANIES, INC., D/B/A FIRTSCOM MUSIC, Licensing Agreement - Lease
dated 12/04/96 (music library)
4. MICROPOWER CORPORATION, Software Contract dated 09/18/82 (Powerplay music
scheduling system)
5. XXXXXXXX CREATIVE, Jingle Lease Agreement dated 12/20/96 (jingles)
7. DC CREATIVE SERVICES, INC. D/B/A VANILLA GORILLA, Performance Agreement
dated 11/14/96 (Xxxx Xxxxxxx voice services)
8. WESTWOOD ONE RADIO, INC., Program License Agreement dated 01/11/93 (Casey's
Countdown and Casey's Biggest Hits)
9. XXXXXX INDUSTRIES, INC., Agreement dated 06/12/97 (copier lease)
10. FOX BROADCASTING COMPANY, Program Agreement [undated and unsigned -- Is
this in effect?] (Fox Kids Countdown)
11. PREMIERE RADIO NETWORKS, INC., License Agreement dated 09/22/97 (Reality
Prep programming)
12. BROADCAST MUSIC, INC., Single Station Radio Blanket License Agreement dated
[_______] [do not have copy of contract] (music license)
13. ASCAP, Local Station Blanket Radio dated [_______] [do not have copy of
contract] (music license)
14. SESAC, INC., SESAC Broadcasting Performance License For FM Stations
Agreement dated [_______] [do not have copy of contract] (music license)
Asset Purchase Agreement Sunburst/SunGroup Page 118
SCHEDULE 2.6
KMJJ-FM ASSETS
All of the licenses, assets, properties, contracts, rights, titles and
interests which are used, useful or acquired for use in connection with KMJJ-FM
including, but not limited to, the following described items:
(a) Governmental Authorizations. All authorizations, permits,
licenses and other such privileges, including the FCC Licenses, issued by
any governmental entity, whether federal, state or local, for KMJJ-FM
including, without limitation, those issued or granted by the FCC,
including pending applications for any of the foregoing, if any, including,
but not limited to those as set forth more fully on SUB-SCHEDULE 2.6(A)
attached hereto (the "KMJJ-FM Licenses");
(b) Studio Site. The studio site which is described on
SUB-SCHEDULE 2.6(B) together with all improvements located thereon. The
parties have set forth in Section 16 the terms and provisions of the
Agreement which relate to the studio site.
(c) Transmitter Site. The transmitter site property which is
described on SUB-SCHEDULE 2.6(C) together with all improvements located
thereon. The parties have set forth in Section 16 the terms and provisions
of this Agreement which relate to the transmitter site property.
(d) Leasehold Improvements, Improvements and Fixtures. All
leasehold improvements, improvements and fixtures which are used, usable or
acquired for use in connection with KMJJ-FM and which are located at any
transmitter site or studio site described in items (b) or (c), next above.
(e) Tangible Personal Property. All furniture, furnishings,
machinery, equipment, broadcasting equipment, studio equipment,
transmitting equipment, technical equipment, towers, antennae, computers,
printers, monitors, vehicles, and any and all other items of tangible
personal property which are used, usable or acquired for use in connection
with KMJJ-FM including, but not limited to, those items of tangible
personal property set forth on SUB-SCHEDULE 2.6(E) attached hereto;
provided that to the extent any item of tangible personal property which is
used, usable or acquired for use in connection with KMJJ-FM, the applicable
lease agreement has been listed on SCHEDULE 5 hereto.
Asset Purchase Agreement Sunburst/SunGroup Page 119
(f) Contracts. All Contracts which are described on SUB-SCHEDULE
2.6(F) except Cash Contracts and Barter Contracts which are provided for
separately under items (g) and (h), next below.
(g) Cash Contracts. All Cash Contracts entered into in the
ordinary course of business that are in effect at the Closing Date.
(h) Barter Contracts and Barter Receivables. All Barter
Contracts entered into in the ordinary course of business that are in
effect at the Closing Date and all Barter Receivables.
(i) Contract Deposits. All cash and other deposits under
Contracts assumed by the Buyer.
(j) Inventory and Supplies. All inventory, supplies, spare
parts, tools and other items of tangible personal property that are used,
usable or acquired for use in connection with KMJJ-FM.
(k) Records and Tapes. All records, tapes, and all other media
and configurations for the reproduction of sound that pertain to KMJJ-FM.
(l) Intangibles. All logos, jingles, marketing plans, the call
letters "KMJJ-FM", business plans, unexpired or remaining warranties on any
item comprising the KMJJ-FM Assets, common law property rights, Choses in
Action, and other intangible personal property, including goodwill, that
pertain to KMJJ-FM.
(m) Intellectual Property. All Intellectual Property, including
goodwill associated therewith that pertain to KMJJ-FM.
(n) Business and Technical Data. All schematics, blueprints,
engineering data and other technical information pertaining to the
technical operation of KMJJ-FM, customer lists, sales records, books of
accounts, and all files, records, and logs, all of which pertain to the
operation of KMJJ-FM.
(o) Choses In Action. All Choses In Action related to or arising
out of any of the Assets listed on this Schedule or any sub-schedule
attached hereto.
(p) Additional Assets. Except for contacts which are not assumed
by Buyer, all replacements and substitutions of items described in the
preceding
Asset Purchase Agreement Sunburst/SunGroup Page 120
subparagraphs which shall be acquire or received after the date hereof.
Asset Purchase Agreement Sunburst/SunGroup Page 121
SUB-SCHEDULE 2.6(A)
KMJJ-FM
SCHEDULE OF FCC LICENSES
1. FM Broadcast Station License KMJJ-FM
2. STL's
Asset Purchase Agreement Sunburst/SunGroup Page 122
SUB-SCHEDULE 2.6(B)
KMJJ-FM
STUDIO SITE
KMJJ-FM Studio Site, 000 Xxxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxxxx:
------------------------------------------------------------
Xxxx 00, 00 xxx 00 xx xxx XXXXX-XXXXXX AND XXXXXXX SUBDIVISION of TAL 17, a
subdivision of Shreveport, Caddo Parish, Louisiana, as per plat of
subdivision recorded in Conveyance Book 4, Page 264, Records of Caddo
Parish, Louisiana, together with all buildings and improvements located
thereon, LESS AND EXCEPT a strip of land 25 feet wide and 120 feet long
with said entire length adjoining and running parallel to the alley at the
rear (Northeasterly side) of said lots.
Asset Purchase Agreement Sunburst/SunGroup Page 123
SUB-SCHEDULE 2.6(C)
KMJJ-FM
TRANSMITTER SITE
KMJJ-FM Tower Site, 0000 XX 0000, Xxxxx xx Xxxxxxxxxx, Xxxxxxxxx:
----------------------------------------------------------------
A TRACT OF LAND IN XXXXXXX 00 XXXXXXXX 00 XXXXX, XXXXX 00 XXXX, XXXXX
XXXXXX, XX. MORE FULLY DESCRIBED AS FOLLOWS: from the Northwest Corner of
said Section 26, run thence South along the West line of Sec. 26, a dist.
of 2650.49 Ft. run THENCE N.89 deg. 58'42"E a dist. of 1,317.42 ft. to a
found 1" iron pipe for corner and the point of beginning of the tract
herein described, run thence N. 89 deg. 58'42"E. a dist. of 2025.24 ft. to
a found 1" iron pipe for corner being a point on the West right-of-way line
of abandoned T.&P.R.R., run thence S. 5 deg. 29'10" W. along said
right-of-way line a dist. of 583.72 ft. to a set 1/2" iron pipe for corner,
run thence N.84 deg. 32'30"W. a dist. of 208.56 ft. to a set 1/2" iron pipe
for corner, run thence S. 5 deg. 24'30"W, a dist of 104.3 ft. to a set 1/2"
iron pipe for corner, run thence ____54'17W. a dist. of 85.71 ft to a set
1/2" iron pipe for corner, run thence S.5 deg. 27'30"W, a dist. of 120.22
xx.xx a set 1/2" iron pipe for corner, run thence S 89 deg. 58'42"W. a
dist. of 1059.7 ft. to set 1/2" iron pipe for corner, run thence N. 0 deg.
20'E, a dist. of 776.98 ft. to the point of beginning, containing 34.27
acres more or less.
This survey was made without the benefit of a full and accurate title
search.
The bearing along the north line of the hereinabove surveyed tract was
taken from survey prepared by Xxxxxx X. Xxxx dated June 2, 1970.
Asset Purchase Agreement Sunburst/SunGroup Page 124
SUB-SCHEDULE 2.6(E)
KMJJ-FM
SCHEDULE OF TANGIBLE PERSONAL PROPERTY
See The Attached List
Asset Purchase Agreement Sunburst/SunGroup Page 125
SUB-SCHEDULE 2.6(F)
KMJJ-FM
SCHEDULE OF ASSUMED CONTRACTS
1. XXXXXXXXX LIGHT, Agreement dated 06/17/93 (relates to the SE corner of
tower site tract and impact on crop dusting)
2. SLT OF INDIANA, INC., Lease Agreement dated 10/01/95 (lease of tower on
tower site tract owned by SGBL)
3. STRATEGIC RADIO RESEARCH, INC., Accuratings License Agreement dated
06/07/95 (ratings services)
4. XEROX, Maintenance Agreement on Xerox 5322 copier dated 06/01/97
(maintenance on owned copier)
5. TM CENTURY, INC., Powerplay Software Lease [undated and unsigned -- Is this
contract in effect?] (music library software)
6. MODERN MEDIA CONCEPTS, Agreement No. RB-138-b dated 11/01/92 [not signed --
Is this contract in effect?] (Rev., Bro., Xxxx)
7. RADIO & RECORDS, INC., Subscriber Agreement dated 05/31/94 (online
information services system)
8. MUSICAM EXPRESS, Letter of Agreement dated 01/10/97 (WinDaX System)
9. XXXXXX PRODUCTIONS, INC., Affiliation Agreement dated 04/14/95 (The
Countdown with Xxxx "Baby" Love - programming)
10. SUPERADIO NETWORKS, Program Agreement undated (Xxxx Love's Gospel Traxx -
programming)
11. XXXX XXXXXXX, License Agreement undated ("On the Phone With Ti-Xxxx" -
programming)
12. XXX XXXXXX COMMUNICATIONS, INC., Daily & Weekend Radioscope Licensing
Agreement [undated and unsigned -- Is this contract in effect?]
(Radioscope programming)
13. INNER-VIEW INCORPORATED, License Agreement dated 03/31/94 ("The
Contemporary Timeline" programming)
14. UNISTAR RADIO NETWORKS, INC., Affiliation Agreement dated [_____], 1993 [do
not have copy of this agreement] and Amendment thereto dated 03/21/94 (news
service)
Asset Purchase Agreement Sunburst/SunGroup Page 126
15. SIS ENTERTAINMENT CORPORATION, Agreement undated (1996) ("Radio BET"
programming)
16. ABC RADIO NETWORKS, [Is there an affiliation here?]
17. WESTWOOD ONE RADIO, INC., Program License Agreement dated 11/01/94 ("Sister
to Sister" - programming)
18. PREMIERE RADIO NETWORKS, INC., License Agreement dated 07/14/94 (Mediabase
Music research services)
19. BROADCAST MUSIC, INC., Single Station Radio Blanket License Agreement dated
[_______] [do not have copy of contract] (music license)
20. ASCAP, Local Station Blanket Radio dated [_______] [do not have copy of
contract] (music license)
21. SESAC, INC., SESAC Broadcasting Performance License For FM Stations
Agreement dated [_______] [do not have copy of contract] (music license)
22. PITNEY XXXXX, Lease Agreement dated [_______] [do not have copy of
contract] (postage machine)
23. MEDIA SERVICES, INC., Agreement dated 12/09/97 (sales agreement)
24. TM CENTURY, INC., New Business Development Disc License Agreement, (music
library)
25. RADIO ADVERTISERS BUREAU (RAB), 1988 membership
Asset Purchase Agreement Sunburst/SunGroup Page 127
SCHEDULE 2.7
KKSS-FM ASSETS
All of the licenses, assets, properties, contracts, rights, titles and
interests which are used, useful or acquired for use in connection with KKSS-FM
including, but not limited to, the following described items:
(a) Governmental Authorizations. All authorizations, permits,
licenses and other such privileges, including the FCC Licenses, issued by
any governmental entity, whether federal, state or local, for KKSS-FM
including, without limitation, those issued or granted by the FCC,
including pending applications for any of the foregoing, if any, including,
but not limited to those as set forth more fully on SUB-SCHEDULE 2.7(A)
attached hereto (the "KKSS-FM Licenses");
(b) Studio Site. All of the rights, titles and interests of the
Tenant arising under that one certain Office Building Lease dated January
2, 1991 by and between Resource Savings Association, as the Landlord, and
SunGroup Broadcasting of New Mexico, Inc., as the Tenant, for 3,706 sq. ft.
of office space for the term commencing February 1, 1991 and ending January
31, 1994; as amended by Amendment No. 1 To Lease, dated the ____ day of
August, 1993 by Gulfstream Worldwide, Inc. (successor in interest to
Resource Savings Association), as the Landlord and Tenant to extend to the
lease term to January 31, 1998; as further amended by Amendment Two Of
Lease Agreement, dated the 31st day of March, 1997 to add an additional 712
sq. ft. of office space.
(c) Transmitter Site. All of the rights, titles and interests of
the Lessee arising under that one certain Lease Agreement by and between
New Mexico Media Co. and New Mexico Media, Ltd., as the Lessor, and New
Mexico Broadcasting Company, as the Lessee, and signed by the Lessor on
11/20/84 and signed by the Lessee on 10/31/84, for antenna space lease on
the Lessor's tower and associated transmitter building for the term
commencing [left blank in lease] and ending December 31, 1992, provided
that Lessee has three (3) options to extend the lease term for 120 months
each. Lessor's interest in the Lease was subsequently acquired by Channel 2
Associates and thereafter was subsequently acquired by Coronado
Communications Company by Assignment dated April 26, 1998 and thereafter
was subsequently acquired by KASA-TV, Inc. on December 31, 1992. The
Lessee's interest in the Lease was acquired by SunGroup Broadcasting of New
Mexico, Inc.
Asset Purchase Agreement Sunburst/SunGroup Page 128
(d) Leasehold Improvements, Improvements and Fixtures. All
leasehold improvements, improvements and fixtures which are used, usable or
acquired for use in connection with KKSS-FM and which are located at any
transmitter site or studio site described in items (b) or (c), next above.
(e) Tangible Personal Property. All furniture, furnishings,
machinery, equipment, broadcasting equipment, studio equipment,
transmitting equipment, technical equipment, towers, antennae, computers,
printers, monitors, vehicles, and any and all other items of tangible
personal property which are used, usable or acquired for use in connection
with KKSS-FM including, but not limited to, those items of tangible
personal property set forth on SUB-SCHEDULE 2.7(E) attached hereto;
provided that to the extent any item of tangible personal property which is
used, usable or acquired for use in connection with KKSS-FM, the applicable
lease agreement has been listed on SCHEDULE 5 hereto.
(f) Contracts. All Contracts which are described on SUB-SCHEDULE
2.7(F) except Cash Contracts and Barter Contracts which are provided for
separately under items (g) and (h), next below.
(g) Cash Contracts. All Cash Contracts entered into in the
ordinary course of business that are in effect at the Closing Date.
(h) Barter Contracts and Barter Receivables. All Barter
Contracts entered into in the ordinary course of business that are in
effect at the Closing Date and all Barter Receivables.
(i) Contract Deposits. All cash and other deposits under
Contracts assumed by the Buyer.
(j) Inventory and Supplies. All inventory, supplies, spare
parts, tools and other items of tangible personal property that are used,
usable or acquired for use in connection with KKSS-FM.
(k) Records and Tapes. All records, tapes, and all other media
and configurations for the reproduction of sound that pertain to KKSS-FM.
(l) Intangibles. All logos, jingles, marketing plans, the call
letters "KKSS-FM", business plans, unexpired or remaining warranties on any
item comprising the KKSS-FM Assets, common law property rights, Choses in
Asset Purchase Agreement Sunburst/SunGroup Page 129
Action, and other intangible personal property, including goodwill, that
pertain to KKSS-FM.
(m) Intellectual Property. All Intellectual Property, including
goodwill associated therewith that pertain to KKSS-FM.
(n) Business and Technical Data. All schematics, blueprints,
engineering data and other technical information pertaining to the
technical operation of KKSS-FM, customer lists, sales records, books of
accounts, and all files, records, and logs, all of which pertain to the
operation of KKSS-FM.
(o) Choses In Action. All Choses In Action related to or arising
out of any of the Assets listed on this Schedule or any sub-schedule
attached hereto.
(p) Additional Assets. Except for contacts which are not assumed
by Buyer, all replacements and substitutions of items described in the
preceding subparagraphs which shall be acquire or received after the date
hereof.
Asset Purchase Agreement Sunburst/SunGroup Page 130
SUB-SCHEDULE 2.7(A)
KKSS-FM
SCHEDULE OF FCC LICENSES
1. FM Broadcast Station License KKSS-FM
2. STL's
Asset Purchase Agreement Sunburst/SunGroup Page 131
SUB-SCHEDULE 2.7(E)
KKSS-FM
SCHEDULE OF TANGIBLE PERSONAL PROPERTY
See The Attached List
Asset Purchase Agreement Sunburst/SunGroup Page 132
SUB-SCHEDULE 2.7(F)
KKSS-FM
SCHEDULE OF ASSUMED CONTRACTS
1. DURPETTI & ASSOCIATES, Agreement dated 11/29/89 (national representative)
2. CENTURY SELF STORAGE CO., Lease Contract dated 07/25/95 (self storage
space)
3. METRO TRAFFIC CONTROL, INC., Traffic Network Radio Affiliate Agreement
dated 08/07/97 (traffic reports)
4. RADIO COMPUTING SERVICES, INC., Standard License Agreement dated 08/17/96
(Selector Software, Revision 12)
5. AUDIONET, INC., Agreement dated 04/17/97 (internet audio software)
6. TM CENTURY, INC., IMAGIO License Agreement dated 06/19/97 (background music
and sound effects)
7. PREMIERE RADIO NETWORKS, INC., Xxxxxx Contemporary Comedy Network License
Agreement dated 09/01/97 (programming)
8. GEOFF ST. XXXX, Agreement dated 11/01/97 (voice over services)
9. DIGITAL GENERATION SYSTEMS, INC., Letter of Agreement dated 06/10/93 (DGS
radio station terminal)
10. XXX XXXXXXXX D/B/A XXXXXXXX BROADCAST MANAGEMENT, letter agreement dated
08/25/97 (program consulting)
11. TAPSCAN INCORPORATED, Software License Agreement dated 09/12/95 (software)
12. THE ARBITRON COMPANY, Arbitron Sublicense Agreement to receive and Use
Scarborough Consumer, Media and Retail Report dated 04/27/94 (ratings
services)
13. DIFFERENTIAL CORRECTIONS INCORPORATED, Subcarrier Lease Agreement dated
03/17/94 (subcarrier)
14. DATACOUNT, INC., Software License Agreement dated 05/04/87 (DARTS III
software)
15. BUSINESS COMMUNICATIONS SERVICES, INC., Service Agreement dated 10/08/97
(equipment maintenance)
Asset Purchase Agreement Sunburst/SunGroup Page 133
16. XXXXX STUDIOS CORP., Quotation/Order dated 06/20/97 (prepaid technical
support for computers)
17. AMERICAN BUSINESS CREDIT CORPORATION, Rental Contract dated 06/17/97 (Canon
NP 4050 Copier)
18. DANKA INDUSTRIES, INC., Equipment Maintenance, and Supply Annual Agreement
#185845 dated 06/17/97 (maintenance on Canon NP 4050 Copier)
19. DANKA INDUSTRIES, INC., Equipment Maintenance, and Supply Annual Agreement
#185867 dated 07/01/97 (maintenance on Canon FAX 7000)
20. BROADCAST MUSIC, INC., Single Station Radio Blanket License Agreement dated
01/??/94 (music license)
21. ASCAP, Local Station Blanket Radio dated 03/04/97 (music license)
22. SESAC, INC., SESAC Broadcasting Performance License For FM Stations
Agreement dated 09/18/86 (music license)
23. SUPERRADIO, Program Agreement undated ("Street Jam" - programming)
24. SUPERRADIO, Equipment Agreement undated (downlink)
25. RADIO ADVERTISERS BUREAU (RAB), 1988 membership
26. XXXXX XXXXX & ASSOCIATES, Sales Training That Sells
Asset Purchase Agreement Sunburst/SunGroup Page 134
SCHEDULE 2.8
ADDITIONAL ASSETS
1. Agreement by and between RadioSunGroup of Texas, Inc. and Mt. Pleasant
Radio, Inc. dated January __, 1997.
2. All of the tangible personal property assets of Air Signs, Inc. including,
but not limited to, the balloon and related equipment and lift gate.
3. Sellers' rights, titles and interests (and being a 50% interest) in and
relating to a Construction Permit to be granted by the FCC for a Class A FM
radio station to be licensed to Winona, Texas (the "Winona CP").
Special Sale Terms for Winona CP: If the Winona CP shall have been granted
by the FCC prior to Closing, then at the Closing the Buyer will pay the
Seller as additional Purchase Price, in cash, an amount equal to Sellers'
documented costs for engineering, legal and private auction settlement as
may be directly attributable to the Winona CP; but not to exceed $175,000
unless such excess costs have been approved by Buyer beforehand. If the
Winona CP shall not have been granted prior to Closing, then the Closing
shall occur anyway as to all of the other Assets and the Seller and Buyer
will postpone the sale and purchase of the Winona CP until such time as it
shall have been granted by the FCC.
Asset Purchase Agreement Sunburst/SunGroup Page 135
SCHEDULE 4
BARTER CONTRACTS
See the attached lists.
Asset Purchase Agreement Sunburst/SunGroup Page 136
SCHEDULE 5
FINANCING LEASES
1. KROW-FM Equipment: Lease Number 100 by and between SLT of Indiana, Inc.
and RadioSunGroup of Texas, Inc. dated July 11, 1997.
2. KROW-FM Equipment: Lease Number 200 by and between SLT of Indiana, Inc.
and RadioSunGroup of Texas, Inc. dated July 11, 1997.
Asset Purchase Agreement Sunburst/SunGroup Page 137
SCHEDULE 9
EXCLUDED ASSETS
1. Cash
2. Account Receivable
3. Corporate assets of SunGroup, Inc. located in Sarasota, Florida per the
list attached hereto attached hereto.
Asset Purchase Agreement Sunburst/SunGroup Page 138
SCHEDULE 17
EXCEPTIONS TO WARRANTIES
1. Sellers hereby represent: (i) CONSECO, the major secured creditor of
Sellers, has alleged that SGI, and one or more of its subsidiaries, has
committed a financial default under a Contract by and between CONSECO and
SGI, and one or more of its subsidiaries, (ii) SGI has responded that it
has not committed any default (financial or otherwise) under such Contract
and (iii) the dispute is being held in abeyance to permit this Transaction
to proceed to Closing at which time CONSECO will be paid out of the sales
proceeds and CONSECO will deliver to Buyer a Release of all its claims,
Liens, Encumbrances and demands against the Assets.
Asset Purchase Agreement Sunburst/SunGroup Page 139
SCHEDULE 17(M)
EMPLOYEE BENEFIT PLANS
1. Xxxxxxxxx Invitational Cash Flow Tournament -- see memorandum attached
hereto.
2. Medical benefits plan provided through Phoenix insurance Company.
3. Group life insurance and long term disability provided through Phoenix
Insurance Company.
Asset Purchase Agreement Sunburst/SunGroup Page 140
SCHEDULE 17(R)
THIRD PARTY CONSENTS
1. Landlords or Lessors under all Real Property Leases and all Ground Leased
Real Property
Asset Purchase Agreement Sunburst/SunGroup Page 141
SCHEDULE 17(BB)
BARTER BALANCES
All balances at 12/31/97
Station: Payables Balance: Receivables Balance:
------- ---------------- -------------------
XXXX-FM 58,768.53 34,918.93
XXXX-AM 765.48 822.48
KROW-FM 2,061.06 4,348.00
KYKX-FM 240,300.73 100,474.43
KKYS-FM 43,364.14 31,480.20
KMJJ-FM 76,477.10 40,012.03
KKSS-FM 62,952.43 138,258.29
Asset Purchase Agreement Sunburst/SunGroup Page 142
SCHEDULE 17(EE)
LIEN SEARCH INFORMATION
See Attached
Asset Purchase Agreement Sunburst/SunGroup Page 143
SCHEDULE 17(FF)
CERTAIN AGREEMENTS
1. Employment Agreement with Xxx Xxxxx dated January 1, 1997 (not to be
assumed by Buyer).
2. Employment Agreement with Xxxxx X. Xxxxxxx, III dated January 1, 1997 (not
to be assumed by Buyer).
3. Employment Agreement with Xxxx X. Xxxxxx dated January 1, 1997 (not to be
assumed by Buyer).
4. Employment Agreement with Xxxxx X. Xxxxxx dated January 1, 1997 (not to be
assumed by Buyer).
5. Employment Agreement with Xxxx Xxxxx Xxxxxxxx dated January 1, 1997 (not to
be assumed by Buyer).
6. All real estate leases for studio sites and transmitter sites described in
Schedules 2.1 through 2.7
7. All Contracts listed on Sub-Schedules 2.1(f), 2.2(f), 2.3(f), 2.4(f),
2.5(f), 2.6(f) and 2.7(f)
Asset Purchase Agreement Sunburst/SunGroup Page 144
SCHEDULE 17(GG)
CONFLICTS OF INTEREST AND AFFILIATE RELATIONSHIPS
1. XXXX-FM Equipment: Lease Number 100 by and between SLT of Indiana, Inc.
and RadioSunGroup of Texas, Inc. dated July 11, 1997.
2. XXXX-FM Equipment: Lease Number 200 by and between SLT of Indiana, Inc.
and RadioSunGroup of Texas, Inc. dated July 11, 1997.
3. KMJJ-FM Main Tower: Lease Agreement by and between SLT of Indiana, Inc.
and SunGroup Broadcasting of Louisiana, Inc. dated October 1, 1995.
4. Xxxx Xxxxxxxxx and Xxx Xxxxx own all the stock in SLT of Indiana, Inc.
("SLT") and SLT owns all of the issued and outstanding common stock of Mt.
Peasant Radio, Inc. which is the party to the Agreement described at Item 1
of Schedule 2.8.
5. Xxxx Xxxxxxxxx and Xxx Xxxxx are creditors of certain of the Sellers and
shareholders of SGI.
6. Xxx Xxxxxxx, Xxxx Xxxxxxxxx and Xxx Xxxxx are shareholders, along with
others, including some of the Station Managers, in four sign companies
which have transacted business with some of the Sellers.
7. Xxx Xxxxxxx, Xxxx Xxxxxxxxx, Xxx Xxxxx and Xxxx Xxxxx Xxxxxxxx are
shareholders, along with other unrelated Persons in a company that produces
a tourist information booklet for New Mexico entitled "Great Locations".
Asset Purchase Agreement Sunburst/SunGroup Page 145
EXHIBIT 10-A
FORM OF CONSULTING AGREEMENT
See Attached
Asset Purchase Agreement Sunburst/SunGroup Page 146
EXHIBIT 26(G)
XXXX OF SALE AND ASSIGNMENT OF INTERESTS AND ASSUMPTION
See Attached
Asset Purchase Agreement Sunburst/SunGroup Page 147
EXHIBIT 34
INDEMNIFICATION ESCROW AGREEMENT
See Attached
Asset Purchase Agreement Sunburst/SunGroup Page 148
